And then we’re going to look at what the returns in those areas are. So what I give as guidance during this period, I’ll also say asset based lending and equipment finance, while they’re new businesses to us middle market, that is middle market lending all day long. So to call those out at this point, we feel like it’s part of our business, it’s how we’re selling, it’s integrated into our process. Then we’ll look at the consumer side and try to create bounce growth between that residential and then pick up the slack with our auto lending. I’m not sure I’d call it a filler product. And I’m certain our division would not really like that as the label. I would say we have professionals that look for Prime paper that have low risk to them in a high risk, higher risk, potentially environment.
So I like the position we’re in there. So I finished that commentary by saying we have optionality within where we are. Our goal over time is to drive margin. We think we have an opportunity we look at, we look at that very closely in the industry. And we see what that mix shift can be. So the idea is that we can drive higher yielding assets over time. But for 2023, what I would like to do is drive balanced growth. We are not the auto lending company. We are a company that can choose between consumer and commercial and try to balance the growth between those two, while maximizing the areas on margin. So that’s a little bit of why we haven’t broken that out going into the year. It’s also the reason that I have confidence that we can hit some of our projections.
Terry McEvoy: Appreciate that and then just as a follow up, I mean, what do you say to investors who are concerned with what they might feel is late cycle loan growth and how those loans may perform in a downturn. When I look at page 4, that right hand category, there has been significant growth for a bank your size in commercial and CRE and construction and even auto finance or especially auto finance. What’s your response?
Andrew Harmening: Well, I would say if you look at 12 months, you probably started too late. And what I would say is we’ve worked on fundamentally changing the balance sheet to derisk it over in that case. And specifically, I could call out, for instance, our residential real estate portfolio, we’re oversized in residential real estate, but we’re oversized in a portfolio that is prime and super prime, in a market that doesn’t have large fluctuations up and down. So inherently, our balance sheet is less risky, in our opinion, going into that, and that has seen some growth. When we look at auto and calling that out specifically, it is the oldest new business I’ve ever experienced. And by that, I mean, we have people that joined us with decades of experience across the board in that space.
Not only do they have decades of experience, we also brought the data, the historical data to understand how the portfolio operates. So we know how that operates. Then on top of that, we went into prime and super prime. And I’ll specifically say to the investors that by traditional standards, 97% of that book is prime and super prime. If we take a scorecard approach, which takes a lot of other factors, and we think is a better way to look at it, it’s 99% of our portfolio. And we know that because we can check that against historical data. So those would be the things that I would say with regards to what the portfolio is. The next thing that I’d say is we did not expand our credit box anywhere. In fact, we’ve tightened up our credit box, as we’ve seen, the world change.
