Kevin Morrissey: Thanks for the question, Paul. It’s Kevin Morrissey. I will answer the first part around the volatility and then I’ll pass it to Manjit around the deployability of that. So when we’re thinking about the LICAT volatility, the comments I made on volatility is largely with regard to interest rates. And I did mention the changing interest rate environment, volatility of interest rates that we saw throughout 2022. Where we are now with interest rates we see our interest sensitivity for LICAT to be largely in line with our reported sensitivities now. However, one of the things to note that as the sensitivities can change quite a bit with changing market conditions. So for example, with interest rates being lower or higher, those sensitivities will change more rapidly than they do under IFRS 4.
And a lot of that is driven by the IFRS 17 market consistent cost of guarantees in the new accounting and actuarial basis. So that is something that we’re aware of that we’re going to be monitoring and we’re ready to manage, but it is something we do expect will create some inherent increase in underlying volume.
Manjit Singh: And then just on the second question Paul, it’s Manjit. Overall the higher capital will lead to higher whole cash and deployable capital. But I would just sort of note two considerations. The first is that some of the LICAT increase that we’re getting is related to businesses outside of Canada. And for those businesses are continued to be subject to their local regulatory requirements. So there can be some timing differences between when that when we can bring that cash bounce back up to Sun Life. And the second factor to consider is obviously, as we’ve talked about, and Kevin’s remarks in mind, we also look at the overall operating environment and kind of base our capital levels in that environment. And so those would be two additional considerations.
Paul Holden: Got it. Thanks for that. And then second question is with respect to SLC, another year of strong sales. There has been some industry news regarding certain alternative managers closing funds for redemptions, maybe some sales headwinds, because of higher rates and concerns regarding valuation and private asset classes. So I think it’d be helpful just given an update on what you’re currently sitting and expecting for SLC flows in 2023. Thank you.
Stephen Peacher: Thanks, Paul. It’s Steve Peacher . I will comment on that. Just quickly looking back at 2022, obviously a volatile market environment. But we felt really good about the capital that we were able to raise in the past year. I think total capital raised was $18 billion for the year, AUM depending on whether you look at fee earning AUM or total AUM was up double digits, that flows over 20 billion for the year. So when I look back at 2022, despite a challenging environment for institutional investors it’s a good capital raising environment for us. We certainly see some pressures in the institutional market looking forward. Because if you’re making decisions that are large pension funds insurance company, the volatility of the markets makes decision making harder.
The other thing is that we have something called the denominator effect. And so as public markets have traded off more dramatically than private markets, the weighting in a portfolio to private markets increases. And so when a chief investment officers think about allocating the next dollar, and they see their alternative weightings are higher, they may be a little bit less prone to allocate there. And so that created some headwinds. In the fourth quarter. You saw that our fundraising was positive in the fourth quarter, but lower than it had been earlier in the year. I think that pressure is going to kind of continue a bit, continue in the first half of this year. Having said that, it’s against the backdrop, both institutionally and now on the retail front of the trend toward alternative asset classes.
