John Greene: Yeah. So, we’re a digital institution. So, the first piece is we’re going to continue to invest in tech and advanced analytics to kind of help the customer experience and then also help us to generate positive returns. Some of the specific projects that we’re working on, so we’ve got a number of advanced analytics programs around collections and around originations in order to be able to service the customers well and then target the right sort of customers. We also did a bunch of work last year and into this year in terms of improving the closure rate of leads from a lead into a funded customer, whether it was a savings or credit customer. This year, we’re investing heavily in our risk and compliance systems, so certainly there’s tech spend going on there.
We also have tech spend related to our on-prem servers and moving to a hybrid and cloud environment, that’s certainly a significant spend. And then also, given the risk and compliance issues that we’ve seen historically, we’re spending a lot of time taking a look at how our core systems work, the data that goes in and the data that comes out and what we do with the data, and looking to kind of reduce the amount of manual touches to that data. So, all of that is part of the reason or the reasons why we’re seeing kind of information processing and tech spend overall increase this year.
John Owen: Two other areas I would call out. Around our fraud detection, we continue to invest heavily in our fraud detection. That’s an ongoing battle every quarter, but we’ve made significant investments in fraud and continue to push on that area. The second thing, around our digital capabilities as a digital bank. We’ve got a very easy to use system, easy application process, very easy for customers to open up their Cashback Debit. And so, we spend a lot of time and effort in customer flows and customer engagement and how we onboard customers in a more seamless manner.
Kevin Barker: Thank you for all that detail. And just to follow-up on your investment on enhancing recovery rates, have you seen any particular shift in the recovery rates you have today or where they’re trending relative to past cycles?
John Greene: No specific changes to recovery rates. We are seeing more customers seek credit assistance and negotiate settlements. There seems to be a cottage industry developing around that. And that’s back in this — I think it was the month of July, we saw a chunk of charge-offs come through as a result of settlements from these institutions. But overall recovery rates remain strong. The pool of charge-offs to be able to capture recoveries from, obviously, is increasing as the charge-offs increase. So that’s actually part of our — how we take a look at overall credit and reserving.
Kevin Barker: Thank you, John.
John Greene: You’re welcome.
Operator: Thank you. Our next question will come from Erika Najarian with UBS. Your line is open.
Nick Holowko: Hi, good morning. This is Nick Holowko on for Erika. Thanks for taking our questions. Most of them have been answered, but just wanted to follow up with one question on loan growth. So, obviously, card growth remains really robust and you raised your guidance to mid-teens for the year. And I’m just wondering, given the comments on the stress in the lower and mid FICO scores, and then the delinquency trends, and then your comments that the revolve rate has really normalized, I’m wondering if you can help us with which parts of the FICO band in your portfolio are driving the loan growth, and whether you’re seeing any outsized contribution from those on the lower end?
