Northern Trust (NTRS) 19 Jan 232022 Q4 Earnings call transcript

Good day and welcome to the Northern Trust Corporation fourth quarter 2022 earnings conference call. Today’s conference is being recorded.

At this time, I’d like to turn the conference over to Jennifer Childe. Please go ahead, ma’am.

Thank you Marjorie. welcome call. Trust and XXXX fourth everyone conference earnings morning to Corporation’s Northern quarter Good

on call Chief me Briar Relations and Allnut, Joining team. our Controller, Rose, CEO; our Mike our from Jason Chairman and O’Grady, Grace Tyler, our Mark our and Financial Higgins Lauren this Officer; Bette, morning Investor are

presentation, The guide be Our call both today’s our website review our is conference Also is our on we available being call. website, quarterly earnings will will which authorized February at release our This financial available made and to press January webcast quarter use XX on fourth trends are find you report live rebroadcast will through northerntrust.com. on only that website call this of earnings on the replay XX. northerntrust.com.

presentation, the on any Northern call regarding today. Please Trust disclaims Harbor this call. XX to accuracy Page forward-looking our of will after continuing statement provided this Safe accompanying apply our to which refer commentary statements on in information of the

people to question one time During and initial possible to and your query session, the us as limit opportunity as move please question queue enable many answer will the through follow-up. one to ask This related questions and allow as permits. today’s

again you joining for Thank us today.

call Let Mike the to me turn O’Grady. over

Jennifer. you Thank

in Let earnings XXXX me welcoming join you to quarter our call. fourth

like significant truly the our of teams and on Northern company is times these their for focus our face throughout political turmoil. our year the differentiates by in across supporting like thanking in start that uncertain unwavering Trust. I’d to strong execution and volatile partners’ the clients It global, market

fee was was X% up the on our of For growth XX.X%. average and common year, X%, including return revenue trust equity full

and million $XXX return the charges our year of on X% grew presentation, revenue impact in was equity for the full XX.X%. the detailed Excluding in

markets pressured a were those income. net weaker than our interest saw by more in Fourth trends but this first namely the year, on reflected through quarter fees, quarters year-over-year of was we the with results offset consistent increases basis that three strong trust

allocations management sequentially in quarter. our lag fees to under of products. index markets, assets reductions some Overall, price new market and funds, management fourth in the due declined, the client XXXX; the as and of management in we in fees see however, grew Within strategic Total out our wealth was in year wealth shifts affect the generation liquidity business, however, half second business advisory activity of did deceleration waned. in healthy

increasing of to our continued leveraging including our We and size Northern the in our marketing digital management, on capabilities sales effectiveness execute force, the Institute. wealth the expanding Trust and growth strategy of differentiated efforts,

impact outflows assets the were solid a quarter. increases management in products and the result management, in more alternative sequentially experienced funds of XX% due weaker in alternatives. declined did markets and liquidity but both we the asset clients seeking year-over-year of under fourth growth to than as year, fees including In up indexed the We our of throughout see

complex with perform of growth well ETF organic Our XX%. to continued year-over-year also

capabilities, ESG focused funds three during including the product launches quarter. ESG on fourth Our the year in new

Whole and a solutions offering office technologies, considering innovative office servicing Within year. as increasingly momentum asset of global the pressure services partners investment platform with are solid asset our challenging servicing, solutions. to delivered throughout the our the macroeconomic the we with integrates saw finish and outsourced access year whole We margin continued face facilitating managers healthy new to in environment.

particularly impressed their service. operating ability because rate large data. were this full was data, a and us chose front core our and into a process to in maximize markets value insight their client of investment model, After digitalize servicing, of that capital holistic with to provide manager’s U.K.-based of products first review client learned to selected combination of what client exhaustive we process and differentiates win offers the an RFP This our client We back asset tools an complete marketplace. analytics us conducted services. a during suite which recent One the we and market-leading of to asset

We also demand platform to on solutions our number for integrated the both saw trading nearly continued XX% quarter the of year. In clients year-over-year offering and the XXX. strong the throughout XXXX, increased

fourth Our quarter spoke strong. about last pipeline to remains in during to [indiscernible] we you quarter backlog and that transition started transition our the

Expense be in growth but of digital reflecting all efforts, people drive elevated too our our in initiatives high. and advance to and the quarter, business, level to growth is investments in modernization critical resiliency, growth continued technology the strengthen the

taking of reflect to are to today trajectory operating bring with environment the create early profitable announced capacity better Some the down growth. for the charges align and we steps current we

color to To productivity of we will underscore more our launched driving commitment, our dedicated on efficiencies remarks. his in recently Jason this reinforce office prepared provide throughout to the company. a approach

we navigate we as well positioned the XXXX, In strength. position ongoing closing, from to uncertainty market and begin macroeconomic of remain a

improving driving our bolster continuing our Our to productivity, foundations. organic growth, and is focus on

I’ll now turn the call over to Jason.

Mike, join to in welcoming Mike and and me our let fourth call. quarter earnings you Thank Jennifer XXXX you

financial Let’s dive into starting quarter, of on the Page the results X.

per income and fourth equity common Earnings $X.XX reported return quarter $XXX.X This average were our morning, net share of on X.X%. was we million.

of of certain of impact charges Also first in lease charges. pension charges; and occupancy which this million to as early that exits, accounting settlement which debt the million impact for These implemented on impact. by noted early following continues $X.X $XXX in security the certain to basis: an million reclassification inclusion included charges $XXX the $XX in losses were of year-over-year we January; on $XX reflect in which sale investment this the unfortunately related of related $XXX fees recall sell per net year, to severance-related $X.XX subsequently million impacted and comparisons, available sold charges share a pre-tax securities, pre-tax were the in of quarter results to million million earnings page. Our income intent of

to Expenses net and highlights Page comparison, the XX%, net review financial income mentioned, XX%. was was Including X%, was quarter. were X down the XX% sequential move previously and charges while was increased income revenue of the In down expenses down down the year-over-year revenue XX%. Let’s up X%.

was X% Excluding year-over-year previously increased and expenses charges mentioned, up revenue X%. the

the charges previously X%. mentioned, revenue Excluding up expenses on basis down X% a and sequential were was

down Let’s look were billion growth down and representing Trust, on of servicing at revenue detail, the points. the X% results starting revenue other reduced basis and sequentially. our from last component unfavorable with currency approximately investment fees and totaled X. in translation XXX greater $X largest Year-over-year by revenue our X% Page year

fees the equity movements. weaker income fixed unfavorably markets by be and unfavorable Our impacted and continued currency to trust

quarter’s As is and a quarter’s fees lag largely third on a of performance of the are reminder, well month reflective a significant portion October November. of quarter so as as months our this or basis, market trust the performance recorded

income intent more sale sequential other remaining non-interest to the subsequently January primarily in available detail million securities to sell I’ll which in minutes. a describe declines certain security XXXX, year-over-year by The debt early sold all securities. $XXX These few in for and investment were are pre-tax due driven the loss in

and an in was more up Net FTE discuss basis, million later, also I’ll $XXX X% and was detail interest ago a which sequentially. year up on XX% from income

trust at look on of and X. our components investment fees the Let’s Page

administration and Within fund and markets X% due For year totaled but primarily were were Custody unfavorable they asset our down year-over-year to decreased fees sequentially. asset and sequentially. the fund $XXX custody servicing unfavorable business. down from flat XX% were and quarter offset X% importantly by million servicing, fees down business, translations, and partially $XXX fees year-over-year million, new prior currency administration

administration and translation. sequentially. year-over-year The and trillion favorable and primarily by servicing and driven sequential for custody asset end, down was by unfavorable driven translation. were $XX XX% increase The was currency at currency markets quarter under Assets up clients year-over-year markets X% primarily decline

sequentially. Investment unfavorable quarter and money management lower up and servicing partially year management prior markets. due management from decreased primarily offset fees by asset outflows market year-over-year markets. waivers primarily outflows fund within due sequentially X% to million, asset $XXX increased asset Investment fees X% to unfavorable the and fee Investment were fees down

for and partially management sequential income and clients markets favorable and Assets sequentially. by unfavorable by and X% was decline growth The by servicing asset outflows. translation. currency was $XXX driven offset year-over-year were XX% fixed translation currency billion, The driven asset markets, year-over-year equity weaker under asset down up outflows,

fees Moving prior the to our $XXX million, investment prior servicing X% wealth down from were year compared management the to other and business, X% trust, down quarter. and

the Within of elimination market was asset the the fund and a primarily strategic by fee market re-pricing outflows, asset markets, driven decline by regions, money by primarily the partially within year-over-year declines waivers. initiative. unfavorable the outflows offset Sequentially impacts regions driven unfavorable were and

re-pricing sequential The fee lower business, outflows, year-over-year to and unfavorable unfavorable was new global With decrease related markets. by by office, the partially initiative. growth was markets, family the waivers asset offset and mainly driven

XX% under X% due wealth markets. management down to driven were management clients sequential our year-over-year was primarily unfavorable end, was Assets The increase for by markets and year-over-year by quarter favorable billion and decline The up on basis. outflows. asset primarily sequential $XXX a at

versus $XXX down in prior the $XX up the down quarter year, Moving while to billion the compared billion, Earnings balances $XXX the billion prior Page million from versus was to deposits XX% and up in interest $XXX XX% loan net were were year. year. the X, income quarter, averaged was assets the and year. XX% prior Average prior averaged X%

The sequential is partially grew an from to due X%. interest declined assets basis margin quarter, from On points average the up Average and The is average points sequential deposits balance higher basis, Average interest primarily due prior to while up higher prior up net a X.XX% quarter. income The increase rates. were interest X%. earnings loan X% basis by net ago offset interest year X%. average unfavorable in X balances rates quarter the were mix. year quarter XX increase a sheet up primarily was

basis X, Page translation. to benefited basis points currency approximately expense due Turning by growth to XXX year-over-year on a

the expenses taking part steps quarter. charges As conjunction with of fourth included $XX year expenses we’re in and productivity. $X.X the our The prior These quarter’s million quarter, the of current launch than reported, prior higher in the in billion XX% higher X% were than in reflect office charges.

to drive organization. and To this better we approach appropriate. the understand shift efficacy and manage our on as greater coming our our analytics to data so you spending cost away, throughout and us base help to We’ll leverage in expenses. quarters Through we progress the initiative, efficiencies update our of optimize as the expect

and both the the year-over-year up recall increased in quarter quarter current to charges of includes expense operating Also, million were periods, fourth mentioned which impact previously the Excluding in accounting reclassification, XX% $X.X compared up X% other the sequentially. by year. expenses the prior that

due part the charges the to inflationary XX% up growth driven and sequentially. year to the to offset prior sequential higher primarily favorable partially salary expense expense up compared expense, primarily and increase year-over-year charges is X% was severance-related severance-related incentives. was by higher in aforementioned lower and partially by by mentioned pressures, currency The Compensation previously due offset salary The translation.

Employee by lower pension costs. lower benefits driven to was due down charge settlement X% The lower relative decrease by to year-over-year costs. ongoing X% higher partially the offset decrease pension sequentially. The to compared period prior pension primarily by medical higher was costs, expense medical prior down quarter sequential partially primarily the was the offset and expense including

Outside increase year ago and The legal higher sequentially. consulting by X% primarily was a X% services, and increase year-over-year services million costs, up expense was services was services from fees and driven and technical $XXX up was and costs. party expense services offset sub-custodian partially expense. lower partially third primarily offset sub-custodian sequential by due services, technical The costs to consulting and advisory legal by higher lower

higher XX% software sequentially. to up was The in technology and investments of as million a primarily and sequential expense higher X% from ago Equipment as up pressures, driven costs inflationary and due year by growth well and are year-over-year software both continued $XXX amortization.

$X.X recognized strategy. with termination mainframe our million associated We charge a also

of Occupancy expense the year-over-year XX% sequentially. $XX up lease million year primarily to XX% by of and previously from ago million exits. related charges and both $XX The mentioned driven was early sequential up a were growth

XX% business driven current a staff-related from higher year primarily compensation The by of was sequentially. Other and expense, sequential is was increase and miscellaneous increase expense. and higher up to expenses business $XXX period. operating plan the in ago promotion, million XX% The supplemental promotion, expense expense, miscellaneous primarily year-over-year up due

year, our XXXX in are on X. to the full Page summarized Turning results

earnings items, compared on were this per $XX page, XX% on years. net on right we billion, from charges charges the a impact in million income million a out impact to $X.XX $X.XX impact called and of and share XX% prior XXXX, these In an for year. had charges share. the In earnings the margin per was that XXXX, a XXXX, had income $XXX we $X.X $X.XX, both On net these income share. down outline impact earnings on Included net per and down these

and revenue partially growth income on previously translation. primarily during other include year Page offset XXXX. The driven currency fees Full servicing outlined mentioned. expense Trust, charges lower and the investment and by the fee and by in trends unfavorable business, grew money was market Net markets year new interest X and unfavorable XX%. are waivers grew X%

XX%. Average earnings assets basis and X% revenue net compared XX% interest by the rates. average in year points, while of to margin XXXX higher The interest XX result net growth driven decreased during by growth the was increased expense of XXXX

prior revenue expenses year in Excluding periods, both year from X%. these for up was full the up were and the charges X%

capital X prior our with under up from standardized XX.X%. XX.X% quarter’s ratios strong the of Page XX, equity Turning ratio remain our the Tier common approach, to

X quarter. in were in unrealized in comprehensive available the sale in Tier ratios. of up primary losses the quarter’s quarter factors was was securities the this foreign $X.X the of decrease capital leverage for the a in less end ratio other A Accumulated billion. at Our income X% from X.X%, exchange volatility loss increase portfolio net and prior

During year, billion $XXX.X we consuming, shareholders million to we of In repurchases and quarter, $X.X $XXX.X lower sold this share cash higher through million dividends the common of non-HQLA of of yielding, early million. returned lower capital unique January reinvested to This HQLA attractive capital, while higher returns. ratios de-risk and portfolio, improve capital and opportunity yielding assets. the our into debt simultaneously offered up securities repositioning our liquidity free generating the proceeds $X.X more consuming,

With the that, for Marjorie, lines please open questions.

Thank you instructions] very much. [Operator

go moment question the but our a do, signal Please Glenn to for for ahead. from first to Evercore. Schorr from questions, allow we we’ll pause opportunity We’ll while take

Good morning Glenn.

morning. and focus I’ll I try guess Good on deposits.

I’m year-on-year, help down us expect higher both non-interest XXXX bearing and much you. betas basis, a bearing a XX%, paid of and rate Thank interest down how the curious, there’s for on you the deposits? deposits, sequential clear So in so mix through impact XX% a attrition, can but to think declining outflow on what decelerating a

then with lot there’s there’s the well, me let me--you let couple detail as well know the give going the a and Sure, with repositioning know, ingredients so on if you’d you additional me a sheet, let of balance key like.

still volume that a is you have a We we think XXX that as some some point of clients outflows seasonality. volume, starting XXX Just at saw quarter XXX. and on first get think to quarter usually fourth up--down range. at left and we’ll taxes. XXX quarter second But XXX for good to the end quarter, still preparation, first in the quarter, tax first spike to as least, start quarters as gets know, We you to good the pay about see is a build from

Then beta let different three really, rates, three me parts. different--or take in in

high. think was would that’s next at the like it in the deposits be three what that indicated cycle, in XX%, Beta still this indication point for be interest-bearing pretty that and was you to we and that of noted look good over of we’ll beta course anticipate we the First We’d do similar. months. We it line. XX%, was a beta, thought

at billion point to about want thinking to mostly perspective. least a a reinvests is it little end should overnight, that overnight. X.XX%, hundred you moving higher. billion, the do Right that that a what couple the we’re to about repositioning, but takes was of X% points it sheet then non-HQLA about what or $X we’ll Balance continue short the think bit now, more starting $X at with from basis we But on be curve

quick rate, a billion X%, similar there. higher we’re and runoff the the securities from a we lastly Then you’re on as dollars, portfolio just pickup the a just talking as about so there’s just is X.XX% end, reminder we’re to repositioning rates over that mature short to moving

big Then fourth quarter. you $X first million first helpful. last day remember that costs count quarter from just Hopefully are just us think thing the as outlook, ingredients. about that’s to Those about quarter, going on

Thank prepared. well that’s Appreciate Wow, it. you.

Maybe I stable just earning now, question up in quarter-on-quarter. the follow-up, a we X% or guess-- Should similar on of average assets feel a range

things out this settled earning little assets Yes, have--like client and in general. so quarter, it’s What the much it as know, tell. about we think calling the has sheet, look it hard does average I on very the flat of size from--obviously, common saw it’s like is at leveled it to and deposits but a bit, a we’re point. balance not certainly mean, you I liability-driven behavior carry driving what’s really in

in a assets. continued that but drive--you muted decline. XXX, to earning That’s We’re operating of the of we’re think driver should that average still the some anticipating XXX really that as way why that’s

Okay, all I that. appreciate Thanks.

Sure.

take Thank Please Graseck next Stanley. Betsy question our from you. We’ll from Morgan go ahead.

the the here, at I all up us because Q-on-Q. think from there that? it Hi, bit, can ratio here? up could it pace around we help expense that, morning. stabilize think is, should How strip basis as forward understand heard expense when but arc go through you where around we begins which I expenses XQ? expect the to out good trajectory I in down maybe the Does the the like efforts XXX from it points you How a that about here, maybe slow the still should rate commentary some one-timers moved we come or still ratio, push is should growth the think to and looks do the from you the

to needs come Well, time. and expense down. doesn’t is, it stay it where certainly over ratio it That doesn’t increase

trust few-- talking fees, so expense a You’re to about, and assume, I

Yes.

the perspective just I expense an there, detail we into things few like, from run at think least and more is it, but give thoughts One, as you start like. can as get quarter on a does think what to it can you look look in some to first going we about out what short Yes, to about. model

timing, got that indicated line, to a those start To Compensation We’ve term going we look online, we some should out that like so this benefit and of year. should in forward, activities obviously from general, a think question get should million, we come even we’ve flatten actually that does as got that. $XX which start near in you so that it to our there. is item on biggest the and the out, pulling severance-related get benefit line on your what

benefit going not to the a take right half anticipating going than but of benefit with we’re severance, so to going see to first get We’re the portion, end to of we’re significant of it place by take to the quarter, we’re away, of that. the more actions start

to us We’re be those is roles, going business but at of some up and FTE showing they’re expensive the about This what the economics the addressing or is not backfill salary for in going very--this line to rate less which run are, it’s getting comp. headcount locations. in is

benefit first that’s about That $XX as so predictable get quarter, million don’t hits quarter, and and that retirement-eligible very you to think going incentives we’ve We’re of year, got but seasonal. online. that this a forget also coming in that

into about a I’d other it wash dynamics The for first as we quarter. going compensation, call think

at to ago out is software about talked a at seen line starting Otherwise, quarter. feel we came of couple that decided about well. fact million. flatten equipment big million in that at contract very It we termination weeks we we Then item higher be like late as the that the $X.X last million, but that thought line and that $XXX where and in would externally to difference--XXX% is do over $XXX a the is years, few the we’ve uplift that

all have--we we into is, item is to in depreciation million from is depreciation software. out. step-up we One to and first think that out. going other will as of coming of uplift to item first flatten obviously amortization, anticipating We’re but $XX about than have that, where come to in that, quarter, flatten hundred we’re but line to our of but equipment beyond a going going start see percent line that and quarter we’re That’s an that

We’re not kind of going going this see to growth forward.

Then about is, and that’s in with started other the ratio fees growth it to you we think as side going trust the as of that well. help the business,

you about you’re know thinking I if this? to strategically Mike, how don’t want more talk about

result your growth. that through will. and about trying of Yes, trajectories it gone you that downward way, factors we’re drive We’ve has through. been to Obviously with on would other the Betsy, to point, curves, trajectory add, fees trust I just a a is Jason primarily the if as

of it trajectory there, new trying we’re to the just clearly strong NII, at bend had XXXX, a how but comes expenses, year cycle. into in When operate growth as Then we into productivity expense That’s in carry office, looking a Jason up. likely went the without through as result just curve a to the we’ve not every to or rate through down through also the doubt that the day business.

that And curve we’ll half--like, see in half in than a more sounds second first? like downwards bend it’s second that

of that’s happening Yes, going in in we to actions and took these then then of them as well, right, there’s fourth through. Jason’s previous the which the first think carrying saying, those, about we some more on quarter that intent that I call, things, and in get as are the talked quarter the had already because

the right you’re actions. So to the impact, relative delayed see time it’s by you the -

you. thank Appreciate it. Okay,

Our comes from next question ahead. Brennan go UBS. from Please Hawken

well. I hope get to Hoping more here. you morning, doing are specifics guys Good

office to in are peer you there a the trends. whatnot relative generally Productivity helpful You bit metrics know, they’re really, gave kind high What the some on being think - emerge, that Betsy’s but the are but expenses seeing to response revenue and relative been group to level just right? control to that especially bending of of what comments how about that out the especially drive? have to objectives, question, and - looking curve we’re the blunt,

you’re for some these and pushing and more understanding, people your using hit we can specific goals getting hitting you’re a Investors to metrics make sure are what changes. through details, this when looking lot to--that make how better you’re morning, really--I’m

can--first I XXX, litmus pulling even that come that’s Yes, at the not quarter, look out the business from to to being to is perspective management in trust down. to still of expense and thing the is all, how long That’s from this doing charges where we’re near expense going test we fees, going be an anywhere the run.

X%, we that you but the X% base. level, know, we Then inflation to to it, just at inflation. going have that, above not When look to just think get we to are at does X%, really like X% inflation doing or start have were how absolutely more tactically, productivity that of say what matching productivity and we to to be--you felt with expense X% about well. historically do productivity we the talked numbers was associated productivity With our should are or

tactically, our in get and is that group through in at buckets if planning next time, it you just then process, the how is every the every all this we’re We going you office laid year out. this to how the work, go group to start goals. I’ll think get this where Second, at, are company productivity give has to going

determining got engaging to that’s have for so is vendor around expense company means externally. a Two we’re technology costs. $X.X we’re where stronger, test the First to we at the we’re it, it. accomplish with same - we the areas strategy XXXX, how those are still how investment and our or partners We rate, in investing we’re and the consuming at and but do the timing. we’re the thinking same want of time and at whether get governance to developing XXXX not investing got efficiently, to--we’ve how item largest at fastest all, and about to technology how in purchasing, got we’ve have. - accomplished but investing delivering growth be how but we’re Three, there and component lot we’re business, same we’ve things technology, it’s the that That’s to growing deeper get we billion, it

analysis, big pillar and things lastly, Then is fourth workforce couple a is there. a

and larger that then that step across You getting out operations, take, earlier that. focused technology-related we’re at accomplished contractors this, normally how to and as now will internally, than do we a at That’s XXX the that’s lot be to a already But of why it. big time productivity on XXX, positions quarter, fourth in than effort corner see and of hundreds us it’s again, to we we’re a get and just severance on should we indication aggressively getting driving this took an impacted. turn

that well, I Yes, have about I as Jason add, but the and to just groups, can top-down, to each think and groups the part the saying, help is office, work that which initiatives would productivity as which Brennan, their those with is things productivity enterprise the also cut structure to meet think described work it is of their their it and bottoms-up right, to was plan. across have Jason the they up top-down way goals initiatives. that productivity are doing The productivity in them the have

a approach of Jason ramp you have but part efficiencies. to get up always as planning process, you as we productivity again in when the the it, and to this be have saying, those is like have to greater is--we do, able That’s activities to inflation order

encourage some weighing the that do, visibility to appreciate from can a think about I conceptual numbers that and Sure, please was actually to perspective, a that we have color, where on certainly to think measure Jason your everybody progress, provide would inflation you’re in with what help in Mike. really trying I that confidence. some and you understand question. it’s to metrics, goals and though, would I investment your order lot of the you’re troubling dealing are, and just but from results improving actual a sure, community what going color for so the and perspective and and is That it’s because not

of back question reasonable, we quarter. there, balance on range the go the it to trying little to was a still side it funding limit again looks know, - of the Is like funding. that would get where wholesale of be took to getting you it a growth? the sheet? I look upper follow-up that is Should think up just to like, and the this One levels was, or this end wholesale XXXX mid-X% because there’s funding ways you about are

say we’ve bring say where It’s it levels. right that strategic nothing that of in doing is historical as and now look to that’s reflective levels. we for we not--there’s not to lower to back There’s down, it have strategy at you’re is any is been area that so but doing instructive not to that the it more are target,

Okay, all Thanks for right. color. the

Thank our much. go question from take Please ahead. you We’ll Alex Blostein Goldman from next very Sachs.

good morning. for question. the Thanks Hey,

pivot Maybe a on I bit. wealth and global the minutes little spend family hoping management the office couple trends. was a I’ll to

asset any ultimately achieve the a think what these mentioned, the there there. but client you color effect stronger flow, on negative hit those maybe pricing for we captured historically, of of outflows, highlighted so maybe fully maybe more guys as and reductions reductions You reasons and the outflows, you both also think, what’s into QX quarter. tends expect of Wealth help both outflows businesses, carryover much I growth, and price kind source global Is outflows ebb that of fees, driving a and in us the of management office been in to organic of unpack has that on is to think kind QX how in bit I the family strategic behind again about these little results.

question. how is million of Sure, mentioned fees, down that’s that half re-pricing earlier. markets of so quarter, a the the of right, because $XX just is and the probably then what--is the it you’re roughly let’s that quarter walk Fees we for framing kind

in make forward and, advisory As of at this more. there, took reductions, We Those group product management done, side we knows we lot benefit appropriately, point, that incremental of on the only fee compression persistent, a extraordinarily fee to well, do step and the types some took down indexed so the so want asset not of sure side, the business, this plans still not going with the priced no to on no and products, a--we there’s done so we’re a those side. that’s have reductions recently. is are

as that well to of We’ve outflows, decline risk very The a there we decline and closely money space, the was--but markets into so to outflows, was then and in as confidence decline and gained large into in COVID, the market of product-related repositioning It’s saw servicing. our as as assets. space. in what for asset started clients across liquidity redeploy the both aligned really deposits we journey quarter that more was assets client came seen other wealth

That’s are related was so The track fee, we clients. with but is litmus from is our re-pricing we’re perspective and were about funds way in clients the advisory business for what business quarter, of positive, this a overall have an lot decline. year-over-year of we think not quarter, fees digits, linked flows activity but to test wealth the and product. net business that product basis, historical assets away side flow a is from quarter in deploying the the we are of mix seeing in frankly, not and their client low - What using positive gone then, market in the single - the the well wealth was money it advice our what and new positive. advisory to management the On

it. Got

that your is you of the you to think yield, seeking net better and fact maybe funds of pretty yield those pricing are as competitive the actually leaving flows about there products, money a folks the capturing any thought to fees As not money fees? if prevent offering, healthy market broadly about advisory component, the more or for think become more market but given options market well money around from reducing giving

We working our clients now the look at in we’re as are and all some we side not that very so money pricing just where business. work pricing actually--it’s time. But and it’s that lot attractive of to large we’ve as strategic look can a got side, ensure that even there the got at. it waivers institutional we mutual for play business, more--that a the on really--we’ve be. the a comes and have more we’re into market of successful fund do We liquidity institutional It clients,

size look and underlying On at the the particular, assets. they side at they in of institutional the look quality

restrictions the they a investors is lower $XX that money how within are we’ve on the big billion, put it fact be on funds little work, side. ultra-large investment so $XX fund, the policy that have enables so and can competition to institutional of a the lot bit and billion, set to A $XX got billion, large those investors

factors, in threshold, be that run, There based good us. so for the in that’s long and it’s run flows ebbs other on long but above the will very good. We’re

back to clients, laddering a ultra the that On side, other thinking of this the building to and this is a time going just flow potentially wealth have they’re it’s been economically. products, where was - going historically, there, that’s aligned, about We our short. confidence and own mix their right attractive just in business. period you’re more of also portfolios, then to the deploying to and usage ebb do Traditionally us it’s of very treasury they’ll the portfolios product come use high exactly engagement is for where it with

hop I’ll in queue. thanks. the back Okay,

Thank Jefferies. from question next you. take Usdin from Ken We’ll our

to sorry kind to morning from good into terms wondering, Hey, curve? put based was balance just I help from come Jason, the back Thanks. all rate a but us you still sheet’s can guess question. on NII for expect shrinking, the of NII, would be the can little you grow repositioning, here you I if get the that in what of on context of bit guys. that

on going you still year, it is first we it’s to appreciate are going I to in absolutely The yes, sure here, not throughout the I answer it can the our anticipate pushing favor. will. meaningful grow that. quarter see--I’m from but and don’t think is that growth, Yes, see trajectories

what--you betas XXX%, got do the Fed with going to actions, we’re end, last right--it The a quarter. of offset attractive to to balance an not and the only We’ve so well. and top look anticipation is--that’s like, was maybe That’s that’s also the at going was too, repositioning not volumes. then are so relatively our and that us we’re lift, remained the above is tiny bit even itself but know, what in sure what sheet flat, runoff helps that which

be year, out the look from NII through is the absolutely anticipation growing to I this If for XXX level.

think that, expected Okay, thank you decent quarter this betas understand that move how terms did increases? you of in you you. of had that You do - My how just we to at? is that said do up you’re from here so a the and get about deposit incremental you. cost mix looking deposits follow-up beta Thank

on actually about mix, dramatically, haven’t I important changing yes. raising which think but are Sure, that that don’t--we an something I depending is currency that’s I about, so that talking that’s you’re the interesting point, seen the you’re different mean, people betas just for it. to the think

Most way calculates beta is interest-bearing on portion. of the just the the industry also

to currency, institutional over and by I effect side, close as think close that about changes think the so XXX% you’ve we’ve but I at instructive bearing XXX%. I call But think to to of well, varies the to them an betas think it’s about, the the interest mix bearing as has it beta call time, you’ve to well. this got point. as total talked non-interest got because to It on

the than kind institutional and level blended talking to side get that in I’m a you it’s is Then and that, to on XX% management of wealth XXX%. XX%, range, wealth can closer imagine less to XX% to closer side, the that for us to about

Jason. Thank got you Okay, it.

Thank from you. next Bedell question our from Brian take Deutsche We’ll Bank.

for Mike Good folks, taking and Jason. Thanks my morning question.

that about to ask actually focus in to trend, about more just deposit XQ. Maybe XXX and growth you also to on NII, talked XXX

this Then a payments defend to into beta what you get hard do extent but think as to of raise related come wealth sort tax further you would you As into the headwind be that? those be on type you second to or deposits of quarter, early, want to, what would question assess and it’s wealth--those we do XXXX? maybe need strategic

going there reverse be I’ll heavy stop, and the important doing so are wealth we’re We’ve can things to our The we economics want everything are deposits. the--those we about go do talked that’s hard with and to clients, make defensive in order. to to but really are maximize rate, what look defend pockets governance They’re we’ve sure infrastructure and can at our those. we and largely doing that. so got where good clients there we’re relationship driven, is--also, aggressively to

to tended--you asking and how there don’t of good outlook, to We what at what tell more we’ve back but place, quarter you’re we been. and of over year, don’t go expect--we the that the that should year, second then has see decline look got a and just we’ve just are be about a throughout course can think--we you year, this is and history does quarter can have thinking we different that anything don’t Then take I anticipate it of pretty second quarter flattish there, kind judge. the remember decline first historically from

Is that helpful, Yes, up or from equipment the first maybe mentioned in the just expenses, that XXX is and on in million charge? quarter. ex-the that’s and the you $XX XQ, software XXX level

that. XXX level. the confirming for Thanks It’s off

get the I’ll back you, in Thank queue. okay. Great,

Global. Mitchell question Jim and we’ll next you, Thank from Please take from Seaport our ahead. go

should triggered and Did pension get year, Maybe bit little a we morning. good charges year? on Hey, again this more just that this accounting. the expect

it’s we those come up going experience led higher same degrees did is it high at of of anticipate year don’t at retirements a outside boat we and is will In we interest RIF, from the Every trigger our in in past be--to it be level can’t the that the and up actuaries, into then there year, perspective. we with time, we expect we’re larger but the year then predict settlement consultants, and with look we it retirement thresholds this XXXX, because ironic a which bad thresholds this do what with and exact that than a we to news triggering, but we had this accounting, significantly time, was to ended but the certainty our no rates anticipated.

have We play let that through. to

it but more over two years, last outside the That two we it’s like you something that--it’s than years. certainly It that, in we we’re about last planning a we what if or these of happened trend think of look so how XX it. years, had That’s ’XX, is hasn’t ’XX said, last anticipating. seems happened to the and experienced what not experienced this like not and prior

just and maybe capital ratios. had Okay, a on improvement nice in capital, you sequential

of part really the much of buybacks being ’XX. this bigger in way you do in year? that Do story EPS didn’t a see You the

Yes, at point. some

a point of you look we’ve think framework and now. there’s it flags at we’re don’t time, used the in to at components right XX:X at framework about there. red those all lot, it given We and talked have any in of have about I’ve combination We saying If no green. historically, the

little also - still actually that in bit, come in because securities the have so did AOCI after of that $X.X quarter, down back at accreting a no some to it business be a chunk because will billion time. we’ve $X.X going capital We we strong, billion wouldn’t returns the a the repositioning, The point. there’s reason are into call so in that’s and be over we got, still

thanks. Okay,

take next We’ll you. from from Research. our question Thank Rob Wildhack Autonomous

Good morning guys.

and side, ’XX organic institutional both landscape, fee I competitive businesses. Thanks. know, for the growth wealth the and this check to the and into you on the quarter in just On wanted

is. calculated on regions, Sure, think second ebb you earlier, focusing gives GFO the slightly flat but in side, core you year had it time; more say basis. that year and a also year-over-year the regions positive for GFO was very business the if the historically about way strong about and a at half talked communicated negative the of where flow least first there. for of but organic sense underlying again that’s over have if was wealth management quarter, on it It so the growth just going the GFO--actually, We’ve different then call stories and than we bit business We and a stronger the of you much the really think was little and about a half noted it it I’d the account weaker. business, to

way business calculated even and being at from of growth the the there to well, and the the core it’s again, side, we’ve fees factors for is and then year-over-year both the advisory quarter, mix product other the did so organic strong. as the think end negative. advisory leading But the We

to talked servicing. business same was That and coming early was a proxy--the there fund corollary in quarter, that In We year started early we new asset good. about quarter, we in had is of servicing, online attractive. and Mike story talked custody that pipeline actually positive different fourth account feel the it fourth in really like That’s in I felt That the we evidenced proxy on-board the the business part feel we more that of be historical good has wealth there was we management to to organic as should the fees by the and mid at - the pipeline growth in business. tune fun digits, talked The of growth management, about about custody single is and its servicing rate. business that kind fees, just back on-boarded. what

have of a we perspective. than have, still they’re business business now is signs average, on stages, business higher average for the in that pipeline positive lot bidding organic on-boarded asset not is the one an three-year higher in servicing late the than business, they so and from three-year of right The the our

helpful. That’s

in to that ’XX, past is online think forward I had starting you on-board talked a not pull servicing, that that second in asset on coming Just so business the the of half about until really there?

there Mark? Actually, ahead, is--go

’XX. was It

We The on-boarding, out another fourth business is to we’re run. in good. short quarter did and good, back of even into that to ’XX talked at we was the we pipeline and quarter, about come the - couple you large of come areas business now--there so on it of year go looking chunk first ’XX play. half into anticipating the there’s and is business I’m that business stages pipeline of different in in have Yes, that sorry The do various is was know then ’XX. right early end farther of is for a on-boarding there that that a the that chunk being

thank it, you. Got

you. Thank

Please comes next Wells Mike Our ahead. from from Fargo Securities. question go Mayo

Hi.

get oh it. expenses, - I the my On

the in bond markets years. stock with dealing are guys You first XX and over decline both in

people tech. leverage operating for and said this you’re by growth investing quarterly can wow, guys. worst I but You inflation, is that the recall in you preserving There’s

operating For cost and of it points, of was year, pace leverage the XXX negative growth. basis twice even revenue grown has the

I a tell for right-sizing - with understand bottom mainframe like you. I away gotten have have you took strategy. that guess you I’m more looking know, get it just means level, standpoint. line don’t from tech-related what is out kind I said--you contracts, you, that from high headcount severance, I the some of expenses haven’t at looks assurance what you it hundreds you’re to of

fee like, do acceptable guess XXX% have, the unacceptable, should but your XXXX? tough is we’ve your over of get is, past you expenses XXXX, resiliency Northern this question from to not ratio you’ve I urgency of is what there know you said gotten trust the when the - to because long while, sense of and through kind What is aside Thanks. times.

back a Mike, it’s been where, We that’s and long time, within number at in it us able thought into to that if and it’s an that kind we that’s where why were XXX range. down Mike. we operate, range to point, XXX To to where for of was that levels yes, continue driving we be your considered a go to effective were of this, area ratio were that is you are. unacceptable years, like it

that drive back That denominator, same and range. the trying have of both a calculation numerator it a getting into and We of is now we’re objective to those.

front, on in to as fee it both, the but the at is and we’re the there, also which the so was our on organic challenged times, our as we growth drive on would environment what going trying happen did various organic numerator we had levels, of much to not year, part. growth stronger I good conditions, challenging the Beyond growth say one

last of and if side, the couple last company to technology. your it more in said, the conditions, to into what expense year couple company be and infrastructure that’s just back of of which an set other from but little in years perspective, get got any said, resilient, technology you just as of the you just is detail this the for the lot but Jason done years really ability is required just of and there we clients with that; the lot on I’ll think pandemic not a more on so Then resilient a call years, the a contextually making, your and investment critical in few a

be be you the invest to it Some about you to modernizing comes have if to technology do front. to require to think of have, you have operate all and completely to investment that that, able also able it, for be you to remotely, it, does it so on clients, so and you reliable when have

In that. push competitive the across much client-facing which growing. the our is been with and also we meantime, that part being is It’s to more essential essential active of very which efforts, forward digitalization to

the front. therefore the discretion speed, particularly which the will Some of done it it, around returns you’re on call it front, in Matrix, productivity going also but a needs be to what said. that do to have revenue about I and do of - and parts investment like digitalization that Other able get more organic at you’re that. that which is, will to non-discretionary, been right things be both to you and talked has our capabilities, We growth for meaningful drive drive looking

that part to the we’ll do we is of The our part That some, and front. frictionless, it, as on clients again, in the in clients. our pay with interface of management, happening wealth sure same technology Steve what would interface is say, the have can with where make thing that’s we technology have to

done the traditional execution more part around last The focus those, times efficiencies I’ll is increase for the call just productivity. and then the which of spend need around just it what and to need to more ways we’ve broadly, just technology on many drive

it does the the we’re driving meantime, plan. and, is I XX%. to numerator above kind it margins that and don’t to view driving okay, know, happen the know towards, what’s because ’XX, denominator, question That’s profitability, exactly get get I the is pre-tax it of meaning is going range, asked the drive with don’t in also into You and when trying the ’XX? that’s range to on, into it what that but

all strategy, elimination in know along Can you your or always if J-curve, or the but any even the the I growth think the give specifics When for like investing still seems some terms it’s year in of contracts, investing expense to to of savings you’re of and of lot a the which are in on I phase. style, you your on this be you the broader harvesting are, tech what year? tech some phase not others for from investing expenses? harvesting just do journey, like go a tech impacting and from seems are think this are the

Yes, so too. but I’ll then let answer add, both Jason

have but so other my view. on in from of a But are that’s years from needs that of towards that sense. that, lot couple over etc., are We stage, that say--you clearly more course in makes words, the perspective, than know, we the it, if change we’re a the I investing away we done you’re always last front, would gotten time, In investing in etc. and cresting because

where so talked down. that how part bring doesn’t that and we’re saying the far so that’s expenses, as the year expenses as at work, the about we for we Then X%, do

growth that some can Now, you are that you’re do year, in trying in have just productivity and other there base of the right? offset costs outside certain that to have with come there’s do expenses is that, you pay everything flow the into increases. of that but going year, amortizations to increases technology year aspects be to carry the You do into just the for still because

up? All right, follow to thank was you. going Oh, you Jason said

point. you give one information at year, and is you’re a things quarters, whatever give happening of we But quarter. as helpful, next obviously if is color is bit and on next just not I the outside the was lots I’m about one, Well, there this it’s more elevated thing fourth the happy several services to what see helpful, can thinking little

expense, episodic some some supplemental is that plan. other expense, has--I’m agency episodic, of is pension sorry, Some that of of that

even--that should our It things pension $XXX that market are other should But expenses supplemental and and should it’s million Some of some at unless-- of that’s - so that these those to travel, way likely we’re going trend, affected. control out hopefully have to like forward. more million stay episodic, some we going million. up stay of elevated. $X a to the was of so quarter, don’t below were and going because $XXX marketing think that But term over longer quickly of plan get think third see actually

about you of think impact Then just the also compensation.

going a to of $X starting some items. quarter. we’ll second, at line be in of in the business. Then color line and us with third quarterly think Just a that’s know $XX activity, to a least basis - have the that some some that’s in to give quarter on you offset we million going growth but severance to additional million we $X is a pay million to base help then probably sense bit, little online be going second of That hiring, there, lift, to going help to that’s gives come the you

equipment visibility a first thing, near levels dollars depreciation it so on to The that what’s a a coming call of lot get couple million that that, we the got last into this level, the There’s a out but hundreds quarter and the--that’s impact lift lot. after that some of where software, quarter, coming nowhere of growth, you contracts out.

flatten which reflective grower. fastest done. just gotten has equipment lot we’ve to sits work line which software, and the that and of been depreciation a that within starting We’re amortization It’s

thank Okay, you.

take question Cassidy Please Gerard from We’ll go RBC. you. from Thank our next ahead.

Morning Gerard.

up conversation, it those is salaries, or to going folks topic Coming more and share this--the on whether of back you about detail can the had the to to are bump Hi second, is you senior why the you just people? more more little Jason. people, it Then a cost expense of risk salary your portion. which is entry-level salaries? salaries, at Maybe losing

we’re technology the of Yes, not and happening. than different this very dynamics just been where frankly, The historically two around a gives operations-oriented actions taking going. centered, they and you board, effectively. functions, across so we’re That very sense year much some more are targeted have

off-cycle we’ve why year was we salary We of obviously of that but the management that’s inflation-related last increase increases, increase, the last think to growth to had this point. done some we had wealth average the largely of year in higher had doing Then specifically an adjustments lot the was business. some merit than talent, a at retain

claim over, with never can fully but You certainty that that’s that was meaningful.

talent You know That after this is episode, us identifying so the get to we’re more point is, those that be franchise defend that seems that and how salary and base to going savings but base. we we over where how aggressively. we’re getting important important to run to rate that rate a and were can growth business-as-usual at across areas and organization, significant

proceeds it were the a the that earn income can with long take then us that resulted sale, sold exit the you to will on securities to can losses back on types and and what you the loss had how you give of color Very which share to portfolios? of take yields good. reported, the that in of Then you you reinvesting fixed follow-up, that from us portfolio by as some those sale securities,

in X% on know, treatment, things: of time couple at--you we maturity. for were being to significant third poor reinvestment X.X% still yield, the earnings average, up billion, looked in lower they That $X.X those and $X at at think What RWA the coming those the had on to lower and ended balances on and The that reserve billion. of was Fed coupon that combination coupon, secondly one, a the had securities about point. in the this X.XX% range bucket

time portfolio, to already this lower the capital seeing from not perspective, drivers and but really what led more stream, to improved ratio, after, opportunity improve or out in so form had do largely we of loss of economic coupled reporting a the to attractive didn’t, of terms it’s ratios, the liquidity to the years, not that liquidity payback this. on around regulatory with - in like us were the that’s at very to and very but capital X.X earnings the go that of was remember and the benefit your we treatment stripped needed In that, unrealized value opportunity the RWA same CET-X improve we hurt

Great, thank you.

take question Steven from We’ll Wolfe you. Thank next from Research. Chubak our

to actually to I Hey, good appetite to book item the further securities asked actually engage Gerard want is you morning. but from any whether which repositioning, portfolio did relating have clarify the here. repositioning of my in question, one

it’s in from was bit billion you within there. pick given appetite, we do, it’s realized the mortgage-backed I - attractive soon that and would non-HQLA asked about bonds that’s Well, HQLA be at it more half, $X interested so a you thing we’ve because something like the same liquidity fact about as harvested color the in but each, ability munis and the making the after pick up like because an Gerard, you feel capital, an But finished, change securities and time, follow-up and were just yield an assets time up to attractive impact now positive. I quarter everything assets, to a curve have I’m go just to as perspective, just frankly, no might we about to know. little and corporate glad economic

taking for follow-up. Thanks That’s my great.

Brown Thank you. KBW. from We’ll next go to Mike

think just number you’ve your When morning. which that Great. capital consider quarter? - from we guardrails in question expect tailwinds some it you’ve guess so minimums, return the purchase the as about is with your is, present, repurchases way a more capital year, capital plan looked in the to wanted that at full to the from ensure seems we got should questions the how here? I the of to engage modeling capital But your you’re time always Hey, on for a Jason, of good no mentioned my resume well we front, up and about think first follow managed are earlier. above but the consistent ratios there’s me I share what we meaningful really I that ratios at the point. like capital, should to on buybacks and you one you

history, the just these none how on more peers Look we think at to the then regulatory perspectives I at to at about XXX% we - think, we look are to and look look are Sure, are it, again, and of part if those which about. these to absolute I they’re of you we timing, we get things. where factors but tells determinative, instructive, relative the guardrails, won’t levels, it’s look--and think comment so at relative to

we RWA we it’s us dynamic clients for is be our to and been loan wanted--our we had of in because institutions we’re wanted to, we’re clients. used we capital thing client had We in that that predictable we our and the FX missing let actually to on, than changes pre-COVID, lending, and activity one and do impact that. make did had--it was because behavior. there last that that were years, because to to several might and balance over any able strength the be the and that other sure not were demand demand looking we sheet has the because RWA our Then also flexibility the forward significant they that less increase few set That’s there

a so that back next the years, concept to still return equity no this in then be of plus in par at billion XX:X, in business still pulling the attractive, a over we sitting right it’s accreting reason the on is won’t some AOCI several position, better $X.X we’re you’re capital, the much quarter in at and each point. market But so

were follow kind that that, how but about It sounded going loan wanted you balances like--I like down that pick up in are alluded forward, demand, just are the Jason, is view on meet to Our it here? can the to demand I If sounds you sequentially. loan be it about X.X% loan fact guess, softer maybe of here kind up was thinking you XXXX? expecting demand client to that you of to so there from

avenue think scale be about just capital another to here on see so terms actions other I asset follow-on mix strategic and front? your you capital inorganic opportunities you side, Do do you’d any the in that one consider how the Then guess of that perhaps capital could on other that change allocation allocation?

I remind it’s Sure, demand, people, on spiky. loan so super always

do amounts, the might that happy come base they that we have it to and clients and have they’ve of a lot because of billions we’re a we potentially the On then with assets, dollars really in liquidity got need of the quarter times, us great want business have at can at for significant as asks, and just dollar asset, to appropriate relationships a We opportunity much institutions. quarter well. to I it don’t them it’s to it’s loan liquidate for they don’t look and think to large very solidifies help other as volumes

growth some more growth more ton business-as-usual. a in do In this of business-as-usual not year general, expectations business, our are anticipate rate. growth a We the but for

wealth of years just in no a of thinking or come it. management. capital more Frankly trying got there’s We’ve necessarily point last they’ve looking to perspective no well, problem acquisition for but to in perspective. or towards it’s that over bring that servicing holistic gone talked list, things us scale. approach we’ve problems the this capability, that about circle a - We’ve a opportunity great asset several value, from fix to mix we’re a we that’d about clients we do don’t be the having product from bias bring, good we’re got If so can create we’re the mix at an some the on done things whole we in at the able product capital, to wealth, than opportunistically. can but but to and be on more Then look up, in top there solve feel we attractive wealth scale we’ve have

taking questions. my for Thank interesting. you Okay, very

to you, Thank and from we’ll go Bedell from Deutsche question Bank. our Brian last

that had switch entrepreneur of significant on some not the you clients? for little or my a lower or valuations just follow-up. Is it really a to that may clients seeing are impact their what bit, to big taking of from extent businesses? side, in deal? private is just Maybe thanks wealth businesses, kind you pullback from Great, any gears Are any seeing public their those it in your have

were a I the Brian, would an were prospects, who business selling mean, that us. for seeing uplift we a was right? of different I or so owners of on a result businesses, and that talking was clients activity about, it’s perspective the of beginning you’re are monetizing part as their lot definitely XXXX, of Mike. say in the XXXX assets,

market also for and of the lower marketplace definitely but activity there, there, reduced then of it’s activity just you’re opportunity for us IPOs impact market the certainly had activity With seeing in that us. private less an

where create what for when you the generating think pipeline, lot’s Okay, that the should in expenses a I asset thanks, business, then answered, and in some the that installed contracts the mandate asked have given of on also on-boarding ahead just some expenses more terms on-boarding servicing of larger, are that Is just and and revenue? - typically one is expect for been but chunky might something noise bringing XQ you’re the on? we XXXX,

this out capitalized contracts, on. for expenses be nothing some things. out nothing it long those In in we’d this to you. ahead we’d we’d If some point Yes, that at even, thinking One, instances, changes, point. of call a couple and call want term so--but that at you that are

follow-ups. Thank my you Okay, for so taking great. much

remarks. it speakers to for back any will now turn We our closing

look us you with to for Thanks much We very speaking joining soon. forward again today.

does participation. day. Have you. Thank wonderful appreciate that conclude We Ladies today’s gentlemen, and a your conference.