Chris Gorman: Sure. So the answer to the first part of your question, Erika, is we’re currently through the third quarter, we’ve reduced 9 billion. So in the third quarter, we reduced 7 billion on a cumulative basis for the year. We’ve reduced 9 billion of RWAs. We are well on target to hit our 10 billion. As you try to kind of pivot from RWAs to the impact on NII, interestingly, there is a certain universe of those RWAs that we were able to get just different treatment on, namely the treatment that we qualify for in any event. Secondly, there was a lot of unused line fees in there that obviously those two categories don’t have any impact on NII. As you look forward, the other reduction in RWAs would have a marginal impact on NII but a positive impact certainly on our returns, certainly on our margins.
The other thing that taking out all these RWAs enables us to do is to focus on rightsizing our expense base as we take out these RWAs. So that’s kind of how I think about it.
Erika Najarian: Got it. And, Chris, I guess the follow up to there is, Basel III endgame clearly gives the banks time. And as you mentioned, the moves that you’re making in terms of improving the margin, being mindful of balance sheet size, being mindful of the expense base, the target would be to improve CET1 generation from here. I guess how do you balance the notion of, okay, we have this 10 billion of RWA reduction, check, that’s done, and potentially we’re ready to be a little bit more aggressive in the market or not. You told me, one of your peers said that they’re ready for loan growth next year versus the notion of with U.S. Bank being freed from its Category II commitments, whenever everyone runs a data on adjusted CET1, Key sort of ends up at the bottom of the list. So how do you balance in terms of running the bank day to day, right, versus how your investors are thinking about KeyCorp in sort of this new world order for regulation?
Chris Gorman: Sure. Well, first of all, as you know, the rules are still preliminary and they’re probably likely to change. That said, we’re certainly competent than under the proposed current rules, including the definitions and the associated timeframes, Erika, that we can hit them. And so what we need to do — what I wanted to do is sort of when the events of March happened and then these rules came out in July, I wanted us to hit the reset button and reset our business and make the difficult decisions so we can get back to growing our business. As I’ve always said, the underlying business is in good shape. We’re adding clients on the consumer side. We’re adding clients on the commercial side. And what I want to do is right-size our balance sheet, get our loan to deposit where it needs to be, get our wholesale funding mix where it needs to be, and then free up our people to get back out in the marketplace and do what they do and that’s grow our business.
So that is the needle that we’re currently threading.
Erika Najarian: Thank you.
Operator: Our next question is from the line of Peter Winter from D.A. Davidson. Please go ahead.
Peter Winter: Good morning. You guys mentioned that capital markets should be up in the fourth quarter. But I was just wondering, just between higher rates and the geopolitical risks, just how you’re thinking about the outlook for capital markets over the medium term?
Chris Gorman: The medium term, I feel really good about it, Peter. Over the near term, which I would consider the fourth quarter, both of the things you mentioned are a challenge. We will be up on a linked quarter basis as I look at our backlog. But the absolute — as I mentioned in my comments, the absolute level of the increase remains to be seen. Obviously, the geopolitical issues are an issue. The other thing you think about over the last five or six trading days where the bond market has been, that obviously has an impact as well. So in the near term, I think there’s probably additional headwinds. But over the medium term, I think I feel good about the business. Private equity firms are starting to transact, which is important.
