On the next slide, we go through expenses. Our comp to revenue ratio in the third quarter was 58%, which was in line with our forecast for the second half of the year. Non-compensation operating expenses, excluding the credit loss provision and expenses related to investment banking transactions totaled approximately $302 million. Our non-comp OpEx as a percentage of revenue was 28.9%. Excluding the legal charges we referenced earlier, our non-comp OpEx as a percentage of revenue totaled 22.6%. Effective tax rate during the quarter came in at 37.7%. Again, the higher tax rate was primarily due to the non-deductibility of legal expenses. Before I turn the call back over to Ron, let me discuss our capital position. We have approximately $300 million of excess capital based on a 10% Tier 1 leverage target.
Additionally, we continue to generate a substantial amount of excess cash as illustrated by our annualized year-to-date net income of $450 million. We remain focused on generating strong risk-adjusted returns when deploying capital, and we’ve done this through reinvesting in the business, making acquisitions as well as through share repurchases. Given the uncertainty in the market and our discounted valuation, so far this year, we have primarily deployed excess capital through share repurchases. In the third quarter, we repurchased 1.9 million shares. I’d note that through three quarters in 2023, we’ve deployed more capital into share repurchases than any of the past five full years. Absent any assumption for additional share repurchases and assuming a stable stock price, we expect the fourth quarter fully diluted share count to be 111.8 million shares.
And with that, I’ll turn the call back over to Ron.
Ron Kruszewski: Thanks, Jim. Let me conclude by talking about how we are positioned and what I believe the potential of our franchise is. Needless to say, our current institutional business is not constructed to operate efficiently in the current market conditions. To put institutional weakness into perspective, annualized industry wide 2023 U.S. equity capital markets fee revenue is down nearly 80% from 2021 and M&A fee revenue was down 50%. In short, while we don’t need activity levels to return to record levels, we do not expect this institutional environment to be the new norm in any shape or form. And then note, I also want to be clear that when it comes to expenses, we are not going to blink at the bottom and try to generate near-term operating leverage by significant reductions in workforce.
The vast majority of our operating leverage will come from the scale of our business with market returns. I’m not going to try to do — you’re never going to try to predict when markets will turn. But I want to highlight that we are, in fact, well positioned. I regularly get asked the question, what does Stifel look like when market conditions normalize. I’m not offering up long-term guidance. I think all you need to do is look at our combination of historical growth rates as well as increased scale and operating leverage. Under these assumptions, we believe that net revenue of $5.2 billion and EPS of approximately $8 per share is reasonable. Now you can all do the math, but this is essentially based on continued, if not modestly accelerated growth in wealth management, NII of approximately $1.1 billion to $1.2 billion based on a combination of balance sheet growth and changes in NIM and institutional revenue of $1.7 million to $1.8 million (ph) and consistent or modestly higher share repurchase activity.
I want to highlight this as I recognize the value created for our shareholders by share repurchases at the current price level and valuation particularly when compared to what I believe our potential is. This is a nice segue to discussing how we think about deploying capital as we build toward this level of revenue and earnings. We’ve always focused on generating the best risk-adjusted returns with our capital. And as I look at the opportunities today, the best returns will come from repurchasing our stock, growing our dividend and recruiting productive advisers. We will continue to look at acquisitions, but given higher interest rates, inflation and still continued elevated valuations, this opportunity today is less attractive. So before I turn the call over to the operator for questions, let me close by reiterating that while the near-term environment is uncertain, I’m very optimistic about our longer-term outlook and upside.
