“However, if it was more gradual in nature, which is similar to what you might see in the forward curve, you will have offsets associated with the reinvestment of the portfolio. So that will offset the rate decline, right? We'll largely offset those rate declines.”

In context

“to unfold as the Fed begins easing and whether there's any appetite on your side to extend duration to maybe lock in some higher yields. Sharon Yeshaya: That's a great question. And the answer is fully premised on what we see first with deposits, right? So your sort of first order condition, as you look ahead into 2024 is what happens to the deposit mix. What I said on the call is that we're encouraged in my prepared remarks, we're encouraged by what we've seen to date as the beginning of January. If you were to assume that, that were to hold, the next question is, what is the pace of the interest rate cuts that we see? If you see an instantaneous shock, we disclose to you what that means, right? So an instantaneous 100 basis point shock lower will be negative, around $600 million, right? However, if it was more gradual in nature, which is similar to what you might see in the forward curve, you will have offsets associated with the reinvestment of the portfolio. So that will offset the rate decline, right? We'll largely offset those rate declines. But it will depend first order condition is -- our deposits stable is the mix stable, and that's what we've seen so far. So let's see if that holds. And then second, what is the pace of the cuts over the course of the year. Operator: We'll move to our next question from Devin Ryan with JMP Securities. Your line is now open. Please go ahead. Devin Ryan: Thanks so much and good morning Ted and Sharon. Maybe just start with a question on investment banking and good to hear about the tone improvement there. Sponsors have been less active than corporates, at least from the data we track, and we know sponsors have record dry powder, but higher interest rates, current valuations have been a little bit challenging for them. So just the question is whether they are in a position to return in force”