“It should not be dilutive to our TCE.”

In context

“nce sheet? Michael Santomassimo: There is a lot in there, so let me try to unpick some of it. As we came out of the period when the asset cap was in place, we knew that the place we were going to see the growth first is in repo, for the vast majority of it Treasury repo, and then there are other aspects to it. It is low ROA, low risk, good returns, and it then allows us to do much more with those clients as we provide them what they think of as valuable financing capacity. I think as we go through this period, you are going to see ROA come down. As that stabilizes and matures and we get a little further into this growth period, that will start to moderate and you will start to see it either stabilize or start to grow as we start to add in the other business activity that we expect to see. It should not be dilutive to our TCE. We are starting to see some of the onboarding come to a conclusion. Some are in process. Some of the clients that are going to do more with us as a result of the financing take time to ramp up. They do testing with you, and we are starting to see that come through, whether it is prime, other trading that they do with us, and across a number of the asset classes. You will start to see that incrementally get added into the mix overall. I will point out we are seeing some of it. Markets revenues are up 19% from last year, so we are starting to see some of that come through. And as Charlie noted, we expect to grow the Markets business in the context of also improving overall returns for the company and do not believe it will be dilutive or get in the way of us getting to that 17% to 18% retur”