Ebrahim Poonawala: Got it. And if I may, Dominic, one more just around capital. So you have a lot of excess capital, a lot of your peer banks have reported and are building capital exiting certain lending businesses. Talk to us in terms of just given where we are, how are you looking at market share growth opportunities? Are you leaning in? Or is the macro way too uncertain to look for growth opportunities right now?
Dominic Ng: Yes, I think that you just said it kind of like answer my question, but your question. The macroeconomic situation, it is uncertain. It is uncertain. I mean anyone said that they know exactly what’s going on in the future is kidding themselves. We really don’t know. I mean I thought that the recession should have been here actually with the rate spike like that, I thought the recession has already arrived. By now, it didn’t. So, they turn out to be a soft landing. And that would be great, but it may not. So, the economic environment is certainly not something that we can bet on. But in the meantime, the market environment has never been as ideal as it is today. When I say market environment is that for decades, we’ve been competing with some very competitive neighbor, neighborhood bankers out there.
And they are good at — some of them are good at venture capital, PE, some of them good at making very high net worth customers, mortgages and, quite frankly, for price, for whatever reason we decide not to be able to compete today, they go on. So, we have just so much less competition and with our size, with our sort of like being able to continue to have senior management engagement with clients. We are in a very good sweet spot. From a market perspective, I’ve never seen East West to be in a better position than we are today. But the macroeconomic environment is certainly not clear. So — and then you reflect back on another perspective, which is when are making 21% return of equity, why do I want to go crazy right now to try and to do all kinds of stuff?
So, we are watching the market. We’re taking advantage of one customer at a time when there’s some other customers from other banks who want to explore relationship with us, we are welcoming them. But we are doing it prudently, not trying to go out there and then in order to make certain kind of earnings and that we have to go out there and make a big group of hirings here and there and then so forth. That’s not necessary because we like where we are right now. We have a very diversified loan portfolio, very diversified deposit portfolio, and that’s good. And if there’s any good prospect coming in, we certainly will entertain. And — but we’ll make sure that we stay disciplined with our East West Bank credit metrics and pricing metrics. And that’s what we are — we still feel that there is opportunity to grow.
I’m not that certain about in the next two quarters, how much opportunity that is, but I’m 100% sure in the next two or three years, it’s going to be really good.
Operator: Our next question will come from Jared Shaw with Wells Fargo Securities. You may now go ahead.
Jared Shaw: Yes, sticking on with the capital theme. As you go into year-end, if the broker deposits run down and the BTFP be paid off and assuming cash flow soon, that capital will continue to grow. How high is too high for capital? What else can we expect the capital management payout ratio at only 22% a year?
