Ebrahim Poonawala: Good morning. I guess maybe, Jeremy, just following up on the credit assumptions underlying. If you could give us a sense of what’s assumed in that reserve ratio at the end of the year, be it in terms of the unemployment rate and your outlook around, just a lot of chatter around commercial real estate, the struggles to reprice in the current rate backdrop? Are you concerned about that? Are you seeing pain points in CRE customers given what’s happening with cap rates and then just the overall backdrop today?
Jeremy Barnum: Sure. Let me just do CRE quickly, Ebrahim. As you know, our sort of multifamily commercial term lending business is really quite different from the classic office type business. Our office portfolio is very small Class A best developers, best locations. So the vast majority of the loan balances in commercial real estate are that sort of affordable multifamily housing, commercial term lending stuff, which is really quite secure from a credit perspective for a variety of reasons. So we feel quite comfortable with the loss profile of that business. And so yes, so then you were asking about the assumptions in credit overall. So yes, as I said, like the central case economic forecast has a mild recession and if I remember correctly, unemployment peaking at something like 4.9%.
The adjustments that we make to the scenarios to reflect a slightly more conservative outlook have us imply a peak unemployment that’s notably higher than that. So I think we have appropriately conservative assumptions about the outlook embedded in our current balances. And the trajectory that we’ve talked about in the presentation, they are definitely €“ can capture something more than a very mild soft lending. But of course, it wouldn’t be appropriate to reflect a full-blown hard landing in our current numbers since the probability of that is clearly well below 100%.
Ebrahim Poonawala: Noted. And I guess just as a follow-up on you’ve managed RWA growth pretty well when you look at like loan growth year-over-year versus RWA, stayed relatively flat. As we think about just managing capital, how should we think about the evolution of RWA? Are there still opportunities to optimize that going into whatever the Fed comes out with on Basel? Thank you.
Jeremy Barnum: Yes. So there are definitely still opportunities to optimize. We’re continuing to work very hard, and it’s a big area of focus. Some of that is reflected in this quarter’s numbers, but some of the other drivers of this quarter are what you might call more passive items, particularly in market with RWA. And yes, but we should be clear that although we’ve said that the effects of capital optimization are not a material economic headwind for the company, they are also not zero. There are real consequences due to the choices that we’re making as a result of this capital environment. And in a Basel III outcome, that is unreasonably punitive from a capital perspective. There will be additional consequences to that. We obviously are hoping that’s not the case and believe that it’s not appropriate, but we will see what happens.
Ebrahim Poonawala: Got it. Thank you.
Operator: The next question is coming from the line of Glenn Schorr from Evercore ISI. You may proceed.
Glenn Schorr: Hi, thank you. I’m curious, I want to talk levered loans for a second. You’ve done a good job avoiding some of these €“ put on these loans for the like the better half of the last half year. So good call on your part. Things have gotten a lot cheaper. However, bank balance sheets, not yours, are still kind of mucked up with a lot of the back book. I’m curious to see if things have gotten cheap enough. Do you consider yourself back in? And how important is this in general for activity levels to pick back up to have available funding from the big banks?
