So as we have been, we will actively be managing our deposit book and the pricing. And in our weekly pricing committee meetings, we’re already starting to talk about, okay, when do we lower rates? Some of our competitors have. So we’re going to monitor very closely, discuss it constantly, and we’ll take the right action at the right time. But somewhere in that 35%, it might get this year.
Casey Haire: Got you. Thank you.
Vince Delie: Casey [Multiple Speakers] just logically.
Casey Haire: Yes, no, understood. And just switching to credit, Gary, if I’m interpreting your remarks correctly, it sounds like you expect net charge-offs to go — to decline this year. I’m just wondering what kind of loss rate your provision guide contemplates.
Gary Guerrieri: Yes. I mean, in terms of the provision guide, at the $80 million to $100 million, naturally that supports loan growth as well as charge-offs. The specific charge-off level that we’ve got baked into our plans, I mean, that’s a number we don’t disclose, but I would concur with your thoughts. I mean, we do expect performance there to be stable, to slightly improve [Technical Difficulty]
Vince Delie: But I think, Casey, if you go to page nine in our presentation, you can see net charge-offs, average loans, third quarter, ‘23 has — we have that one-time event that occurs. So I mean, we’re…
Casey Haire: Yes, fair enough. That was great, okay.
Gary Guerrieri: That’s what you’re seeing in your charge-off.
Vince Delie: Yes. If you look over the last three years, Casey, last three years would have been 6 basis points, 6 basis points, and ’23 would have been 10 basis points, excluding that one item. So you’ve got really solid, steady performance there over a very — pretty, sizable, extended and somewhat tumultuous period. And like I said, we like the position of the portfolio. We feel quite good about it going into 2024. Naturally, we’re all concerned a bit about where’s this economy going and what will that all mean. And that has to play out, as we all know. But we’ve seen good steady performance and stable outcomes across the portfolio.
Casey Haire: Okay, great. And just last one for me. Vince Delie, you mentioned your TCE is at the highest level, I think, in your history, and the CET1 one above 10. How are you guys thinking about what’s the share buyback appetite with your capital ratios at current levels?
Vince Delie: We still have — we have authorization to repurchase shares from the board. We plan on evaluating that as we move along. If we see opportunities to buy shares back, we’re certainly going to do it., if the earn back is reasonable, right? Because we’re trying to manage tangible book value levels as well. So I think we’re going to continue to look at it and evaluate it and opportunistically execute transactions if they make sense. The deployment of capital as we move forward, really, we’re looking at the potential for changes in the economy and loan growth as well, because we want to deploy that capital in the most meaningful way. But if we see slowness, we’re not just going to sit here and continue to build capital, do what we have to do to make sure the returns are. I don’t know if that answers your question or not. In other words, still on the table, and we’re still going to consider it as we move along.
Casey Haire: Got you. Thanks, guys.
Operator: Our next question comes from Michael Perito from KBW. Please go ahead with your question.
Michael Perito: Hey, guys, good morning. Thanks for all the color so far. I really just have one last question I wanted to hit on for Gary on the credit piece. Just — yesterday Discover reported earnings and had some uptick on the consumer side in their prime book, lines of credit, auto and things of that nature. Just curious what you guys are seeing on the consumer side and from a credit health perspective, most of those portfolios outside the mortgage book I think shrunk this year. Just what type of growth is baked into 2024 and what are some of the — maybe the key things that could drive some better growth performance on the consumer side? Is it just kind of a macro health environment? Is it pricing, competitive dynamics? Just would love some color around all those topics. That’d be great. Thanks.
Gary Guerrieri: Yes. Total delinquency across that all-inclusive portfolio, which is right at about $12 billion, is 89 basis points. So that’s all in consumer. The fourth quarter, it’s always up a little bit seasonally at the end of the year with the holidays and whatnot. But if you look over a rolling 13-month time frame, it’s been from 70 basis points to the low 90s. So we’ve seen very consistent performance across that portfolio. The underwriting that we do there, I feel very good about. I think it’s very prudent and very stable. We’re able to generate good loan growth through those portfolios. And when you look at the investment that we’ve made in the teams there, it’s an important part of our business. So as we look forward, we continue to expect good solid growth there.
And that being a slightly higher range in this environment, did the higher single digit range in this environment and expect that portfolio to continue to perform well through the cycle that we’re in.
Michael Perito: That’s helpful. So it sounds like in the mid-single-digit growth guidance, there’s some consumer growth baked into that for ’24. That’s the expectation as you stand today.
Gary Guerrieri: Yes.
Vince Delie: Including mortgage. But if you stripped out mortgage, we’re still expecting growth. And again, I think some of the investments we’ve made in the digital tools, the fact that we’re spread across a pretty broad geography, we have 60 million consumers in our footprint. Some of the build out with the ATM delivery channel that heightens provides consumers with accessibility to cash and our brand. I think all of that gives us a little bit of confidence. Even though I would say the consumer, with inflation and some of the changes economically that are going on are going to be a little challenged. I think we’re in a pretty good spot that it’s continued to grow. The book, not as robustly as we have in the past. I know it’s been — last year was tough, but things are going to stabilize and we should see in a lower rate environment some opportunities to grow that portfolio that’s baked into the guide.
