That is not driving our reserve build at all. So, just to kind of bring it to life for you. From the third to the fourth quarter as we look at our models, we looked at GDP declining by about two-thirds from sort of 1.3% to 0.4%. Unemployment going from, say, in the third quarter, we thought it would peak at 4.1%, we now think it will peak around 5%. But significantly, when we look at things like home price index, in the third quarter, we thought homes were going up by 1.3%. In the fourth quarter, as we modeled it, it was a decline of 4.6%. So fairly significant quarter-over-quarter change of 5.9%. Now to bring it back to kind of our portfolio, we, for example, have $21 billion of mortgages. That’s about 18% of our loan book. It’s booking about — the FICO scores on those are, say, 761 from memory, or some such number.
We also say that 40% of our mortgages are 800 or above. And I share this texture for you because we are not worried about our mortgage book. But as we drive our CECL models, which are forward-looking, the macro drivers have significant impact. And I’m just using that as an example for why the reserve build. Does that answer your question?
Manan Gosalia: Yes. That’s really helpful. Thanks so much for the color. And then, if you could just round that out with how you’re thinking about the NIM and just managing the NIM as you go through 2023. Earlier on, you were in the camp of the Fed keeping rates higher for longer. Has that changed? And has that changed how you’re managing putting on any additional swaps or hedges on the books?
Don Kimble: Well, sure. As far as how we’re managing it right now, our assumption set is basically that we would just continue at this point in time to replace roll-off of swaps that we have that we’re continuing to evaluate that. I think the challenge that we all have is just with this inverted yield curve is when do you pull the trigger to start to lock in some of that rollover risk and outlook. And so, right now, we’ve not embedded any of that into our base assumptions, but it’s something that we’ll continue to have as optionality to take care of that in the future.
Operator: Your next question comes from the line of Ebrahim Poonawala from Bank of America. Please go ahead.
Ebrahim Poonawala: I guess just wanted to follow up on credit. So, you talked about the consumer book and the FICOs. When we look at the commercial book, both on the C&I, CRE, just talk to us about the idiosyncratic risks, I mean, the leverage lending book you provide on slide 15 is relatively small. But when we think about the impact from higher rates, cooling demand and you talked about mild recession as your base case. Like where within the CRE and the C&I portfolios do you expect delinquencies to start moving higher? And where is the lost content?
Chris Gorman: Sure. Well, Ebrahim, thanks for the question. So, you started at the right place where we focus. We focus any place where there’s leverage. And obviously, if you think about leverage finance, which, by the way, for us is only about 2.5% of our entire loan book, and it’s focused in our 7 industry verticals, and it has a pretty high turnover. But you’re exactly right, where there’s leverage and you go into a mild recession and you have declining EBITDA, you have to watch that very closely. We feel good about that portfolio. Nothing has bubbled up to the surface. But as you can imagine, we’re modeling it very, very regularly. The next area that you mentioned, which I think is really appropriate is real estate. And real estate is an area that we look at closely.
