Welcome, and thank you for joining the Wells Fargo Fourth Quarter 2024 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. [Operator Instructions]. Please note that today's call is being recorded. I would now like to turn the call over to John Campbell, Director of Investor Relations. Sir, you may begin.

Good morning. Thank you for joining our call today where our CEO, Charlie Scharf; and our CFO, Mike Santomassimo will discuss fourth quarter results and answer your questions. This call is being recorded. Before we get started, I would like to remind you that our fourth quarter earnings materials, including the release, financial supplement, and presentation deck are available on our website at wellsfargo.com. I'd also like to caution you that we may make forward-looking statements during today's call that are subject to risks and uncertainties. Factors that may cause actual results to differ materially from expectations are detailed in our SEC filings, including the Form 8-K filed today containing our earnings material. Information about any non-GAAP financial measures referenced, including a reconciliation of those measures to GAAP measures, can also be found in our SEC filings and the earnings materials available on our website. I will now turn the call over to Charlie.

Thanks, John. Let me start by acknowledging the unbelievable devastation from the Los Angeles wildfires. Our hearts go out to everyone who's been affected and we're committed to helping rebuild their lives, businesses and communities. I also want to thank our employees, who are working hard to support our customers, many of whom who have been impacted themselves. Turning to Wells Fargo's performance. I'll make some brief comments about our results and update you on our priorities. I'll then turn the call over to Mike to review fourth quarter results as well as our net interest income and expense expectations for 2025 before we take your questions. Let me start with some general comments. Our solid performance this quarter taps a year of significant progress for Wells Fargo across multiple areas. Our earnings profile continues to improve. We are seeing the benefits from investments we're making to increase growth and improve how we serve our customers and communities. We maintained a strong balance sheet, we returned $25 billion of capital to shareholders, and we made significant progress on our risk and control work. We grew net income and our diluted earnings per share was up 11% from a year ago. After I arrived, we reviewed our businesses and sold or scaled back several which reduced revenues in the shorter term and increased investments in others. We also made a conscious effort to diversify revenues and reduce our reliance on net interest income. In 2024, our strong fee-based revenue growth, up 15% from a year ago, largely offset the expected decline in net interest income, reflecting these efforts. Our disciplined approach to managing expense levels has been consistent and an important part of our success. We increased investments in areas that are important for our future and generated efficiencies to help…

Thank you, Charlie, and good morning, everyone. We had solid results in the fourth quarter, including net income of $5.1 billion or $1.43 per diluted common share. Underlying business performance was strong compared to a year ago. We grew fee income across most categories, maintained our expense and credit discipline and grew customer accounts and activity levels as we benefited from the investments that Charlie highlighted. We also grew net interest income from the third quarter. Our fourth quarter results included $863 million or $0.26 per share of discrete tax benefits related to resolution of prior period matters. This benefit was largely offset by $647 million or $0.15 per share of severance expense and $448 million or $0.10 per share of net losses on the sale of debt securities as we took the opportunity to further reposition a portion of the investment portfolio. This included the sale of approximately $8 million of securities, which we reinvested into higher-yielding securities. The estimated payback period for this repositioning is approximately 2.5 years. Turning to Slide 4. Net interest income grew $146 million or 1% from the third quarter, the first linked-quarter increase since the fourth quarter of 2022. The increase was driven by higher customer deposit balances, which enabled us to continue to reduce higher cost market funding. Moving to Slide 5. Average loans were down from both the third quarter and a year ago, Period-end balances grew $3 billion from the third quarter with growth in commercial and industrial loans and credit card loans more than offsetting declines in most other categories. Average deposits increased both from the third quarter and a year ago with growth in our customer deposits, enabling us to reduce higher-cost corporate treasury deposits. Average deposit cost declined 18 basis points from the third quarter as deposit…

At this time, we will now begin the question-and-answer session. [Operator Instructions] Our first question comes from John McDonald of Truist Securities. Your line is open.

Mike, I was hoping you could unpack the deposit expectations embedded in Slide 18 and the NII outlook. You talked about stabilization of retail volumes and mix. Just kind of wanted to get a little more detail about what you're assuming for retail deposit growth mix and how that plays into the paydown of higher cost borrowings throughout the year in your plan?

Yes, sure. Thanks, John, and welcome back and welcome to your new seat. Look, I think as we've sort of talked about now, I guess, for the last three or four quarters, we've been seeing less and less migration out of noninterest-bearing to interest bearing. You got to look through some of the product consolidations we did in the third quarter. So, there's some noise that we talked about last quarter. But so, we've seen continued sort of stabilization of the mix between noninterest-bearing and interest-bearing. And so that's sort of helpful as you go into this year, and we expect that to continue as we look forward and then start to see absolute growth across the consumer franchise. As you know, in the interest-bearing products in the consumer side, pricing hasn't really moved much through the cycle. And so, you're not seeing standard pricing change much, but you are seeing the promotional savings and CD rates continue to come down over the last 90, 120 days as rates have started to move. And so, we would expect that that mix to stabilize. We expect some absolute growth, and we don't expect pricing pressure to come through on the consumer side.

Okay. Got it. And then just wanted to shift gears and ask about credit card profitability. When you're in growth mode, credit card experience is a drag from accounting on the upfront acquisition costs and provision. Where are you on card profitability now? Is that an upside driver to ROE? Is more of the balances roll off teasers and some of that upfront expense wanes.

Yes, certainly is. I think as you look backwards a little bit, we started launching the new products 3.5 years ago. So, the first of the vintages came on starting in August -- July, August, a few years ago. And so, we're just starting to kind of see those earliest vintages mature and become more profitable. So, we're still early days in terms of seeing that profitability really come through in the P&L. I'd say, obviously, the factors you got to think about as you sort of look through that is the credit box and the credit performance, that's all behaving right on top of what we would have modeled. So, we're not seeing any concerns flow through from what we modeled across all of the different new products. And we're seeing, as Charlie highlighted in his script, we're seeing good new account growth, continue across the different products there. And so, it's just a matter of time for that to really more meaningfully come into the P&L. It really hasn't contributed much at all yet as you sort of look at it, but it will start to come through over the next year or two.

And John, this is Charlie. The only thing I would add, I mentioned this in my prepared remarks, but the two places that we think of as where we've already taken actions and assist execution now, which will improve profitability. One is card, as you pointed out. And the second I referenced is we're still not at the level of profitability where we should be in home lending, just given as we continue to wind down that servicing book. And so, we think those two things will be helpful for us as we look forward.

The next question will come from Ebrahim Poonawala of Bank of America. Your line is open.

I guess I just wanted to go back, maybe, Charlie, to something you talked about back in December on the back of the lifting of the OCC consent order. As we think about just the ROE trajectory for the bank, it will be useful if you can maybe give some tangible examples of things that you've been able to do post the lifting of the consent order in terms of incenting branch employees and where in the balance sheet or in the P&L, we should expect that to show up maybe as early as 2025.

Yes. Ebrahim, it's Mike. Maybe I'll start and Charlie can chime in if he wants to add. I think what you're referencing just to make sure everyone is clear, is the sales practices consent order, they got lifted last February. As part of the work, we had to do when that came on, we dialed back much of what you would expect to see in the branch system around incentive plans and sales goals and the like and to make sure that we built -- rebuilt the control framework and all of those things that we would do there in a way that would make sure that the problems of the past don't reoccur. And so, as we saw that consent order go away, we've been able to more fully roll out a standard sort of incentive framework across the branches. We have been piloting it for a while in a small subset. And as you would expect, you would see different performance and better performance in those pilot branches, and that's across new checking growth, credit card accounts and the like. And so, we're still in the early days to see the benefits of that system be put in place because it got rolled out throughout 2024. And so, we would expect to kind of see the results start to come through more meaningfully over the near term, medium term.

Maybe just a little more color to what Mike said. I think again, if you think back, it was hugely important that that we satisfied the obligations that existed in that consent order and that we were comfortable with the control environment that existed. And so, we took away, as Mike said, a whole series of things. It's not just one thing. It was compensation. It's recording goals, just the whole way we manage the system, as we were building out everything that would make us and our regulators comfortable as we managed the system in the future, similar to the way other people manage their system that if someone were to be doing something that wasn't appropriate that we had the right controls and reporting in place to catch it. So, it took a long time to build that out. But to have the confidence that we could add back a lot of these management mechanisms that you have in place. And so, no one individual thing is earth shattering. But when you take compensation, when you take reporting, when you take management routines, when you take all those things and put them together, at the same time, you're monitoring all the controls that you've built that's what gives us the confidence to go forward with the system that we think can attract more customers and do more with our existing customers, but within a very tightly controlled framework that we feel comfortable relative to how we manage the risk that's there.

Ebrahim, actually, Charlie and a lot of other folks here have seen this before, and we're confident we're going to get the results we think out of it.

That's helpful color. And I guess, just maybe following up -- so thanks Mike for running through the expense investment priorities. As we think about the severance charge in the fourth quarter, and run way to extract additional efficiencies relative to $54.2 billion expense guide. How should we think about like are we getting to a point where some of the low-hanging fruit is done and expenses generally move higher given the investments and we should at least anticipate positive operating leverage on the way forward? Or do you still see opportunities to meaningfully cut costs, make things more efficient, especially in the consumer bank.

Yes. I think, Ebrahim, as we sort of look at what you see there and what we're doing in 2025, it's no different than -- the thinking is no different than it's been now for the last four or five years that we've both been here. I think as you look at the Company, we still feel like there's a significant amount of opportunity to drive efficiency, and that's what you see in 2025. And I know we've used this analogy a lot, but it is just like peeling an onion. And as you sort of look at the next layer down, you find more efficiency, you bring better technology, you bring better automation, which, by the way, saves us money, but also in a lot of cases, improves the client experience for our customers. And so, we -- as we come in every day, we still think about it the same way that we've been thinking about for a while, and that's what you see in the expectations for this year.

The next question comes from John Pancari of Evercore. Your line is open.

Good morning. On the NII outlook, I know you said it includes modest loan growth expectation for 2025. I just want to see if you can elaborate a little bit on how we could think about that in terms of level and trajectory? Should it be near GDP? Or how should we think about that? And then can you -- in addition to the sizing of the most likely drivers, maybe can you also give us a little bit of color on the pace of expected incremental runoff of balances as you look at the growth outlook?

Yes. So, maybe I'll start on the loan side. So, as I said in my commentary, like we're expecting to see a little bit more of it as we get to the middle and second half of next year. So, we may see a little bit in the first half, but it's not be more meaningful as we go later in the year. I would think of it as like low to mid-single digits depending on the category of loans. But obviously, some of that will be dependent upon the overall backdrop that we're in. As you look at the consumer side of the picture, mortgages will likely continue to decline a little bit given sort of the rate environment we're in. We did see a little bit of incremental refinance activity in the fourth quarter. But now with rates back up, that seems to be back down again. We should see some card growth as we go through the year, and we should start to see some growth in the auto portfolio as well. On the commercial side, some of it will be new account new client growth as we go through the year. We've been adding bankers across different categories. We do expect to see some growth in the markets business as well to drive some loan growth. And so, it should come from a lot of -- a little bit from a lot of different areas across the population, but I would expect to see that a little bit more as we go into middle and second half of the year.

Great. And then separately on capital, 11.1% CET1 pretty solid and you still bought back about $4 billion this quarter. How should we think about the buyback appetite as you look at 2025, assuming that you do see some improvement in organic growth opportunities, how could that influence your pace of buyback.

Yes. I mean, look, it's the standard sort of waterfall of decision-making that goes into it, right? If we've got good organic growth opportunities across loans and other categories, we're going to serve customers, that's always first. We still have the asset cap in place. So, there's some limits to that. we'll look at all the different risks that are out there across the different categories of items that we got to be concerned about. And then buybacks will kind of be the rest. And given we've got the after cap and given we've got limited organic growth depending on the quarter you're in, I think you'll see us continue to return capital back to shareholders like we've done now for the last number of years. At this point, we don't believe we need to be higher than where we are from a CET1 percentage. And so, we'll manage that based on those opportunities and those decisions that we talked about.

The next question comes from Erika Najarian of UBS. Your line is open.

Clearly, the way the stock has reacted the message from your shareholders has been an embrace of Wells Fargo was more than a remediation story. And thinking about the return improvement even beyond the asset cap resolution and the consent order. And I guess to that end, Charlie and Mike, you have a medium-term ROE target of 15%. In 2024, you generated almost 13.5%. And by your own commentary, you still have places like Card and Home Lending where your profitability should improve from here. You're carrying excess capital. You're under the asset cap. Obviously, you're making great efforts in CIB in terms of really using your balance sheet to generate even more fees and off of your relationships. And as we think about that 15%, especially in the context of you have one money center that has to hold more capital than you that has a 17% target and another money center that has to hold more capital to go than that 15% target. I guess, I'm wondering if your shareholders are thinking about fully realized wells beyond the remediation story, what is the true natural return of this business?

Yes. Let me -- Eric, thanks for that. I think I guess what we would say is -- well, let me just repeat what we've said in the past, right, which is when we look at our businesses, we look at each one individually and we compare ourselves to the best people out there in terms of performance. And it's both returns and growth that we look at because, again, other than our home lending business and I would say the auto business generally, we do expect that our businesses, given the quality should be growing at rates commensurate with some of the best out there in addition to having some of the strongest returns. So, when you compare us to other people, right, you've got to look at the mix of business, you got to look at the size of our different businesses versus others. But when we think about where we ultimately what our aspirations are, it is based upon where the others are by business and what our business mix looks like relative to how we think about our own targets and what the timing is, I guess we would just say, we got to think about it one step at a time. And we don't want to get ahead of ourselves. We've said we want to get to 15%. We're close, but we're not there. And so, we want to achieve that for sure. We have to get out of these orders that we still have that do constrain us. And so there's a point at which we've said that not just yourself, but we, too, will address where we think we go from the 15%, but in due time.

The next question comes from Betsy Graseck of Morgan Stanley. Your line is open.

So, two questions. One, just to follow up on the last question that Eric asked on the drivers. We're in the last mile. So, congratulations we're in the last mile to the 15%. And are you thinking about that last mile as being driven by revenue growth happening faster in the businesses that have the higher returns? Or are there still expenses to be cut out such that the expense ratio and the expense focus is what's going to drive that?

Betsy, it's Mike. I'll start. I'll go back to what we said at some point last year as a reference point, but obviously, there's multiple paths to get there depending on sort of the environment and what happens. But if you look at where we were talking about earlier in the call, you have the credit card business, you have the home lending business as those two things get to sort of more mature -- more mature return profile in the card business and we get to sort of the profitability improvement we want to see in home lending. You can make your own assumptions, but those two things alone probably get you pretty darn close. You can then look at growth we're getting in the investment bank in capital markets and wealth. And so, there's lots of different combinations that get you there. And that's why we feel very confident that we'll get to that 15% and then reasonable people can have different opinions on exactly what gets you there first. But I think there's multiple paths to get there.

Betsy, for a second, if I can. If you just look at what we've said for next year, right, we've given you an expense number in terms of what our expectations are, which are pretty close to what they are this year. And so, we've given you our NII guidance, which is also up from the prior year to make your own assumptions on credit and fee income and you'll get a sense for what we -- to your question if it's expenses or revenues, how we think we're going to get there. I mean in terms of what those dynamics look like. The one thing I just do want to say though, when we think about returns, we feel really great about the prospects here. But as I said, we don't want to get ahead of ourselves. We've been very, very careful to make sure that we've got the latitude to spend whatever it is we need on all of the risk and operational things. And so that's still the case. And so even though we feel great about the progress and I've tried to give an indication of how we feel about that. We have to maintain that flexibility because that is a gating factor and the top priority. The second thing is, we've been very careful not to provide multiyear guidance for expenses. And that's because as we continue to peel the sending back, we find opportunities. We tried to also lay out in the presentation the point that we're not just reducing expenses and funding inflationary increases across the place, we're increasing the level of investment in technology and other things. And as we look towards the success that we have in different parts of the Company as we invest. So, as we see the positive results, we want the ability to make those decisions at each point in time as to how much more we want to invest. So yes, if we didn't increase the level of investment or if we kind of cap that out, you could sit here and say, yes, lots of things -- margins we continue to expand, returns would expand, you could get to some pretty significant numbers. But we're building the Company for the future. And as long as we see the payoffs there, we want the latitude to do that. So, we're very conscious of what our investors expect from us. We're very conscious of what we think the franchise can produce, but we do intend to build both a higher returning at a higher growth franchise, and you're just starting to see that. And how that plays out from a timing perspective, that's what we're trying hard not to get boxed in on.

Totally get it, and it does feel like there's a bit of a shift at the margin to rev-led profitability growth, in my opinion, which is great, a lot of low-hanging fruits already out on the expense side. And then just lastly, on credit card. I understand get it more mature. There was the announcement during the quarter, I believe, that Ray Fischer is stepping down. Could you help us understand what drove that decisioning? And new -- yes, and new management and what I assume it's going to be the same goals and everything, but if we could just have a few thoughts on that whole situation? Thank you.

Yes, yes, yes. So, listen, Ray, I've known Ray a long time. We've worked together for many, many years. When I came to, Wells, literally, the -- I think it was the first or second day I was at Wells, the person who was running the card business told me that they had already accepted another job outside the Company. So, if that had nothing, I wasn't a part of that change. That was a decision that was made. And so, ask Ray to join us and he's done a fabulous job. Ray, I think -- I don't know his exact age. I want to say.

We can give away his exact age, but he's old enough to deserve to retire. Yes. Very well, thank you, Mike.

Very well -- very well put. He's done a great job. And so, this is a very natural progression and something that we've talked about relative to his timing and what his expectations are. So, we've got a great team in place that he's built out. We've recruited a great leader from outside the Company, Ed Olebe, who joins us, I believe, sometime in February. And the strategy is the same, nothing is going to change. We've had lots of conversations about what we're doing and what the opportunities are. And I think I'm super excited about both what we've done, but continuing to execute along the lines that we've laid out for you all.

Okay. And you'll announce the new head when the time is appropriate, right?

We have already -- we have Betsy, John will send you the press release.

Thank you. Thank you. Sorry about that.

I think we set it out. To be fair, we sent it out internally, and there was an article this past week pointing it out.

The next question comes from Matt O'Connor of Deutsche Bank. Your line is open. Matt O’Connor: Obviously, rate volatility is quite high here. So, how do we think about the rate sensitivity to your net interest income, if rates end up being a little bit higher, obviously, it seems like a structurally good, but help frame some of the sensitivity to the guidance that you put out there from changes in rates? Thanks.

Yes, Matt. And obviously, we'll update the sensitivity in the Q or the K, I guess, when you get it. But we're still marginally asset-sensitive, as I said in my script. But the balance sheet has sort of naturally gotten less sensitive over the last number of quarters. So, rates coming down, as I said in the guidance is a slight headwind to sort of our estimates. And if they hold a little bit higher than what was in the forward, then I think that will be a slight positive. So obviously, we're a little -- we've become less rate sensitive over the last number of quarters, but it's still a little bit asset sensitive. Matt O’Connor: Okay. That's helpful. And then just on trading, obviously, you guys have been executing really well for a few years now. And I don't want to make too much of just one quarter. But even if we strip out the fair value adjustment, the trading was still down year-over-year. Obviously, the peers are kind of implying up, I don't know, 15%, 20% plus just maybe talk a bit about was there anything unusual this quarter that fall weaker trading. And again, I appreciate last year was a strong quarter, but it did jump out.

Yes. It was really about last year being a strong quarter than this year being a weak quarter. Nothing's changed. There's nothing abnormal underneath the surface. Nothing's changed in sort of our approach there. And obviously, the businesses are quite different when you look at peers. So, I do think you have to look through the results a little bit given the global nature and maybe the risk that some of the others take. Matt O’Connor: Okay. Actually, just on that last point. Obviously, we know you're more domestic, but your comment that others might take more risk. Like how do you think you're being more conservative in trading?

Well, I just said you have to look at the risk they're taking. I'm not suggesting that I'm not going to -- I'm not trying to say anybody is taking more risk or not. But when you look at our business, we've been very, very disciplined about sort of the risk appetite that we have across the trading businesses. And much of the focus has been in places that are balance sheet friendly, like FX, given the asset cap and other areas.

What we're saying is just that the size of our business is materially smaller than the biggest folks out there. The complexity of the products is very, very different, both because of the global nature, but also some of the things we do. So, it's just that we just have a smaller, less complex business.

The next question comes from David Long of Raymond James. Your line is open.

As it relates to auto, just seems like a bit of a strategic shift after three years of seeing that portfolio decline. What are you seeing in that business that is increasing your appetite to grow it here forward?

Yes. I wouldn't position it as a strategic shift. But a couple of years ago now, we took some tightening actions based on credit tightening act. There were two things going on. We took some credit tighten actioning tightening actions based on what we were seeing as what was happening in the market, and that had an impact on originations. We also saw some pretty significant spread compression at different points over the last couple of years. And so, our focus is not to be big. Our focus is to have a good returning sort of profitable business there. And so, we backed away in certain areas. I think over time, that starts to evolve and change and spread, we still -- these spreads are a little bit better than they were a couple of years ago in some pockets. And so that's part of it. Second, Charlie highlighted it as well. We are continuing to invest in the auto business. We've been continuing to build out better capabilities to be a little bit more of a full-spectrum lender across different pockets. That's a very small piece of what you're seeing in there. And then obviously, the deal we signed with Volkswagen and Audi, hasn't had any impact at this point. That will start to have a small impact as we get later in the year. And so, it's still relatively small growth in the originations. We're only talking a couple of billion year-on-year. And so, we'll see as it progresses throughout the year.

Got it. And then the second question I had relates to the investment securities portfolio repositioning. And do you have certain internal payback maximum that you're willing to look at? Or do you need to have a gain elsewhere in the bank before you look to take a loss in making some adjustments? What is the thought process that you go through to get you to the decision to actually act?

Yes. Look, I think we've acted twice. We're in the third and the fourth quarter as we've sort of looked at different opportunities. We've been pretty disciplined about payback periods so far in total, it's roughly a 2- to 2.5-year payback period across both of the repositionings we've done. Could we do something has a longer payback period maybe, but it's something we'll continue to evaluate based on what we're seeing in the market. But so far, we've been pretty disciplined about when we do it.

The next question comes from Vivek Juneja of JPMorgan. Your line is open.

Mike, a follow-up for you on your guide for NII of plus 1% to plus 3% for 2025 full year. Can you give us the guide for NII ex-markets for 2025?

Yes. Vivek, that's not something we've historically provided. Again, given the size of our markets business and the contribution, and obviously, it's very sensitive to where short rates will end up going. There is an improvement embedded in the guide for trading-related NII. That becomes -- that is very sensitive to where the -- where rates end up going. So, it's not something we're going to disaggregate at this point.

The next question will come from Gerard Cassidy of RBC Capital Markets. Your line is open.

Charlie. Can you guys share with us, obviously, there's geopolitical risks all around. And I think many investors, obviously, are aware of those. Can you list for us the risks that you guys talk about outside of the geopolitical risk when you're running your business, what are the things -- because the outlook, I think we all share the optimism you and your peers for the upcoming year for banking? And what are the risks, though, that could maybe sort of a curve ball at us?

Well, the biggest risk that we have that we spend the most time talking about is cyber at this point, just away from the normal taking around credit, interest rate, operational risk, all the types of things you would talk about. And so -- which is why we spend so much time on that and have the level of investment that we have and put the resources into it. Listen, as I said, I think in my remarks, we feel optimistic about where we are going into 2025, both because of where the economy is and the strength that has existed as well as the business-friendly approach from the incoming administration. What can -- I mean, you know bad things can happen. It could be related to conflict, could be related to a surprise in the market. I mean those things are out there. We're prepared for them as we think about just the way we run the Company, but there's no one risk that sticks out relative to just the things that you would do relative to how you run the business. And the most important thing for us relative to just risk management and the performance of the Company away from these big tail risks is the strength of the U.S. economy. The strength of the U.S. economy will drive the levels of success for our customers, both on the consumer and the wholesale side. And then we follow from their success. So, anything that risks that is a risk for us.

Very good. No, very clear. As a follow-up, and I apologize if this is putting the cart before the horse. You guys have obviously made great progress in resolving your regulatory issues. You talked on the call today about the OCC lifting, obviously the cease-and-desist order earlier last year. And so, when we get beyond these issues for you folks, obviously, everybody talks about the asset cap and the Federal Reserve’s cease-and-desist order. Can we talk about strategic planning going forward in terms of how you might -- because you have plenty of excess capital, how you might consider acquisitions? And in particular, what I'm interested in is pre-pandemic and pre-year asset cap Wells deposit market share was over 10%, which as we all know, you're not -- no bank is permitted to buy a depository with the market share is over 10%. But now with the growth in the industry's deposits, you guys have been flat, you're below 10%. So, would there -- and again, I apologize if this is the cart before the horse, but is there any consideration once this is all behind you, as you guys look to grow through maybe acquisitions, depositories or investment banks? Or how are you guys looking at it from that standpoint?

Gerard, it's Mike. Look, we're 100% focused on all of the organic growth opportunities we have across each of the businesses. And that's -- and the plan that we have been executing that Charlie started when he got here five years ago, is the same plan, we're going to be executing post asset cap. And I think it just involves basic execution across all the priorities, whether it's in card, wealth, IB, capital markets, et cetera, et cetera. And so that's our focus and -- because we think there's a tremendous amount of opportunity to build off of the positions, we have in each of these businesses across the country.

And the last question for today's call will come from Saul Martinez of HSBC. Your line is open.

You addressed -- in response to an earlier question, changes in the incentive framework across the branches. And there is this debate about the extent and how quickly an asset cap removal would kick start and allow for balance sheet growth. But I'm curious to hear if you think there are still operational/cultural constraints that you need to address to really capitalize on the growth opportunities across your businesses in response to the sales scandal, you changed the compensation structure of the branches. As you mentioned, you've built in safeguards to prevent abuses and maybe there is more of a cultural predilection to be more risk averse. But do you feel like these are factors you still need to address to sort of remove the shackles, create incentives that help you grow as you change more to a more of a growth mindset. If you could just maybe elaborate on those questions, please?

Yes. Let me take a shot at it. So, I think when we think about it is we are -- and we've been this way since I got here, which is very deliberate about how we go about business expansion. And whether it's an area like the card business where we started five years ago or the CIB, whether it's in trading or banking or in the private credit space that we're offering something in the direct lending world for our commercial. We do -- we're very focused on doing all of these in a very controlled way with the right risk framework and with all the right processes in place behind it. And so, I said in my remarks, we're not done yet in terms of all the things we have to deliver. But we are a very, very different company relative to the types of controls that exist today versus then. And so, it's having those controls in place. It's just doing the testing and seeing that they're actually effective is what gives us the confidence to grow. And so, when we talk about the opportunities that we have and the things that we're doing, it's because we have the confidence in those things that we put in place. So, when you talk about the shackles off and where we go, we just -- I mean, those aren't things that we talk about. Those aren't things that we think about. What we think about is that we are very disciplined in our approach in a very linear way towards where we are today versus where we want to go. And when we have the ability to grow the balance sheet from this point of view, we would expect to see the same. It's not -- we're not going to sit here and say the shackles are off. So therefore, the following 10 things are going to change materially. It's going to be disciplined, thoughtful piece by piece in a very controlled way and only in places that are supported by the controls that we have in place.

Well, listen, everyone, thank you very much. We appreciate it, and we'll talk to you next quarter. Take care.