Prime balances, we’re pleased they were nicely up this year, driven by client momentum, and we are a leading equities derivatives franchise. So you do have these four core businesses and I go back to our big point of differentiation and why we still we feel we’re well-positioned, we have a very differentiated corporate client base, and a very strong partnership between our core markets franchise, TTS, and banking, and that — and security services, and that helps us in FX and commodities and in rates around the world. So, Markets is important, both in terms of its leadership but also how it fits into the strengths that we have from this simplicity of those five core interconnected businesses. We demonstrated solid returns in the past. I think a lot of the actions we’ve been taking will help drive returns in the future and you should be getting confidence when you see the discipline we’re putting onto RWA, 5.3%, getting close that target we set at Investor Day, we’re moving that up to 6%.
The exits we’ve got of non-strategic businesses shows our focus on efficiency, and we’ve also been doing some good investments in our technology and it’s getting us into a good place there. So I think don’t be concerned about the shrinking, we’re just making sure that it really plays to our strengths and we optimize the returns.
Operator: Our next question will come from Gerard Cassidy with RBC. Your line is now open.
Gerard Cassidy: Good afternoon, Mark and Jane.
Mark Mason: Good afternoon.
Jane Fraser: Hey.
Gerard Cassidy: Mark, can you share with us on your revenue guide in the net interest income, I know you mentioned this going to be lower and part of it is due to lower interest rates. Some of your peers have come out with their guides using the forward curve in their net interest income forecast, which includes the Fed in our country, six cuts. Can you give us some color what kind of rate environment. I know you said lower rates, but any insights around that guide?
Mark Mason: Yeah, I think what I pointed to is in the range of the 81 — the 80 to 81. We are assuming three to six cuts, right? You got a range there and the reason I describe it like that, excuse me, is that if you think about our IRE, as we’ve shown it in the Qs before, we are positioned such that with a 100 basis point move parallel shift in rate across the curve, the US dollar impact would only be a couple $100 million, right, and so to the negative, obviously, but it’s a couple of $100 million. And so as we think about that forecast, and as I mentioned, NII being down a bit, that covers kind of three to six cuts over the course of 2024, likely back-loaded, but that’s what’s in there.
Gerard Cassidy: Very good. I appreciate that. And then, Jane, more of a qualitative question rather than quantitative. But obviously, there’s numerous moving parts of the strategies that you guys are executing on. Exiting businesses, downsizing businesses, especially on the downsizing, I think you guys mentioned the headcount of about 20,000 coming down. How do you keep the morale of the organization elevated when you have these types of tough decisions that you all have to make.
Jane Fraser: Yeah, well, we’ve also got areas which are growing. So that does help to see — we have a diversified portfolio here. I think we’re very mindful of that there is a human impact of the decisions that we’re making. We’re trying to be as transparent with our people as we are with our investors about what we need to do, why we’re doing it, what to expect and laying that out so people understand the logic behind the decisions and then they understand what the decisions are as quickly as they can. I think that’s the most humane way to do this.
Operator: Our next question comes from Erika Najarian with UBS. Your line is now open.
Erika Najarian: Hi. I’m sorry to prolong the call. Thank you for all your color. Just one more question. Jane, when will you feel comfortable giving us a buyback outlook that’s beyond just quarter-to-quarter. I know you still have a little bit of ways to go, but you do have a 100 basis point buffer to your minimum, and I know Basel III and game is still out there. And I’m sure that reducing risk just doesn’t mean expenses, but also reducing your — or being mindful of your RWA footprint. And given where your stock is relative to book, when will we be more comfortable about giving sort of a longer-term outlook that was — that’s underpinning your RoTCE target with regards to the buyback?
Jane Fraser: Erika, it’s a great question. It’s one I ask myself every morning when I get up, because it — given where we trade, the value for our shareholders of buybacks is enormous. And Mark and I are very committed to doing so. We also know that we’re building our credibility. And I don’t want to say things that we’re not going to deliver against although we’re going to have to change. I think it’s one of the values that we’re really trying to adhere to very strongly. And with the NPL, I think we’ll get a better sense about this soon. The comment period just got extended and we want to see what that is. I think you’ve all heard us at the Senate banking hearings with our concerns about it. I very much hope that it is either completely revised or very materially, so it doesn’t have a negative impact on the economy and the US banking system competitiveness, the move for more business, the shadow banks, which I think has got to a point, which is not healthy.
So we’re going to wait and see before — where that comes out before we give it to you, but I would be asking exactly the same question in your shoes as well.
Erika Najarian: Thank you, Jane. I think that it was very helpful that you said on this public forum where you’re trying to build credibility because as I think about what long-only investors have been dying to see from Citi in terms of the previous leadership was that sort of awareness. And I think just having that awareness recognition will be very important to investors. So thank you.
Jane Fraser: Thank you.
Operator: Our next question will come from Matt O’Connor with Deutsche Bank. Your line is now open.
