Ken Vecchione: Thank you.
Operator: Thank you. The next question will be from the line of David Smith with Autonomous Research. Your line is now open.
David Smith: Good morning. So the strong liquidity growth this quarter led you to bring back on about $700 million from held for sale back to held for investments of the remaining $1.8 billion in held for sale? Are you viewing any of that as potentially coming back as well if you have another strong quarter of deposit growth?
Ken Vecchione: A good portion of that in the held for sale is relates to our op. Any comment, Dale?
Dale Gibbons: I mean, we — this is something we are just going to always evaluate. So based upon kind of where we are, but the $1.8 billion is queued up, it’s marked and we will see how that goes, but most of that we expect to exit.
David Smith: And would you expect the CET1 benefit from that to be proportional to the benefit you saw from the $4 billion of sales that you have already executed?
Dale Gibbons: Yeah. So, I mean, the CET1 elements are — I mean most of the assets we are talking about are all 100% risk weighted. That goes for what’s already been done but not all, as well as what’s in there presently. So I mean — but at the same time it means as those loans come off the books, that is beneficial to CET1. Conversely, I mean, I think, the industry is looking at a special charge probably this quarter to recapitalize the insurance fund related to the demise of those three institutions. So that will be some chart. That will be maybe 10 basis points against our capital growth in Q3 as presently proposed.
David Smith: Sure. And lastly, you talked about laying the groundwork for eventually crossing the $100 billion asset mark. I guess, you are just continuing to build $2 billion of deposits a quarter. That’s $8 billion a year. The $32 billion to $100 million take you about four years from now. That seems very proactive. What we need to see to take up your growth targets and growth goals, but before that if you were going to hit that market any sooner, what would give you comfort to open the growth back up?
Ken Vecchione: So let me just give some color commentary about being very early. I think what you are going to see is supervisory review from the regulators starting much earlier and holding you to a higher standard well both — well before $100 million. So the process isn’t, hey, you hit $100 billion, you are going to be reviewed differently. The processes starts well before that, that are you ready to go across over $100 billion and that starts before that. That would be my just comm — color commentary on how that review process works and why we are building it. In terms of opening the gates, I think, our growth is going to be determined by our deposits and our growth in deposits. And we have traditionally been a little bit more heavier weighted to the left side of the balance sheet, which we can turn that machine on, we are really good at growing loans.
What we have turned around here is said, wait a minute, we need to have a more holistic relationship with our client base and growing the deposits are critical, obviously, to our future growth. And investing in future deposit channels and the deposit channels that we have talked about here today, that will drive the deposit growth in the future. So we said $2 billion last quarter that we thought we would grow in deposits. We came in at $3.5 billion. Yes, there was a lot of brokerage there. This quarter, we said $2 billion without broker and we are going to try to exceed and do better than that and then we will kind of grow our way into 2024.
