Rob Wildhack: Okay. Thanks, Eric.
Eric Aboaf: Sure.
Operator: Your next question comes from Glenn Schorr from Evercore. Please go ahead.
Glenn Schorr: Thanks, Eric. Maybe just a different attempt of the deposit discussion. So I get clients wanting more yield. I bought treasurers too, we all did. But is there any point where the client profitability discussion has teed. Like are they able to move 100% of non-operating deposits if they want, like what discussions you’re having with them about doing more with State Street areas like FX like lending, alpha. But maybe you could update us on what you’re doing to try to help impact what seems like you can’t impact the deposit side. So is there anything else you can do?
Eric Aboaf: Yes. Let me start there, Glenn, and I think Ron will weigh in as well because a number of us have these engaging conversations with clients. I think from a burn down standpoint, let me first take it from that angle is if you think about our $200 billion of deposits, we’ve got deposits at a number of different price tiers and we have kind of very large sophisticated clients and then kind of that large tail of small and midsized clients. Of the $200 billion, we think there’s about $50 billion that we’ve been very focused on and continue to be focused on. So about a quarter of our total deposits are with these clients that as we’ve talked about the last couple of questions, there’s been a real catch-up on the back book.
I described that because of that $50 billion, which is either a very low price or zero price for our larger and most sophisticated clients, where we have these engaging and balance of trade discussions, right? We’ve around — we’ve got about $25 billion that’s behind us, where largely, we’ve repriced those deposits. We’ve had those discussions and some of those have come with some balance of trade improvements or some commitments on stability on fees, and those are behind us. Included in the outlook that I provide beyond the $25 billion, there’s another $15 billion that’s underway right now. That’s included in my third quarter outlook, right? So that gets us to $35 billion, almost $40 billion of the $50 million. And then there’s a trail that we’ll still have.
And so I think from a client discussion and negotiation standpoint, the third quarter we expect to be the peak. I think what you’ll find is that each of these questions on deposits, certainly, rates goes through a pricing committee from a balance sheet management standpoint. But very quickly, those go to the most senior client executives and all the way up to our C-suite because those are large. They’re very large and that’s where we engage. And I think what you’ll see over time is some of that we’ll come back through in FX revenues and sec lending revenues and the absence of fee rate reductions in the future, right, on one hand. And on the other hand, some of what we do here is also work with clients on expanding the range of what we do for them when it comes to managing their cash, right?
I think some of the reason you’re seeing the uptick in cash with in our asset management business because some of those clients say, look, I’d like to be in a cash money market sweep until we’ve been doing that. You see our repo business continues to do very, very well is actually an add to — it’s a stabilizer to NII or an add to NII on a year-on-year basis and stabilizing and it’s a stable source of NII income quarter-on-quarter because we’ve been able to shift some of the client cash to those areas. So there are some offsets as well there. But that’s a bit of a start.
