Kevin Hogan : Yes. Thanks, John. Look we’re very happy with the overall life business and the way that it’s performed even through the pandemic. And the mortality improvement — the UK, it’s a nice business. It’s a fast-growing business in terms of new business, but the balance sheet is still quite small because it’s a relatively young business. The real improvement in mortality for us was in the U.S. where once again, even including COVID, which remains at that sensitivity that we have projected since the beginning of the pandemic, even including COVID, was for the second quarter in a row below our pricing expectations. So the mortality performance really in the U.S. is what is driving that improvement and has consistently been quite attractive over the last couple of years.
And we’re repositioning the portfolio in the U.S. and that’s also going well. We’ve moved away from the more interest rate-sensitive businesses, essentially stopped VUL and GUL a couple of years ago and are focusing on indexed universal life in the permanent area, and then simpler protection products in the rest of the portfolio. The fourth quarter did have a couple of one-offs, as Elias mentioned, but the earnings have returned in this portfolio to the levels that we would have expected pre-pandemic. And in addition, it contributes extremely strong cash flows. So we’re very happy with the position of the Life business.
John Barnidge : Thank you very much. And my follow-up question, sticking with that business, are you experiencing an increase reinsurance rates after the pandemic? Some other companies have noted that. Thank you.
Kevin Hogan : The reinsurance rate environment following the pandemic hasn’t been something that has been a material factor for us in managing the business.
John Barnidge : Thank you very much.
Kevin Hogan : Thank you.
Operator: Our next question comes from Michael Ward with Citi. Michael, please go ahead. Your line is open.
Michael Ward: Thanks. Good morning. I was just wondering if you could discuss some of your portfolio — investment portfolio changes between asset classes. I think for the year, I noticed you guys rotated out of residential and commercial MBS and into a little bit more CLOs and ABS. So I’m just curious how you see these asset classes, and I assume part of it is from your partnerships with asset managers.
Kevin Hogan : Yes. Thanks, Michael. I’ll start and then maybe hand over to Elias. But first of all, I’d just like to say we’re very comfortable with our asset portfolio. It’s a high-quality, well-diversified portfolio, on average credit rating of single A minus where it’s been the last couple of years. And our assets reflect the profile of our liabilities, including our spread businesses, which are, in many cases, illiquid and longer dated. And we do actively manage the portfolio, which has performed well in different cycles. So I think that’s the context in which to think about our asset strategy, but I’ll hand over to Elias.
