You are given a text that consists of multiple sentences. Your task is to perform abstractive summarization on this text. Use your understanding of the content to express the main ideas and crucial details in a shorter, coherent, and natural sounding text. 
Text: I think we're all very ready to turn the page and what was a very challenging 2020 and while the global pandemic remains very pervasive, we do all see light at the end of the tunnel and we look forward to 2021 with cautious optimism that conditions will improve.
Throughout 2020, we focused on executing our long-term strategy while recognizing the necessity to focus on employee health and safety, finding ways to work, and serving and delivering expected outcomes for our clients.
Over the past decade, we've been successful investing ahead of shift in client demand, placing us in a strong position to take advantage of key industry tailwinds in the future.
Our investments in these capabilities and our tremendous focus on our clients is now again producing good momentum in our business that became more visible as the year progressed by working better to anticipate, understand, and meet client needs during the challenging times.
We've achieved six straight months of net long-term inflows, totaling nearly $18 billion in the second half of 2020 with progress across channels, geographies, asset classes.
Retail flows improved in the second half significantly.
Our solutions enabled institutional pipeline remain near record levels.
We saw net inflows in Asia Pacific, totaling $17 billion in the second half of the year and improving flows in EMEA within the Americas over this timeframe and net long-term flows in the fixed income remained robust during that period.
All of these factors combined build a strong foundation as we head into 2021 and maybe a few highlights of the 4th quarter.
On slide 4, if you happen to be following along more specifically during the quarter, investment performance for a large portion of our high demand capabilities were in the upper quartile.
We had net long-term inflows and then nearly $10 billion during the quarter, long-term inflows in the fixed income capabilities continued while we saw client demand for equities within ETFs, quantitative and index strategies in particular.
We saw another quarter of strong inflows from Asia-Pacific region and flows in the Americas turn positive.
Alison will provide more information in a few minutes on the flow's strategic evaluation and more details of the quarter.
But I would like to note, we also improved our operating leverage during the period, paid our credit facility to zero, and made progress improving our cash position.
I would like to spend a few minutes on slides 5 and 6 to talk about our competitive strength and key capabilities in areas with high client demand and our focus for 2021.
Slide 5 illustrates the market opportunities we see for these key growth areas and demonstrates the majority of our investment capabilities are aligned with these opportunities.
In these areas, our investment performance is strong.
We're highly competitive and well positioned for growth and as we move into 2021, we plan to further expand our market leading position in ETFs in the US and EMEA in particular and build our passive presence in Asia-Pacific.
We are the fourth largest ETF provider globally, and our capabilities span passive active strategies in establishing and developing a spectrum of ETF-ESG ETFs and building on our 15-year legacy of innovation, we continue to develop the products in this space as demonstrated by the launch of the QQQ innovation suite and our first non-transparent ETFs that we delivered in the 4th quarter.
Strong alternative platform and our focus is growing our private markets business led by our market leading real estate and bank loan businesses, and active fixed income and global equity remain key areas of opportunity for us and our offerings are well positioned with strong investment performance and high client demand.
In addition, we are focused on our solutions efforts and as we have seen by the contribution to the institutional pipeline, clients value the service, the ability to offer solutions that builds the full power of our competitive set of capability and services-services to client continues to be a priority for us during 2021.
We continue to invest in our leadership position in Greater China.
We have been managing dedicated Chinese products for nearly 40 years.
We have already seen the benefits of our early mover[Phonetic] advantage in the China onshore market through our joint venture, which [Technical Issue] our position in the fast-growing China market and further develop our media solutions and asset allocation offerings.
Given our investment in the business over the past decade, our most recent efforts to better align the organization with our strategy, I'm confident that we have the talent, the capabilities, the resources, and momentum to [Technical Issue] future growth and success.
[Technical Issues] happy New year and remain focused on helping our clients achieve their desired outcomes regardless of where the markets take us.
Moving to slide 7, we had 61% and 70% of actively managed funds on the top half of peers on a 5-year and a 10-year basis, reflecting strength in fixed income, global equities, including emerging market equities and Asian equities, all areas where we continue to see demand from clients globally.
Looking at our AUM on slide 8, we ended the quarter with $1.35 trillion in AUM.
Of the $132 billion in AUM growth, approximately $95 billion as a function of increased market values.
Turning to flows on slide 9, our diversified platform generated long-term net inflows in the 4th quarter of $9.8 billion representing 3.9% annualized organic growth, which we generated positive net inflows in active AUM of $400 million and passive AUM of $9.4 billion.
Our ETFs experienced net inflows of $6.1 billion including $4.7 billion in long-term ETF and $1.4 billion in our QQQ.
Our US-listed ETFs excluding the QQQs have their best quarter in their 15-year history.
We saw net long-term ETF flows in the US focused on equities in the 4th quarter including a high level of interest in our S&P 500 equal weight ETF which had $2.7 billion in net inflows in the quarter.
Two of our top 5 end-flowing ETFs were ESG related.
We continue to see momentum in our ETF business and demand for ESG funds and as Marty highlighted, the market opportunity is significant for this key growth area in 2021.
Retail net outflows were $800 million in the quarter, helped by the positive ETF flows.
On the institutional side, we had net inflows of $10.6 billion.
I'll provide a little more color on these flows on the next few slides, but importantly, the growth in our passive AUM and our institutional AUM is meaningful for the firm and contributed to the positive operating leverage we generated in the period.
Also, as Marty noted earlier, we are seeing the mix of ETF inflows being weighted toward higher fee-generating products.
Looking at flows by geography, you will note that the Americas had net inflows of $2.2 billion in the quarter, an improvement of $6.6 billion from the prior quarter.
This improvement was driven by net inflows into ETFs, institutional inflows, various fixed income strategies, and importantly, focused sales efforts and improvement in redemption rates.
Our global equity products improved by over $1 billion or 37% from Q3 driven by our developing market fund, which returned to positive net flows in the 4th quarter following negative net flows in the first three quarters of the year.
The UK experienced net outflows of $100 million in the quarter, as positive flows into our institutional quantitative equity capability were offset by net outflows in multi-asset in UK equities.
EMEA net outflows were $1.4 billion driven by institutional lumpiness and ETF outflows largely in our S&P 500 and Nasdaq-100 use ETF.
And finally, I noted last quarter that Asia Pacific delivered one of its stronger-strongest quarters ever with net inflows of $8 billion.
In the 4th quarter, net inflows were even higher at $9.1 billion.
Net inflows were diversified across the Asia Pacific region.
$4 billion of these net flows were from Japan, $3.8 billion arose from our China JV, and the remaining $1.3 billion was generated from several other countries in the region.
It's worth noting that we continue to see strength in fixed income across all channels and markets in the 4th quarter with net long-term inflows of $8.2 billion.
This following net long-term inflows of $8.8 billion in the 3rd quarter and $6 billion in the second quarter.
It's also important to note that of the $26.1 billion in fixed income net inflows in 2020, $25 billion of these net inflows were from active fixed income capabilities.
Active fixed income has been a growth area for us in 2020 and remains a key investment area in 2021.
Now, moving to slide 10.
Our institutional pipeline remains robust at $30.5 billion on the heels of strong pull through in the institutional pipeline during the 4th quarter.
This pipeline is diversified across asset classes and geographies, and our solutions capability has contributed to meaningful growth across our institutional network warranting our continued investment in this key capability in 2021.
Turning to slide 11, you will note that our revenues increased $135 million or 12.4% from the 3rd quarter, driven by higher average AUM in Q4, as well as a meaningful increase in performance fees.
Net revenue yield at performance fees was 36 basis points flat and flat at the, at the Q3 yield level.
The impact of rising markets on our yield was offset by modest fee rate decline from the mix shift we experienced across products in the quarter as well as the impact of non-management fee earning AUM.
We recorded performance fees of $78 million in the 4th quarter, $48 million of these performance fees arose from our real estate business and $21 million from our institutional business and our China JV, two of our key growth areas.
Seasonally, we tend to see higher performance fees in the 4th quarter.
Total adjusted operating expenses increased 8.3% in Q4.
The $57 million increase in operating expenses was driven by higher variable compensation as a result of both market growth and compensation related to the performance fees in the quarter.
Operating expenses remained at lower than historic activity levels due to pandemic driven impacts to discretionary spending, travel, and other business operations that persisted in the quarter.
That being said, we did see a seasonal increase in marketing expenses as expected.
Moving to slide 12, we wanted to update you on the progress we have made with our strategic evaluation.
As we noted previously, we conducted a strategic evaluation across four key areas of our expense base, our organizational model, our real estate footprint, management of third-party spend, and technology and operations efficiency.
Through this evaluation, we will invest in key areas of growth, including ETF, fixed income, China solutions, alternatives, and global equities while creating permanent net improvement of $200 million in our normalized operating expense base.
As we noted, a large element of the savings will be generated from compensation which includes realigning our client facing workforce to support key areas of growth and repositioning to lower cost locations.
In the 4th quarter, we realized $7.5 million in cost savings, $7 million of these savings were related to compensation expense as depicted on slide 12.
The remaining $500,000 in savings were related to facilities, which are shown in the property, office, and technology category.
The $7.5 million in cost savings were $30 million annualized is 15% of our $200 million net savings expectation.
Of the remaining $170 million in net savings, we anticipate we will realize roughly 50% of the savings through compensation expense.
The remaining 50% would spread across occupancy, tech spends, and G&A.
As it relates to timing, we still expect approximately $150 million or 75% of the run rate savings to be achieved by the end of this year, with the remainder recognized by the end of '22.
We estimate that we will realize roughly 75% of the anticipated compensation reductions in 2021, roughly 50% of the anticipated reduction in occupancy expense also in 2021, and all of the reduction in G&A this year.
The majority of efficiencies identified in our tech spend will not be realized until 2022.
In the 4th quarter, we incurred $104 million of our total estimated $250 million to $275 million in restructuring costs.
We expect the remaining transaction costs for the realization of this program to be in the range of $150 million-$175 million over the next two years, roughly two-thirds of this remaining amount occurring in 2021.
As a reminder, the costs associated with the strategic evaluation are not reflected in our non-GAAP results.
With respect to Q1, after improved market performance and asset inflows in the 4th quarter, we start the year with ever $1.3 trillion in AUM.
Given the market improvement with more back-end weighted toward the end of the quarter, we expect both operating revenues excluding performance fees and the associated variable expenses to be modestly higher in the first quarter.
This reflects the follow through from the market and slow growth that occurred over the course of the 4th quarter, even if we assume no change in markets from year-end.
On the expense side, this will include higher associated variable compensation from the seasonal increase in payroll taxes, partially offset by lower compensation related to the seasonal decline in performance fees and the execution of our targeted cost savings.
Turning to slide 13, adjusted operating income improved $78 million to $485 million for the quarter, driven by the factors we just reviewed.
Adjusted operating margin include 230 basis points as compared to the 3rd quarter to 39.5%, demonstrating the operating leverage in our model.
This helped drive a 19% increase in adjusted earnings per share to $0.72 a share.
In addition, we benefited from higher non-operating income and lower non-operating expenses in the quarter.
Non-operating income included $31.9 million in net gains for the quarter compared to $15.2 million in net gains last quarter.
The increase was driven by unrealized gains primarily in our seed money holdings.
Interest expense of $24.4 million was 28% lower than the prior quarter.
Q3 was the final quarter in which we paid dividends related to our forward purchase agreements, a portion of which we settled in January with the remaining portion to be settled in April 2021.
Our tax rate for the 4th quarter was 21.7%.
The reduction in the rate reflects the lower taxes on unrealized gains in our seed portfolio due to the jurisdiction of our holdings.
We estimate our 2021 non-GAAP effective tax rate to be between 23% and 24%.
The actual effective tax rate may vary from this estimate due to the impact of non-recurring items on pre-tax income and discrete tax items.
A few comments on slide 14.
As Marty mentioned, we reduced revolver balance by $90 million to 0 in the quarter, consistent with our commitment to improve our leverage profile.
In addition to using excess cash to reduce leverage, we seek to improve liquidity and our financial flexibility.
To that end, our balance sheet cash position improved to $1.4 billion in the 4th quarter from $1.1 billion at the end of Q3, $764 million of this cash is held for regulatory requirements.
I will note, we paid $117 million earlier in January to settle a portion of the forward share repurchase liability with the remaining liability of $177 million to be settled in April.
We believe we're making solid progress in our efforts to build financial flexibility.
We remain committed to a sustainable dividend and to returning capital to shareholders longer term through a combination of modestly increasing dividends and share repurchases.
In summary, Marty will walk through our key capabilities through organic growth opportunity each presents and our focus on executing the strategy that aligns with these areas.
We're also focused on our strategic evaluation and reallocating our resources to position us for growth, and we remain prudent and cautious in our approach to capital management.
Our focus on driving greater efficiency and effectiveness into our platform, combined with the work we've done to build a global business with a comprehensive range of capabilities, puts Invesco in a very strong position to meet client needs, run a disciplined business, and to continue to invest in and grow our franchise over the long term.

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quarterly adjusted earnings per share $0.72.
long-term net inflows of $9.8 billion in q4-20 compared to $7.8 billion in q3-20.
qtrly adjusted net revenues $1,228.4 million versus $1,267.8 million.
qtrly operating revenues $1,630.1 million, down 6.5%.

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