Vivek Juneja : Okay. So I want all these definitions, everybody has a little difference, so it’s important to clarify that. The second one, I guess, John, going back to the rate discussion, just to get my head wrapped around that. If I heard you right, just in response to Matt’s question, is that small increase in rate is beneficial to NII. But then rate cuts is also positive. So I’m trying to reconcile how both scenarios are positive for you?
John Woods: Yes, I can clarify that, Vivek. I mean a small increase in rates from here would drive some NII — a small amount of NII and a small decline would be a small negative in terms of the small decline in NII, but they’re both quite small which is why we’re calling ourselves neutral. But just — but from a positioning standpoint, it would be a small positive if rates rose from here and let’s say, one additional hike for example. Let’s say if the Fed has a hike in the fourth quarter in November or December, we’ll see an NII contribution to that. A small cut goes the other way and also — but not a significant decline if there was a cut. Yes. And to be clear, that’s — and the difference here is what happens immediately, say, in the next quarter versus what happens over time.
We are very constructive and feel very good about a gradual decline in rates where the short end gets down to 3% to 3.5% over, call it, a quarterly period of time. We think that’s very good as it gives time for balance sheets to adjust and to have front book, back books continue to get locked in and be supportive of a healthy balance sheet migration over the next, call it, a year or two as our balance sheet optimization continues to take hold with Non-Core runoff, et cetera. So we would — our balance sheet does well with an upward sloping balance sheet that we’ll migrate to over the, call it, the ’24 and early ’25 period.
Vivek Juneja : And one more clarification — that’s helpful. On the expenses, Bruce, when you talk about stable for next year, what are you assuming for capital markets? Are you assuming capital markets revenues and therefore incentive comp goes up? Or are you just using current level? Any color on that?
Bruce Van Saun : Yes. Well, we haven’t given the full guidance yet on ’24, but there is a variable element of pay that if revenues go up in capital markets that pay would go up. That’s probably the 1 area that has the rates tied to revenues across the bank. And we would have to contemplate that as we go through the budget process. So we said we’re targeting the flat expenses for next year, and we would incorporate our view on kind of where the capital markets fees are going to be and then what additional payouts would result from that. And then we’d have to find ways to offset that elsewhere in the bank.
Operator: And at this time, there are no further questions. With that, I’ll turn the call over to Mr. Van Saun for closing remarks.
Bruce Van Saun : Okay. Thanks again for dialing in today. We certainly appreciate your interest and support. Have a great day. Thank you very much.
Operator: Ladies and gentlemen, that does conclude your conference for today. Thank you for your participation and for using AT&T teleconference. You may now disconnect.
