Operator: Our next question is from the line of Gerard Cassidy with RBC. Please go ahead.
Gerard Cassidy: Bill, coming back to your thoughts on the spreads that you guys just referenced on the commercial loan book relative to the CECL outlook. I’m glad you framed it that way because I think many of us are in that camp that you just described. But in terms of the spreads, is there any capacity issues, meaning there’s too much lending capacity, which has kept the spreads maybe lower than normal?
Bill Demchak: I’m not sure what’s going on, to be honest with you. I mean there’s — on the smaller end in certain retail categories, which really isn’t our focus. There’s — there’s just irrational competition in certain asset categories. In the larger corporate space, where we have this opportunity to grow clients, particularly in the new market and ultimately cross-sell, there just hasn’t been any sort of gap the way you’ve seen in the public markets, there hasn’t been any real change. Spreads aren’t going down, but there hasn’t been any change at all with respect to kind of the outlook in this economy. And until — and if there’s real defaults and charge-offs, there probably won’t be. So one of these things is going to give, I just don’t know which one it is.
Gerard Cassidy: Very good. No, I noticed in your Table 10 in the supplement, the inflows of non-performance had been pretty steady. So, there’s real — excuse me, real evidence yet. And then as a follow-up, can you just remind us your outlook for returning capital to shareholders in the upcoming year with dividends and share repurchases?
Rob Reilly: Yes. Gerard and just to finish up on that on the credit spot, to your point, in the supplement, the non-performers, but also you take a look at our NPAs and our delinquencies, which are down. So the leading indicators are still very strong. Yes, on the share repurchases, a couple of things. One is we are going to continue our share repurchase program into ’23. Secondly, it will be at a reduced rate relative to what we did in 2022 and likely to be less than what we did in the fourth quarter of ’22, which was $600 million. A couple of things about that, one is, why lower? One is, given all the uncertainties that we’re seeing, obviously, we need to be smart and tactical in terms of our capital deployment as the year plays out.
But secondly, and just logically, the rate of repurchases slows when your capital ratios go from 10% to 9%. So, we still have a lot of capital flexibility. But by definition, as we get closer to those operating guidelines, we slow the pace of repurchases. All that said, there’s flexibility, as you know. So, with the stress capital buffer, we’re allowed a lot of flexibility around it. And we plan to use that flexibility as circumstances present themselves.
Operator: Our next question is from the line of Bill Carcache with Wolfe Research. Please go ahead.
Bill Carcache: Bill and Rob. Following up on your swaps commentary, could you speak broadly to how you’re thinking about downside protection in this environment? Any color you can give on where you’d expect your NIM to settle if the Fed ultimately pushes the economy into, say, a mild recession cuts rates and Fed funds normalizes, say, somewhere in the 2.5% to 3% level? That would be great.
