Ladies and gentlemen, thank you for standing by, and welcome to the Ally Financial Fourth Quarter Earnings Conference Call. At this time, all participant lines are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today’s conference is being recorded. [Operator Instructions] I would now like to hand the conference over to your speaker today, Daniel Eller, Head of Investor Relations. Thank you. Please go ahead, sir.

Thank you, operator. We appreciate everyone joining us to review Ally Financial’s fourth quarter and full year 2019 results this morning. You can find the presentation we’ll reference throughout the call on the Investor Relations section of our website, at Ally.com. I’ll direct your attention to Slide 2 of the presentation, where we have our Forward-Looking Statements and Risk Factors. Contents of today’s call will be governed by this language. On Slides 3 and 4, we’ve included some of our GAAP and non-GAAP or core measures. These and other core measures are used by management, and we believe they are useful to investors in assessing the company’s operating performance and capital results. Please keep in mind, these are supplemental to and not a substitute for U.S. GAAP measures. Supplemental slides at the end include full definitions and reconciliations. This morning, we have our CEO, Jeff Brown; and our CFO, Jenn LaClair on the call to review our results and take your questions following the prepared remarks. With that, I’ll turn the call over to JB.

Thank you, Daniel. Good morning, everyone, and thank you for joining our call. I want to start by saying how proud I am of our results this year. 2019 reinforced the strength and adaptability of our businesses that’s powered by thousands of Ally teammates, who drove operating and financial performance to new levels and increased value for our shareholders. This marks the fifth consecutive year since becoming publicly traded, that we’re able to say we’ve achieved the highest results or returns across several of our financial and operating metrics. The consistent ability to drive improvement and deliver on our goals is centered around our relentless customer focus. Looking closer at some of our highlights for the year. Adjusted EPS was $3.72 for 2019, a 12% increase year over year. Core ROTCE of 12% remains solid and within our expected range, even when considering the impact of lower rates on OCI. Total revenues exceeded $6.3 billion, a 5% increase versus the prior year. All of our businesses contributed to these solid results. In auto, strong customer engagement across our broad product offerings led to improved risk-adjusted returns. We originated $36.3 billion of loans and leases, a $900 million increase year-over-year. We increased volume despite slowing new vehicle industry sales. This was fueled by a record 12.6 million decisioned applications, reflecting our extensive reach across the market. Retail auto yields expanded 46 basis points on our 72 billion portfolio, driven by originated yield improvement. Full-year originated yields exceeded 7.4%, while net charge offs of 1.29% declined 4 basis points reinforcing our consistent approach to underwriting and ability to drive strong risk-adjusted returns. Our dealer base has expanded for 23 straight quarters, resulting in relationships with over 90% of U.S. franchise dealers. Moving forward, our focus is to continue in strengthening and deepening…

Thank you, JB, and good morning, everyone. In 2019, we delivered another year of sustained financial progress through operating discipline and consistent execution against our objective. On Slide 8, 2019 adjusted EPS of $3.72 as more than doubled since 2014 representing a 17% CAGR over this timeframe. Full year core ROTCE of 12%, increased 53% or 415 basis points over the past 5 years. Excluding the impact from lower rates on OCI, ROTCE was modestly favorable to 2018. Our ongoing financial progress as resulted from momentum across all of our businesses, disciplined capital deployment, and a healthy macroeconomic backdrop. Revenue trends are on Slide 9. We exceeded $6.3 billion in 2019 revenues, an increase of $1.35 billion or 27% increase since 2014. Over this timeframe, we’ve averaged 5% annual revenue growth through 3 fundamental drivers. First, momentum across every business within auto and insurance, we’ve diversified and deepened our dealer relationships, increasing application flow and improving risk adjusted returns. In mortgage, we established a growing pipeline of direct-to-consumer origination through a strong partnership with Better.com. And in Corporate Finance, we’ve continued to grow prudently by hiring experienced teams in new verticals. Second, transformation of our funding profile. Since 2014, deposits have more than doubled to $120.8 billion and now represents 75% of funding, a 30 percentage point increase, while unsecured debt with an average coupon of 6% has declined by over $12 billion. And third, dynamic and effective interest rate risk management, we’ve managed re-pricing dynamics across our balance sheet resulting in predictable and stable net interest margin, and net financing revenue growth every year. The path we’re on reinforces our ability to execute and solidifies our expectation to drive accelerated 2020 revenue and net interest margin expansion, a key differentiator for Ally. Moving to Slide 10, let’s look at…

Thanks, Jenn. On Slide 24, I’ll spend a few minutes reviewing our strategic priorities for 2020. In 2020, we’ll build upon the operating and financial momentum we’ve established. Our dominant auto and direct deposit franchises that have tremendous scale are well positioned to produce stable and improved results. This reflects our multi-year efforts to position these businesses for long-term strength and ongoing growth. We see opportunities to expand the way we serve our growing customer base at Ally. We made important investments in our capabilities over the past few years through enhancements to our existing products and the additions of new offerings. It’s clear to us as we look at consumer trends, that there is a rapid and growing desire for convenient financial products with excellent service levels, key characteristics of every Ally product offering. The significant improvements we driven over the past five years provide a strong foundation for our company. We constantly assess opportunities to deliver for our customers and drive value for our shareholders, allocating investment resources through a consistent set of parameters including differentiated customer value, accretive financial return profile and alignment with our overall strategy to maximize long-term value through disciplined capital deployment. It’s through this lens that we have assessed expansion into Ally Home, Ally Invest, and most recently, Ally Lending. And it’s with the same logic that Jenn and I discuss all the time that will guide us in to the future. Finally, Ally’s culture remains critical to our success. And I’m particularly proud of what I see every day in the way our associates operate. We’ve created a place where people enjoy working and are proud to say they’re employed at Ally. We’ve altered our benefits and philosophies to make our employee value proposition even stronger. We created one of the most passionate and inclusive environments for all of our teammates. This leads to lower turnover, deeper pride and energy, well above industry-average engagement scores, and ultimately, a better company for all. And that’s what you can see from our results. Our 8,700 teammates remain focused on continuous advancement and improvement delivering for our customers and our shareholders. It’s because of this, what I am confident in our ability to continue delivering in 2020 and beyond. Thank you. And, Daniel, we can now head into Q&A.

Sure. Operator, please see up the Q&A.

[Operator Instructions] And our first question is from Ryan Nash from Goldman Sachs. Your line is now open.

Hey, good morning, JB. Good morning, Jenn.

Good morning.

Good morning.

So, JB, thanks for all the color on the auto business. I wanted to start with the competitive environment. So you’ve been able to expand auto yields almost 50 basis points throughout the year given the shift towards used and the continued optimization of the portfolio. However, we’ve now heard others talking about competition increasing, particularly in parts of the market where you play. So just wanted to get a sense for what you are thinking competitively and what you think this means for origination yields going forward. And I have a follow-up.

Sure, sure. Thanks for the question, Ryan. So, I mean, obviously, we’ve stayed in tune in the past couple of days with other key competitors in this space kind of in their commentary. What I’d say is we’re not really feeling it yet. It’s still – particularly in the bank space, a pretty rational environment now. So we’re confident in continuing with origination trends at similar levels you’ve seen from us over the past couple of years. Obviously, we’ve been pretty consistent in doing $9-billion-ish a quarter. And I think in terms of pricing power, we still feel really good about where things stand. Obviously, for us, what maybe makes us a little more unique is just the scale we have within auto, the deep relationships we have, and then obviously the outreach for us. I mean, we’re seeing a lot more application flow this year. And this just gives us confidence in our ability to, A, book originations; and, B, book them at very attractive levels. So, for us, not really feeling it yet, but obviously, mindful that it’s a dynamic environment out there.

Got it. And then, maybe a follow-up on credit. Thanks for the color on CECL. The impact will largely be driven by growth. You just talked about originations. So how should we think about earning asset growth? And then second, given your credit outlook of the low-end of the targeted range, what are you assuming in terms of used car prices going forward? Thanks.

Sure. Ryan, so on your first question on earning asset growth, look, as we go into 2020, we see opportunities to grow across all of our portfolios. We’ll continue to find opportunities in retail auto. And to JB’s comments, we’re not seeing any slowdown there. We outperformed our mid-$30 billion origination target and pricing continues to be robust. So, we’ll be growing in retail auto and opportunistic in that portfolio. Corporate Finance grew over 23% over $1 billion this year. We’ll continue to find opportunities in that portfolio. And then, some of our newer products you see, DTC mortgage ramping up really nicely this year. We’re pretty close to that $3 billion target we set. We’ll continue to look for opportunities in mortgage, and then HCS is just getting off the ground but good trends there so far. So, I would think about 2020 growth along the same lines as 2019 growth. We will be slowing down investment securities a bit. We kind of hit our funding, our target portfolio, mix target for securities, so that will slow down a bit. But the loan categories will grow in line with 2019. And then, on to credit, we’ve been guiding towards lower used car prices for some time now, 3% to 5%. On a full year basis, we did outperform that. Fourth quarter, we did see some softening. It showed up in NII and in our – on our NIM, and we’re projecting that to go down about 5% to 6% next year and that’s really what drives up our NCO rate to the low end of that 1.4% to 1.6% range.

Got it. Thanks for all the color.

Absolutely.

Thanks, Ryan.

Thank you. Our next question is from Moshe Orenbuch from Credit Suisse. Your line is now open.

Great. Thanks. And very impressive kind of growth on the deposit front, particularly given the moves you’ve made on pricing. Just curious, if you could kind of talk a little bit about your views as to how that kind of goes into this year and next. Do you see that, just the online space is continuing to take share? I mean, how will you be able to continue to do that?

Sure, Moshe, I appreciate the nice comments, and we agree, we’re very pleased with the performance of our deposit business, and we don’t see any signs of that slowing down. And in fact, you see the record volume and the record customer growth, and that’s in spite of the increased competition as well as taking rates down from kind of the peak OSA rate of 220 down to 160. And so, we’ll continue to optimize really across our customer strategy. That’s a very important part of our continued expansion into new products, and want to continue to grow our customers. We’ll be mindful of the value we’re providing, but we’re also going to be focused on margin and OSA. I mentioned, the decrease we’ve had, that will roll forward into 2020 and create that nice double-digit NIM expansion I talked about. And then on CDs, CDs right now are about 250. They’ll be rolling off around 180. So we’ll see some nice margin lift on the CD front as well. But I’d say overall no change to our strategy. We continue to find opportunities to grow both deposits and customers. And it’s a great place to be to have the margin expansion come with that.

Got it, and could you talk a little bit about the kind of evolution of Ally Lending and in terms of, you had spent a lot of money during Q4. You had mentioned as part of that process of kind of getting them up and running. But how does that kind of get to a more, I guess, normal efficiency and maybe what that means for the prospect of incremental acquisitions as you go forward?

Yeah, sure. And I’m not sure I would say a lot of money. And it’s a very, very small amount in terms of the expense increase. Yeah, just as a reminder, we really like this business. The market is about $130 billion. It’s growing at almost 20% and the variable risk-adjusted margin is kind of in that 9%, 10% range, ROA in the 3% to 4% range, and ROTCE above 20%. So, Moshe, our focus is really around ramping up growth in the portfolio, making sure we get the right marginal return profile. And over time, we’re very confident that we’ll see the total financial profile accelerate into 2020 and 2021.

Got it. Thanks very much.

Thank you, Moshe.

Thank you. Our next question is from Betsy Graseck from Morgan Stanley. Your line is now open.

Hi, good morning.

Hi, Betsy.

I just want to dig in a little bit on the expense side. You indicated earlier that your systems conversion occurred in January. And when I look at the outlook for operating leverage this coming year in your guidance, obviously better than what you’ve been generating over the past year which is solid, but you’ve got an acceleration ramp in there. So I just wanted to understand how much of that is coming from the systems conversion benefit that you should be getting this year. And then if you could speak to other levers that are driving that outlook. Thanks.

Yeah, sure. And, Betsy, I think you captured it nicely. I mean, we are focused on positive operating leverage. That is what we delivered here in 2019. That is again our focus in 2020 and you see that in our efficiency ratio guidance, coming down 50 to 150 basis points. In terms of the overall expense story for Q4, really for full year 2019 and then into 2020, it’s all the same themes that we’ve been talking about. It’s variable cost attached to growing our businesses. Q4, we had an outsized impact from Insurance, because we’ve hit record highs in terms of written premiums and earned premiums. And so, we see variable cost attached to our insurance business. We also have grown, as you’ve seen, our application flow in the auto side of 9% year-over-year. Deposit accounts up 24%, so we’ll continue to see that variable cost increase in line with revenue. And then we continue to invest in brand and technology. The system conversion, that’s been largely capitalized, so that will roll forward into 2020. But keep in mind that’s embedded in the guidance that we’re giving around positive operating leverage. And then, last but not least, some modest investments in new products like HDS, obviously hit this quarter. But – so I’d say pretty modest in terms of that new product impact.

Okay. So the systems conversion really isn’t an outlier in terms of its impact on the 2020 efficiency outlook?

Well, I mean, it’s embedded in our guidance there, it was a pretty material investment that we made. You think about we’ve completely upgraded our whole servicing platform in the auto business, which was over 4.5 million accounts. And by the way, huge shout out to the team who accomplished that, I mean, we had almost no friction in terms of the conversion and customer feedback has been really strong to date, so we’ve kind of hit that big milestone. The expenses will roll forward and depreciation kind of over the next couple of years, but it’s embedded in the guidance we provided for 2020.

Yeah, Betsy, it’s been an effort that’s been literally underway for about 5 years inside the company. And as Jenn pointed out, we just successfully rolled it out after the turn of the year, but amazing effort particularly given how minimal customer disruption was experienced over kind of 3 to 4 days, when you’re converting over 4.5 million accounts that was quite impressive. But from a financial perspective, it’s already been partially embedded, and we’ll have a little bit more to come.

All right. Thank you.

Thank you.

Thank you. Our next question is from Sanjay Sakhrani from KBW. Your line is now open.

Thanks. And good results. I guess, maybe we could tease out a little bit, sort of, what the HCS acquisition means to 2020 and maybe over the near-term. Can you just talk about sort of how we expect it to factor into growth?

Sure. And good morning, Sanjay. So, on HCS, we had modest impact here on Q4 next year, it’s really going to depend on the growth opportunities that we see. We brought over about a $200 million portfolio, had some modest costs there and some modest provision. We originated about $70 million in new originations this quarter. And we want to ramp that up as quickly as possible. But the total impact for 2020, number 1, it will be pretty immaterial, and number 2, it will depend in large part around opportunities that we see. We’re new in this space, and so we’re going to be thoughtful about how we pace it. And the growth that we’re confident and we’ve embedded into our 2020 outlook. We also – that business is largely focus on healthcare. We are also looking for opportunities in other verticals on improvement, in particular, in auto, where we’ve got a very expensive dealer network and we see some good synergies there.

And when you say home improvement, you mean like personal lending with home improvement or something else?

Yeah, point-of-sale lending with home improvement, consumer investments.

Okay. And you guys would grow that organically or through acquisition?

We have the platforms. So the acquisition that we closed on in October is largely a purchase of the platforms. So that would be an organic expansion of that platform into new verticals.

Okay. Got it. And one final follow-up question on used car prices and remarketing gains, that dropped pretty significantly in the fourth quarter. Is there anything to read into that and sort of how we should be expected to progress over the course of this year?

Yeah. Sanjay, we were expecting that, and we’ve been expecting lower used vehicle values for some time. In Q4, specifically, we saw trucks and SUV values declining a bit, and that’s just the phenomenon we’ve been talking about around the supply side dynamics where we hit a peak here in 2019. The peak continues in 2020. And then it does start to subside actually in 2021, but we should see some near-term pressure, which is why we’ve continued to guide down in, 5% to 6%, in used vehicle prices in 2020. But to us, not a big surprise, and it was in our forecast.

Okay. Great. Thank you.

Thank you.

Thank you. Our next question is from Eric Wasserstrom from UBS. Your line is now open.

Thanks very much. Jenn, I wanted to just circle back on a couple of issues related to the net interest margin. The – is the – I was backing into the marginal origination yield on auto from the bottom of Slide 18. In the fourth quarter, getting a number around 7.1%, is that ballpark correct?

The origination yield in Q4, it – that’s pretty close, it was above 7%. The full year is 7.4% and in Q4 it’s seasonally up on seasonality, so it came down a bit.

Okay. So as – so in terms of the double-digit NIM expansion guidance. What – how should we frame out what yield that implies?

Yeah, sure. And keep in mind, the double-digit NIM expansion is really reflective of a lot of drivers, the auto origination yield is in part of that. So we’ll expect our current portfolio, which is full year about 6.60% in origination yields to migrate up towards that over 7% origination yield that we’ve been putting on the books for the last 7 consecutive quarters. And in 2020, we expect new origination yields to remain above 7%. So there’s just this natural tailwind in terms of the re-pricing up. You saw this year we had a 37 basis point increase in new origination yields, which translated into 46 basis point increase in the portfolio. Those trends will continue into 2020. So that’s kind of driver number one. Driver number two is what I talked about a little bit earlier around our deposit portfolio as we’ve re-priced down OSA, that rolls forward into 2020 and then with the CD deposit re-pricing that creates a tailwind as well. And then others are there dynamics we’ve got over $2 billion in unsecured rolling down at over 6.5% coupon, and so we’ve got some nice liability management tailwind there as well, so all of that will contribute to that double-digit margin expansion next year.

And just on that last point, and this is my last question, and then I’ll get off. But the unsecured – back of the envelope, I was calculating about 2 basis points of NIM benefit from the shift – from the repayment of the high cost debt. Is that – again, is that ballpark correct?

Eric, I don’t have the exact number right in front of me. But I think it’s a bit higher than that. Yes. And it depends a little bit on the timing. We’ve got 1 – we had almost $1 billion coming off in the first quarter at over 7% to 8% coupon. So the timing of that matters as well. And we can follow-up with the exact math, but I think, 2 basis point seems a little bit low.

Got it. Okay. Thanks very much.

Thank you, Eric.

Thank you. Our next question comes from the line of Rob Wildhack from Autonomous Research. Your line is now open.

Good morning, guys. You’ve talked a lot about the dealer count, obviously, something that’s grown nicely in the past few years. Can you give us some context around the growth and performance is coming from the expansion of the dealer count versus the success you’re having on a per dealer basis? And then what you think the growth levers and opportunities are from here? Thanks.

Yeah. Hi, Rob. I would say, the growth that we’re seeing in application volume that’s really coming from both the dealer count and deeper penetration into those dealers. I will say with the number of consecutive quarters we have growth in dealer count and the fact that we have relationship with 90% of dealers that the go forward priority will be around apps per dealer, about 70% plus of our dealers give us less that 5 apps per month and we see tremendous opportunity in increasing apps and the quality of the dealer relationship. So that’s really going to be the focus going forward continuing to bring in more apps, more looks and then increase the quality of what we originate and continue to expand the risk-adjusted returns. But it does shift a bit from counts to quality.

Maybe the only other point there, as you asked about performance, I’d say, it’s been very consistent with we haven’t see the new dealers have been on-boarded maybe the past 18 months or so, really perform any differently from a credit perspective on accounts has been very consistent with the rest of the book.

That’s great. Thank you, guys.

Thank you.

Thanks, Rob.

Thank you. Our next question comes from the line of Kevin Barker from Piper Sandler. Your line is now open.

Thank you. In regards to your comments on CECL, which I thought were very helpful. Could you provide some quantification around the incremental impact to your provision expense in 2020, given what you’ve laid out there? I understand you’re going to keep reserves to loan stable, but just overall, the impact on provision expense.

Yeah, sure. So Kevin, I think, you’re getting at some of the day 2 impact. So as we’ve put our guidance out there, we’ve been mindful of where we’re growing the portfolio, and we’re seeing growth across every single one of our businesses. But we’ve embedded in there those increases in reserves. So auto – retail auto will be growing modestly. We’re now reserving at over 3% versus the 1.5% we were reserving before, and that’s all embedded in the guidance that we gave you. But it’s a fairly modest impact as we head into 2020. Now we have to keep in mind, that’s what we know. There are factors here that we’ll have to continue to work through as we’re new to CECL, and that’s around just the macroeconomic variable changes. If we see growth opportunities in the portfolio, we want to continue to originate at strong risk-adjusted returns and not let CECL hold us back. So there are some unknowns there. And then the last thing I’d say about CECEL is with the way in which we have approached the reversion to the mean, we have included the Great Recession. And so, we’ve got kind of an embedded kind of headwind just from the macroeconomic assumption that we’ve made. That’s already embedded in there. And that should reduce some of the volatility as we go forward just from a macro perspective.

So would it be fair to say that you were taking a more conservative view on the economic outlook and assuming somewhat of a slowdown versus what – wide industry standards in order to just remain conservative around the provisioning?

Yeah, I mean, what I would say is we just been very balanced in how we’ve looked at just the longer term trend in the portfolio, and that the assumptions that we’ve made are all embedded in the day 1.

Okay. And then, would this, the implementation of CECL have an impact on how you think about certain asset classes that are currently on your balance sheet that may be lower yielding, but may be tougher to hold in post-CECL environment?

Yeah, look, I mean, we’re always trying to optimize yield and risk-adjusted returns. But that’s not related at all to CECL. We – as I mentioned in my prepared remarks, I mean, nothing changes in terms of the long-term profitability of our various portfolios and we want to continue to focus on what’s important to us, which is driving value for our customers and long-term shareholder value as well.

Thank you for taking my questions.

Absolutely. Thank you.

Thank you. Our next question comes from the line Rick Shane from JPMorgan. Your line is now open.

Hey, guys. Thanks for taking my question. Look, we spent a lot of time thinking about asset and liability mismatches. I’d like to think about this in a slightly different way, which is sort of compare your asset gathering franchise with your deposit gathering franchise. It strikes me, one is a traditional business. And I don’t mean that in a pejorative way, where the other is very cutting edge and innovative and you’ve cited the awards you’ve received. I’m curious, when you look at those customer bases, what differences you see, particularly from a demographic perspective and is – how will that evolve over time? Will you see convergence?

Yeah, Rick, appreciate the question. And, yeah, I think we are innovative across all of our businesses. I wouldn’t say just on the deposit side. And in auto you can see a lot of the partnerships that we’ve created with some of the new entrants, has positioned us very well for the modernization of auto. And we will continue to lead in that space. And then, I look at what we’re offering through Better.com is a absolute topnotch digital, fully digital end-to-end customer experience that has some of the highest NPS scores across the industry. And I would say we are absolutely leading and cutting edge in terms of the product that we have out there. And I’d say the same thing with what we just acquired, the new platform with HCS, now Ally Lending. We are leaders in that space as well and we’ll continue to grow and lead in there. So our goal is to be innovative across all products, not just on the liability side, but also on the asset side. JB, I don’t know if you want to add anything in there. But we don’t see the big difference across the two. And I just – I mean, you did ask about customer profile. And our deposit base tends to be more of a mass affluent customer from a balance perspective. But we’re growing millennials at a very rapid pace from an account number point of view. And we do see overlap, certainly overlap in terms of the Ally Lending customers we’re bringing in, Better.com and Mortgage, I mentioned the 56% of the new originations are coming from the existing deposit business. So we certainly see a lot of overlaps across all of our businesses on the asset and liability side and even with Invest.

Got it. And look, I appreciate that you need to be innovative across all of your business products. I really – I like the answer to the second part of the question, in terms of that customer profile. I’m curious, when you look at it, have you had more success selling loans to depository customers or deposits to borrowing customers?

It’s the former. It’s mining our deposit business for new asset opportunities. And Mortgage is a great example of that. And then, not just outside of Lending, but in the Invest space, over a third of our new Invest customers come from the deposit platform. And as we continue to add new product into Invest in advisory capabilities, we see that very tight connection only continuing to grow.

Thank you guys for your time.

Thank you.

Thanks, Rick.

Thank you. Our next question is from John Hecht from Jefferies. Your line is now open.

Thank you, guys, very much. Most of my questions have been asked and answered. First one is out of curiosity. Jenn, it seemed like you suggested that the day 2 impact was modest. I’m wondering, are you able to share with us, is it – are adjusted EPS in 2020, the guidance, would it have been higher under the accrual method or would it have been generally in the same range?

It would have been higher. And that’s just we have to reserve at a higher rate than we had under incurred number one. And then, because we do have to pre-fund day 1 impact in 2021, just capital levels would be a little bit elevated especially in the back-half of this year.

Okay. Thanks very much. And then, second is you talk about strong growth in applications, but the originations were generally flat. Is that an indication of being more selective in terms of what you’re pulling through the funnel or is there any other commentary around that?

Yeah, I mean, John, our strategy over the past several years has really been around quality, driving risk-adjusted returns. And we do that by increasing application flows. The more looks you get, the higher bar you can set in terms of what you book on your balance sheet. And tying this to the competitive question, we continue to increase our reach and haven’t seen any sign of that slowing down. And that – the more applications we bring in, the more selective we can be around what we book and we don’t see any signs of that slowing down here in the first quarter or expecting that to slow down here in 2020.

And, John, I’d just say that that ties into the initial question we got from Ryan Nash, as well about giving us confidence around pricing power as well. That it’s all integrated together.

Perfect. Thanks very much, guys.

Thank you.

Thank you.

Thank you. That’s all the time we have now for questions.

Okay, operator, thank you. That concludes today’s call. Feel free to reach out to Investor Relations for any follow-ups.

Ladies and gentlemen, this concludes today’s conference call. Thank you for participating. You may now disconnect.