Good morning, everyone. And welcome to Citizens Financial Group First Quarter 2023 Earnings Conference Call. My name is Allan, and I will be your operator today. Currently, all participants are in a listen-only mode. Following the presentation, we will conduct a brief question-and-answer session. As a reminder, this event is being recorded. Now I will turn the call over to Kristin Silberberg, Executive Vice President, Investor Relations. Kristin, you may begin.

Thank you, Allan. Good morning, everyone, and thank you for joining us. First, this morning, our Chairman and CEO, Bruce Van Saun; and CFO, John Woods, will provide an overview of our first quarter results. Brendan Coughlin, Head of Consumer Banking; and Don McCree, Head of Commercial Banking, are also here to provide additional color. We will be referencing our first quarter earnings presentation located on our Investor Relations website. After the presentation, we will be happy to take questions. Our comments today will include forward-looking statements, which are subject to risks and uncertainties that may cause our results to differ materially from expectations. These are outlined for your review on page two of the presentation. We also reference non-GAAP financial measures, so it’s important to review our GAAP results on page three of the presentation and the reconciliations in the appendix. With that, I will hand over to you Bruce.

Hey. Thanks, Kristin. Good morning, everyone. Thanks for joining our call today. First quarter many unexpected challenges in the environment. Nonetheless, we proved resilient and adaptable and we delivered a solid quarter for our stakeholders. We maintained a strong capital, liquidity and funding position with our CET1 ratio at 10%, our TCE ratio at 6.6% and a solid deposit franchise that skews two-thirds consumer. We have seen the churn in the deposit market continue to diminish since the bank failures with our deposits broadly stable in the month of March. For the quarter, we posted underlying earnings per share of $1.10 and return on tangible equity of 15.8%. Our NII was down 3%, reflecting day count impact, slightly lower earning assets and a stable net interest margin of 3.3%. Non-interest income and non-interest expense came in broadly as expected, both impacted by seasonality. Our credit metrics are also trending as expected and we built our ACL to loans ratio to 1.47%, which was up 4 basis points during the quarter and it’s 17 basis points higher than our pro forma day one CECL ACL ratio. We repurchased $400 million in shares during the quarter, which reduced our share count by 1.7%. In our slide deck, we tackle head on some of the industry issues that investors have been concerned about. I will let John run through the details, but the headline is that we have strong confidence in our capital, liquidity and funding position. We have been conservative in maintaining a capital ratio near the top of our peer group in focusing on a stable consumer oriented and granular deposit base, and in establishing a prudent credit risk appetite and reserve level. While we had some commercial real estate exposure, we feel good about our diversification, the asset characteristics and…

Thanks, Bruce, and good morning, everyone. Let me start with the headlines for the financial results referencing slide five. Big picture, first quarter results were solid against the backdrop of volatility in the macro environment. We continue to progress against our portfolio of strategic initiatives, including the well-executed conversion of the Investor platform in February. For the first quarter, we generated underlying net income of $560 million and EPS of $1.10. Our underlying ROTCE for the quarter was 15.8%. Net interest income was down 3% linked-quarter given the lower day count and lower interest-earning assets. Our margin was stable at 3.3%. Period-end loans and average loans were down slightly quarter-over-quarter, reflecting the impact of our balance sheet optimization efforts, such as our ongoing runoff of auto. Deposit levels declined in the quarter primarily due to the impact of seasonal factors, the compounding impact of the rate environment and particularly earlier this occurred in the quarter. Importantly, our deposit levels were broadly stable during the market turbulence in March. Our quarter end LDR is 89.8% and our liquidity position remains very strong with current available liquidity as of today of about $66 billion. Our credit metrics and overall position remains solid. Total net charge-offs of 34 basis points are up 12 basis points linked-quarter, in line with ongoing normalization trends. We recorded a provision for credit losses of $168 million and a reserve build of $35 million this quarter, increasing our ACL coverage to 1.47% up from 1.43% at the end of the fourth quarter, with most of the increase directed to the general office portfolio. Our current coverage ratio is about 17 basis points stronger than our pro forma day one CECL reserve of 1.3%. We repurchased $400 million of common shares in the first quarter and delivered a strong…

Okay. Thank you, John. Allan, let’s open it up for some Q&A.

Thank you, Mr. Van Saun. [Operator Instructions] Your first question will come from the line of Erika Najarian with UBS. Go ahead please.

Hi. Good morning.

Good morning.

As we contemplate your original net interest income guide of 11% to 14%, now up 5% to 7%. Could you walk us through what the major changes are in assumptions and how much of it was cyclical, such as the deposit runoff, higher beta and how much of it could be a little bit more structural as you anticipate the different rules such as carrying higher liquidity funded by wholesale funding?

Yeah. Let me start and I will quickly flip it to John. But I would say, Erika, that really we are just recognizing what we have seen on -- in the deposit markets and the cost of deposits is going up. I think that was partly a response to kind of the Fed rapid rises and money funds becoming alternatives. So there was, I think, a greater sensitivity around earning a return on cash that kicked in and then that was, I think, further exacerbated by the bank failures in March. And so I think there was kind of heightened velocity of deposits moving around the system and so to retain those deposits, folks had to increase rate paid. We feel that we did a pretty good job here. We came into the year expecting that there would be some seasonal outflows in Q1, and since we had built deposits in the second half of the year and then we had auto running down, so less volume on the asset side, we were prepared to let those run down by about 3.5% in the quarter. We actually saw about 1% higher than that in the runoff, but in any case, we tried to hold the line on betas and I think the betas that we posted are slightly better than peers that have reported at this point. So, but if you kind of play out the rest of the year, we are going to be paying more for our funding than we thought coming into the year and that’s pretty much the big driver. I would say there might be kind of a little more disciplined in terms of who we are extending credit to, given I think probably a higher likelihood that we could see a shortened shallow recession. So there might be a little volume impact there from slightly lower earning assets and maybe there’s a little mix where we are holding a little precautionary cash. But if I had to kind of put it in order, I would say, number one is the cost of deposits, and maybe slightly the volume on assets, and then thirdly, would be composition. So, John, I will flip it to you.

Yeah. Those are the right points to focus on. I’d say you break it down, Erika, between rate and volume. On the rate side, as you heard from, Bruce, we have the migration from a deposit standpoint, you are going to see the full year effect of that, of what’s happened over the last quarter or two and the drivers of that are well documented. We have got the cycle with higher rates and quantitative tightening going on that’s causing those forces to kind of hit us. I would also say that beta move up a bit more than maybe we had planned given the outlook. So we were, I think, in the high 30s prior, maybe we are in the low 40s through the cycle. So we are building that in. You also mentioned that from a liquidity standpoint, I think, we feel very good about that. From that, we are already compliant. If we had -- if we were a Category 3 bank, we are already compliant on the LCR. But from a volume standpoint, we are in rundown in auto, we are looking at some balance sheet optimization initiatives in Commercial and so you will see the LDR fall throughout the rest of the year. And then, finally, I would say that, the other things I look at on the positive side, I mean, our loan betas are from a cumulative standpoint will still exceed cumulatively where we are coming out on deposits. So you will see that mid-to-upper 40s on loans versus the low 40s on deposits. You got front book, back book when the Fed finally kind of pauses and starts to cut. You will see a lot of the balance sheet continue to contribute over the quarters post maybe a possible pause and cut that the Fed may kind of engage in. So lots to...

Right. You might have add too John about the swaps that we continue to dynamically recalibrate the swaps to provide protection for the event that the Fed ultimately moves lower.

Yeah. I think it’s a really good point. I mean when you think that’s that what we are just talking about is the 2023 sort of story. I mean when you get into the end of 2023 into 2024, this cycle compared to last cycle, we have a lot more down rate protection in place for the second half of 2023 and into 2024 than we might have had in prior cycles, Bruce notice.

This will help support a good guide for 2024.

Yeah.

Yeah.

Yeah.

Yeah. And I guess just to close this off, Erika, I would say, if you look at the outlook for the year, kind of the one thing that got marked down was really NII. We still feel pretty good about the fee outlook. We are going to work a little harder on expenses and probably bring that in below where we thought coming into the year. I’d say credit provisioning should be about kind of where we thought coming into the year. We are still angling to repurchase shares over the course of the year. So our expectation is that we can continue to deliver return on tangible equity in the kind of mid-teen area and just reflective that it won’t make quite as much net interest income this year, but still investing in the things to position us to have a good kind of runway into 2024.

Thank you. I will let one of my peers ask more detail on the swap fee calibration, because I think that’s important as we think about NII for 2024, but since we have you, Bruce, I want to ask you about how you are thinking about these anticipated regulatory changes for regional banks. I think that -- I am glad that you said in the prepared remarks that it takes time, right? You have the NPR, which could come out end of the year or a year from now, a year common period has been a phase-in. So as we think about what the market is anticipating, whether it’s TLAC or getting rid of opt out on AOCI, and of course, you said you are already LCR compliant. How are you thinking about managing your capital relative to your stock down at time, right? So it seems like banks can ever buy back as much at the time when they should be buying back and the potential in 2024 for some non-banks to be in bigger trouble and potentially taking market share, but balancing that with what’s going to be potentially tighter requirements on capital and liquidity. How much are you front-loading that versus thinking about the opportunities that can come your way if you remain as profitable as you say you are going to remain?

Yeah. Great question. And I guess just to set the big picture, Erika, that I would say, first off, I don’t believe that the answer to the two bank failures is more regulation on regional banks. I think those were idiosyncratic situations and there was sufficient regulation. So you basically had business models that were not well diversified and the banks grew too fast and stretch management capabilities, the supervisors didn’t really do their job and so I think there will be a thoughtful review of what were the issues and then how to address them. I think it’s probable that there will be some tightening around liquidity and capital, and probably, closer reviews of how banks are handling their asset liability management. There may be other aspects of this in terms of the overnight repo facility and creating a kind of viable drain on bank deposits in the money funds and should they change that and deposit insurance and should they take a look at that. So there’s a bunch of things that I think will come under review. Specifically, with respect to us, I think, the good news is that we have managed our capital at the high end of our peer group and so we are already compliant. We would be if we ended up having the AOCI filter removed, we would be in compliance today. The same thing John pointed out, the LCR. We have run that at a high level. We won very rigorous internal liquidity stress testing regimen that we would already be in compliance with the Category 3 bank as well. So the fact that we have managed the balance sheet conservatively, we are already in compliance if they go kind of heavier regulation if it ends up going down that path, I think, we are in good position. So I think we will have and the fact that these will be phased in over kind of, I’d say, two years or three years gives us lots of capital flexibility to be buying back our stock or taking advantage of other situations where that could arise. And if it’s strategically and financially compelling, I think, we have the capability to go on offense. So anyway, that’s kind of my thoughts on that, it was good to kind of stay conservative even when we had lots of questions as to why aren’t you leveraging your capital structure more where you are keeping your CET1 target so high. Guess what? We keep it that way, and we run conservative for precisely these air pockets that you are always going to experience turbulence and high capital and high liquidity is your best friend in these circumstances.

Thank you.

Your next question will come from the line of Peter Winter with D.A. Davidson. Your line is open.

Hi. Good morning. I wanted to just follow up on Erika’s question on the NII guide. I was wondering could you be a little bit more specific on the outlook for margin and loan trends going forward?

Yeah. I will go ahead and get started on that. So the guide being up 5% to 7%. What we built into that, as we mentioned, is the fact that we are going to have some downward kind of impact on margin coming from the deposit migration, as well as increased beta assumptions that we are building in. So it’s -- there’s a lot of uncertainty here and a lot of things to play out. But to try to frame it a little bit, go out to -- if you think about where we may end -- 4Q 2023 where we may end the year, we are starting the year at 330. We may end the year, call it, in a wide range, maybe 310 to 320 and if things kind of if there’s good execution and some trends maybe end up going our way, we will end up at the high end of that range, and vice versa on the lower end. And then so I’d say that when you think about playing it out throughout the year, there will be a step down as you work through the year with maybe a little bit of weighting into 2Q and things basically flattening out into the second half of the year. But like I said, there’s a lot of uncertainty there and -- but that helps -- hopefully, that will help give you a frame. And then you have got, as we mentioned, on the volume side of things, we do have the auto rundown, which we began last year that will be -- is built into that guide, as well as the ongoing work that we are doing in Commercial and balance sheet optimization. So you put all that together then that gives you the NII guide.

I would just add to that, a good answer, John, that this is an opportunity. We have always been on a balance sheet optimization path. But I think we are really intensifying our focus there. So businesses like indirect auto where it was a good place to kind of part liquidity and we run the business well. We service it very well. But it’s not really that strategically important to us. It doesn’t have direct customers that we cross-sell to, because those customers, frankly, are customers of the dealerships. So looking hard at those business and say, if deposits are more dear, what do we have on the left side of our balance sheet where we don’t have deep relationships and we are not making the best risk adjusted returns. And so during this year, I think we are going to really focus on making sure that the right side of the balance sheet in terms of deposit quality is as strong as it possibly can be and that where we are lending money we are doing that to true customers that we have deep relationships, whether they are Consumer, Small Business or Commercial and so we will take the opportunity this year to potentially have a little bit of a reset and even intensify those efforts. So we will really love our balance sheet going into 2024.

Got it. And if I could just ask about deposits, the outlook. I recognize deposits stabilized in March and you have done a lot of work to improve the deposit franchise. But it just seems like in this environment to keep deposits stable to growing deposits from here could be a little bit of a challenge, not only for you. And I was wondering if you could just give some color on some of the deposit opportunities?

Yeah. Why don’t I stop at the start at the top and then maybe I will turn it to Brendan and Don to talk about what we are doing in Consumer and Commercial. We did put a slide in their Peter about some of those opportunities. And so, I think that, right now we just need to kind of get through this earnings season and see the cards turned over and continue to trend, hopefully, of less and less turbulence and getting back to a more comp situation. So that’s where kind of stability comes in. And by the way, through -- halfway through April, we are still kind of trending stable to even slightly up. But then the initiatives that we have long invested in and the value propositions that we have both for Consumer and some of the new innovation we have on the Commercial side, we think should start to play out and then we can start to build back deposits. But why don’t I first turn it to Brendan to talk about Consumer.

Yeah. Thanks. So the Consumer -- in the Consumer business have got sort of kind of three segments of deposits, the Traditional Retail, Wealth Management and then Small Business. And it’s kind of progressing as expected, has been chatting mode over the last couple of quarters. We certainly have customers coming into the cycle that have excess deposits and liquidity from pre-COVID. We are seeing very, very small earn down rates, but nothing that is unexpected. And broadly right in line with trends from mid-summer last year through this quarter. As John pointed out, through March, on all three of those portfolios, we saw 60% to 75% increase in inflows, but the same sort of increase on outflows broadly just moving money around it. So we were very stable on net balances across those businesses through the month of March. We feel really good about the underlying health. Over the last eight years, we have invested a lot of time and energy in making our Consumer deposit base much more granular. Our primacy rates, so whether customers consider us a primary bank or not is up dramatically to above peer levels. That’s a good thing. That means stability in low cost deposits when payroll is coming in. We have done things like added benefits like early pay for consumers, which is an encouragement to bring payroll and direct deposit over that’s going quite well adds more granularity and stability of the deposit base. So when I look at levers to continue to have strong deposit performance for the rest of the year. There’s a couple of things in the Consumer Bank that we are really, really focused on. One, John mentioned New York City, New Jersey, household growth, getting more customers. That is going well. We are performing at the…

Don?

Yeah. So on our side, I think, a lot of it surrounds the Payments and Treasury Services business. You have heard us talk for the last couple of years about the investment we are making in that business. It has not only been around the core operating services, but also a lot of work around deposit franchises and liquidity franchises, frankly. One of the things we haven’t talked about is we have a liquidity advisory service and the liquidity portal, which goes beyond deposits, but allows us to capture customer funds even if they are on balance sheet. And then on the deposit side, over the last couple of years, we have introduced five or six new products. We have talked about the green deposits, talked about carbon offset deposits, we have talked about escrow deposits. So the product sets quite broad. The other thing we saw during the disruptions is we added about 300 new deposit clients, a lot of which interestingly came out of the JMP franchise as they referred some of the technology customers onto our platform. Some of those are funded up. Some of those aren’t funded up. But like Brendan said, the core of our franchise is really the primary core relationships and the operating relationships and about 66% of our deposit base is really with core primary relationships. And the last thing we are doing is we have turned the deposit business into a primary thrust sell. So where we were asking for capital markets business, when the capital markets were, we are now asking for deposits and we are framing the deposit raise in the context and overall relationship and have gotten a very good response from a lot of our clients.

Great.

That’s great.

Thanks.

Thank you for the detailed answer.

Okay.

Your next question will come from the line of Scott Siefers with Piper Sandler. Your line is open.

Good everyone. Thanks for taking the question.

Thanks,

I was hoping you might be able to speak at sort of a top level about how Commercial customers are behaving now with their operational deposits, like are they keeping less in operational deposits than they would have previously and then just spreading that money across several banks, which would imply maybe you lose some, but gain on, in other words, higher churn.

Yeah.

Maybe thought what Commercial account openings have looked like over the past month or so?

Yeah. As I mentioned, we have opened about 300 new accounts over the last month, which has been encouraging. I’d say at the top end of the client base we have seen more diversification activity. So the public companies, which had excess deposits kicking around the system, some of which were search deposits, some of those flowed out and went to other banks and then on the flip side, some of them flowed into us as customers balance their deposit accounts, so kind of net neutral on that. And then the other thing we have seen, frankly, and this is far before SVB and some of the disruption is clients are, because the capital markets are kind of quiet and the lending markets are kind of required, clients are using some of their cash to fund their operations and fund CapEx. So we have seen a little bit of a drift out in terms of just utilization of excess cash balances. And then the -- I’d say, the core operating deposits have stayed pretty flat. I mean people are basically toggling between ECR and deposits, if there’s a toggle, but I’d say, the kind of core funding of operational activities is relatively flat.

Okay. Perfect. Sorry, I had missed that 300 accounts over the last month, but I appreciate all that color. And then maybe separately, it sounds like you had some fairly constructive comments about the possibility for investment banking to recover over the course of the year, maybe in the second half. Just maybe a little more color on how you are expecting things to traject from here, please?

Yeah. I think we will see. It’s going to depend on what happens in the marketplace. I will say that over the last couple of weeks, we have seen a pretty strong bid in a lot of different asset classes, particularly the syndicated loan underlying asset class. So there’s some signs of life in the market, whereas it was dead quiet at the beginning of the year. We are starting to see some transactions actually clear the market some and kind of and some get restructured in ways that are, I would say, not more aggressive, but more regular way from various structured transactions that were happening over the last couple of months. So good signs of life. I’d say our pitch activity and our pipelines are extremely robust. And I would come back to what I said a couple of times is in things like our M&A business, we are a middle-market investment bank and so we play in smaller-sized transactions, say, $250 million to $1 billion, not the $5 billion to $10 billion transactions. So the financing dependency that’s in a lot of our pipelines is not as difficult as it is for the mega transaction. So we think as things begin to stabilize and recover and the rate cycle begins to come to an end, we will see activity in the second half of the year and we are seeing that in our pipeline. And then remember, we also have a very diverse set of capabilities now. So we are doing a lot around private equity, we are doing -- placing equity for clients into, for example, a family office or a lot of pitch activity around convertible bonds. So while some traditional full market products might not be fully back yet, we have a wide arsenal that we are actually deploying on behalf of that.

And let me just add to that as well and maybe flip it to John. But, Scott, the fee guide is supported, I think, broadly not reliant just on capital markets coming back. So we have a positive outlook across card, across wealth, the cash management business, mortgage, at market. So it’s fairly broad.

Yeah. Let me just add one more thing, Bruce. So if the first quarter is an indication we were down about $14 million quarter-on-quarter in syndicated finance. We were up about $13 million in our interest rate products and commodities hedging businesses. So diversification of those fee streams to Bruce’s point is quite important.

Yeah.

Yeah. Just picking up on that, so I was going to make that exact point just in terms of the bond and equity diversification along with M&A and cap markets. But in terms of cards, I mean, we do see some positive outlook in card as well, primarily in the credit card space. In mortgage production volumes and margins starting to recover a bit and that’s really good to see after quite a few quarters with headwinds there. And so -- and then on the wealth side of things, that has just been steady for us and is continuing even early April activity has been quite strong and so we are feeling good in the wealth space. So it’s sort of diversified across four, five categories in terms of what we are seeing for the 2023 outlook.

Perfect. All right. Thank you very much.

Your next question will come from the line of Gerard Cassidy with RBC. One moment, please. We are having a technical difficulty. Mr. Cassidy, your line is open. You may proceed.

Thank you. Hi, Bruce and John.

Hi.

Hi.

John, you talked about lowering the asset sensitivity of the balance sheet. Can you share with us how quickly you could take -- can take that to neutral if you want -- wanted to as the rate environment shifts possibly towards the second half of the year and then also the cost or the strategies you would use to do that?

Yeah. I mean, the way to think about that is, we are pretty close to neutral now and when you are down around 1%, there are a number of assumptions that go into that calculation, including deposit migration, et cetera. And so if your models are off one way or the other, you could easily be neutral. When we think about that when we consider the fact that we have a view that the Fed may hike one more time and may be on hold. But inflation -- if inflation is more persistent and stubborn, things could rise, right, from here. So we nevertheless don’t try to overcook things one way or the other, but gradually getting back to neutral has served us well and so you have to think about that 1% split between what’s typically hedgeable and what is a little less hedgeable and the short end is more hedgeable. So the construct of what short rate exposure is, is actually less than 100%, I am sorry, less than 1%. We are actually 60-40 skewed towards the short end. So to close that down would not take very much at all, would be typically a shift in balance sheet outlook and/or additional resi fixed swaps. But more broadly, we basically layered on a number of transactions to basically get our coverage for the rest of 2023. We have got about $20 billion of coverage in resi fixed swaps for the rest of 2023 and more like $26 million or so for 2024 and so we are sort of thinking of ourselves around neutral with protection to the downside. And I would offer up that, that will result if, in fact, the Fed does at the lower rates by a lot. We have a view that we will end up with a trough NIM that’s well above what we saw in our last cycle. So much more stable and a much more narrow corridor of net interest margin than you might have seen from us in the past.

Very good. And Bruce, I like the branding you are doing in New York with the Giants, looking forward to the day that Citizens becomes the bank of the Yankees. But with that as a follow-up on retail, this is maybe for Brendan. You guys gave us really good detail on slide 31 on the FICO scores. And a theory out there, I don’t know if it’s true or not, that the FICO scores have been inflated, because of what we came through during the pandemic, some people claim as much as 70 points. Do you guys buy into that theory, and if so, would you then expect maybe the behaviors of your customers to be different than what the actual FICO scores are?

Yeah. Great question. There is a theory out there that FICO scores were inflated with all the stimulus and delinquency going down really fast. The good news is our credit underwriting is fairly sophisticated and while FICO is an input, it tends to be one of about 100 things that we look at, including free cash flow and a whole bunch of other different metrics in all of our businesses. And so we have taken that into account in our underwriting that the range of real FICOs versus actual printed FICOs during COVID was incorporated into all of our credit metrics as we kind of made new loans over the last three years or four years. So we feel really good about that and I think the performance is showing that we think so far, at least we got that right. And as John pointed out, we are seeing the Consumer book normalize, but both delinquency and charge-offs are still south of where they were pre-COVID and we are not seeing an unexpected acceleration of delinquency or charge-offs given the environment really across any of the asset classes. So I know over the years have been questions about some of the businesses that were faster growing in Consumer and unsecured like students that are Citizens Pay business, those are well under control despite the great clubs surrounding us. So we feel really good about where we stand right now for Consumer credit, given the health of the Consumer and the quality of our underwriting standards. And lastly, yeah, we have tightened a bunch in the last six months to nine months just as a cautionary measure. So as we are kind of tightening up on things like auto on just size of balance sheet around the fringes in almost every single one of our asset classes, we have made credit tightenings, not because we are seeing anything we don’t like just in an abundance of caution to make sure that we don’t have any tail risk in any of the portfolios. So as everything we can see right now, we feel pretty good.

Great. Appreciate the color. Thank you.

Your next question will come from the line of John Pancari with Evercore. Your line is open. Go ahead.

Good morning.

Hi.

On the expense side, I think, Bruce, you had alluded to potentially being able to come in below the expense expectation, the 5% expectation may be for the year as you are focusing on that given the topline pressures. Can you maybe give us a little more color there what you are looking at and how material of a potential benefit you could have on that front as you see the topline pressure building on the NII side?

Yeah. I will start and flip to John. But we had -- coming into the year we were going with a 7% guide, some of that was reflective of the HSBC and ISBC full year effects and then some was the higher FDIC premiums. We have marked that down to 5%. So clearly in recognition that will have some compression in the net interest income. We are going to work really hard to try to protect the bottomline and so I think that’s what we have circled at this point. Clearly, TOP remains an open program and we have lots of ideas in terms of are there other things that we can kind of get working on and actually have a benefit this year. Some of them may actually have a benefit for next year. But, certainly, we have got our folks taking a hard look at what else we can do on the expense side. But at the same time, we are trying to make sure that we protect all of the investments in our future, the important strategic initiatives across Consumer and Commercial, across technology and our overall client experience organization so that when the storm clouds pass we are growing faster than peers and we are in a good position to grow both customer base, as well as our revenues. So that’s the balancing act is to keep looking for efficiencies, while making sure that we are prioritizing the things that really are important to future positioning, John?

Yeah. I think that’s well said. I would just add that we are take -- we try to calibrate our expense base along with the revenue base that’s being projected here. And so I think you could very well see an upside in TOP 8 in the coming months. We are working on that. The couple of areas that we are thinking about expanding on is the further simplification of our operating models all of our -- we have taken a look at -- a harder look at all of our third-party spend, reimagining how we operate from an automation perspective is something that structurally we have been making investments in and we can double down on that going forward. And just making sure everything we are doing is absolutely focused on our core objectives of growing a top performing bank, generating low moderate cost deposits and investing in our customers and clients. And so when you put a sharp eye on all of that, you often come up with opportunities to basically create additional efficiencies and we have demonstrated that over the years and then we are going to intensify those efforts here in the coming months.

Got it. Okay. Great. Thank you. And then just secondly, on the commercial real estate front, can you give us a couple of stats that you might you have -- you may have on that in terms of, as you are looking at refreshing or reappraising some of the properties in office. Can you give us what you are seeing in terms of some of the value declines, we had a peer of yours indicate 15% to 20% value decline in some of the office reappraisals? And then, separately, I know you indicated that you are seeing some pressure, you expect pressure on commercial real estate criticized loans. Do you have what the percentage increase was in commercial real estate criticized and what’s the ratio?

All right. General criticized is running at about 24% for the office space. I don’t have it for the overall real estate book at the time, but office is what we are very focused on. We haven’t seen a lot of appraisals yet, because we are not really in the restructuring mode, the ones we have seen have actually been modestly better than we expected. I don’t have the exact downdraft. But our entry LTVs are around 60%. So there’s a lot of cushion in our underwriting of commercial real estate. As Bruce and John said, we have really staffed up our workout teams and we are really putting each individual property, each individual MSA under the microscope. We are focused on maturities. In the office book, we have about 60% of the book maturing by the end of 2024. So it’s not a huge amount and we have a majority of the risk in the book swapped or fixed in terms of interest rate protection. So while we are beginning to engage client-by-client, remember the way -- we are very kind of focused on who we are doing business with. So client selection is very important. MSA is very important, suburban versus urban is very important and so we think we will have some trouble in the book and we are going to have to restructure a lot of the transactions, it’s going to be very manageable in terms of the overall loss content.

Very helpful. Thank you.

Due to time constraints, we will now turn the call back over to Mr. Van Saun.

Okay. So, again, thanks everybody for dialing in today. We appreciate your interest and your support. Have a great day. Thank you.

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