BK (BK)

“We expect deposit balances to revert to more seasonal patterns from here. We expect Q2 to be moderately down from Q1.”

“For euros and sterling, the betas roughly peaked at 80% on the way up, and for dollars and non-dollars, we expect betas to perform in a symmetrical fashion going up as well as going down.”

“We have said we are going to do that consistently. We are setting ourselves up for peer-leading levels of operating leverage while also investing in the long term.”

“We have run a bunch of scenarios—different rate environments, different levels—take the feedback from the businesses, and that gives us confidence around the 10% guide.”

“I would just like to reaffirm our belief and commitment that we can grow the business’ net new assets at mid-single-digit growth over the coming years.”

“Overall, great momentum in that part of the world, and we expect it to continue.”

“It was 3% last year; it was zero four years ago, and we have been working the order book higher. We expect it to grind higher over the balance of this year.”

“The recent rule is broadly favorable for The Bank of New York Mellon Corporation. Before, when we talked about it on previous calls, we gave a preliminary estimate of up 5% to 7% based on the original proposals, and now we expect flat to a modest reduction.”

“We are at the high end of our guide for expenses this year.”

“We continue to believe that we are grinding organic growth higher than where it was.”

“Q3 is usually our weakest quarter, with Q4 being our strongest quarter. Over the balance of the year, we expect balances to be modestly higher relative to 2025.”

“We continue to expect a quarterly tax rate of approximately 23% for the remaining quarters this year.”

“We expect full year 2026 expense growth, excluding notable items, to be at the top of the 3% to 4% year-over-year growth rate range that we provided in January.”

“That includes our expectation for full year 2026 net interest income to be up approximately 10% year over year.”

“In light of our strong performance in the first quarter, we are raising our outlook for total revenue, excluding notable items, for full year 2026 and now expect approximately 6% year-over-year growth.”

“We feel pretty good about the outlook for the year, but we are only one quarter in, three quarters to go, a lot of uncertainty, so we are not really changing our outlook on the fee at the moment.”

“Q3 is usually the seasonally slowest and you would expect over the next couple of quarters to moderate down slightly.”

“we are increasing our return on tangible common equity target also by 500 basis points to 28%.”

“Today, we are raising the bar. We are increasing our pretax margin target by 500 basis points to 38% and we are increasing our return on tangible common equity target also by 500 basis points to 28%.”

“And so the buyback number as a percentage is really an output to all the things that we've talked about earlier. So it's going to be in that kind of [ 95, 105 ] range.”

“And so we feel like we've turned the corner in IWM and '26 is the year that we're going to begin to see the transformation as we brought that business closer together with BNY.”

“So I'm not too sure what your definition of significance is, but I would expect over the course of 2026 for NIM to grind higher from where it is today.”

“So I would expect higher organic growth this year, which reflects the flywheel of the new commercial model and also new product development and the culture that we've kind of changing over the last couple of years at the firm.”

“When we give you the -- when we think about the 5% plus, it's really around the asset side of the balance sheet where we have securities kind of rolling off, and we're reinvesting as a kind of [ 100 to 150 ] basis point pickup.”

“So we expect to continue to grow internationally and moderate in the U.S.”

“So the way I would think about this is, as you rightly pointed out, the growth rate over the last couple of years has been quite nice to see. And so we would say the growth rate from here, probably a little bit more modest compared to previous years.”

“We expect that 2026 will be the year in which this work will start to translate into improved financial performance.”

“Our Tier 1 leverage ratio management target remains unchanged at 5.5% to 6%, and we will continue to manage ourselves conservatively to the upper end of that range for the foreseeable future.”

“And on taxes, I'd like to note that over the course of 2026, we expect a quarterly tax rate of approximately 23%, with the exception of the first quarter, in which we currently expect to see a tax benefit from the annual vesting of stock awards.”

“so we have set ourselves up for another year of more than 100 basis points of positive operating leverage in 2026.”

“And we're now with the deconversion behind us, we expect growth in net new assets to reaccelerate for the balance of the year.”

“And finally, we expect to continue returning capital at a pace that is consistent with a total payout ratio of 90% to 100% for the full year 2025.”

“We currently project our effective tax rate for the fourth quarter to be approximately 21%, which would bring our effective tax rate for the full year into a range of 21% to 22%.”

“We continue to expect expenses, excluding notable items, for the full year to be up approximately 3% year over year.”

“On the back of a strong third quarter, we expect net interest income in the fourth quarter to be approximately flat sequentially, which would ultimately result in full-year 2025 net interest income to be up 12% year over year.”

“Going forward, we expect net new asset growth to reaccelerate as we completed this previously disclosed deconversion in the third quarter.”

“More than 70% of employees are now working in the model, and we expect to complete the remaining transition over the course of the next year.”

“So we've replicated that thinking in that model and that kind of proactive repositioning of the balance sheet for 2026. So we've done a lot of work and we've done a lot of positioning. And so to your specific, the latter part of your question, I would say Q4 is a good jumping-off point as a base case for 2026.”

“That means that while we will be entirely operational in the new model by the fall of next year, we don't expect to see the full benefits of these new operating rhythms until early 2028.”

“you're going to see the North Star of positive operating leverage be delivered for the foreseeable future.”

“we remain on track to complete our phased transition into the platform's operating model by this time next year.”

“But I would expect that to moderate a little bit in Q3 and pick up again in Q4.”

“I expect the balances to moderate into Q3.”

“we see kind of strong momentum continuing.”

“we plan to continue repurchasing common shares under our existing share repurchase program.”

“And we continue to expect to return roughly 100% plus or minus of 2025 earnings through common dividends and buybacks.”

“We continue to expect our effective tax rate for the full year to be in the 22% to 23% range.”

“And we continue to expect solid fee revenue growth in 2025, of course, market dependent.”

“And so it's not for another two years where I would say the firm will be reasonably mature in the model.”

“With fifty percent of the firm in the model and ten percent in it about fifteen months, I would expect the maturity of this to kind of give us a benefit for the next few years.”

“we resume that path towards 25% which is going to further fuel organic growth at the enterprise level.”

“I think under a wide range of situations for '25, with the expect -- with the -- on the rate curve, we're good.”

“But on the more positive side, I would say we continue to see kind of strong client uptake in the pipeline for Wove. We gave a guide in January, which was for 2025, roughly $60 million to $70 million. We still feel very good about that guide.”

“And to give you a little bit of an indication like up down -- if the Fed were to cut rates by 50 basis points tomorrow, it wouldn't really impact how we think about NII for the balance of the year.”

“So, there's nothing that we see kind of changing our view of the overall deposit mix for the balance of the year, which kind of gives us a lot of confidence around the guide that we gave you.”

“Yeah. So I would think like by this time next year, when we do this call, all things kind of going according to plan, we would say the firm is fully operating in the new way of working.”

“So we were a little bit higher than that. And so our current we kind of believe that that's -- it's going to roughly hang into the ZIP code that it's currently in, may moderate a little bit from here due to some cash sorting. But we don't expect any meaningful change on it, and that kind of feeds the 5% guide.”

“We expect to ramp up in the latter part of this year. But in terms of moving the needle for the firm's revenues, it's just another happy clients wanting to do business with BNY and it's going to come into the run rate latter part of this year. So it will be in the full year numbers next year.”

“In terms of the beta question, look, this is a question, I guess, that's come up on a lot of calls over the last several quarters in that we deal with a sophisticated client base, and we kind of pass on the rates as we get them. And so our kind of bases have always been quite high, like in the low to mid-80s, and that's kind of where we see the book. And so the marginal base is around 100%. And if rates were to go down, we'd see the betas to perform in line with the way on the way up.”

“I wouldn't have a huge revenue item in the 2025 P&L, but that isn't to undermine its promise over time.”

“So, look, noninterest-bearing deposits, I think, are roughly in line with where we don't really expect them to go meaningfully higher or meaningfully lower from where they are now, which reinforces our guide.”

“And we continue to expect to return approximately 100% plus or minus of 2025 earnings over the course of the year.”

“We also continue to expect our effective tax rate for the full year 2025 to be in the 22% to 23% range.”

“And we continue to expect approximately 1% to 2% year-over-year growth in expenses, excluding notable items.”

“We continue to expect some fee revenue growth, of course, market dependent.”

“That means we continue to expect full year 2025 NII to be up mid-single-digit percentage points year-over-year.”

“the clients' excitement about that product continues to kind of give us confidence about saying mid-single-digits through the cycle as it relates to M&A.”

“and I think we're going to do just fine in '25.”

“So we feel confident that we're going to hit those targets sustainably through the cycle. So you're going to see more of the same from us and what you've seen in the last couple of years into '25 and beyond.”

“on balance, expect it to grow, but it's not a meaningful part of the overall number.”

“So, incremental revenue for '25 of $60 million to $70 million”

“we are kind of more neutral on kind of market growth in terms of our guide.”

“So what I would say is roughly kind of 5% on markets from here is about kind of $70 million in fees. That's the rough sensitivity”

“So Pershing continues to be a very, very strong business for us and we continue to see it growing.”

“we think we have a good ability and the right to win and grow our net-new assets at mid-single digits through the cycle and that's across the space, whether it's RIAs, whether it's broker-dealers, banks”

“So you take all those discrete elements together and you add it together, you kind of go, okay, fee revenue is going to kind of incrementally grind higher from here with the tools that we're deploying and executing.”

“Our Tier 1 leverage ratio management target remains unchanged at 5.5% to 6% and against the backdrop of continued interest rate volatility, we will continue to manage ourselves to the upper end of that range for the foreseeable future.”

“And then on taxes, we expect our effective tax rate for the full year 2025 to be in the 22% to 23% range.”

“We want to demonstrate to you that we can prove that we can deliver 33% margins through the cycle.”

“We think it's very important for our franchise, and we don't see a secular decline in that business from where we see it today.”

“We don't view current prices as being problematic in terms of continuing our stock buybacks.”

“We remain on track for the $30 million to $40 million of revenue in 2024 as we guided in January.”

“So we expect the benefit that Dermot was describing to be a multiyear endeavor past that 18-month point.”

“We expect maybe NIBs grind down a little bit from here.”

“We're looking forward to closing that transaction in the fourth quarter and welcoming the team in.”

“As it relates to elevated activity in terms of volume and activity, I think from what we see on our platforms, we kind of see that continuing to be the case in the medium term.”

“So the decisions that we've taken over the last couple of years in terms of realigning certain activities into different parts of the firm are showing up in our revenues this year, and we will continue to do that into next year.”

“Our underlying organic growth this year, we feel quite happy about, and we feel it reflects a really good nine months of the year. And there's no reason to expect that, that momentum won't continue.”

“And also, as Robin said in his remarks, we've announced the acquisition of Archer and there'll be some integration costs associated with that.”

“I think, overall, we've kind of -- we've held in there. We had a strong Q3 for a variety of different reasons. So, I would say, I expect where we are to moderate a little bit on balances in Q4 and we'll see what happens next with the next Fed meeting, but no significant change for us as we kind of sit here right here today.”

“And lastly, as we said at the beginning of the year, we expect to return 100% or more of 2024 earnings to our shareholders through dividends and buybacks.”

“We now expect our effective tax rate for the full year 2024 to be at the lower end of the 23% to 24% range we estimated in January.”

“Regarding expenses, we continue to work hard to keep core expenses, excluding notable items, for the full year 2024 roughly flat.”

“The transaction is expected to close before the end of the year, and we look forward to welcoming the Archer team to BNY.”

“So I feel good about expenses. I feel good about flat, notwithstanding there's pressure to that from a revenue-related expense part, but we're very determined to deliver positive operating leverage to our shareholders this year.”

“To wrap up, we enter the second half of the year on the back of solid fee growth, a better than expected NII performance to date, and continued expense discipline, which gives us incremental confidence in our ability to drive positive operating leverage in 2024.”

“We think that each quarter, each year has a different composition to it, but higher fee growth over time is a very important part of that combination of solutions.”

“Depositary Receipts, we have good market share. We punch above us and we expect that to continue.”

“And in previous quarters, I've kind of guided mid-single-digits of underlying core growth through the cycle. We continue to believe that, notwithstanding on any given quarter, it may be slower or better.”

“I kind of reiterated my guidance on prepared remarks about the $30 million to $40 million of revenue for this year.”

“So I would say nobody is happier to see the ongoing deconversion of the clients to come to an end. So we expect that to be fully out of the portfolio by Q3.”

“And so I do expect that business to continue to grow, but in terms of the year-over-year to your specific question, it's not a material driver of the year-over-year change.”

“So if Chairman Powell cuts in September and then cuts again, I guess, which is the general view of the market, we're kind of basically NII, okay, it doesn't really impact the book that much.”

“And for Clearance and Collateral Management, I think I do expect that trend to continue in the near term.”

“So I think in terms of specifically to your question, it's both, I think the overall balance will come down, and as a consequence, I would expect NIBs from here to grind a little bit lower, which is the main driver of the NII change.”

“And lastly, we continue to expect to return 100% or more of 2024 earnings to our shareholders through dividends and buybacks.”

“We continue to expect our effective tax rate for the full year 2024 to be between 23% and 24%.”

“Regarding expenses, our goal remains to keep expenses excluding notable items for the full year 2024 roughly flat.”

“For now we will therefore keep our NII outlook for the full year 2024 unchanged, down 10% year-over-year.”

“And so the segment overall, I guess, we've said over the last several quarters, we believe we can go back to the 25% margin over a period of a few years.”

“and we made a commitment to the market that we would kind of add $30 million to $40 million of revenue this year, and we still feel very good about that guidance and that commitment that we made to you back in January.”

“We want to be able to expand the pre-tax margin in the business to over 25%.”

“Also, as we both said in our prepared remarks, the migration to a new way of working, the platform operating model over the next couple of years, we feel will not only help us grow top-line, but it will also just help us run the company better.”

“And so as rates stay higher for longer, I would expect NIBs to grind a little bit lower.”

“If QT continues and rates stay higher for longer, on balance I would expect deposits to decline from here.”

“Our guide at the beginning of the year was down 10% and given the rate volatility and what's going on with the inflation report last week and the back-up in rates et cetera, et cetera, we don't see, you know, there's nothing that's causing us to think that we should change our guidance between now and the balance of the year.”

“And finally, we continue to expect returning 100% or more of 2024 earnings to our shareholders through dividends and buybacks over the course of the year.”

“Overall, we remain determined to deliver some positive operating leverage this year.”

“Similarly, on expenses, our goal continues to be for full year 2024 expenses excluding notable items to be flat year-over-year.”

“So, despite the repricing of the curve since the beginning of the year, we continue to expect net interest income for the full year to be down 10% year-over-year, assuming current market implied interest rates for the remainder of 2024.”

“We feel good about our NIM for 2024.”

“And assuming interest rates follow marks implied forwards, we expect to generate additional excess capital from the unrealized loss related to AFS securities pulling to par over time.”

“we're currently projecting $30 million to $40 million of incremental revenue from Wove in 2024.”

“Our plan is to improve the segment margin to 25% or higher over the medium term on the back of a combination of growth and efficiency initiatives.”

“and the completion of a multi-year uplift of our payments platform is expected to drive an increase to our swift market share through growth in several geographies.”

“Here, we are reiterating our existing 30% pre-tax margin target.”

“It is our goal to improve the firm's pre-tax margin to 33% and our ROTCE to 23% over the medium-term, while maintaining a strong balance sheet.”

“And look, I think we kind of -- we're optimistic about where equity markets are going to go. And so in our plans, we have mid-single-digit equity market appreciation to support that fee revenue growth.”

“So we're neutrally positioned in the outlook for 2024 on balance if rates -- if the rates happen -- happen this year, we might expect balances to go up. If it's higher for longer, we expect people to optimize and we say continued outflow of deposits.”

“So we are focused on positive operating leverage next year. That's aggregate operating leverage to answer your question.”

“Yeah, we believe we have the confidence to earn our way out of that over the next several quarters.”

“So there are a lot of things happening underneath the hood that give us a high degree of confidence that we'll be able to continue to bend the cost curve into 2024 and beyond.”

“But we're determined to bend the cost curve into next year and to continue to deliver that positive operating leverage.”

“So overall, that and when you take the asset side of the balance sheet and how liquid we are on the asset side and how that's rolling down, you might want to know that as the balance sheet continues to roll down, we have a yield pickup of 200 basis points to 300 basis points, which kind of gives us a lot of confidence in our estimate for the year and outlook into 2024.”

“Where we sit today, I am confident that we will outperform the target of 4% expense growth, excluding notable items that we communicated in January, and we remain determined to drive that growth rate down to 3% for the full year 2023.”

“Without a doubt, we expect our more prominent solutions, like Wove and buy-side trading, to move the needle on growth over time.”

“With less than three months left in the year, we are confident that we will outperform our 4% expense growth target for 2023, all while self-funding over $0.5 billion of incremental investments this year.”

“So we made some leadership changes there this year, and we're going to begin to see the fruits of that in the coming quarters.”

“But our balance sheet is positioned for higher, for longer. We have a lot of the balance sheet in cash. Our fixed income securities are going to roll off a quarter a year over the next few years, and the pick-up and yield from that is about 200 basis points to 300 basis points.”

“I think in the medium term we kind of still see that business continuing to grow given the level of treasury issuance and what's happening in the market. So we kind of feel good about the underlying growth.”

“As it relates to your specific question, we have about $2.3 billion of unrealized losses in our AFS portfolio and we expect about a half of that to come back into capital over the next over the next 12 months.”

“So there are a lot of things to be worried about. And at this stage, we'd rather be on the cautious end of things and see no real need to change our stance on buybacks in the short term.”

“So I would say for the next quarter, no really change in the buyback. It's going to be consistent with the last couple of quarters.”

“We expect that to happen over several quarters, Ken. I think the important point, so it happened over both quarters.”

“We expect that to happen over several quarters, Ken.”

“Our fixed rate securities are going to roll down over the next, a decent amount of the fixed securities, I think it's a quarter a year rolled down over the next couple of years. And that gets us a pick-up of 200 basis points to 300 basis points.”

“So we feel overall pretty good about NIBs as a percentage of total deposits being in the 20% range.”

“This is inline with our full year outlook to return 100% of earnings or more to shareholders over the course of 2023, while maintaining our strong capital ratios, mindful of the significant uncertainties relating to the operating environment.”

“This reflects our expectation for a sequential step up in expenses, excluding notable items in the fourth quarter, with seasonally higher business development expenses, as well as discrete increases for professional services and occupancy.”

“Based on market implied forward interest rates at the end of last month, our net interest revenue outlook for the full year 2023 remains unchanged for 20% growth year-over-year.”

“So I would say the feedback from our conference in Florida Insight, where we launched Wove, was really, really good. ... So we kind of think over the next several quarters, we like the business momentum.”

“So collectively, we are going to pursue all of these things. It's going to take us a couple of years realistically to see all of the benefit of all of this work, but we feel reasonably optimistic about our path forward here.”

“While we expect the operating environment to continue to weigh on fee growth relative to what we expected at the beginning of the year, our progress on the expense side continues to give us confidence in our ability to deliver positive operating leverage this year.”

“Remember, in January, we committed to essentially cut expense growth in half this year, roughly 4% growth excluding notable items in 2023, compared to roughly 8% ex currency in 2022. Halfway through the year, I'm pleased to report that we're on track even a little ahead of our plans.”

“And importantly, in my prepared remarks, I said that we funded the entirety of our investment plan for the second quarter from efficiency, and we expect that to continue over the medium term.”

“So I think when we look at our balance sheet, we positioned it higher for longer. And that kind of has informed our guidance of 20% for this year. And the book over the next 12 months, 12 to 18 months, we are broadly neutral on the outcome for rates up a little bit or rates down a little bit, and that's kind of how we think about it.”

“Based on our internal analysis, we think that will have a smaller increase than what the QIS has shown in the past.”

“Based on what we know, we expect operational risk RWAs to be in the standardized approach, and that will drive an increase in our standardized RWAs.”

“And look, it's reasonable to expect that they will continue to grind higher from here, but I would say no meaningful change.”

“And we do expect this growth to moderate in the back half of the year, and we do expect declines in our balances as a result of the treasury issuance, which I think is going to be announced in August in terms of what they're going to do between bills and coupon payments.”

“Number three, we still expect to return 100% of our earnings or more to our shareholders over the full year while continuing to position ourselves conservatively with respect to our capital levels, considering the amount of operating uncertainty.”

“Number one, our net interest revenue outlook for the full year '23 remains unchanged for 20% growth year-over-year.”

“Excluding the impact of this ongoing deconversion, which we expect to weigh on our reported net new assets for several quarters, net new assets grew at a mid single-digit annualized growth rate.”

“There's no reason to think we couldn't get back there over time.”

“And then we go into Investment and Wealth Management, which 11% margin is a bit -- to be honest, it's probably a bit disappointing. But 18 months ago, that was a 30% margin business. And we don't see any reason why we can't get back there with a lot of hard work.”

“Look, back in January, the environment was a little bit different to where it is today. We feel we've had a very good start to NII. We did a lot of scenario analysis in January to come up with that number. And look, there was a big kind of divergence between the market implied forward curve, which we use to kind of budget and project where we think NII is versus where the Fed is in the dot plots. If you look at it today, there's a little bit more of a coming together of that and there's more of a market color around higher for longer. We're positioned for that. We feel good about this. And as a consequence of that, we've locked in a good quarter and we feel good about subsequent quarters.”

“We continue to feel very good about the business and more importantly, performance. And then this business performance matters, so we expect that will -- you'll see better balances going forward.”

“We saw a flight to our balance sheet. People wanted to use our platform. And so we saw deposits elevate. Now that's largely moderated, albeit we're a little bit above our forecast, we expect that to moderate further like the rest of the industry in the coming quarters as our clients are sophisticated and they will look for yield.”

“We still expect an effective tax rate in the 21% to 22% range and finally, as we calibrate the amount and pace of our continuing share repurchases in the weeks and months ahead, we will be mindful of the continued uncertainty in the operating environment, especially as it relates to the uncertain path of interest rates and so we're planning to maintain our current more conservative capital buffers for the time being.”

“We've made good initial progress on our plan to return more than 100% of earnings to shareholders in 2023, and we currently expect to continue buying back stock, albeit at a slower pace given the uncertain environment.”

“That is a longer-term build. We've talked about the fact that it wasn't going to meaningfully contribute over the course of couple of years since we first talked about that. And so, that's really a '22, '23 thing. You should expect essentially nothing from it in that period of time, but we'll update as we go past launch, we'll give you some updated view on that. But I view that as being a '24, '25, '26 story overall in terms of its ramp.”

“But we're not relying on that stickiness. And I think that is an important point that Dermot mentioned. And so to the extent that we are -- we will harvest the benefits as we have them, but we definitely recognize that they could go down to the prior cycle those in percentage composition terms, and we're managing ourselves accordingly.”

“Our project commits to achieving positive underlying growth this year across almost all of our businesses, with particularly healthy growth coming from Asset Servicing, Pershing and Treasury Services.”

“I'll just remind you that to the extent that rates start to come down, then AOCI will pull to par faster.”

“we do expect deposit pricing to perform similarly on the way down as it did on the way up. So, we'll get the benefit, of course, because our -- we will get the benefit should rates suddenly start to come down of deposit costs also coming down very quickly.”

“we expect those to be above the average growth of the company.”

“I expect it to be negligible from a revenue point of view over the course of the next couple of years, it might be negligible for the next five years.”

“kind of net-net, putting it all together, when you look at the margins for Securities Services overall, they're going to be lower than what we printed in Q4, but certainly higher than the full year level.”

“you should expect and we are expecting the large majority of that to be from NIBs because they will probably revert back to about 20%, 25% of our total deposit balances as we've really seen in historical average.”

“we think that we'll have growth in the near-term through onboarding the pipeline, and then we've got the medium play of Pershing X.”

“we do expect some modest runoff in balances as well in money market funds.”

“we would expect them to continue to increase, but of course, more so for non-dollar balances.”

“we do expect deposits to decline modestly, call it, low to mid single digit from fourth quarter average.”

“we do continue to expect to benefit from significantly higher reinvestment yields.”

“we expect our effective tax rate for the year to be in the 21% to 22% range, primarily due to an increase of the corporation tax rate in the UK this year.”

“we intend to deliver a further pickup in 2023 as we increasingly sell our platform and better connect the dots for our clients.”

“we do also expect there are going to be some offset for us. So, lower credit risk RWAs and also, we'll probably benefit modestly from the more risk-sensitive market -- the market -- the more risk-sensitive, excuse me, market framework.”

“X's minimum viable product remains on track to launch in the fourth quarter.”

“We do think the lion's share of the runoff will be behind us by the end of this year.”

“We do think that a large majority of the deposit outflows will be behind us by year-end.”

“We do expect another step-up in the fourth quarter and even beyond the fourth quarter based on a lot of the factors that you mentioned. We do expect that NIM will continue to expand but probably at a slower rate.”

“Looking ahead, we do expect marginal betas to continue to ramp higher as rates continue to rise, but at the end of the day, we do think that they will largely retrace what we saw in the last cycle and so ultimately end up higher than where they are today.”

“So I think I've mentioned and we still believe that NIBs will ultimately revert to what we saw pre-pandemic, which would be about 20% to 25% of our total deposit base. We actually think that, that might happen here in the fourth quarter.”

“we do expect to continue to get incoming phone calls given some of the differentiated nature of how Insight has performed through this, and we view that to be positive for the franchise.”

“we still expect an effective tax rate between 19.5% and 20% in the fourth quarter.”

“That being said, we are intensely focused on disciplined expense management and are working hard to drive this towards the bottom half of that range”

“We continue to expect expenses, excluding notable items for the full year to be within the range of up 5% to 5.5% that we had guided you throughout the year.”

“As their cost pressures rise, we are seeing a lot of interest in engaging with us to review operating models. The scale of our platforms should allow us to lower operating costs for our clients enabling them to focus on their core strengths.”

“we talked to you about improving our pretax margin in security services to 30% over the medium-term”

“So for us, obviously, some of the impact made the loss that we took on Russia, and in Ukraine are just some CC business in that region. But then that is offset by organic growth, but still 50 odd â is expected to be between 50 basis points to 100 basis points.”

“I'll reiterate my prior point on the revenue though, which is we don't expect to have a meaningful drop to the bottom line on this thing, I said at the time, for a couple of years.”

“And we would expect also, given the change in mix of our business, Treasury Services is a much bigger business, Asset Servicing likewise is a bigger business, so we think we'll be able to retain roughly two-third of that when it's all said and done.”

“For this year, assuming currently implied rates are realized, we would expect deposit -- average deposit balances to probably decline another 5% to 10% from where they were in the second quarter, and that was $311 billion.”

“What I would say is as the ECB gets to zero, that's probably the toughest place to be for us. And then as soon as they get negative, we expect betas to also kind of largely retrace what we saw in the last cycle.”

“We still think that ultimately betas will retrace what we saw in the last cycle, although like I said, they're currently lagging what was actually anticipated.”

“Although based on current projections, we expect to end the third quarter at or above our internal capital ratio target.”

“And last but not least, we continue to be cautious on buybacks in this volatile environment.”

“Taken together with our 16.7% tax rate in the first quarter, our expectation for a 19.5% to 20% tax rate in the second half of this year remains unchanged.”

“Due to the impact of the notable item in the second quarter, we now expect our effective tax rate for the year to be closer to 19.5%.”

“Continuously strong inflationary headwinds are expected to largely offset the favorable impact of the stronger US dollar.”

“Assuming equity and fixed income values as well as currencies stay at the level where they ended the second quarter, we would project fee revenue for the full year to be flat to slightly up year-over-year.”

“And it also assumes slightly lower deposit betas than previously expected, which has been informed by our repricing experience to date.”

“This improved outlook continues to assume modest deposit runoff in the second half of the year.”

“Based on current market implied interest rates for the second half of the year, we now expect the percentage growth in net interest revenue for the full year to be in the low 20s compared to the prior year.”

“At closing, we expect that this sale will increase the firm's CET1 capital by about $0.5 billion and it will free up seed capital to help accelerate our strategy of developing new, differentiated solutions from our specialist investment firms that meet the evolving needs of our clients.”

“This transaction, which is expected to close in the first quarter of 2023, builds upon our strategic relationship with Franklin Templeton”

“So, I wouldn’t expect it to increase a lot more from here.”

“And what I would also just flag is that by the end of the year, it’s not – it’s likely – actually not out of the normal possibility, but frankly, probably likely that our binding constraint will become CET1 versus Tier 1 leverage.”

“We would expect, of course as we start to see some probably deposit runoffs that will take a lot of pressure off Tier 1 leverage.”

“So actually, we have been – we are very proactively growing the loan portfolio. So yes, as you mentioned, it’s up 3% on average and 18% year-on-year. We will continue – it’s our expectation to continue to grow that over the course of this year.”

“So, basically, any like a 5% move in equity markets is kind of happening gradually throughout the year is about an additional $75 million in revenue.”

“Yes. We really decided a few more of a full year guide for the second quarter. But I mean to size what you are thinking about, I think specifically on waivers, we do see the Fed raise rates by 50 basis in May as I think we are all kind of expecting. Obviously, that will be a nice uptick in terms of recouping waivers and it’s to the tune of, call it, like $100 million or so is what I – is how I would estimate it.”

“But as we have disclosed before, we are not expecting this to drop much to the bottom line over the course of the next couple of years.”

“So, I think that’s pretty good... we would expect expense growth, the rate of growth to moderate.”

“So, the particular businesses, which are probably most – which are going to be most impacted, we think, are investment management, corporate trust, depository receipts to a lot lesser extent, asset servicing.”

“Yes. It was helpful this quarter. I don’t have it right off hand. But it was obviously – definitely helpful this quarter, but – and we just expect it with rates rising as we go forward, it will continue to be a bit helpful, but frankly, at a more modest level.”

“By the time we kind of get towards year-end and we have many more rate hikes, that will be probably closer to – betas would be closer to 70% plus, which is kind of where we ended in the last rate cycle.”

“So with all that said, we would expect deposit probably run off maybe about 10% over the course of this year.”

“Last but not least, we continue to expect our effective tax rate for the year to be approximately 19%.”

“And based on the environment we described earlier, we ultimately expect to return at least 75% of earnings to shareholders this year.”

“And the other thing I would mention is that as we see deposit runoff, we also could see a migration to money market funds. And if that does indeed happen, then obviously, that could be a nice tailwind for us as well.”

“But we are delivering positive operating leverage in 2022.”

“I do think we will see the operating margins in our Securities Servicing business. Those are depressed right now, and I do think you'll see those expand, both combination of greater efficiency and revenue mix.”

“What you'll see as deposits, as rate hike, what generally will happen is that they will - some will roll off, for sure, but others will actually just kind of migrate into interest-bearing deposits, so all of that is baked into our guidance.”

“Yes, I'll go ahead. We've been pretty consistent in targeting dividends around 30%, Alex. So I think probably you will see the adjustment come in the form of a buyback, if there is one.”

“But ultimately, I think those excess deposits will come down with mitigated somewhat by just normal growth.”

“And we do expect that we will get more leverage out of our business model as we just continue to make it more scalable.”

“And we do expect, and I talked about this at the last conference I was at, we do expect that to grow in excess of 30 plus percent over the medium term.”

“Sure. So ultimately, from a deposit perspective, we don't really expect much runoff in deposits from here until kind of, again, third or fourth rate hike or the Fed starts to actually tighten.”

“Having said that, it's very important to note that as waivers dissipate, we also do see a rise in distribution expense, and that's been captured in the expense outlook.”

“So when you put it all together, we would expect money market fund waivers to be a little less than half of what they actually were in 2021.”

“So we see that not as a 2022 event, but a 2023 and 2024.”

“So that's something where we have been gaining and have shown up in the numbers and we continue to expect to continue to gain.”

“Also, we are expecting some healthy loan growth and for premium amortization to reduce a bit.”

“We expect our securities portfolio to be roughly flat.”

“To sum up and as Todd alluded to earlier, we expect to generate positive operating leverage on the back of continued organic growth and higher rates translating into higher NIR and lower fee waivers, while continuing to invest in the future growth and efficiency of our businesses.”

“We expect roughly 2% to be driven by organic growth and approximately 1% by market driven factors.”

“And in terms of betas, in particular, just speaking specifically about betas, which is what I think you're probably getting at, we do think they'll be largely in line with the past. Like I said before, maybe a little bit higher, Treasury Services deposit balances are higher.”

“To give you an idea just - sorry. To answer the second question, which was more about sensitivity, just I think something that would probably be helpful. If we size the impact of both waivers and, frankly, NIR, if we had, say, a 50 basis point hike in March versus a 25 basis point hike, that would be about $100 million more in recouping waivers than what's in our guidance. And it'd probably be about $50 million more in NIR.”

“And then lastly, with regards to buybacks, given we ended the quarter of 20 basis points above or management target from Cherilyn leverage. The fact that we continue to have excess deposits that we expect to recede you over time, and based on our expectation for continued strong capital generation, we intend to once again return capital well in excess of 100% of earnings to our shareholders in the fourth quarter.”

“Encouraging the -- we had originally expected about a 20 million impact of the lost business due to just being on the wrong side of M&A that is due to timing that was a lot less. So, I would think about it as the uptick will be about 15 million between the third quarter and the fourth quarter.”

“We'll see the full effect of that in the next -- in the Fourth Quarter, probably be another 10 million or so decline.”

“And our intent is to increase our technology spend next year.”

“And ultimately, there are other headwinds as well, inflation as I just mentioned, look, we're seeing. It's a good thing, but return to more normalized travel rates. So CNI (ph) is likely to go up.”

“With respect to premium amortization, it's likely our expectation forecasts based on rates is that it will be pretty much flat fourth quarter to third quarter.”

“And we also expect our effective tax rate for the year to be approximately 19% (ph).”

“And we expect that 40% of digitally-enabled U.S. consumer accounts will eventually have this functionality by year-end.”

“And look, there's probably some upside. I mean, certainly based on what we're seeing in terms of volatility and rates, and EBITDA movements by, for example, the Bank of England, etc.”