“So Mike, the way I think about it, this is Andy, by the end of the fourth quarter, we will be on a run rate recognizing $900 million of savings, which will be fully reflected in 2024 in our expense base.”

In context

“the third quarter, the first quarter of 2025 could see $800 million of additional expense savings? John Stern: No, because we've been -- the savings have been generated all throughout the course of the year, and they have -- they accelerate third quarter into fourth quarter, and second quarter, third quarter and the fourth quarter. Mike Mayo: So what's the cumulative merger savings? I guess how much more expense savings should there be when they're fully realized in the first quarter relative to the third quarter? John Stern: When we have the savings, we'll have approximately $400-or-so million that has gone through this full year, and then we'll expect to see that in the next coming year. But that's embedded into our full year guidance of flat expenses between 2023 and 2024. Andy Cecere: So Mike, the way I think about it, this is Andy, by the end of the fourth quarter, we will be on a run rate recognizing $900 million of savings, which will be fully reflected in 2024 in our expense base. And that is consistent with how we think about a relatively flat 23% to 24% expense base, including those savings plus investments we'll continue to make in the business. Mike Mayo: And then the big question then is, so if you have flat 2024 expenses, do you think you can get to positive operating leverage? Or is it too early or too many moving parts? Because this is the sweet spot of the merger savings coming up, right, by the next quarter. Andy Cecere: It is a sweet spot, Mike, you're absolutely right. And the savings are great. The opportunities to deepen relationships on the Union Bank customer base, I mentioned that in my comments, I think that is terrific. Our fee businesses are doing extremely well. On a year-over-year basis, it was up 12% across almost every category. And frankly,”