Manan Gosalia: Got it. Thank you.
Operator: Thank you. The next question is from the line of Matt O’Connor. Please go ahead.
Matt O’Connor: Good morning. I wanted to follow up on expenses and a couple of things. I guess, first, what’s the base of expense for this year that you’re trying to keep flat too, because you have some items coming in 4Q called out from this quarter and obviously had some in 1Q as well? So what’s the base as we think about flat costs for ’24 that you’re targeting?
Clark Khayat: I would think the range of kind of 4.4 billion, Matt.
Matt O’Connor: Okay, that’s helpful. And then the pension settlement charge just for modeling purposes, I know that’s ex the guidance for 4Q, but how much do you expect that to be?
Clark Khayat: We said 15 to 20, in that range.
Matt O’Connor: Okay. Sorry, I missed that. And then just lastly, anything on the criticized loans. Not everybody discloses this, but you’ve got a slide in your deck that shows it and it’s bumped up a couple of quarters in a row here. Is that just kind of normal progression or what would you call out there?
Clark Khayat: Yes, that’s just — Matt, that’s us just very critically writing our portfolio. There’d be a few categories in there, as we look through it. Transportation would be one, healthcare would be another. There’s some consumer product type businesses there. But we take a fair amount of pride in — and Mark Midkiff is here in the room with us really going through with a fine tooth comb. I don’t think there’s any additional lost content there. But at this point in the cycle, and you start looking at anyone that has floating rate debt, I think you need to look at that pretty critically. So that’s really the genesis of it going from 3.3% to 3.9%.
Matt O’Connor: Okay, that’s helpful. Thank you.
Clark Khayat: Thanks, Matt.
Operator: Our next question is from Ebrahim Poonawala from Bank of America. Please go ahead.
Ebrahim Poonawala: Good morning.
Chris Gorman: Good morning.
Ebrahim Poonawala: Just want to add a quick follow up, Clark, for you. So I guess going back to some of the discussion you had with Ken, when we look at the 46 million in NII that’s going to come in from the roll off in the fourth quarter, your NII guidance is flat. So ex that 46 million, NII would be down 5% quarter-over-quarter. And I appreciate there are a bunch of moving pieces. As we think about the core level of NII beyond fourth quarter RWA optimization, depository pricing, like, what’s your expectation for those deposits — for NII, sorry? Does that NII hold flat or do you still expect that NII just on a core basis to drift lower?
Clark Khayat: Yes. So when you say core basis, I just want to make sure I’m understanding —
Ebrahim Poonawala: If we remove the lift from the Slide 9 that you have from the swaps and the treasury maturities, if we didn’t have that, what in your view would NII do through the next few quarters?
Clark Khayat: I got it. Well, so not to be picking word choices but I would say the core is actually without those positions, underlying business is reflected there. So I just — that’s an important I think quality of business point to make. But I think you’re right on puts and takes. And obviously, if rates — using the forward curve, if rates were to stay flat, we have seen already in kind of second quarter to third quarter trajectory, deposit pricing has slowed I think NII while running off still a bit, it is stabilizing. So you’ll still see some drift in those deposit costs. I think the places where, and obviously we’re continuing to shrink the loan book a little bit, so those create some headwinds. As we did say though we are moving aggressively to reduce wholesale funding costs as well.
