Great-West Lifeco Inc (GWLIF) Q4 2025 Earnings Call Highlights: Record Earnings and Strategic …

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Fri, February 13, 2026 at 8:02 AM GMT+9 3 min read

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Release Date: February 12, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Great-West Lifeco Inc (GWLIF) delivered record base earnings, up 11% over the previous year, with a 12% increase in base earnings per share.

The company maintained a strong balance sheet with over 2 billion in deployable cash at year-end, despite significant share buybacks.

Empower, a key segment, crossed the $2 trillion mark in client assets, highlighting strong customer attraction and retention.

The company announced a 10% increase in its quarterly dividend, reflecting confidence in its financial position.

Great-West Lifeco Inc (GWLIF) achieved a base ROE of 18.2%, with the US business surpassing 20% for the first time.

Negative Points

In Canada, results were negatively impacted by lower earnings on surplus due to falling yields.

Europe experienced a significant decrease in earnings on surplus, primarily due to large dividend payments exceeding business earnings.

The company's LICAT ratio decreased from 131% to 128%, partly due to seasonality in the reinsurance business.

The PNC retrocession market saw a 20% rate reduction, leading to less attractive returns and reduced exposure.

The company anticipates an increase in its effective tax rate to approximately 18% by 2028, due to growing earnings from Empower and tax changes in Canada.

Q & A Highlights

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Q: How is Great-West Lifeco Inc. leveraging AI to enhance its operations and customer service? A: David Harney, President and CEO, explained that AI is being used to improve efficiency and customer touchpoints. The company is focused on AI-assisted advice, which is already in use in call centers to gather information and assist advisors. AI is expected to further improve efficiency ratios, and the company is comfortable exceeding its target of reducing the efficiency ratio below 50%. Ed Murphy, President and CEO of Empower, added that AI is being used for sales and service supervision, prospect targeting, and advice delivery, particularly in the mass market, to enhance customer interactions and build trust.

Q: What is Great-West Lifeco’s approach to mergers and acquisitions (M&A), and how much capital is available for such activities? A: David Harney stated that the company has a high bar for acquisitions, focusing on strategic fit, scale, and capability addition to existing segments. John Nielsen, CFO, mentioned that the company has about $2 billion in excess cash at the holding company and additional excess capital in its Canadian and US operations, totaling around $5 billion. The company is well-positioned for M&A opportunities without needing to issue equity.

Story Continues  

Q: Can you discuss the competitive environment for retirement blocks in the US and how it affects Great-West Lifeco’s strategy? A: David Harney noted that while the market is slightly more competitive, the company remains focused on acquiring clean and well-integrated businesses. Ed Murphy emphasized that Great-West Lifeco is a strategic acquirer with a strong track record, making it an attractive option for sellers looking for a credible buyer.

Q: How is Great-West Lifeco managing its capital and risk solutions business, particularly in light of changes in the PNC retrocession market? A: Jeff Poulin, CEO of Reinsurance, explained that the company has reduced its exposure to the PNC retrocession market due to lower rates but remains opportunistic in deploying capital in attractive opportunities. The focus is on capital solutions, which have shown strong performance, and the company maintains a diversified approach to its business lines.

Q: What is the outlook for Empower’s growth, and how does it plan to address participant outflows in the US retirement market? A: David Harney expressed confidence in Empower’s ability to achieve double-digit growth in 2026, driven by positive net plan flows and scalability. Ed Murphy highlighted that despite participant outflows, the company continues to add assets under administration and participants, taking market share and expanding its revenue base through additional product capabilities.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

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