SVB Financial (SIVBQ) 26 Jul 192019 Q2 Earnings call transcript

Welcome to the SVB Financial Group Q2 2019 Earnings Call. My name is Adrianne, and I will be your operator for today's call. [Operator Instructions]. Please note, this conference call is being recorded.

I'll now turn the call over to Meghan O'Leary, Head of Investor Relations. begin may you Meghan,

XXXX and the CEO, for CFO, Greg to of second are Adrianne, joined we'll The other by Dan us President here members quarter our about and Becker; management talk results thank you, and joining be for everyone the today. Beck, financial Q&A. Thank and our

website current release as Investor highlights letter CEO and in earnings well the earnings Our are section Relations at our of slide as our svb.com. available quarterly

statements forward-looking differ you review earnings making We'll to call, may call. in the forward-looking this our statements be actual results the this equally during materially. and in which with We to applies release made information, encourage dealing disclaimer

measures. measures, those to earnings Information a reconciliation In in be filings may including about include some addition, our financial discussion measures, GAAP of in our may and our found release. SEC non-GAAP references to

our And over call now CEO, to and will Becker. turn I President Greg the

for Good Meghan. Thanks, Great. us. afternoon thanks everyone joining and

I started, scripts. remind earnings going reading be get different everyone to call. We're we this something doing just on Before were not that to like

important on highlight and each quarter summary, of documents results drivers answering that's website. we know filed Relations you've but in intend spend the our deck and and relevant get release questions. earnings section on call got The a slide beginning summary many Investor short full filed comments short and your of the quarter's key Q&A. a our focus are to just adding we on deck, we of going the themes the I Now strategy. to some and really a we're time highlighting to most to then and XXXX By QX the markets in have couple going what But disappoint you, the our today, aspect the color that our was providing available letter and of

on dive by strong we'll comments line, had about into record driven a effective Credit that an still we well. extraordinary our then market note the was to with going on much across-the-board. warrant excellent outstanding quarter with a execution backing and add important few of continued as client just profitability the strategy. the gains, pretty quarter we Q&A. quality to I'm exceeded Bottom and out It's expectations earnings even

healthy near- headwinds, Our are managing NIM creating we strong we continuing growth best for the on income, for and balance to aside, rates of growth opportunities rates seeing potential sheet and declining interest although leverage. long-term generated driving are operating and see proactively we're business. continued in doing the impact our But declining growth and our net in

any to so questions, president a credit with good bank quarter Beck emergency, since up Meghan out and said, our is on will really credit-related and Descheneaux, have and be directed actually a to quality So questions solid. Dan for to Mike family Mike myself. me our that, is as Mark myself, CFO, open that's

that, operator, open can the questions? So line to with up you

question from from Stanley. Morgan first Zerbe our And Instructions]. [Operator comes Ken

a Fed achieve is a to is leverage actually the understand, trying to that times much how on expectation to to few Maybe especially Can positive next of probably growth, you transition flexibility you limit specifically, into And operating expense possible head about few me we just given just it start rates off the amount cut going expenses. talk year? the XXXX? let I'm the have as

Ken. Yes,

then is sure Greg. I'll will commentary. So to Dan this start some I'm add want and

guidance, to That do are rate curve have you expense be we going the trajectory we're that do that go One in initiatives, change be the flexibility lot we to growth. of shouldn't being for it's decreases couple have So is really and a we're business, a project of changes we any big the to the I Yes, investment have if answer to rate reasons, expect just honest, to flexibility? couple pretty have investing for honest, spend don't But changes, place. project and a spend, built-in, to our that. is, different right? forward make and the said, a real in whether

I a wouldn't expect -- to So just see I of much change.

see Now way we but bit curve up, that there of I it saw if different a a forward is, headwinds and story, issues more were change. expect the the little a wouldn't that's with came other to lot of

discussions would single change still in be thing guidance is with about add I'd we continue there's we next the able that. expectations that, to at that, the that's early, is like to only invest. talk And looking And we're high with focus. The to digits. Ken, as The it's but in expense for no year, really thought

to lending Okay. call total guess, of or XX% Can XX% term level? in of capital Great. is terms now loans. I assume, increase just to exposure I willingness above your that the up to capital talk about appetite lending, your that your you

This Yes. Greg again. is

So we going calls comfortable we said are to XX%. prior on over

balance and Our -- room a how we half when loans share remember kind think it, again, soft balance to you XX%-range, is are to our kind maybe go only one about some guidance is, to sheet. up. have of look overall at of sheet, of And think just our about

number large-cap private diversified. in is been buyout, it itself then the lending still portfolio within equity, sheet, from into balance XX% is from services diversified in equities two, and equity diversified the private That It's to is roughly, preponderance. private very buyouts. number small-cap venture the is mid-cap, roughly call which one; capital of So incredibly fund-to-funds

dispersed. geographically So

very very, it's diversified. So

So and do also to we be to at it. saying, XX%. need yes, looking we're more point, above some sensitive But we're at comfortable going

loans other of you the still looking amount different ways but at exposure the to so create growth that to from those dollar want manage syndicate participations, overall and we're clients, allow So ways perspective. can add? a for the we to Mike,

in is cetera, thing clear partnerships, as at very, one also threshold our well facilitate the help and et would in for about us this about. means -- and what Ken, other I this number that market also there's looking mean, And swaps of uses the clients, very irrespective be No, that's that's and for that's think we're talking I to continue that exactly right. to addition were that runway default extended syndication the said credit runaway. to Greg

you. Got

Okay.

of to think it Just it. There's your just I'm to at What low. to here? XX% get between are if understand, $XX the do XX% made I insanely only a cost just million remarks, actually this you trying one XX trying a last I deposit XX%." and basis costs It points was "this estimate assumes a question, basis prepared number. deposit point beta you about basis could. There's at lot currently? deposit like cut, am it and sentence a missing XXX million to you're [indiscernible] annualized how I'm and in understand assumption $XX points talks there, XX% beta in I says, Like

at points Ken, the deposits. are XX of of basis Yes. cost that's The deposits cost look total when right interest-bearing number, X.XX%. you around

there. do So we from flexibility have to decrease

[Operator Fargo. Jared from Wells Instructions]. Shaw question your And comes from next

of the ramp going the away you the hardware levels on start start seeing and through seeing deposit that sciences loan to growth. Maybe on strong sort as the stronger growth strong we capital that's of do up as of money flow-through reinvested and products activity into were and think see you really When side, and at loan Should lending? just start we from to the life the peaks? as categories go to to exit you starting call year more expect season software

and can just predict, One outstanding, a So and we life sciences, all relationships liquidity is hard Jared, but be this parts why. is, relationships. growing and new is is the two answer adding I'd say, the exist. It's, to Greg. to to here's challenge we relationships, new little stick headwinds let's lending private new technology a a but or There's are positive technology, life the The bank The sciences. positive, bit growing in did credit are answer. yes, that

but $XXX their large borrow sheet. not working We're So $XX of we've because million, they're on get seen million, million $XX million, have to balance financing willing they these $XXX very closing this capital $XX of done. liquidity million, loans, rounds

is see market. of a bit headwind. comes We don't that So know. expect given When out, I in a balance it just some -- a of the to it. liquidity from the little that still have is standpoint, headwind But do that that all it's again, we

of only profile loans, like The competitive risk have structure right returns get grow growth? kind terms for when I on the a sense, And you but but marketplace. the just where reflect that's can in is of an keeping loans environment grow of as to we're So you much think, that's the in of we where we the to certainly something of so right thing when ion size have you play given well? kind would in do actually growing just want liquidity pricing an available kind we and smart I the environment there's again natural can add loans today, kind and is,

balances, continues about next how falling be look looking rate likely at should Okay. then And environment, a we the grow and at few that the over being thinking deployed that cash cash to we as quarters?

on work. money we're Jared, to focused Yes, putting that

the form that So billion going between anywhere of billion to our in put least work in is of $X third quarter. securities the we're at that investment $X anticipation to to cash

So looking managing balances at we're and constantly that them those investments. deploying and to

stay level margin, added maybe rest quick see loan that back The I fees we does similar you mean pull we second. bit? that could guidance as at year? I that the And go little just Or that to Okay. think a over of through the basis sort a assume X the switching that there, of really points? the pre-payment have

back. them Jared, expect to pull we

to So the our the guidance, factored range. remainder we get for of out X.XX% base year X.XX% to that in the to

Poonawala comes of America. question next the And from from Ebrahim Bank

on interest-bearing in something I to follow-up get of peak for a deposit When wanted to at Ken's said, if this that look clarify and the be cost we the Fed you we earlier. deposit based assume question to terms cut should is bank? cost, the then, it week, safe what next just

the for objective that's rate continue No. that, get we the additional expectation #X to stickiest using as towards us. think the clients, from a to relationship, cost clients that's If The That's relationships the going about with also But where well. interest-bearing. will an and perspective, that's and is value -- where the serving shift expectation mix is down. we there that is go

year, So are this to today year. we where drive, expect for deposit stable this that through get from to we I cost more continue deposit rest could of of a which would remainder we say, the interest-bearing balance the increase as

Understood.

deposit cost it. interest-bearing go Got would So down?

That deposits should environment. total of more rate would cost in go down, stable but the remain that

issue. rate versus volume a That's

go would from expense volume and rate the growth there, those the the if so get down, I is mean coming higher. with get would I go Yes. the I actual associated

as coming us Just more philosophically, of using are back deposits to And you a securities buying opposed Dan, these to off-balance X.XX. good for it? book help I rechanneling of you're that, understand, some if rationale you mean but Like X.XX to recognizes security's would sort of X.XX, sheet. hear the reason in at at about what's it the love to I could and how think I X.XX growing deposits

Yes.

to some sense things: what less quite is of market of when that the we rate for So had just financial make is money doesn't that our was in first three moving terms to what that a product we frankly, that it's really I institutions. before, in And clients us. referring competitive other were noticed

We continue and depositor. makes their it the to be sense to us with primary them primary have relationship for

with clients. one. And deepening with the comes additional the number that that's value So we're

makes us off situation money balance money point. looked fact the matter ancillary from the the put points point sense that to Secondly generate that's That better that able this to fund, just capital. a have is the that than benefit on this and excess at of sheet technically relationship perspective, the XX, if extent of excess XX we the we at for cycle, having that the with we're the to continue treasury to sheet, to basis of balance

factors and we those consideration, two into why make take sense. it So think continues that's to

that we The piece proven I ability shift that now the dynamic. will is, third once it with time, quarter-or-so, makes to and mention it take have a will sense, we've

stone in baked aren't decisions forever. these and So

I it it. allocation, And includes on announced separate million completing looks bought a you've Got about capital two buyback year, it like just their the $XXX question last think back.

will in the thoughts be buybacks $X quite in capital Just terms any given the Obviously, the updated -- I'm million the that quarter? of you're book next we than we just capital in are creating strongly see deployed? around where value the wondering use, despite more if, buybacks. tangible remaining just could

So been the to buyback fully so we accrete at clear, as executed. full to point, capital. we this continue And we complete be do did mentioned, that's

definitely considering options we dollars, do that opportunities to So but look gives same the as to at us we We are continue ahead. invest have for flexibility time, return. capital those

soon guidance what too we it's on for those to have and the more think right I we'll thinking. make as with we're come back quarter decisions, next now

question next JPMorgan. our from And comes Alexopoulos from Steven

are it's to How wanted hedges? $XX particularly in much, about you I in if saying have that asset million calling million for quarter to reduction, you a economical the dropped X%. XX-Q start, XX% asset-sensitive, $XX it implies I last the where banks to out Dan, that so were so you're disclosed sensitivity today, look and did most at

aspects and earnings of outline try So of sensitivity, we this in asset slides. one to two there's the the

balance curve Into is XXX XXX into yields. basis one billion point difference securities. the redeployment investing yield to shift environment forecast. balance $X billion. shift down we is regular with parallel for sensitivity one anticipate between is overall On static a sheet where investments in we're the investing. sensitivity, consideration The points basis, of with our and in, in the the a static The us investments wouldn't rate we're So we're $X.X basis takes the associated big

$XX in of and So annualized we points. which $XX get what the I for million the the we to mentioned expect million between is to every basis of happen that impact XX to earlier, that cash deployment reality,

reduce Okay. That's to is able Or at helpful. were at the quarter? still sitting Dan, XX% all same that the you for it level.

It's sitting at XX% now. right

making that. been progress have against we So

up Okay. And the the Slide XX environment. at where changing the in you're different looking rate then looking levers

ratio bottom improve that? a can your here, rate you said Is lower improve where that in Are you're could what reducing that you believe on the in comment, efficiency short-term you said saying its the environment. You the of backdrop in it seeing that the you Fed rates?

don't we to have that growth we scalable business. What can is what before there efficiency believe we're our operating the do but levers the saying drive that ratio, more we improve

funds the will rate we equation be to But and So options of more the revenue been side declines. operations. Fed have do clearly investing impacted with drive have scalable

versus efficiency an ratio. it's operating So efficiency more operating

going are not may So the made, it's not be itself it's that just improvements to ratio change.

clear expenses there, the if continue the you Okay. the manage to to that know starts thoughts on coming And sustained expense I NIM the you said what aggressively rates? guys just so pace plan overall we're Fed investing. going the down do you are more were But if just of growth? keeps cutting what

it. what here's about I Steve, think

and you approach. just if how getting if to -- we it start tell be it a investing or pay going see in point, down decisions that X/X, down of if goes will over you not At will growth invest you're of you think, baked where to our Feds, lot curve, if see you out just and around to look investment two don't sitting that, making it's I Once I can't the that a The change down, to at philosophy the think we function X/X, I slow this it whether that. in. as said, it's we goes with be I settles we'll time. opportunities got to forward going beyond because

do to that's that, call just flexibility. because point. still at we'll it So or point. the beginning, more Whether important though, make as do don't it's flexibility. have said we this What's information that we not, use at the undetermined I at judgment have have I the choose than We a

Evercore. John from Pancari with And your next comes question

Back indicated rate the question or to know on in that confident excluding I Leerink the you're XXXX. including you high single-digit still expense XXXX, that growth expense for Is Leerink?

year. That includes Leerink next this for

All on the Okay. Leerink. increased maintained bank, also on it growth that quarter the this Leerink you the last for a but changes And Meaning were essentially -- that? it. there lowered the outlook that right. the quarter Got whole. Is expense any as expense topic, you're indicated for outlook for company then

Leerink we're the be based including as reduce going stand, range company lower the at the Leerink. didn't at expense outlook I to where on we point, for And guidance a of to We end was just this that the bank. specific No. for that the whole, believe

quarter. the that you years on portfolio? last to X.X years And portfolio, to you and around bond willing duration duration. looks outlook extend What's helpful. That's further now like to the mention are did is portfolio continue strategies the X.X there? bond was How much And extend it the right

available-for-sale. the very year as that I time, the buying call is When range. we looking just same year at you the the is specifically the at and in four consistently, six be look range. were been sitting the duration So to four-year it, have at period, out three. you clear, over portfolio, this At think combined to we look last let's

So to protect to we're would extent quite that this possibility a that good up to surprised and outcome to us. falling against further, for continue that point the at be picked do the positive that we're rates quickly, rates for going

So really against the now right a risk downside. just we're of further here protecting

Chris And our KBW. McGrady comes next from from question

an CECL any is implementation, Dan, about product four assumptions? -- five a capital are other predicated updated October return it if maybe question all your to or CECL more, you now we've update until waiting months there's on got to thoughts give on the that on initial

a what with we'll the ready the look and to our early, as of again, change. material But quarter. is related. We're estimates, back we're at we in not be more get to that's like, see come refining looking that third able our were estimates quarter. CECL two in details we think third for still more going The where don't and But early

one you on deposit if sneak more Okay. I could mix the talked Great. And about. that

cut, kind thoughts reversing the With a maybe now basis? there deposits it expectations kind growing in flat -- growth should just and Fed course on of bringing in pretty your from quickly of on dollar and I'm interested we a Or does this sitting here now are be make and year-over-year quarter?

So the as the expectation a acquisition, [indiscernible] at impact coming we build distribution, over time, we that to balances. The in time, private our those had fund that deposits. of have we really But terms noninterest-bearing relationships, quarter at equity continue is, along X,XXX is into things lines, to franchise. strong deposit build fine same we client continue will expectation do

So -- to the time, we'll on looking that expectation still in net-net, as be And just It's the customers yields environment I are clients to going at of and to for we continue phenomenon the of in several over in to rate environment will think the non-interest-bearing. change. clients, where are we for grow grow is pace what's a because because slower change reductions that it rate funds Fed the deposit. continue

Vandervliet next comes UBS. your Brocker from question And from

was two Just these X.XX%. our range X.XX%. That's of exit down that math -- given that I'm NIM the of some level? reasonable -- NIM that model. turning around to doing cuts to to on in cuts with Slide based year two X.XX% coming up Taking QX in into the get to X, I Fed that quick that a and roughly, Is

that, exit in taking a -- where that in deposits. expectation to to X.XX% to mid-XX% be we'll you let's those range just September, figures. where that's in are about total name. in range terms two in third the of funds: highly upon X.XX% time, dependent At look of quarter, the non-interest-bearing July; the quarter you're the one you'd is call it amount same their one the in expect at for So And the scenario also thinking rate

rate the on of exit kind assumptions. that's those So based

the to X.XX% quarter? for X.XX% fourth

Yes.

to by you And you aggressively hedge foxhole do curve, going more relatedly, the going like, your forward here? implied expect you're given fight feel near forward? do Or from what's to

the is to The hedge portfolio. expectation continue to increase

the at and for continue billion conditions, $X in market $X further we depending and range. as insurance the our billion, As over $X potential this on. closer is, to flex cycle on Again smart we to of insurance term now, think billion expectation long where to sitting to up that it's are declines, view rate things the head we're to

doing in if direction, here, again, So it any that's say, what spikes positive let's rates and us. grows we're for other

question Stafford next from Stephens. our comes And Tyler from

slide rate. XX% can in generate Investor that to sustainable you out At flat EPS you Day deck, laid growth guys that

So type you can what cuts you growth Fed generate EPS implying where I'm EPS of with Can growth just positive think generate rates? is curious, the you rate given now? down right still

Yes, cuts is time in Greg, rate start. this have me long let did a Tyler, we when like ago scenario. Seems this

you again, when and but a of So way about it there's are obviously we get rate break of that I got through able going to would little lot think do cuts the we even that variables -- think is a you believe believe bit built-in. be ahead it,

couple then When shooting couple see forward you were with still into stuff, it the we and cuts. we're EPS But think get rate positive. fast positive for depends So all a be to built that more this that a with than how it on going starts challenging. are that, curve to more

only thing grow expectation the excluding range. to the is to add the The that rate still course, growth able we'll cuts, XX% of strong that in rate, is,

growth strong. underlying still the So is

add would number really goes it that goes got icing I excluding low cake the been is -- right warrants be low have we just to we've a the securities. when to that if challenging. clear, nice extraordinary back number, and it's nice more make that that it a to it about on from -- to caveat Obviously, would And those The it, gains think now.

part main the excluding gains. of the those So business,

Yes.

EPS up to point, environment. business assuming, a gains So flat hopefully you changing, that can that your those grow ex Is summary? Dan, that not is still with the securities gains, in warrant fair to cuts growth, slightly investment and

Yes.

right on that. You're

budgeted expense rate to prepared comments ROE. And the the lower hikes the you of have embedded on range I for end internally believe your mentioned, growth in XXXX,

range do the look do, like XXXX two rather than might we So growth get if cuts expense you I'm and hikes? just what wondering for

lower our get of extent range. here. won't that of the the looking of for at are to lower benefits, end the little but from set right We will it now be out be that to and the It provide significant range, a bit cuts XXXX. that's going forecasted assumptions rate end within It's with still that of we

lastly And it's the cost billion you just of me, I'm Okay. couple then we about gave? more adding your if that? do for of curious you NII prior the in mentioned included associated the question, in that swaps. expense with just How dollars a think those swaps is guidance

Yes. we'd swaps NII of included to we dollars in million to billion extent look, have guidance up range, the with that another The $X -- couple say cost went, the are expenses. let's the the up

it's that to material not year. the So

our O'Neill. Sandler next comes Aaron of question from Deer And

about the deposits. A question

that rate am you period when if one was first sheet pushing but year this I a that not set, there new please when like I'm guys they're -- -- felt of mistaken, think product that I I the I was started if on-balance remembering correct me is am, correctly?

At -- have have this the what within rates year. first we don't any point, set we

products is looking of have associated we're with implementing the that at now, of no. year as right a it. One new will rate But that something

for didn't it, there but say one rates. requirement wasn't flat We Yes. year a Aaron,

Okay.

flexibility So rates? the your to offered full bring down

do. We

maximize still up, book portfolio coming cause make inspires the some pricing with your if obviously, at what your bond price did thereto does -- just a that I how options be working side rethink funding about just, but Okay. cost to with the yield? you're decision, potential book And your market or are the yields loan get of the in It I'd you of prospect to you're serve your that, of fund higher looking now? better guess, may obviously and costs But curve. -- higher -- year it's funding loan deposit cost other pricing

point, markets been cost impact low you're with pricing What strong comfortable pricing on all that, There there, some services look and the yield. pricing made doesn't still have has still competition at average we points particular at origination in in quite book. funding, private all equity our really the we've this compression we've At and cost No. very the yields basis is the the but overall we're mention XX in market. in, when margin our strong a of looking funding. That in worth We of power. competitiveness or to to seen

put And efforts been? new in production forth in your how effective to place has your

with the fine it. overall doing investment sensitivity a well securities to swap than portfolio. has we much do the It what with get impact portfolio just what been We've can as smaller NII on can the we as

effective, much a until at same part book. XX going it's to So of And the even past of not it's been then, get time, as worth but protection reductions. points provide on you the XX, basis smaller it's

Gary from comes question from Davidson. next the D.A. Tenner And

of comment line? the the I'm really, just have in queue Let's kind item a sheet just getting on rate sheet talk about And quarter. of fees essentially rate down that impact environment? on-balance the deposits, obviously off-balance your client you're line you the volumes in also investment this increased At curious

with same. see would the XX decrease, second about what basis July remain the the largely, So that the abundant be we're worth margin and of see we extent We about in it for fee that we rate looking remains think rate constant basis in that this decrease would funds would overall and Fed compression that that a rate we think a point do points. at probably quarter is every basis

XX points, expectation So point. much the every down would is we've that, that back by got and about basis XX a for basis basis without least compression, it come after first at points this

people in the the market. like And what only thing I are other would it's is, doing clearly market-driven add

market XX, starts to if we'll to overall because on well. a as certainly So that the we down keep try lower obligated bring may close that eye be than to

comes Brian Autonomous. And from [ph] the next question Florian from

guess, and that head grow understanding sounds Just that that even I'm minus I I it so base the can it's nice of also your NIM thinking EPS a number gains, excluding that the $XX grow or of? you're kind working in like when little thinking guess, to off you the round a say you the make can but you of? sure right base mean you can off exit, rates, plus extraordinary bit falling off I Or that you're $XX EPS grow slightly is of with slightly

Brian, don't We it's guidance. EPS give Greg.

thinking I out of increases, the two described rate -- like just simple little see together to a models get keep we to when sorry, on if going perspective. slight I'm we're a as make a model, business rebuild we bit as it's that of It's trying as I it you as growth rate the think kind be -- in EPS and do there rate decreases. possible. increases. you core again, put increase decreases, you'd a Rate it,

on still is first is And XQ? that XXXX I some with be NIM, a little else something Or to up is all in X.XX% like bit fully that the but catch that XQ, where obviously would settles? to where I that happen up? there in dust XXXX, the that of lag in X.XX% I'm in it midpoint asking, two like deposit going the Okay. cuts? lag pricing range, and rates just happen And equal, lifted then out mean, half and first XXXX a the X.XX% there's the lift? NIM the that back guess, happening half is of in of the what may like give really effects settles is Or

the still the cuts -- in see X.XX% growth and -- and see It's assuming to that to base. at interest-bearing we expectations predict for as total two with We percentage hard momentum where we'd expect end increase two the a stop some with in deposit we would range. X.XX% into heading of is deposit cuts, in what year Yes. certainty, interest-bearing of further

a environment how we the driver out, the we be cost see of margin for But to XXXX. get some on and could deposits have that as on So and too it's additional to to really into lock-in rate speculate plays XXXX. a early

around the look There's to We at direct to on play, well. to on-balance deposit it why rates, it because and compressed, can And an that so going again those the more variables different if that becomes have NIM look you answer, way many rates blend give off-balance an could reinvestment products of it's like, as may are the becomes what sheet, that too into hard that's look like. to impact uneconomic it come what are change bring sheet.

so or to months, there's four, you next this will variables clear on XXXX at it's a here the -- into that just real hard there's come So three, picture many five over give play point.

we'll back be coming quarter's year. Brian, the And next the preview in earnings into for next

be is XXXX. So our in will what happen set on when going that think we we to view really

level? clarify you're the reminder, comfortable very you if on minimum capital just And or quickly on, the the could what's metric a

Tier range. we we on with level. feel the But at that X% focus reasons was But range, were that just of the We share and that leverage bank between that X% comfortable the that this comfortable buyback we completed. point. one we're main X And over over Yes. we're and the currently at

our comes Jaffray. question Rabatin And next from Piper Brett with

continued I about and it liquidity? is about growth. little but continue stage, it deal that and VC/PE PE to wanted talking looking you set be that for DC kind that exit if your [indiscernible] as you for Slide see Can you slide, for investment. if this then talk just a ask says, to at a about talked of strong think about little values, values, how expectations up, bit? you I X, just And as know continues at bit, has? move if Or this will just to

said, from value of the year lot the exit right? and exit different but obviously, first to your a There's about values, perspective, talk are it let's lined held a question. stock have pretty life One up increased, given is, prices technology or there's been dramatically. how public [indiscernible] half up have the the that exceptional. number being behind the cases, in science has Yes. some companies of market, parts So just of have companies a That gone companies

So be that for the some reasonably stability, in will assuming continue to the venture again, of year the has capital market the balance exits robust.

year of pretty were that's Talk actually that and to market say a in crystal would our slower, dampened. going the And that's So holding, talking again, market category. little one equity the the in first second half exits robust and of year. be about to the the actually equity. more ball private half Private

are, ones are private a market they that then to come nice the our assuming and So going capital perspective. equity, fundraising doesn't positive. again exits, there's And the change looks say I stay money they're on a these would continue and venture where access dramatically, from if this markets side, again, there alternative expectation see and to assets momentum to makes more funding

offices, On sovereign from those source, funds individuals, our other from that's in wealth letter of in family high capital, in the we last fueling net corporate a described the flowing point is, worth the liquidity that's market. just all whole venture VC/PE. But capital there's also as

these VC/PE, kind as that's also just well. to us other positive in causing that the it's have second of the half So year areas. of outlook not And it's

Wedbush comes next question David our from from Chiaverini Securities. And

me. Just for one left

interest-bearing roughly deposit you're you're sheet? curious, sheet to was roughly equal equal off-balance the the to the off-balance are what offering sheet growth. offering rates to still I'm growth just that So on-balance

Yes. along right one probably They're now. lines somewhere were There those basis another. been pretty to close X points,

So roughly [indiscernible] at this point.

X%, you that when sheet And to leverage, the it? on-balance X or Tier as is reduce you start approach toggle-down slow range, that rate to that X%

be That pay we things attention would of that one to. the

things was at other on the sheet can we on investments. accounts is that overall And And desire expectations and net point. the client get is on-balance the spread focus just we needs. money that was again, a overall for there to meeting market The mentioned this

versus we're at the all So moving levers capital that things of forecasts off-balance together, kind paying of looking or of sheet. to make measuring on- those decision the to attention

Poonawala from the of America. from And next Ebrahim Bank comes question

about I your for NII, hit, X% points of implies just going the follow-up of compression. in had basis Dan. XX for a guidance points thinking math X just I'm margin about terms basis

prepaid income to points somewhere XX with discrepancies like that still So the just implied understand the X.XX%, X.XX% to I'm by going cut? talked gets what take, versus around you hit back about X% X.XX% X.XX%. lower, trying you basis X.XX% each from give something or between to the

a Yes. good It's question.

come the growth to continued we the see and that year is continue make points deposit about is will composition, that the our is between that will in from primarily expectation slide the the think rest you we here interest-bearing. If the the growth of in interest-bearing, expectation of one

generating that the element So other margin that's the some mix of that's compression. continues as to shift,

Right.

for So sheet? the balance or X% static the is off

balance The in but sheet, X% mix is at expect into year. takes the now in off also that a and the shift consideration we between static of end the of

So is same, balance but mix different. the is

Understood. mean, in there, there's Greg. had And follow-up one Wondering change any just on Canada? so a you update leadership if question. I

you've it's -- on ground got terms bean any update in days early that any the with loan you know provide? color, of Just if the since like I office, there's could

of that Canada. Mike very definitely exciting doing a Descheneaux very you strive, it's think about in I going have probably tell I to we'll and we here. is It's but excited opportunity couple It's doing well. And mean, such in look, and months, in some prospects, things Canada. business we're a

comes next from our SunTrust. And Demba question from Jennifer

question A on Leerink.

if wondering could like on some looks It you fees quarter? cover give the Just were flattish of us Leerink sequentially? the kind

This start. Greg. will I is Yes.

connection communicated, pretty a as outlook what variability, we Obviously, forecast. have forecasted are numbers little it say on the the When track for and that the feeling are it. you team would there, market, quarter-to-quarter a engagement. would we're as we everything expectations, of built and how into on I So very just our their team we say but is me leadership feeling bit numbers of of talk I let the I level over And overall, the that. with they're with into market our execution, about, far we're expected about I again, healthy SVB clients, overall, had Leerink we Their doing very, are the their to good. function and built plan the guess, think given more that see things and in year. the track about a

there's know I that, and on good about but much add it's very it. on we track more to feel So

And question-and-answer CEO, call concludes turn Becker. and Greg the over back this session. I'll our President now to

have Great. quarter. growth, of feel record Thanks. about new on incredibly been can And everyone the I overall, for of again, the you we you obviously wanted of net top us robust icing both joining from securities income, that quarter, client client the that core business strong. and great really cake. look the EPS-wise, and kind at income feel and these I top of today. just gains net kind funds on a to on strong, thank Record growth, warrants

a expect when headwinds from EPS Q&A, the what's generate positive if potentially one declines, hitting rate the and we change we in of of really all to But cylinders couple be about have Yes, we we with able of to kind on rates. from So that quarter-to-quarter. and side business. the lot have as standpoint. even the things to a articulated, the reflect the of the core numbers spent But talking I questions time going we

basis. for; and that quite excites number What more we're we're strategy about on great that's doing three things you those missed two, And me what it's than that employees quarter-to-quarter this. three, And long the where the where else. market. talking we've executing ask market got what I a positioned hope believe on It's best in number clients But think got still happens anything for; lot doing our a could of and in honestly, lot really a anyone one, why the ever we're what we've we're best could in run. I we is are that in the me the back gives confidence best and and in going it it's sit that and over

you. pass want We'd the thanks in can is feedbacks, a a do different And as said then guys last had. this great our what our very let along you more to we've And of beginning, to it to than guys that, with format have say thanks us to experienced, forward I know provide quarter. talking day. as so part, I and all clients, please to and we you So Meghan, to employees, to look lot, obviously love clarity thanks and a even next

you concludes for you, ladies This participating, conference. disconnect. gentlemen. you and today's Thank Thank may and now