iA Financial Corporation Inc. (IAG) Earnings Call Transcript & Summary

[Interpreted] Hello, everyone, and a warm welcome. Welcome to our joint annual meeting, which is being held today in hybrid mode. My name is Jacques Martin. I am the Chairman and the Board of Director of iA Financial Corporation and Industrial Alliance Insurance and Financial Services. I would like to acknowledge all the participant shareholders, participating policyholders, partners and employees who joined us today in person and via webcast. I would also like to acknowledge the presence of several of our directors and officers. Thank you for being here. I will be pleased to guide you through the terms and conditions of this joint meeting of iA Financial Corporation and Industrial Alliance Insurance and Financial Services. In order to provide the opportunity for our shareholders and participating policyholders to participate in the meeting in the way they prefer and with flexibility, we have chosen to hold our meeting in hybrid manner. I will preside over Quebec City. I'm accompanied by Mr. Denis Ricard, President and Chief Executive Officer; and Mrs. Amelie Cantin, Corporate Secretary. Before starting, I'll share with you some technical and administrative information necessary for the smooth running of this session. A notice of the meeting was duly given. The minimum numbers of shareholders and participating policyholders required is met to constitute a quorum for this meeting. I therefore declare this assembly open. I bring to your attention the agenda for today's meeting projected on the screen. The rules of the conduct for the virtual portion of the meeting, including the procedure for online voting and questions have been published on our website and are available through this webcast. But simultaneous translation is available. If you are participating in person, translation devices are provided in the back of this room. If you are participating online, you can choose to see the entire webcast in French or English by clicking on the language button shown on the top right-hand corner of your screen. When you log into the meeting, you can choose to listen to the webcast in either original audio, French or English. If during the meeting, you would like to change the chosen option. You will be able to do so by clicking on the audio button shown on the bottom right-hand corner of the video cast screen. You may also submit your question in both languages. [Interpreted] Please note that a question period is provided during the consideration of each of the proposals put to the vote of shareholders and participating policyholders as well as the end of the meeting. The purpose of this final question period is to receive your comments and to answer any general questions that we are not able to answer during the meeting. For those of you who are attending in person, we ask that you save questions on topics that are not on the agenda for this period. For those attending the meeting virtually, you can submit your question at any time, and we will deal with those that do not touch on the topics that appear on the agenda during the question period at the end of the meeting. You will be able to ask your questions in writing via webcast or in person by phone. To that end, I encourage you to submit your questions or comments now so that we can address them at the appropriate time during the meeting. If you wish to submit your question in writing, please use the dialogue box located at the bottom left of your screen. Please note that in order to access this dialogue box, you must disable your device's full screen mode. If you wish to ask a question in person, by phone, we ask that you press the phone instruction button and dial the number that is made available to you in the window that appears. You will then be placed in a queue. The operator will connect you with us and introduce you when we are ready to answer your question. In both cases, before submitting any of your question, please indicate whether it relates to our proposal that will be considered and voted or whether it is more of a general nature in which case we will respond to it during the question period at the end of this meeting. Whether you are attending the meeting virtually or in person, please identify yourself and let us know if you are a shareholder, participating policyholder or a proxy holder. In addition, I would ask you to formulate 1 question at a time. We want all participants who wish to ask a question to have the opportunity to do so. So if you are on the phone, and have more than 1 question, we ask that you get back in the queue on the phone line so that we can speak with as many participants as possible during the meeting. If you are in the room and have more than 1 question, we ask that you go to the microphone and ask only 1 question at a time and go back to the line for the next question. Your question should be about the company's business and should not be of personal nature. Questions and comments received through the dialogue box of this webcast will be ready and read by the Corporate Secretary. If we have a number of questions that deal with the same or similar subject, Mrs. Cantin will summarize those questions, and we will answer them at the same time. Individuals who own common shares and eligible participating policyholders, example policies issued or assumed prior to June 30, 2019, will be able to vote online or in person on matters that affect them. The proxy holders of these shareholders and participating policyholders will also be able to vote online or in person. Persons attending the meeting as guests are not eligible to vote. We'll provide additional instructions in a few moments. I now draw your attention to the cautionary statements regarding forward-looking statements and non-IFRS and other financial measures that appear on your screen and on Page 18 and following the annual report. Documents related to this meeting are available online on the company's website in the Investor Relations section and via the webcast platform. The video recording of this meeting will be available after the meeting on the company's website for a replay. I would like to remind you that iA Financial Corporation is the parent company of the group and that it is the sole holder of common shares of Industrial Alliance Insurance and Financial Services, which I will now refer to as iA Insurance. The meeting will therefore be held simultaneously for both companies. Mr. Steve Gilbert and Mr. Moussallem Charles of Computershare will act as scrutineers for this meeting. I will now take a few minutes to share with you my comments and thoughts on this year 2024. The Board of Directors is pleased with the company's financial strength and excellent profitability growth in 2024. The company also experienced strong business growth across all of its business units in Canada and the United States. In a few moments, Denis Ricard, President and Chief Executive Officer, will present the company's strategic orientations and comment on its performance and its main achievements of the year. For my part, I would like to bring to your attention that the company has been very active in terms of deploying capital. It has made significant investment in organic growth and digital transformation. In Canada, iA Financial Group acquired the assets of Laurentian Bank Securities -- retail banking division of Laurentian Bank Securities. iA also acquired Global Warranty, a group of independent warranty providers and administrators in the used vehicle market. In the U.S., the company completed the acquisition of Vericity, a life insurance company and digital agency. It also completed the acquisition of 2 blocks of business for Prosperity Life Group. In short, the Board of Directors would like to highlight not only the company's excellent financial performance, but also the relevance of its strategic orientation and its ongoing commitment to creating a long-term value for you and our shareholders. Thanks to its strong business model, the company continues to grow and make its mark year after year. Discussions and actions of our various business units. The Board of Directors fully endorses this course of action and is pleased with the enthusiasm and commitment of the senior management and staff. Here are just a few examples of the corporation drive and commitment to sustainability. On the environmental front, the corporation has continued to decarbonize its investment and support the implementation of a normative framework for the environment and climate change. On the social front, iA Financial Group has distinguished itself to its employee talent development. Sound governance is a commitment taken seriously by the Board of Directors, management and employees. A strong governance framework links the culture of integrity to the corporation purpose, governance, structure and key governance policies and practices. The corporation adheres to governance best practices to preserve the independence of the Board and its ability to effectively oversee the corporation activities. In 2024, iA Financial Group was named one of the Best 50 Corporation Citizens in Canada by Corporate Knights. iA distinguish itself through its climate change initiative and its solid and healthy corporate governance. [Interpreted] A few words now on the activities of the Board of Directors. In September 2024, the corporation announced that Mr. Nicolas Darveau-Garneau will now act as strategic adviser in the field of AI applied to improve the customer service. In doing so, Mr. Darveau-Garneau stepped down as a member of the company's Board of Directors on October 1, 2024, to devote himself to this mandate and other professional projects. He also stepped down as a Director on the Board of Directors of the Canadian insurers that are part of iA Financial Group. Mr. Darveau-Garneau was a Director at iA Financial Group and a member of the Human Resources and Compensation Committee since May 2018. In addition, Mrs. Monique Mercier has announced her intention not to stand for reelection at the May 2025 Annual Meeting of the Shareholders. Mrs. Mercier had been a member of the Board since May 2019. On behalf of all the members of the Board and on my own, I would like to thank Mrs. Mercier and Mr. Darveau for the considerable contribution. At December 31, 2024, the percentage of women of the Board of iA Financial Corporation was 50%, 54% for independent members. If all directors nominees presented today are elected, the percentage of women of the Board in 2025 will be 47%, 50% for independent director. On behalf of all Board members, I would like to thank shareholders, policyholders and customers for their support and trust. I would also like to congratulate and thank all of us at iA Financial Group. The challenges in 2024 have been met with great efficiency and commitment at all times. I now invite Denis Ricard to present his observations.

[Interpreted] Thank you, Jacques, and good morning, everyone. I am very proud today to present our excellent financial results of 2024. iA Financial Group delivered a robust performance posting record profitability. We also delivered remarkable business growth across all of our business units and maintained our strong financial position throughout the year. We also achieved all of our financial targets given to the market at the beginning of 2024. Let's take a look of some highlights of business growth in 2024 by business units and start with Canada. In Individual Life Insurance, total sales were at $392 million. This is a growth of 6% compared to 2023. This is due to the strength of our extensive distribution network, the performance of our digital tools and our comprehensive and competitive product portfolio. In employee group insurance, premiums, premium equivalents and investment contract deposits totally neared $1.7 billion in 2024, an increase of 8%. The group insurance component for special market was not to be outdone with sales up 12% to attain $412 million. On the dealer service side, sales totaled $715 million in 2024, up 4%. This business unit continues to expand its presence across Canada through agreements with original equipment manufacturer and dealer groups as well as through the development of new products and partnerships. iA Auto and Home posted $600 million in direct written premium, this represents a growth of 16%. Strong competitive position of iA AH and higher customer satisfaction rate have enabled it to generate good premium growth through price increase and strong policy growth. iA AH business volume has grown at compound annual growth rate of 11% over the past 5 years. In Individual Wealth Management, gross sales totaled more than $9 billion, up 21%. The high level of sales is attributable to the strength of our extensive distribution networks and product mix. Segregated fund gross sales exceeded $5 billion, up to 52%. Segregated fund net sales were strongly positive, reaching nearly $3 billion. This maintains our position as an industry leader of first in Canada for gross and net sales of segregated funds. And third in terms of assets. Gross mutual fund sales totaled nearly $2 billion in 2024, up 26% from 2023. On the Group Savings and Retired side, recurring premium from accumulation product plays a crucial role in sustainable business growth and are essential to the business unit strategic approach. These recurring premiums represent a contribution made by members to the plans of existing group clientele. In 2024, recurring premiums totaled nearly $2 billion in 2024 due part to the sale of large -- insured annuities more than doubled, totaling nearly $2 billion in 2024 due in part to the sale of large policy. Sales of new plans increased significantly by 32% and also totaling more than $2 billion. In Individual Insurance, sales reached a record USD 227 million, an increase of 32%. This was primarily the result of growth in both the final expense and the middle/family markets and the addition of sales from our new subsidiary, Vericity. Total net premiums reached USD 632 million, representing a 32% increase. This result reflects the strong growth of 18% in the number of contracts issued in 2024 and good conservation of in-force business as well as the contribution from the companies acquired last year. This solid performance points to iA's strong growth potential in the U.S. life insurance market. U.S. Dealer Services sales totaled over USD 1 billion, an increase of 14%. This performance reflects the combination of several positive factors, including an increase in the number of contracts sold, higher sales of extended warranties and the favorable impact of pricing adjustments. [Interpreted] Strong business growth across all business units have driven net premiums and premium and deposit equivalents to more than $20 billion in 2024, a significant increase of 22%. Total assets under management and assets under administration exceeded $259 billion at the end of the year, an increase of 18%. Now let's look at the profitability. In 2024, iA Financial Group recorded net income attributed to common shareholders of $942 million, an increase of 22% compared to 2023. Diluted earnings per share, EPS, were $9.77 in 2024 compared to $7.48 a year earlier. This is a 31% year-over-year increase. Return on common shareholders' equity, ROE, was 13.9% for the year compared to 11.6% in 2023. The company recorded core earnings of more than $1 billion in 2024, an increase of 12%. Core diluted earnings per common share, EPS, of $11.16 in 2024 were 20% higher than 2023. Core return on common shareholders' equity, ROE, of 15.9% for 2024 compared favorably to 14.4% in the prior year. Our solvency ratio remained well above its operating target throughout the year at 139% as of December 31, 2024, compared to 145% a year earlier. The year-over-year change is mainly due to capital deployment initiative including share repurchases and the 3 acquisitions. The dividend paid to shareholders marked an increase of 13%, which reflects the recent hikes in dividend and in our concern to create value for our shareholders. On February 24, 2025, there was an investor event under the theme "Ready for more, the iA way." This was a public event with an update of our growth strategy with peculiar retention on commercial operations in the United States and key objectives for Canadian units. Here are our new market guidance during that core event. We aim at a core EPS growth of 10% and more as average on the midterm. We also aim for a core ROE of 17% and plus in 2026. Now the new -- as for the organic capital generation target, it increased to $650 million and plus and the core dividend payout ratio should be between 27% and 35%. Now our decisions and actions are guided by 4 key strategic orientations. Global client experience, capital deployment, our commitment to being a learning organization and operational efficiency. In 2024, these orientations were translated into clear strategic priorities, including the following examples. iA Financial Group is more than ever an organization immersed in the global client experience. We have made significant progress in this area, thanks to a vast mobilization of all our teams and extensive marketing activities. Particular attention has been paid to improving our ability as an organization to anticipate our clients' needs even more effectively by developing a 30 (sic) [ 360 ] degrees view of our clients. Another strategic priority is capital deployment. Currently, we have capital available for deployment, amounting to close to $1.5 billion. It's an enviable position, but one that also calls for discipline and a long-term vision. In 2024, we acquired assets from Laurentian Bank Securities, Inc. retail full-service investment broker division and finalized the acquisitions of businesses in the United States, namely Vericity and 2 blocks of business from Prosperity Life Group. Throughout the year, we also made significant progress towards our goal of becoming a learning organization. Considerable effort has gone into aligning our thinking and actions towards the creation of a global vision with 3 identified focus area, a safe and inclusive working environment, the sharing of knowledge and experience and curiosity and learning mindset. We also make every effort to maximize our operational efficiency. This requires rigorous discipline in all our business units to achieve our ambitions. We ensure that all our efforts are invested in maximizing returns so that we can continue to grow successfully. We are also benefiting from the major investments we've made in digital transformation in recent years, particularly in optimizing our technology platforms, for the benefit of both our advisers and our clients. In 2024, we made significant progress in our strategy regarding the use of artificial intelligence. We have set up a governance process in this particular area, assessed the legal and risk management aspect and drawn up road maps for employee training. These are all important steps toward implementing and optimizing artificial intelligence in our operations. [Interpreted] On the other hand, we still remain committed to sustainability, our strategic framework for climate change. Now in 2024, we've developed a strategic framework which will help to identify the risks and identities pertaining to climate change. In parallel, there were continued efforts to decarbonize our real estate assets in Canada and the public corporate fund. As a learning organization, we have continued to enrich our programs to enhance the talents of our employees to allow them to aspire to greater accomplishments. All the while, professional development is important and essential to prepare the succession. And also, we have continued on the philanthropy front with contributions close to $10.4 million for diverse charities. Governance has always been for us a fundamental dimension. We have announced in 2024 changes to our executive committee. After 25 years of devoted services, Mike Stickney, VP Executive of -- Co-Chair of Acquisitions, has retired. And I would like to thank him personally for his tremendous contribution to the success of iA Group Financial. Sean O'Brien was then appointed and Denis Berthiaume became VP Executive, Strategy, Performance, Mergers and Acquisition. We've also announced the appointment of Louis-Philippe Pouliot as VP Executive for insurance and savings, which is that for the year 2025... [indiscernible] quarter of this year. Here are the few highlights from the beginning of the year. iA Financial Group ended the first quarter of 2025 with a net income attributable to common shareholders of $186 million and core earnings of $273 million. Diluted earnings per common share amounted to $1.98, while diluted core earnings per common share amounted to $2.91, which is 19% higher than the same period last year. Core ROE for the trailing 12 months was 16.1%, progressing steadily toward our new target of 17% plus set for 2027. The solvency ratio was 132% at March 31, 2025, reflecting a strong capital position. The capital available for deployment to create and return value to shareholders was $1.4 billion as of March 31, 2025. In terms of business growth, total assets under management and administration stood at more than $264 billion at March 31, a solid 15% increase over the last 12 months. Premiums and deposits totaled $5.8 billion, representing a 19% increase year-over-year. First quarter sales were strong in both Canada and U.S. with almost every business unit recording good growth compared to the same period last year. The corporation had record quarterly sales for both gross and net seg funds, while net inflows totaled nearly $1.2 billion. Book value per share was $74.62 at March 31, representing an increase of 8% over the past 12 months. [Interpreted] Just to conclude, I would say that we are resolutely growth-oriented and excellence driven. Our business model is unique. We have achieved great growth in later year, thanks to our way of doing things, and we are ready to continue. February 2025 marked the 25th anniversary of iA on the stock exchange. We're also proud to belong to the dynamic financial community of Canada. Now I will let Jacques Martin take over from now. Thank you.

[Interpreted] Let's now look at the documents that have been received by this assembly. The financial statements there for iA Financial Corporation, the financial statements for the year ended December 31, '24, and for iA Insurance, the financial statements for the year ended December 31, 2024. The only -- the sole holder of common shareholders -- the financial statements include the report of the actuary and of the independent auditor are -- been filed. So I declare these documents received by the assembly. And I would ask Madame Cantin to add them. Let us now move to the formal period. The Corporate Secretary will -- here for the voting practices, except for the motions by individuals -- I would let Madame Cantin explain all the modalities of it.

[Interpreted] Thank you, Mr. President. Today, the shareholders of iA Société Financière and participating shareholders and policyholders could vote in -- online or in person. In as much as you've already voted through a proxy form or a power of attorney, your vote has been already registered unless you want to modify it. I would recall that only the person having common shares or their proxy have a right to vote on the topics that are presented today, except for the election of 1/3 of the administrators of iA Insurance, which shall be elected by the participating policyholders that are eligible. Pursuant to [indiscernible] 1/3 of the administrators must be elected by the policyholders with participating eligibility. These voters will not vote on other motions and will have no right to vote pertaining iA Société Financière, specifically for iA Société Financière, the shareholders or their authorized signatory will have to vote on the following: the election of the administrators, the appointment of the external auditor, an advisory resolution on iA Financial Corporation's approach to executive compensation and 3 directors motion. Who can vote? The participating policyholders who will elect 4 of the directors, iA Société Financière as a sole common shareholder will vote for 7 directors and appoint the external auditor. This vote has already been [ exerted ] through a written motion that was sent to the Chairman of the meeting. You can vote at any time for any of the items submitted to the vote even if we haven't yet discussed these elements in the current assembly as much as you are an eligible shareholder. Now for those sharing online, you must have opened a session of the webcast with a code from 15 figures, which you received from Computershare before the meeting. For those who participate in person, you could access through your tablet through the QR tab -- code that was handed to you by a representative of the corporation. If no corporate representative reached you, raise your hand and someone will come to you. For those who are participating in virtual, you could press on the lower left button, vote window will open on the side of your screen and the webcast will continue simultaneously. You have to push on begin to start the vote. You could then read the question and push on -- press the option corresponding to your choice. After that, you vote on the vote button in order to submit your vote. If you don't push on vote after your choice, the vote could not be accounted. So you must repeat the same operation for all items. If you wish to move from one item to another, you must use the options return or skip so as to move among the different items submitted to vote. You could always press on summary to go through all the items. And if you leave the window inadvertently, you could open it again and you will land where you left and you want to vote pursuant to the recommendations of the Board, you press on [indiscernible] button, then you press on yes for all and your votes will be tallied. If you do not select any option, your vote will not be registered. The vote is now open. The preliminary results will be at the end of the meeting, and the final results will be filed among the competent Canadian securities commissions.

[Interpreted] Moving now to the election of directors. So the number of administrator is 13 for iA Financial Corporation and for iA Insurance, contain -- this is pursuant to the applicable laws. Let's begin with the 13 directors. Only the common shareholder can participate in this election. All candidates who the position of Director were elected at the last annual meeting, and we recommend you vote for them for another term. Now the candidates you see on the slide are the ones we recommend, namely William F. Chinery, Benoit Daignault, Martin Gagnon, Alka Gautam, Emma Griffin, Ginette Maillé, Jacques Martin, Marc Poulin, Suzanne Rancourt, Denis Ricard, Ouma Sananikone, Rebecca Schechter, Ludwig Willisch and myself.

[Interpreted] Mr. President, I propose the election of the 13 directors you've mentioned, which are found in the circular.

[Interpreted] Thank you, Amelie. Do we have any questions on this topic by the participants?

[Interpreted] No.

[Interpreted] Thank you. You will recall that at any time during the meeting, you could [ exert ] the vote by going on -- pushing on the vote button. Now with the nomination of the directors for iA Insurance for participating policyholders. Seven of them will be voted by iA Société Financière. These candidates are found in the information documents that were forwarded to you. I will ask Madame Cantin to move for the nomination of the 4 following persons.

[Interpreted] I propose the election of Benoit Daignault, Ginette Maillé, Marc Poulin, Suzanne Rancourt.

[Interpreted] Thank you, Amelie. Are there questions pertaining to their election by the participating policyholders?

[Interpreted] We have received no questions yet. No.

[Interpreted] Thank you. If you're a participating policyholder, you could vote on this motion. Moving on to -- of the 7 elected directors of iA Insurance that are to be elected by the sole common shareholder. And to that end, a written resolution was already kept by the iA Société Financière, the sole common shareholder of iA Insurance. So the following have been elected: William F. Chinery, Martin Gagnon, Emma Griffin, Jacques Martin, Denis Ricard, Ouma Sananikone, Rebecca Schechter and myself. The shareholders do not vote on this item. Moving on now to the appointment. For the current fiscal year, I would like to take the opportunity to welcome the presence of representative of external auditor Deloitte, Mrs. Sophie Fortin and Mr. [indiscernible], thank you for being here. Before appointing Deloitte for the current fiscal year, I would like to reiterate that we conducted a robust tender process in 2024, which after careful consideration and in line with the recommendation of the Audit Committee, led to the Board of Directors to approve the selection of Ernst & Young as auditor for 2026 fiscal year, subject to the shareholder approval. It is therefore expected that Ernst & Young will engage in a transition process with Deloitte in the current fiscal year to ensure orderly transition. The company intends to propose to shareholders at the 2026 meeting that Ernst & Young be appointed as external auditor. Additionally, information and documents relating to the change of auditor will be provided in the next year's circular. This is further explained in the management information circular at Pages 8 and the following. The company would like to express its sincere gratitude to Deloitte for its dedicated and invaluable services as an external auditor. The company greatly appreciates Deloitte's in-depth understanding of its business, operations, accounting policies, systems and internal controls, which has contributed significantly to the high quality of audit services provided over the years. I now invite Mrs. Cantin to propose the appointment of the external auditor of iA Financial Corporation for the current fiscal year.

[Interpreted] Mr. Chair, I move that Deloitte be appointed as the external auditor of iA Financial Corporation for the current fiscal year and that its compensation be set by the Board of Directors.

[Interpreted] Thank you, Amelie. Do we have any questions from participants on this subject?

[Interpreted] No, no questions.

[Interpreted] Thank you. Holders of common shares can vote on this proposal. Let us now proceed with the appointment of the external auditor of iA Insurance by its sole holder of common shares for the current fiscal year. To this end, a written resolution was passed by the sole holder of common shares and Deloitte was duly appointed as the external auditor of iA Insurance. A copy of this resolution will be filed with the minutes of this meeting. iA Financial Corporation shareholders and participating policyholders do not vote on this item. The company is asking the shareholders to participate in an advisory resolution on the company's approach to executive compensation. The Board of Directors view this vote as an important part of its shareholder engagement process. The executive compensation of iA Financial Corporation is described in the company's management information circular on Pages 95 in English and 89 in French. However, I would like to highlight some important points. iA Financial Group is well known for offering fair, competitive and attractive compensation to its executives and employees in a dynamic and constantly changing job market. The company has developed a compensation proposal that is synchronized with these objectives while keeping in mind that the incentive for performance remains an essential criteria for performance. One of the major findings of 2024 was the remarkable increase in the value of the company's stock on Toronto Stock Exchange, IAG shares has risen nearly 48% in 1 year compared to 18% for the S&P/TSX index. The significant increase of this result of the good performance of iA Financial Group as a whole and the recognition of the efforts invested in recent years in long-term value creation, the Board of Directors is pleased with the company's excellent profitability growth once again in 2024 as well as the strong business growth of all its business units across Canada and the United States. In addition, the company has a strong financial position. All of all, its key financial indicators are in the green. The results recognized by all financial market participants are beneficial to shareholders and to all other stakeholders of the company, the 2024 performance also had positive impact on the incentive compensation of the company's senior management. The Human Resources and Compensation Committee composed exclusively of independent directors, oversees the development and implementation of the executive compensation program. The committee is supported by baseline data from a relevant peer group of Canadian financial services companies as well as the advice of an independent external consultant. I now invite Mrs. Cantin to move the advisory resolution on executive compensation.

[Interpreted] Mr. Chair, I move the adoption of the resolution relating to the say on the list vote on the corporate's approach to executive compensation described on Page 11 of the French version of the information circular dated March 11, 2025, and on Pages 10 and 11 of the English version.

[Interpreted] Thank you, Amelie. Do we have any questions from participants on this subject?

[Interpreted] No. We have not received any question.

[Interpreted] Only shareholders of iA Financial Corporation can vote on this proposal. The last item of the agenda concerns the vote of 3 shareholder proposals. Shareholders have had the opportunity to read the proposals in Appendix B of the Management Information Circular dated March 11. You will also find for each proposal the response of position of iA Financial Corporation. All these proposals were submitted by the [Foreign Language] or MÉDAC. To be adopted, this proposal must be supported by a simple majority of the votes of the holders of common shares. We are pleased to welcome today via videoconference a representative of MÉDAC to present shareholder proposals #1 to 3. Following the shareholders vote on this proposal, I will invite the MÉDAC to comment briefly on the other proposals submitted. As agreed with the MÉDAC, this proposal will not be put to a vote. Sir, I now invite you to present your proposal.

[Interpreted] Good morning. This assembly to be in person reinstituted after a proposition that we sent to you, a brief comment, we are happy to be here today in person. In answer to your proposition, imposing a permanent in person is too prescriptive. I would like to make -- to inform you that every one is back in person. [Foreign Language] [ BCE ] who did not want to come in person, but decided to do so. They have all engaged themselves to maintain the assembly in person. Moving forward, except you, we will not vote. We are happy that the assemblies here will not hold a vote, but we would have been happy to hear that you have the intention to maintain this assembly in person. There are many people here that I've spoken to that would have not been able to do for them by distance. And this is a spirit of the in-person. So we will not be voting on that. We asked the shareholders to ignore it. We have 3 other propositions that were submitted to Industrial. Like in the past, the implementation of a consultative vote on climate change. In your answer, we note that they must create some bias, subjective bias, then we could do a better follow-up of climate change by other means. But how would that affect you to have an additional audit to pronounce yourself in that? In your answer, we do not know the 20% vote that were approved on that. We do not know what the shareholders think. Are you in contact with them? We invite this 20% to keep on voting for it. We have sent a proposition, the competency of the administrators that environmental issues must be ventilated. You say in your answer that you do not believe that the competency -- climate changes must be treated as -- there are many other societies who merge them, we do not understand. So we ask the shareholders to vote. And the last one, we ask you to [indiscernible] the languages that are required from the employees. Contrary to your answer, it is not confidential information. It's not information that you get from your employees, but you demand -- but it comes from you so you must have this information. So you have your certificate of -- French certificate and the new laws, whatever corporation ask for any other languages other than French must say why. So there must be a registry of every job that requires any other languages is a social contribution and the job offered in language in X, it sustains sustainability of -- you sustain the collectivity of that language. So we submitted this proposition. I ask you to do what [indiscernible] do. They have given the numbers, and we would be happy to know them. We are -- we know what we have not obtained. And we've received a very strong support from other companies. We've done a survey from [indiscernible] marketing that showed that most of society is -- it's mechanical, but we invite the society to be sensitive to this question. A brief comment, I'm happy to have heard the presentation of the CEO. It's always interested to know what the CEO have done and before voting, thank you so much for the time allocated, and I'm happy to see you in person. It's really one point, I would say.

[Interpreted] Thank you. Amelie, do we have questions from participants?

[Interpreted] No, no questions.

[Interpreted] I remind you that society are asking to vote against 1, 2 and 3 for reasons mentioned in Page 1, 2, 3. Please note that if you have voted by proxy before and you do not want to vote, you have nothing more to do. You have one more minute to submit your vote before we close it. I imagine from MÉDAC, you have made your comment in regards to the proposition concerning the assembly. Yes, it was about the assembly in person. And we'll have more questions in the question period. Thank you for the constructive comments in respect for exchanges you have had with the corporation and the subject of corporate governance.

[Interpreted] We have -- we are now at the question period. [Operator Instructions] Denis, Amelie and I will answer the questions and questions received from participants that could not be answered during the meeting and that comply with the rules of conduct will be published along with our responses on the company's website shortly after the meeting, with the exception of questions that specifically concern a shareholder or participating policyholder. I mean, do we have any questions? Yes, we do.

[Interpreted] My name is [indiscernible], shareholder of Industrial Alliance. There's a consensus that for now, there's -- when we look at your sustainability report, you like to answer a lot of regulatory questions. There's a distinction between what is important and what is considered more of a marketing, would follow up what the MÉDAC says is, can a company be a good citizen and answer all the questions? My question to Denis is, if you have to identify certain regulations that you consider that are not useful to the company, what kind of regulations would you address to the authorities to say that this regulation is not justified?

[Interpreted] Thank you for the question, [ Evan ]. What I would like to say, firstly, we are a financial institution that is regulated and one of -- what makes us regulated is that the trust of our clients is the most important thing when we promise them to protect them once the moment present itself or preparing for the retirement, financial security. This is what the regulations make sure that the dollars will be here when the clients will need it. The regulation is important. So we will start by saying that. So we will not be able to be in business. Your question is pertinent because it brings out the just enough, where does it start and where does it end? And it's always delicate because when I look at the regulation authorities and even the government because it doesn't come only by [Foreign Language] companies because some come from politicians in general, 99% of the time, they are subject to debates between regulatory institutions. So there are opportunities for us to make comments and tell the politicians or authorities or regulations and what we consider as just enough and then it's their decision, and then we have to adjust the system and live with it because this is the reality. Is there enough or too much? I cannot judge because we can always say we want as less as possible, but the client will pay for it at the end of the day. But I will say that the big majority of regulation is really necessary. So we would like to have between provinces certain harmony, not total harmony, but it's important as an industry to have coherence between different jurisdictions. It's something that is important. I'm looking recently, the government of Quebec merged the [indiscernible] and we support that because it simplifies the regulations. Commission of -- so we support that also. Out of the border, there is a movement actually of removing those regulations. And what is important for us is to be able in our competition with our peers to have other tools and to fight with equal weapons. So we work with them and we try to -- the whole insurance industry, we work with government and the authorities or regulations and the ensemble -- and to have -- the ensemble of regulations to have the better price for our clients. I'll name a few examples. Maybe there's some work to be done in this regard, and the industry will make recommendations. It's part of the priorities to make recommendations to the government and to suggest areas where we could be more efficient according to us. After that, it's a government's call and that of the authorities. So you can mention -- well, I mentioned a few.

[Interpreted] I'm [indiscernible]. Policyholder with -- a participating policyholder and shareholder. We know that the price of the share has increased significantly since the last fractioning, what could prevent you to fractioning it to its current price?

[Interpreted] Yes, I'm often asked that question. Fractioning shares if we refer to 25 or 50 years ago. Back then, shares were transacted through blocks of hundreds. And the organizations would ensure themselves through fractioning when the share increased that the price of the shares remained reasonable at the end of the day. But now with technology, one can now buy 1 single share through the digital media. So the share is $2 or $200, we won't purchase $20 share but a block of them. But now with the fractioning of shares, it's much less relevant. And we see less of the relevance of fractioning. So as far as we go, it's not part of our priority. I don't think it influences the share's price today with technology. It does not really have an impact on the price of a share. So that is my answer. Are there any other questions?

[Interpreted] Yes, we have one via our webcast platform. And it is from a shareholder, Mr. [indiscernible]. Following the several communications statements of the American President concerning tariffs and mainly for Canada, what are the consequences on iA Financial Group? Is there an action plan to respond to the situation?

[Interpreted] Well, yes. The first thing I'd tell you is that at iA Group Financial, we have operations in Canada and the United States. The American operations, we are shareholder and an American Corporation managed by Americans for Americans regulated in the United States. So we are not subject to the tariffs on the products we sell. On the other hand, there could be indirect consequences as to what's going on in the United States, such as should -- if should the administration's measures create a recession or bring some inflation or would disturb the -- we see now we have problems with the automobile industry. Clients have anticipated their car purchase in the United States. Those are the -- and there can be some realignment from one quarter to the next, which might have a certain impact on the results. So there is a volatility in the results. So the question I ask myself is that on a midterm horizon, will people drive less cars because Donald Trump is a President of the United States? I'm not sure about that. Will price on cars increase? Perhaps, but people will love that. They will change the type of model. Maybe they will buy used vehicles. There could be some consequences. We sell products that could be re-tariffed. For instance, if price of repairs will increase, of course, we would have to change our prices. So we monitor this closely. And the other thing I'd tell you is that we have a business model, for those who've attended to the Investors event in February have understood that we have a very diversified business model. We have several areas of activity in operation. If a pressure occurs in one area, the other areas will compensate for it. And I've been working for 30 years for the [ group financial ]. I have witnessed financial cycles, recessions or hard times, but we have a range of products and range of activity that allow us to move through the more difficulties. And we also have an excellent risk management at iA Group Financial. That's why we are in a much better posture to face the economic perturbations as compared to 2008. A lot of work has been done in this regard since then to make us less sensitive to volatile economic environments. So in a nutshell, I am not overly concerned by what's going on in the United States given our business model. Thank you.

[Interpreted] Mr. President, as a shareholder, I would not address this if it had not been brought up during the CEO's presentation today, but please correct me, but you said you gave about $10.4 million to humanitarian charities, when I look at the net result, and please correct me if I'm wrong, that's $962 million. That's like 1%. Is that the rule in corporations, there would be a motion from the shareholders that would -- corporation would dedicate 1% of its earnings? But then the other criteria was added that we wanted the corporations give as much as what they pay their top, high management. Of course, my question is for the Chairman of the Board. When we look at what the [ high ] management, they earn is $20 million, not $10 million. So when the corporation accepted our motions, they would either lower the compensation of top brass or they would increase what they gave to philanthropic foundations. So we would like the corporation to give as much to charities as it gives to its top management. But now I have an unrelated question. You spoke of the acquisition of the society that belong to the Laurentian Bank. Why did you buy it? How is it going? Are you happy with the purchase?

[Interpreted] Very much so, very, very much so. It measures perfectly with our business plan. At iA Financial Group, a greater strength is a relationship with our distributors. And those will meet our customers, and we are there to serve the clients. And our ambition is to be the Canadian financial institution that combines the human and the digital the best because people think that the future will only be technology. But we believe that the combination of human and technology is the future. So we need distributors. So we're very happy to have an opportunity to acquire these distributors who now work in our environment. We are very happy that the distributors we've acquired is excellent. They stay on, and we are, yes, very happy about it.

[Interpreted] As for my suggestions, I leave it to your appreciation. But I'm not asking an answer for those.

[Interpreted] Are there any other questions?

[Interpreted] I believe not, no questions.

[Interpreted] Thank you, Amelie. Because we don't have questions, we will now look at the results of the vote. The officers have been able to look at the results, and I would ask Madame Cantin to communicate to us the results.

[Interpreted] According to the results of the vote for iA Société Financière, the 13 candidates for directors, as mentioned in the circular, were elected with about 94% of the voices. For iA Insurance, the 4 candidates for directors as per the document were elected with at least 91% of the voices. Deloitte has been reconducted as an external auditor for the 2 societies with about 89% of the voices. The advisory motion on iA for the compensation of top management was adopted by more than 82% of ballots. The shareholder motion #1 concerning to the environment have been rejected with at least 77% of the ballots against it. The #2 motion pertaining to the competency of directors and environment was rejected by at least 92% against it. And as for the third motion pertaining to the disclosing of the languages of the employees have been rejected by 93%. Detailed results will be published on the iA Société Financière website and SEDAR website.

[Interpreted] Thank you, Amelie. We would like to thank the shareholders and policyholders to have [ exerted ] their right of vote. And we take it into account that motion #1 was well received by the shareholders. We will always be very attentive to the need of our shareholders and to determine how the corporation could better respond to the expectations of the shareholders. This closes our assembly. I would like to thank the directors and the employees have shown their commitment and dynamism, I would like to thank all of those who participated to this first hybrid joint meeting of iA Group Financial and iA [indiscernible]. I would like to thank you for your support. And now the meeting is over. [Portions of this transcript that are marked [Interpreted] were spoken by an interpreter present on the live call.]