And so that shows cases to you that’s well above the average that we’ve seen. So I think it just continues to show that the investments that we have made are really working as we move forward. So that’s sort of point number one. The second point that I mentioned, and I think you asked where are those assets coming from? It’s really – in this particular quarter was in that adviser-led space both from existing accounts and new clients. To me, what was most remarkable when I was going through the diligence materials really was what we’re seeing from clients. So the idea that we continue to be a destination of choice for our existing clients and attracting assets held away, again, speak to all the conversations that we’ve all had over the course of the last 7 years or so talking about investments to give our advisers more time to service their clients as we move forward.Then the final question that you asked around the fee-based flows actually a very strong fee-based flow number, to be honest, from our perspective in an environment where individuals – we think about it, cash and cash equivalents are high.
You’re thinking about putting your money into managed kind of accounts associated with it from that fee-based concept, you’re unlikely to do that in a period of time where you think the cash and cash equivalents and safety might be what you’re looking for right now. And so that is, in fact, the dry powder that we have that over time could move into the fee-based assets. So I think it’s actually a strong number given the environment that we have on the backdrop.Steven Chubak Really helpful color, Sharon. And just for my follow-up, with – on sweep deposits, those are now running below 4% of AUM. That’s historically been a strong support level for transactional cash within the advisory space broadly. I was hoping you can give some perspective on how we could think about where sweep CAT could potentially bottom and have you seen any continued mix shift into sweep or deposit pressures in April so far?Sharon Yeshaya As it relates to April, I talked a little bit in one of the earlier questions about modeled client behavior.
And that what we did see is that in March, we really deviated from some of that modeled client behavior. Now in April, we have been more in line with modeled client behavior. So that does speak to your point of maybe we are in a position where from a transactional patch level, we are there. But again, as James said, it is an uncertain environment. And so from that perspective, we will have to wait and see how we move through time from here.Operator Moving next to Brennan Hawken from UBS.Brennan Hawken Good morning. Thanks for taking my questions. I’d actually have to follow-up on that last question from Steven. So April is more modeled April is typically a tax payment month, which is a headwind. So are you seeing – where is that cash getting funded from?
Are you seeing some of the taxes – tax payments coming out of both sweep and the other higher cost deposit sources? Is it more biased to the higher cost? Could that provide some relief? And when we put all that into the mix and think about NII going forward, should we be thinking about stable NII we know it’s not growing, but funding this funding cost elevation maybe could lead to some downside. So curious how we should be thinking about that.Sharon Yeshaya I think that your question in terms of April in terms of where it’s coming from the exact breakdown is challenging to see in terms of exactly where it’s coming from, from all of the deposits perspective because there is could, as you know, cash is fungible, so you could take something and then move it into a different security or a different asset.
To parse that out, is challenging. I do think that what’s more important, as you highlight, is that it is tax season. And so to not see an acceleration is obviously one of the more optimistic signs that you are moving through more model client behavior. Now what it means from funding, we obviously have many funding different places. I don’t think that funding is concern, as you mentioned, it does matter from an NII perspective, but it will be a function of two things, Brennan. As you know, rate expectations have also changed since January. And so our NII forecast and predictions are based on models client behavior in terms of cash, sweep etcetera, and also where interest rates are and where the forward curve is for Fed bonds. And so as you begin to see if that changes, that could change your NII forecast.
We are still, if you look at models client behavior, asset sensitive. And so from that perspective, I think that gives you a few different pieces to put together in terms of how to think about the forward look based on deferred assumptions.Brennan Hawken Okay. Thanks very much. Obviously, a lot of uncertainty, so I appreciate that color. And then one more on the net new asset component. Sharon, you guys have an offer for – promotional offer and it’s tied to higher yielding cash alternatives. What percentage of the net new assets came into – from that promotion this quarter? In the past, you’ve spoken about how when you bring that cash in a majority of it stays in the system. Do you have any more granular statistics on what portion of that stays in the system?
It’s obviously good that it comes into the system, but kind of curious when we think about stickiness and how much is hot money and how much is actually durable? Thanks.Sharon Yeshaya So the best way to think about the stickiness within the system is actually NNA right, because you’re going to see the outflows would be a net negative to the NNA more broadly. And so the consistent growth over time, if you look at it all the way back even to when we saw promotional levels back, I remember we spoke about this in ‘18 and I think it was ‘17 and ‘18. In those early years, that was still seeing net new asset inflows over time. So, for me, the most important thing is, well, what’s the net, the net continues to be positive and continues to ramp higher.
In terms of the CD exact offerings and what that would mean from NNA, it’s considered NNA if it’s brought out from outside of the firm. And again, what’s important here is that we continue to see more in the advisor-led space. And that over time, again, think about the channel migration from workplace into the advisor-led space. What’s important here is that when people begin to seed money into advisor-led, we actually see more money from assets held away. So, I know that doesn’t answer your question directly, but I think it’s important to highlight, as people begin to work with an advisor, what we said to you is 90% of the assets that then come are from assets held away outside the building. So, just again, another proof point that once they understand what the advisor has to offer, it helps aggregate new assets into our system.Operator We will hear next from Gerard Cassidy with RBC Capital Markets.Gerard Cassidy Thank you.
Good morning. Sharon, can you share with us, when you guys talked about, I think James said around 25% of your Wealth Management customers’ assets are in cash or cash equivalents, which is high, of course. What interest rate do you guys sense, meaning do rates at the fall 100 basis points or 200 basis points for that money to move back into more traditional assets?Sharon Yeshaya So, I don’t actually know that it’s the absolute value – the rate level. And I will answer it in two different ways. First, you have to remember that the events in March didn’t make people – I mean, we all read the popular press and most individuals begin to think about what is the most risk-free asset, that being a U.S. treasuries. So, one should not be surprised if they begin to move assets into U.S. treasuries.
So, I do think that it’s a function also of uncertainty and not just the absolute level of where interest rates are or aren’t. Now, as I have said, we have these moments that are opportunistic, both when you think about the corporate activity and then when you think about the individual activities, so both for ISG and in Wealth Management. And that was evidenced last August, last October and then earlier in January and February that when markets become calm that you begin to see movements into asset classes and further activity as evidenced by our self-directed channel as well. So, I don’t know that there is an absolute level of rates, but I would say it’s related to confidence in the system more broadly and a belief in asset levels being in a place that will bottom and then potentially will rise as we go forward.James Gorman I totally agree with that.
I think Gerard, if people can get a 4%-ish return in a very uncertain environment, that’s not a bad thing to have in your portfolio, at least for 25% of their portfolio. As they get better visibility, as we all get better visibility of when the Fed stops moving and did we go into this recession that some appearing or not or if it’s modest, then I think you will start seeing more engagement. I mean it’s just, we have all been through this. It’s human behavior. We have had a pretty significant shock to the system in the last few months, which thankfully the world kind of – the financial world got through, but could have turned sideways. And higher rates came at a time of increased uncertainty. So, it’s entirely rational that people would take advantage of higher rates and increased uncertainty by parking in cash, but they are not going to stay in cash at 4% forever.
That’s not going to help.Gerard Cassidy Thank you. I appreciate that. And then just as a follow-up question, Sharon, you talked about the credit, the provision and linking into commercial real estate. Of the total loan portfolio, what percentage of that is in commercial real estate mortgages? And are there any construction loans in that portfolio?Sharon Yeshaya As it relates specifically to the construction loans, I don’t know about the exact construction loans that you might have. I am certain that somewhere there could be a construction loan. But more broadly, I think the absolute level, we do disclose from the ISG side around that $10 billion, and that was in our filings from last quarter.Operator Devin Ryan from JMP Securities.Devin Ryan Thank you.
Good morning. I just want to start just on market share opportunities that maybe are accelerating here. You touched on some on the call, but one of your peers highlighted your private banking in Europe, just on the heels of some of the banking stress or potentially even just opportunities where you are going to get paid more for committing capital when your capital is becoming more scarce in the system. So, just love to maybe think about some of the things that you are seeing just over the last month or so that might be sustained going forward.Sharon Yeshaya On capital opportunities, in Europe. Sorry, could you repeat what’s the question?Devin Ryan Yes. The question is just where there is opportunities to take market share kind of in the wake of the banking turmoil.
So, one peer had highlighted private banking in Europe as one example. But just whether there is others as well here, just on the heels of the recent stress?James Gorman Yes. Devin, let me have a go at that because that probably builds off the capital discussion and where we would invest. We do not have an appetite for private banking in Europe. In fact, we sold our Private Bank in Europe to Credit Suisse several years ago. It’s one of the first things I did, because we would had an unhappy experience. We had owned the business for 21 years, and we lost money for 20 years of them. And I kind of took a fairly simple view that if you lose 20 years out of 21 years, you have probably got to lose it. So, we got out, you need scale. And frankly, it’s not a good fit I believe, with the current regulatory structure that we operate under, so much more interested in the U.S. and Asia and some in Lat-Am. The U.S. business, it’s just going to be an asset gathering monster.
