Lynne Fitzpatrick: Yes, thanks Kyle. We do have our next maturity coming up in March of 2025, so it’s certainly something we will be looking at over the course of this year. As you know, we don’t have a strong need for debt financing, but we do try and keep some bonds out in the market, just to keep our name in front of the investors and keep that credit work fresh. We’ll certainly be evaluating our approach for those bonds as we go through the course of the year. Certainly rates are higher now than when we did that issuance, so we will take that into account, but we haven’t made any decisions on level of refinancing or how we will do that at this point. In terms of the maximum target for M&A, we do value our strong investment grade rating, so that’s where we came out with that one times target.
Certainly there is flex up in an M&A context, given the fact that we do generate a lot of cash and would be able to pay down that debt relatively quickly. I think it would all depend on the circumstance and the transaction if we were to execute, how far we would go on the leverage. I don’t have an exact target for you, but it’s something that we do try and balance the use of debt and equity in our transactions, as you’ve seen historically.
Kyle Voigt: Thank you.
Operator: Thank you. Our next question is from Brian Bedell with Deutsche Bank. Sir, your line is open now.
Brian Bedell: Great, thanks. Good morning folks. Thanks for taking my question. Let me just come back to the treasury futures complex. To what extent is the portfolio margining agreement with DTC contributing to the strong volume growth, or is it just more of a sideshow relative to the other dynamics? Then from the–I appreciate it’s very early in days for the treasury [indiscernible] dynamic, but would that potentially change the cross-margining agreement with DTC? If I could just squeeze in one more, I didn’t see the revenue for EBS and BrokerTec in the prepared quarterly summary. I don’t know if you can comment on those for 1Q.
Terrence Duffy: Yes Brian, we’re going to have to kind of wing this one a little bit, because I think we heard about every third word that you said, for some reason. I don’t know what’s going on with the line, but you kind of tapped out a few different times there. Can I just break this down? You asked about our treasury business, and you asked about DTCC and the offsets – is that correct? And then you asked about–just give me the headline of the other things.
Brian Bedell: Yes, maybe this is clearer. I was on my headset. Basically, the contribution from the portfolio margining in your treasury volumes, just to sort of categorically–is it really helping or is it merely more of the market dynamics? Then back to the treasury clearing question, maybe it’s early days, but does your application complicate things with the DTC agreement–
Terrence Duffy: Oh, okay. That’s the part I missed. That’s the part I missed. Okay, we got it. I’m going to let–I’m going to take your last question, but the first couple, I’m going to have Suzanne Sprague, who heads up our clearing and risk, deal with those. Suzanne?
Suzanne Sprague: Yes, thanks very much for the question. Just on the participation and the existing programs, we have seen some new clearing members take direct membership to be able to take advantage of that cross-margin program that is currently in place for house accounts between ourselves and the fixed income clearing corporation. I think it’s hard to quantify how much of that would be new activity versus activity that may have been cleared as clients grew existing clearing numbers prior to that. Tim McCourt may be able to chime in a little bit on his thoughts there about the growth in that activity, but generally our focus with the DTCC continues to be growing the participation in that program as well as extending that program to customers.
It’s something that we’ve been working very closely as partners on and is still important to us in thinking about the clearing mandate and bringing to market more efficiencies for those end clients that could be impacted by the clearing mandate as well.
Terrence Duffy: Okay. Tim, do you have anything to add? I’ll talk about the relationship with DTCC, but–
Tim McCourt: I think the one thing I would add is when we look at the additive value of the CME one pop [ph] portfolio margin, where we have the futures against the–futures and options against the swaps, is that has grown significantly over the years, and while it’s hard to exactly draw a strict relationship, as Suzanne said, as those margin savings have grown to $7 billion to $8 billion last year per day, about $7 billion per day this year, along that our interest rate complex has doubled in volume and open interest, and that is the testament. We believe is we focus on unlocking capital efficiencies for our client, enabling them to more efficiently manage their risk, we would expect any further capital savings to have similar effects, but hard to say what that coefficient of growth might be.
But we think it is a tailwind for our complex, and the more we can do to unlock those savings, the better we will do on the transaction side for futures, options and swaps here at CME.
Terrence Duffy: Thanks Tim, I think that’s really important. Let me just add, Brian, that on the relationship with DTCC as it relates to our treasury clearing application, I have spoken to those folks before I said anything publicly about this, and what I also said publicly when we announced this is that I do believe that DTCC has the most efficient offering in clearing of these products today. We didn’t create the mandate that’s coming at us in 2026. We have an obligation, as I’ve told my friends at DTCC, that we have to go through with this application. We don’t know what’s going to happen in 2026 when the mandate kicks in, what the market structure is going to look like, is it going to change, is it going to be the same.
