We expect them to continue into the second quarter that we’ve seen so far in April and throughout the managing time period. What I’d say about Q1 is that, it’s really hard to sort of separate out what may have happened because of all the uncertainty and maybe a flock to safety as people trust SoFi and came to our product and used it more frequently. I would say the trends in April are off to a start that would indicate we should be at the similar level of $2 billion plus in deposits at the end of the quarter. In terms of spending, we continue to see really strong growth in spending as our direct deposit members increase, given that they’re using as their primary account. And so that’s also a contributing factor to our financial results that sort of gets overlooked because of just a strong performance on NIM that we continue to see and how much more scale that is.
But the spending trend on (ph) and so forth has really mirrored the trend in deposits as well as NIM to reinforce our overall strategy, giving us an opportunity to have more touch points in helping people get their mind rate based on their spending and what’s happening in their accounts.
Operator: Thank you. Our next question comes from the line of Reggie Smith with JP Morgan. Your line is now open.
Reggie Smith: Hey. Good morning and congrats on the quarter. I only have one question, so it’s going to be kind of long, I guess. I was curious, what are your loss expectations, life of loss expectations for your most recent cohort of personal loans? How does that compare to maybe your 2022 cohorts? And then follow-up to that is, how are the 2022 tracking relative to your initial expectations?
Anthony Noto: Thank you for the question. I’ll let Chris get into the particulars. But at a high level, since 2018, we’ve architected our personal loans in a way that will drive to at least a 40% to 50% variable profit margin. And that includes all the variable cost, including life of loan losses and funding costs. The reason why we target that level of profitability is so that our loans are durable through the cycle. If we’re seeing trends that lead us to believe that we can’t get to that level, we will make changes. Sometimes that’s increasing our WAC. Sometimes that’s being more efficient in our marketing costs. Sometimes that involves driving down lower cost of funding. As it relates to the macroeconomic conditions impacting life of loan losses, we will tighten credit.
We’ve tightened credit in the past. We have very sophisticated real time ability to test pricing and credit and a number of early warning economic indicators that have caused us to be more conservative on what we under write and tighten credit throughout the year and we’ll continue to do that. But we’ve been below our targets life of loan losses of 7% to 8%, which is part of that equation of 40% to 50% variable profit margin. I just don’t want people to think it’s just about that metric, it’s about the overall unit economics of getting to 40% to 50% variable profit margin and that assumes 7% to 8% life of loan losses, which we’ve been below and our cohorts have really continued to trend relative to that metric in a positive way.
