Steven Finch: It — I think it changes the amount of attention it gets in the spotlight because the capitalized impacts could be quite large, as you’ve seen from our sensitivities. But in terms of the rigor that we apply those assumptions are important for pricing, they’re important for setting the right expectations for projections of earnings and for embedded value. And it will continue to get the same level of rigor and attention from Scott’s group and my group. And you saw in the — in Phil’s prepared remarks that over the last 18 years since the acquisition, we’ve been bang on effectively just a little higher than the current assumptions. So it will continue to get the same focus, but probably less of a spotlight.
Operator: The next question is from Lemar Persaud from Cormark Securities.
Lemar Persaud: I’ll be really quick because most of my questions have been asked and answered. But just starting off here, I want to come back to Paul and Tom’s questioning on earnings on surplus. So I just want to be clear here bottom line. Are you guys suggesting that this quarter is over $300 million in earnings on surplus is indicative of what we should expect moving forward or perhaps even some upside from that number from higher rates?
Phil Witherington: Thanks, Lemar, for the question. This is Phil. I think what we’re seeing this quarter is a reasonable baseline. The benefits that are included this quarter from the seed capital and available-for-sale equity gains are at the higher end of our typical range. In fact, just over the higher end of a typical range, but only by about $10 million post tax. As I said earlier, the main benefit is actually the impact of higher interest rates, which is showing through on our fixed income portfolio within surplus. And when we break that down as to what’s driving that increase in the fixed income yield, there are a couple of things. One is the impact of higher rates on the shorter-term instruments that we include in that portfolio, but then also the impact of trading within the portfolio.
And Roy earlier referenced $170 million a pretax of benefit that we have seen in 2022 from higher rates. So that’s the benefit through the year on our interest on surplus — or the fixed income element of our earnings on surplus. About $80 million of that $170 million was coming from the impacts of higher rates on the shorter-term instruments. And then $120 million of it was coming from trading longer-term instruments, therefore, locking in a higher yield. And offsetting that was a slight increase naturally in the cost of debt in a higher interest rate environment, and that all nets off to the $170 million pretax that Roy referenced.
Lemar Persaud: Okay. Great. And then just my second question here. You guys talk about how Manulife has returned a significant amount of capital to shareholders over time. I just want to try this one again because I think it’s come up in the past. How should we think about excess capital for deployment under IFRS 17, maybe in terms of dollars and directionally, is it higher than under IFRS 4? I know you guys had referenced the $20 billion over the supervisory target. But presumably, not all of that is deployable. So how should we think about that?
