Citizens Financial Group, Inc. (NYSE:CFG) Q4 2023 Earnings Call Transcript

And we’re thinking about the private bank in some ways in a similar way. So we’ve got all the tools to compete. We do expect, as the rate curve follows as projected, interest-bearing deposits on the consumer side will start to come down as well. And we’re starting to think about a mix of balances. We’ve got a lot of CDs that potentially can roll over here in the first part of the year that we’ll be looking to have more balance and put some of those balances into liquid savings to give us more levers to manage down betas over the course of the year. So all that is to say I feel pretty good about how we are situated. We’re starting to see good dynamics with the consumer expected to continue and I’ve got a lot of confidence that we will outperform peers in whatever environment comes our way.

Manan Gosalia: Great, thank you. And then just to follow up on credit, given the move lower in long end rates, can you talk about anything you’re seeing in the non-office CRE portfolio, like maybe in multifamily? How do things like the debt service coverage ratios look today versus a couple of months ago, and how do you expect that to trend given where the forward curve is right now?

Bruce Van Saun: Yeah, I would just answer broadly that we feel good about the multifamily portfolio, its characteristics, its relatively small loan sizes, a lot of fixed term loans, good diversification geographically. And so we, I think, felt that loss content there was going to be quite low. But now, obviously, with rates ticking down, that provides more kind of air in terms of the distance between the debt service coverage ratio and kind of cash flows. And so we feel that it’s helpful, but we weren’t worried all that much previously. So anyway, that’s…

John Woods: Yeah, I would just hasten and add that it’s very different than general office. I mean the capital markets are still active in the context of buying and selling multifamily properties and that will just provide further tailwind to that activity.

Bruce Van Saun: There’s a lot of liquidity there.

John Woods: Yeah, there’s liquidity there. Buyers and sellers are still transacting. So it’s just a very different night and day situation compared to general office, and certainly rates which won’t have much of an impact maybe on the general office, will very much have a positive impact on the multifamily construct that was already okay to begin with.

Bruce Van Saun: Okay. Very good.

Manan Gosalia: Great. Thank you.

Operator: And there are no further questions in queue. And with that, I’ll turn it over to Mr. Van Saun for closing remarks.

Bruce Van Saun: Okay. Great, Keeley. Thanks again, everyone, for dialing in today. We appreciate your interest and support. Have a great rest of the week. Thank you.

Operator: That concludes today’s conference call. Thank you for your participation and you may now disconnect.