Jimmy Bhullar: Hi. The first word, Chris or Ellen, maybe on the expense program that you’re talking about, is it fair to assume that initially, it will absorb cash flows and be dilutive then, but obviously, you’re hoping that over time, that will be more than offset by the incremental savings?
Chris Neczypor: Jimmy, I think it’s too early to get into the details. I think any time you’re talking about a expense program or an efficiency program, there’s the upfront cost and then there’s ongoing savings, I think will be thoughtful as to whatever it is that we do. So let’s just stay tuned. We’re looking at all that right now.
Jimmy Bhullar: And then how do you think about the RBC level that you’d like to be at eventually a few years out, given your business mix? And do you feel that you can get there through normal statutory income? Or is it sort of — is it necessary for you to do more transactions to get there?
Chris Neczypor: So Jimmy, what we’ve said is that the near-term target is to get back to the 400% RBC. I think we’ve also mentioned that longer term, we expect to hold a buffer to that $400 million. I think the goal is to not have a repeat of 2022. And so to have that holding excess capital above the target makes sense. To specifically your question, we can certainly get there be natural organic capital generation over the next couple of years. just thinking about the growth in free cash flow and then to the degree that there’s anything strategic we can do to accelerate that, we would look at that.
Jimmy Bhullar: Okay. Thank you.
Operator: Your next question is from Wes Carmichael of Wells Fargo. Please go ahead. Your line is open.
Wes Carmichael: Hey. Good morning. I had a question on holding company liquidity. And with the debt maturity, I think that’s down around $450 million. And I’m just curious what you’re kind of comfortable operating with there? And if there’s any potential levers that you have if there are any near-term kind of statutory earnings headwinds?
Chris Neczypor: So Wes, thanks for the question. I think the level that we’re operating at now is the target level. And I think you can hold excess capital at the HoldCo or you can hold excess capital at your insurance company. To me, they are relatively similar in terms of the way that you think about goals over time. You’re right, we had a $500 million debt maturity during the quarter, paid that down. I think we have a long-term goal of delevering more broadly, but we feel comfortable with the amount of liquidity that we have at the holding company.
Wes Carmichael: Got it. And maybe would you just — can you comment on the statutory earnings generation in the quarter within L&L and kind of how you’re thinking about overall earnings generation in the quarter?
Chris Neczypor: So I think it’s the same idea as to the RBC comment that we made before, whether you’re looking at it from an earnings perspective or in RBC, it’s the same math. We improved modestly and I think if you look at some of the items we talked about on a GAAP basis, a lot of those port over to stat as well. You referenced Ellen, I mean we have one main insurance company. And so fair to think that for a lot of the items that we discussed gap should look relatively similar to stack for some of the one-timers. So despite some noise in the quarter, we were able to modestly grow RBC. We feel good about that. And we look forward to updating you as it relates to the longer-term outlook early next year.
Wes Carmichael: Thank you.
Operator: Your next question is from Wilma Burdis of Raymond James. Please go ahead. Your line is open.
Wilma Burdis: Hey. Good morning. I guess, could you discuss if you freed up any RBC via the enhanced cash value surrender program in the quarter? And are there any other opportunities for Lincoln to buy back its own GUL policies and larger volumes from third parties?
Chris Neczypor: Well, thanks for the question. I think we’re not going to comment on future programs. Fair to say, we look at these from time to time. This quarter is a good example of some success there. As it relates specifically to that, what I would say is the net impact was basically de minimis. So we had the one-time item, but then there was — you would imagine there would be capital freed up behind that. So no major plus or minus as it relates to RBC.
Wilma Burdis: I guess should I take from that comment that the RBC freed up sort of offset the — mostly the cost of the program? Or is that how I should think about it?
Chris Neczypor: Yes. I think there’s always going to be some pluses and minuses. It will, in theory, improve over time, but we’re talking about a relatively small portion of the overall program.
Wilma Burdis: And how would you think about that going forward once you reinsure the business, do you stop doing those types of programs? Or how should I think about that?
Chris Neczypor: So Wilma, we had as part of the deal, 40% of our GUL, we have a lot to go. So I think that this will be something that we continue to look at the way that the rest of the industry does and to the degree it makes sense for us, now we’ll continue to execute.
Wilma Burdis: Good. Thank you.
Operator: We have completed the allotted time for questions. Lincoln Financial Group will follow-up later this afternoon with those remaining in the queue. I will now turn the call over to Adam Cohen for closing remarks.
Adam Cohen: Thank you for joining us this morning. We’re happy to take any follow-up questions that you have. You can e-mail us at investorrelations@lfg.com. Thank you, and have a good day.
Operator: This concludes today’s conference call. Thank you for your participation. You may now disconnect.
