Ron O’Hanley: Yes, Glenn, It’s Ron. So we’ve tried to be quite clear above what we’re doing over at SSGA. I mean, first is around continuing to grow the ETF franchise. As you know, our legacy strength is in the institutional business, where we continue to be quite strong, and we’ve focused a lot over the last several years on growing the low-cost ETF franchise, which tends to find its way into retail portfolios through intermediaries. That led to the repricing initiative that we did last year, which in retrospect is proven to be quite a smart move because the market share has gone up and those portfolios tend not to move, these are buy and hold investors. So ETFs would be one and then we continue to grow the active space, typically with working with very close partners of ours, and we see a lot of runway inactive.
And then finally, fixed income, particularly out, we have a strong fixed income offering here in the U.S., and we’ve built it out quite a bit in the last couple of years in Europe, and you’re seeing lots of strength in the ETF ecosystem in Europe. Second area of growth is really trying to leverage the institutional client base, because its legacy is the passive index business. If we have an institutional relationship, we tend to be the number one or number two manager on their platform. That leads you, that gives you a seat at the table and we believe it gives us an ability to potentially distribute other, kinds of, products and services. So that’s where a lot of our focus is now on the institutional business. And then finally, continuing to deepen.
We have a global franchise, but there’s areas that we can deepen it more. You’ve heard us talk about Europe, and we’re focused just as much on Asia Pacific as those markets continue to grow, and we’re able to leverage the positions we have, but really focusing on deepening as opposed to broadening geographic reach. So that in a nutshell is how we’re thinking about it, and we’re pleased with how it’s playing out.
Glenn Schorr: I appreciate that, Ron. Thanks.
Operator: Thank you. Next question will be from Ken Usdin at Jefferies. Please go ahead. Please go ahead, Ken, your line is open. Could you please unmute? No response. Moving on to Alex Blostein at Goldman Sachs. Please go ahead.
Alex Blostein: Hey, good morning, everybody. Thanks. Another one for NII, I guess good quarter, good guide for the second quarter as well and that’s sort of elevating your full-year NII guidance also. But similarly, I guess to kind of what we saw in your guidance last quarter, the back half of the year seems to have a pretty meaningful drop off for the tune of maybe $100 million bucks or so versus the quarterly run rate. Eric, I guess given your comments on deposits being stable and higher rates are kind of are where they are, you still get in the benefit of repricing on the securities portfolio? What sort of informs this sort of decline in NII towards the back of the year?
Eric Aboaf: Alex, it’s Eric. You know, we’re going to continue to see some of the trends that we have been seeing, and it’s just a matter of how the various pieces, you know, partially or fully offset each other over time. You know, we’re going to continue to see a tailwind from the level of rates, at least given the current forward curve, because that plays through the investment portfolio and gives us a tailwind, as does some continued growth in lending. The headwind that we’ve been navigating through, which I would describe comes in steps, and sometimes it’s a step down, sometimes half a step back up, is around the deposit levels across the interest-bearing stack, where we’re just seeing deposits, I think, at nice levels, to be honest, while we continue to see the grind down of non-interest bearing deposits.
And we do expect another quarter of that non-interest bearing deposits to trend down and then to flatten out in the second-half of the year. I think, so you’ll see those trends continue. I think you’ll — we’ll see where we come out. But you know, if you take our guide together, we expect a modest step down into the second quarter, and then we see a leveling off in the third and fourth quarter of our NII. I think in the past we’ve talked about being in a range of $500 million to $600 million a quarter. We’re now seeing and expect to be comfortably above the $600 million per quarter range. But it’s those factors as headwinds and tailwinds that’ll play through, that’ll kind of dictate exactly where we come out. But I think as I said earlier, the level of client engagement that we’ve had in terms of putting deposits with us, putting deposits at different price points with us.
Some of those are the core transactional deposits that need to support custody accounts, and some of those are the discretionary amount of deposits. It’s been a real priority for the franchise and I think one that we’ve shown some good success in. And that’s really creating, I think, this better expectation than we had earlier signaled at the beginning of the year, and one that we think will endure and then, you know, provide the stability and over time upside in NII in the coming years.
Alex Blostein: Great. All right. I think, that’s helpful. My second question is around expenses. You talked about how consolidation of the GV, I guess, that took place recently in April here, will create a new wave of optimization for next year, if I got that right? Can you just outline what that could mean in terms of incremental, either rejuvenating benefits or cost benefits, however you want to frame that, and what that means for maybe the overall kind of expense growth for the franchise? I know you’re holding the line this year really well, but is there an opportunity to kind of continue that into 2025 as well? Thanks.
