Morgan Stanley (MS) Earnings Call Transcript & Summary

Great. Welcome up next. Very pleased to have Morgan Stanley. You could put up the first ARS question as we introduce our speaker, but very pleased to welcome back Dan Simkowitz. I think this is your third consecutive year. But for those that don't know, Dan's co-President of Morgan Stanley, responsible for the Institutional Securities Group, serves on the firm's operating management and risk communities as well as the Morgan Stanley MUFG Steering Committee. Before we jump in, Morgan Stanley asked me nicely to do this. This discussion may include forward-looking statements, which reflect Morgan Stanley management's current estimates and subject to risks and uncertainties that may cause actual results to differ materially. Morgan Stanley does not undertake to update the forward-looking statements. Discussion today is copyrighted by Morgan Stanley and may not be duplicated or reproduced without their consent and is not an offer to buy any security. Great. So with that, Dan, welcome back.

Jason, it's great to be here. You and your partners, including Venkat, put on a great event. So we really -- we like coming each year, and it's a great place to bring the industry together right time. So I really appreciate being here.

Thank you. Dan, I appreciate that. Dan, maybe the best place to start is just the overall environment. It certainly feels a lot better, many suggesting we're finally kind of seeing green shoots grow. It's maybe taking a little bit while. Just do you agree with that? And how does this the current environment feel to you?

Yes. I think it's much better across the board from our perspective. If you look maybe narrowly, but it's really, really important from a capital markets and M&A perspective, it has dramatically improved. And not just versus the April, May, maybe tariff volatility, but versus any period we've seen since the post-COVID inflation move. I think what we're seeing through the summer, you see it in equity beta, you see it in credit spreads. Policy volatility is actually narrowing. It doesn't always feel that way, but it is narrowing. I think the equity markets are reflecting that both the people in this room, asset managers, asset allocators, corporates have sort of had to get through, I would argue, the early tough medicine, some of which could be long-term good medicine around the economy, tariffs, DOGE the cost cutting or the growth inhibiting part of DOGE, not maybe the deficit reducing part of DOGE immigration. And now in front of us, our whole series of pro-growth policies around deregulation, the impact of the tax cuts, especially on the corporate sector, private and public partnerships. So that's in [indiscernible]. And then if you just look at the data this morning, the market is telling us 6 Fed cuts between now and the end of '26, at the same time the market or the consensus is not talking about recession. And so that is a confidence building backdrop as you think about people who have to make decisions on strategy and large, let's say, illiquid capital investments. And at the same time, the last 3 years, M&A and IPOs, but I almost group IPOs as a part of the M&A and strategic dialogue way off the trend line versus GDP growth. So you've had 3 years where it's just way, way off. So there is a huge backlog around strategic activity that's out there. And as you know, we've talked about this in the past. When I ran strategy and MSIM, we had a pretty good run on M&A. I think we bought $20 billion to $25 billion of companies. I think they're all working out incredibly well. We'll talk about that. But we looked at over 100. And what I will tell you, as you look at 100, each one gets a discussion about something else. And that could be at the corporate development team, that could be in the C-suite, that could be at the board. But you don't just look at something and then reject it. And I think we ended up doing 5 or 6 deals, not just the big ones, it -- flow begets flow in the strategic element. And that is happening across all of our clients in the corporate world all around the world as well as our private equity clients. And then the other element is there's a lot of change going on. And sometimes, it's scary, but in other times, you have to react to it. And so the industrial policy in the United States is being sort of restructured. That has impact on supply chains and where you want to put your assets if you're a multinational company, AI is generationally changing. If you're in the U.S., you got energy independence. And if you're in Europe and other places, you've got energy transition, all driving boardrooms to now react into that environment. And then so the flow begets flow. The other place where flow is coming is private equity is just starting to monetize. They were skewed to the buy side this summer, and I'll talk about that in a second, but they are monetizing. I think that's a function of both LP pressure, which people have talked about, the LPs want some of that capital back. They want the model of PE to be reaffirmed. But also there's some compensation element. You don't get paid in private equity until the asset set gets sold or really the entire fund gets monetized. So there's some junior partners who want to get the compensation going. And so there's private equity flow. We estimate that there's 1,500, I got to get the numbers right, 1,500 private equity-owned companies just in the United States worth at least $1 billion, and many are worth much, much more. So there is flow coming. And then the other flow element is regulatory, right? So we advised Wiz when they got bought by Google, we closed the Discover transaction, where we were an adviser, and we were the adviser to Union Pacific. We're going to go from 4 railroads to 3 railroads. So all of that creates a flow, and then there's fuel. And you and I have talked about this. And so I've been waiting for it. As we said, not just shoots but the growing of shoots, but the credit market has been really stable and really deep throughout. But there is a connection between the IPO market and the M&A market. And the IPO market has recovered in sort of late May, June and has continued through this morning with a big deal that we announced pricing last night for Klarna has been really, really strong. And what that does in an M&A context is it creates another alternative that sellers can use, and it lowers the execution volatility and execution risk which then gets buyers and sellers more willing to engage. And I think that is why we're enthused and it's a narrow topic, maybe around M&A and the IPO market but for a firm like Morgan Stanley, it cascades through our entire business. So the M&A revenue is obviously impacted the advisory revenue on a lag these got to wait for the deals to close. IPOs you see the closings. But in our entire credit infrastructure, we're financing all those transactions. People want to risk manage rates, FX, sometimes commodities in and around those transactions. And then in wealth, it creates a lot of NNA, money in motion, and we're the #1 wealth management firm in the U.S. So you get things going on. And even in MSIM, you get carry. So I think that gives us some real encouragement around the market backdrop. The other thing I would say around that backlog that is built and what we're seeing, the backlog being not just the corporate backlog I mentioned, but probably $4 trillion to $5 trillion of PE dry powder, that doesn't all get done in late '25 and '26. So we're going to have bumps along the road. I'm confident of that. But to get through that backlog and get back on trend line, this is a multiyear, I think, recovery. And it -- we're in the early innings to use a baseball phrase.

So I guess, solid near-term outlook. You talked about the early innings. Maybe just expand on that in terms of your view of the longer-term wallet opportunity as well?

Yes. I think we get a lot of questions around the markets business, again, this is in ISG, I think you're asking me specifically on ISG and the securities business. And then just back on that M&A, there's $7 trillion of cash back around health. You don't do anything for 3 or 4 years, you get conservative and yet GDP continues, productivity continues. There's $7 trillion of cash sitting on corporate balance sheet. So there's a lot of fuel in that. In terms of markets wallet, we just go sort of line by line. Long-term debt long-term government debt is still a growth business. And so you've got -- we've got defense spending and stimulus in Europe. The Japanese bond market was not a place anybody focused on for 20 years. It's now a place. So you got a real rate curve in Japan. And so macro is still has some growth -- underlying growth and volume behind it. Risk management against that macro is still a growth business. So again, in a world of financial repression, we didn't have a Japanese bond market to go deal with. And we didn't have to risk manage because it was all being repressed. Now if you're a corporate or a private equity firm as an example, you're making investments, you're worried about your rate exposure given what's gone on in the last few years, and you're going to go hedge it and you're going to hedge it with us or our peers in that context. So that creates growth in the business. And then I think we'll talk a bit more, but we are very bullish as a long-term, really scaled secular trend is credit is moving into the asset management space in real size and with more activity and more active management and more sort of complexity to it, and that is really good for us. And then in equities, we continue to see just really good equitization trends around the world. Japan was dormant back to that point. The rate curve developed in Japan, but then the equity market comes -- there's real IPO volume, there's activism. There's hedge funds coming there for the first time. And so you have a lot of activity in Japan. You've seen the press around how much activity there is in India. We have enormous rate of change in the interest in Greater China, the Middle East, Brazil. So there's a lot of equitization around the world. And at the same time, this is one of my new phrases, maybe a word I used with you, there's derivatization. That's not a real world, but it's a Dan word, all around the world, including single day options here, people want to change their risk and return profiles. And that could be the managers in this room who don't have a pure Delta One view on Morgan Stanley, hopefully positive. And so they'll manage that in a way because you can't just afford to be lazy in your expression, in your views, and certainly in the wealth management platforms, people want, generally speaking, not pure Delta One. They want risk management, downside protection or a little bit of leverage on the upside. So all of that helps the equity business create elements. The final thing I would say as it relates to markets is all of this is coming in a world that I would say is more complex globally rather than less. And in a world where I think everybody in this room thinks about what's going on around the world more than they ever have before. So deglobalization is not showing up yet in our asset management clients, our private market clients and our corporate clients. They have to worry about it more than they ever have before. And in that context, they have to come and assess that with Morgan Stanley, and that allows us to have just less competitors. The number of competitors who can build Ted used to talk about 9 boxes, think about 9 boxes at the whole firm level. We are in the credit markets. We're in the equity markets, we're in the macro markets, we're in the corporate control markets. We're doing that across cash and derivatives and financing. And we're doing it everywhere around the world at a time when, hopefully, our asset management and corporate partners want to have less partners around the world, less advisers. And so what we can do is really optimize and I'll just give you 2 examples. They're both from conferences, Morgan Stanley is doing the health care conference, you guys are doing this conference as an example. But if we do a study for a big multinational around the Chinese market, they may not act in China, but they know we have a world-class M&A franchise and so they'll hire us to sell a U.S. division. At the same time, we've got an asset manager, we're getting them corporate access, our version of this. They are going to pay us back potentially because we're the #1 prime brokerage firm in Asia with complex Asian prime brokerage, which is higher margin. The ability to create that kind of ecosystem is really expensive. We're actually -- we lost competitors. We lost [ Credit Suisse ] and equities. We lost a few others. So in that context, we like the market share dynamic in the markets business. And again, I've already sort of talked about the, I would say, the cyclical but multiyear cyclical move in the banking businesses.

Stay with ISG for a second. You kind of touched on market share, and we've seen Morgan Stanley this year kind of increase its share versus peers and versus the last couple of years. Just maybe anything else you would add in terms of just how you're doing this?

Well, I think there's a relentless -- I think being global, being focused, right? We're not distracted. And we'll talk, I'm sure, along the way as it relates to corporate strategy. But Ted and Andy and I building off of James' focus on this, we just help clients allocate capital. When business strategy is that defined and that distinct, and that client could be a wealth management client, that could be hopefully a whole bunch of the asset managers in the room, asset owners and corporates. In that context, if you get really focused and you're not distracted and you're not wandering strategically, we think you can gain share. If you do it with all those boxes I mentioned and they're linked together, and we'll talk a bit more about this integrated firm, you can gain share. And we're just relentless right now on bringing the entirety of the firm the value we bring and where can we gain share. And so actually, the question we're often asked, and I'll deal with later maybe is you're gaining share and you're really big, but you need to go somewhere else. And we think the growth opportunity still in the firm in ISG around market share, but certainly around wealth around just the TAM is still really attractive, and so we don't need to wander and so that keeps us quite focused. But again, being global in a world that's more globally complex and we're investing. And we're big enough, $250 billion market cap or so circa $60 billion in revenue that we're investing in the underliers. And so we are investing in technology in the equity business. We're investing in credit financing. We're investing in sort of regular way U.S. investment bankers here who know sectors because the private equity industry has become much more sector oriented rather than general. These are sort of bread and butter core investments that help us drive share because the brand and the client need is so high. And I hope I just found out I want a piece of business. We want a piece of business, front row. Our client base generally, and this is a great thing to inherit that I came back to ISG, clients want to do more business with us, just across the board. Corporates, asset managers, public and private, they want more from Morgan Stanley into an environment that is turning.

Interesting. I guess, we've heard -- we've also heard that Morgan Stanley is looking to leverage its bank more. Maybe just help us understand what the firm is doing and how that fits into the overall strategic plan?

Yes. The bank is critically important and really has been for maybe the last 6 or 7 years. So just to put it in context, and we had regions and I think maybe at Fifth Third before -- got all of them here. But the numbers are important. And it's both sides of the balance sheet, and then I'll give you a context of the strategy. So loans have gone from about $115 billion to $250 billion in the last 6 or 7 years. And on the deposit side, we've gone from $190 billion to almost $400 billion in deposits in the last 6 or 7 years. Both sides of that balance sheet in the bank have been driven entirely by the client franchise and client value. Our clients want to both leave their money with us in good, good hands on the deposit side and lend back to that client base. So we're not wandering to either go grab either side of that trade. So there's no mission creep in the bank. But what's new, and this is just a function of how we became a bank and some of the intervening years is we have dramatically less of our ISG asset base versus our peers on the bank. And so what you'll see over the next years is if there are eligible assets, we're going to move more and more of that into the bank funding model, and that has a whole bunch of real-world positive impacts. It's got a funding impact. It allows us to do more growth into those client bases. And it makes us both more client-friendly, we look like our peers, so there's client simplicity to that, but it's also regulator simplicity because we look like all the other firms that they regulate. And so I think that is a play around just the ISG element. But the other part of this is, we'll talk a little bit more about lending. Everyday Banking for wealth management. We've got the client. We've got the deposits. We've got the loan. Can we put more to make it even more sticky. The E*TRADE digital bank infrastructure helps us do that. And then I can't believe I made it this far, and I haven't mentioned workplace, but workplace delivers a vehicle where we can broaden our bank scope. And we've got a really great team sort of managing in a very integrated way. Ted and Andy and I, Sharon and our Chief Risk Officer, we spent an enormous amount of time around this growth area as sort of the infrastructure to help us grow in many, many ways.

I guess maybe that's a good segue into Wealth Management. Love to get an update what's going on there. And maybe just start with giving us a sense of how you're seeing retail clients behave. Love to hear about kind of what you're focused on the growth piles of business? And just maybe how do you kind of maintain the moat around those business. Wealth management is certainly something we're hearing a lot of other providers talk about?

Well, I think the client base has been patient, resilient despite some of the volatility and other elements. And that you're seeing the numbers, the business continues to grow pretty dramatically, which is a function of clients wanting advice and staying engaged in their investment portfolios and still very, very much engaged in the market. I think it's worth -- I still am surprised, hopefully not -- definitely not with Jason and hopefully not with this room, that people haven't been keeping up with what Morgan Stanley Wealth Management is. If I have been at this conference 6 or 7 years ago, I'd be talking about 2.5 million households, and fighting it out with wire houses for people -- for advisers who are not young and clients who are not young. We're at 20 million households today, 2.5 million to 20 million households as an example. $1.6 trillion in assets just over the last 6 quarters. We're getting those households much earlier, much younger ahead of their wealth accumulation, which is really important. And as their lives become more complex, they become advisory clients, and I think Ted and Leslie put up a slide at the beginning of the year, 99% retention on advisory clients. So if you do that math, we're in the various earliest -- very, very early days of monetizing that move from 2.5 million to 20 million. But once we monetize and once they become -- their lives become complex, they need advice and they become advised clients -- they are advice clients for a very long time, and we're going to have that much earlier in the element. But it also -- that whole formula means we are the destination of choice for financial advisers. This is our best attrition year ever. So people were writing off this industry or our model a while ago. Our model is not like anybody else's model. We are generating leads. So in that world, where we've gone from 2.5 million to 20 million, there's an enormous lead potential if you're a financial adviser. And then again, these are leads that could become clients for 30, 40, 50 years, outstripping the lifespan of actually the adviser. So we are a leads machine in that context. We're also -- we're not a recruiting machine, but our ability to go to high end and recruit this year is one of our best years ever. And I think as you know, when we hire our assets coming in are dramatically higher than the assets we lose when we lose adviser. So there's a delta in the asset accumulation. And that is just a function of we can help advisers grow. We can help them grow in terms of new clients around leads and lead generation. That is, as Andy and Ted say, we're a model of one. We can get it through the workplace, we can get it through digital and E*TRADE and then we can be part of the advisory model, that is a really powerful element. And I think it's also somewhat underappreciated that the service that we provide that 99% retention has to be earned. And so the service we can provide off the platform. We're the #1 private market alts firm in wealth in the country by a big margin, and it's innovative. Most of that stuff we're showing more than half is exclusive or first look product. The integration of Parametric has been a huge home run around delivering real value in the portfolio into the wealth management client. And that's going to grow over time. And all -- and then lending, as I mentioned, off the bank, and all of that is tech-enabled, which is really powerful.

I guess maybe shifting gears to investment management business near and dear to you. We've had -- we've pretty strong net flows this year. Maybe talk to kind of what's driving the strength and what just differentiates your franchise?

Yes. Again, you guys have so many companies to cover. You have to think through it. So I know it, and Jason knows it more, but just to put this in context, this was a $400 billion franchise in 2018 dominated by mutual funds and sorry, some of the people in the room, mutual funds, active equity developed market, $400 billion. Today, it's more than quadrupled. So it's $1.7 trillion, dramatically more global in its distribution, and dramatically more diversified in its asset classes. And so $1.7 trillion, you've got a $0.25 trillion private markets and alternatives platform, as you know and have seen, these are really hard to build. They're really potentially expensive to buy, and we're -- we've built over a couple of decades, this really powerful private markets and alternatives platform at $0.25 trillion. And embedded in that are 2 or 3 like market-leading franchises. We're the largest open-ended core real estate fund in the country. We are the dominant player in the private funds that help people diversify away from their concentrated positions. Both of those are really big funds and really big market leaders. So alternatives is one. But Parametric just keeps on delivering value to MSIM and the entirety of Morgan Stanley. So it's now almost $600 billion. It's, I think, 2 or 3x bigger than its next nearest competitor. But you've seen a real validation this year around the product which is historically has been a beta product that gives you customized indexes, but we are now seeing external asset managers, the capital group, Lazard, -- there's -- I think there's almost a dozen come to us and say, we're not going to go build this ourselves. We're going to wrap our active portfolios in an SMA wrapper, that's tax efficient and that SMA wrapper is Parametric. And so when the industry, the asset management industry, the people in this room are not building it themselves and they're coming to Morgan Stanley Investment Management to wrap that and take that. That's a validation of the product, a validation, a little bit of our open architecture ethos all the way through the firm. And it's also a validation of the fact that the strategy is tight and there's real integrated firm going on because I can tell you that all those relationships from those asset managers that are coming into another asset management company are driven by the relationships we have in ISG, the relationships that we have in wealth, and that's pretty powerful growth drivers. So Parametric has been a really fantastic growth element. And then the other one, we just have a secular view, as I've mentioned already, around credit and we needed to get that business bigger and get the overall MSIM more diversified. And so the credit business at MSIM has gone from $60 billion, 6 or 7 years ago to over $350 billion. And so that is a nice sort of balance to that extremely profitable, great performance model but was pretty narrow in its construct. So we like the dynamics and to get over the last several quarters into very healthy long-term flows has been really encouraging.

Maybe we'll come back to some of that, but I just wanted to shift gears a second to capital. You in the industry are in a strong capital position. The environment for capital regulation is getting easier, SEC came down, it maybe comes down further. Maybe just talk about how you think about deploying that excess capital and it's not lost on me that you've mentioned E*TRADE, Eaton Vance and other capabilities multiple times so far this morning.

Yes. I think the core of this is we're just very encouraged by the regulatory backdrop. Vice-Chair Bowman, is bringing to the dialogue and the policy -- a common sense approach to capital that as we see it is rational, it's highly professional. So she is hiring really very, very talented, thoughtful people to be part of her leadership and her staff to go over. It's detail-oriented, and as it relates to capital, it's holistic. And it's holistic across SLR, SEB, G-SIB, maybe even Basel, and the net of that is it's going to create a greater level of certainty as we plan. And on the supervision side, which I don't think you can discount, there's just a real world, real life intense focus on what really is safety and soundness and stability issues. And so both on the income statement as well as the balance sheet, we're just going to be able to run safer and more efficient, and then play a bigger, bigger role in the growth of the economy. And so as part of that, you come back, it's going to allow us to continue to deploy capital in greater amounts both capital levels, income statement impact and then a removal of our own internally generated buffers given some of the vagaries of the past, invest in the business. So I've already mentioned ultra-high net worth, high net worth lending and wealth management, supporting corporates in the context of M&A wave but also a CapEx wave in data centers and AI and energy transition around the corporate client base. And then what you'll see is continued investments and growth in our financing businesses in the markets business. So financing of credit asset managers in fixed income and financing of prime brokerage, all enabled by a more rational common sense and holistic capital model. So that's coming. Obviously, it's in the context of the dividend and dividend growth being paramount. We have a durable business that is getting more durable and more scaled and we can -- we're really committed to not just the dividend level, but the dividend growth. And then on acquisitions, we love what we have. And so we -- as I said, we love the TAM that we're operating in. I didn't say it earlier. The #1 growth opportunity because I used -- when I ran strategy, and ran [ Anthem ] I got to speak to everybody, other asset managers, wealth platforms, other financial services company. The #1 growth opportunity in financial services, I think, that's scaled is Morgan Stanley Wealth Management in the U.S. today. And we're already #1, but the growth -- the scale growth from here to there as we monetize that workplace funnel and have all those capabilities. So we love what we have. So in essence, M&A really fits into business strategy. And it fits in, in a context where ISG, we have relatively good and solid market share and the market sort of mature. And -- but if there's product extensions or client extensions in wealth and asset management, we'll look at that, but we don't have to go anywhere because we do love what we have. What I will say is embedded in that in those business units we'll continue to look at innovation engines. And so I think Solium. If you think about it, Solium, Parametric, E*TRADE, probably 3 of the greatest fintech acquisitions in financial services in the last 15 years. So they -- in the case of Solium, it's not the biggest, so you won't see big, big deals, but where we can see innovation that can help our individual business strategy. And again, the business strategy is very simple, just help clients allocate capital. We love that strategy. You'll see that as a part of the capital deployment and the strategic agenda. But strategy doesn't drift. We really just keep it to the business.

Got it. We have 5, 6 minutes remaining. I just wanted to touch on kind of private markets and maybe a bit more -- talk a little bit more about that and why you see that as such a compelling opportunity.

Yes. Again, it touches all parts of our business, and I'll sort of mix it with both a private market view and a view on the credit markets as well. But we're the #1 allocator into the private markets in wealth management. We think we may be the largest private markets investor in the world. So that includes sovereign wealth funds and asset managers is a little hard to get the data. But we have $250 billion in the private markets and wealth management. It extends actually also into private shares. Because of the cap table business and the partnership with Carta, we're in the flow and our advisers like us to be in the flow and our investment bankers like us to be in flow with every private company in the ecosystem. So we are in there with the Carta partnership and we're innovating. And when I ran MSIM, it was all around ease of use. So we now are launched over the summer, Phemex, which is a single ticket full private market portfolio product, third-party or open architecture product, and it is going because the advisers then get their entire portfolio with a single ticket. That is really, really important. So we're innovating in that business. And again, in ISG, the largest segment, fastest-growing part of the business is on the private markets manager, and it's not just PE firms, but it's also private credit firms. And there's a lot of talk about private credit. What I try -- what I think is more relevant is just think about credit, financial repression is over. The asset owners historically had extremely low allocations to credit, big U.S. pension funds. They follow the Swanson model. The Swanson model had 0 strategic allocation of credit. Financial impressions over, banks are regulated or bank investors don't want banks to lend. Asset managers are stepping into that. So we see huge flows and it's both on the public side and the private side. To a degree, at Morgan Stanley, we're indifferent. As long as money is flowing to supply credit and it's flowing through the asset management industry, it's really powerful for us, and Apollo and Marc Rowan in particular, deserve a lot of credit. The insurance industry and how it invests its credit portfolio has been revolutionized. So you have all of this insurance capital that has gone from being very, very passive to very active and is being run by asset managers. And again, all those asset managers who are embedded in this credit secular trend, they need us to help them come up with new products. We help them raise capital. We help them buy other asset managers. We originate the assets, we finance the assets, we securitize the assets. And depending on where it sits on that public private line and the line is getting blurrier, we trade the assets. The ROE of that business for Morgan Stanley, that move from assets being maybe in the bank sector or maybe in the insurance sort of sleepy part of the insurance account, all moving to asset managers, big secular trend and big ROE play. We think over the next 5-plus years, there could be $35 trillion of credit money in motion. And that gives -- and that -- the private markets are just one example of that. And you're seeing -- it gives us what's happening in the insurance market and the sophistication of these asset managers is it gives our investment banking team an ability to be a solutions provider to a corporation or a private equity fund that we've never been before. And we are the origination partner for all these funds. They need assets. They have to come through the Morgan Stanley Investment Bank and maybe one or two others, but not a lot of others, and that's pretty attractive. And we're deploying that strategic view, as I said, in MSIM, where the credit business has gone up 6x. The private credit business has gone from $1 billion to $50 billion, and then wealth management is definitely deep into that ecosystem.

We've got a minute left, but it wouldn't be complete without talking about integrated firm, something we spent a lot of bit of time on last year. But just maybe quickly, how important is that to driving long-term results? How is that coming together? Any metrics we should be looking at to monitor the progress?

Well, I think the metric is, are we doing well as a firm. We -- as I said, we love all the components that the leadership team, inclusive of James built over the period. So we love all those components. But at this point, we think one of the greatest, I guess, deployments, and it's not maybe deployment of capital, but deployment of energy and time and technology dollars is to buying them together because what we're finding is there's so much synergy around our client bases. Just think about this room, the prior speaker was a regional bank. We have a great relationship with them. We have a great relationship with every asset manager in this room. Our wealth management clients want investment banking services. So there's real linkages. And so increasingly, we're saying, we love what we have. But instead of thinking them about them like business units, let's think about them as client segments. And so client segments are asset managers, asset owners, corporates and relatively wealthy or affluent individuals and they all engage intensely with each other. As an example, in essence, we're here at this conference because corporates need to engage with asset managers. Right there, we've done 2 of them. And I'll give you 2 examples. I know I'm going to 30 seconds over. Workplace, just think about workplace. This is corporations that we know in investment banking. We're now running part of their sort of talent management program. And we got in there with a product, but we're not stopping with the product. We're going to go and do financial wellness. So our investment banker has a conversation with the CEO and says, "I'd like to do financial wellness, not just with your top 100 executives, but your rank and file the next 1,000", because we're the only firm who can handle and scale, the ability to service that CEO all the way from their CFO to their software engineer. We can go do that at Morgan Stanley, and then that creates the funnel, and that gets to the 20 million households. And that's linkage. And then asset managers, hopefully, a whole bunch of this room, we can be their holistic partner, and the more we're doing it, the more we're seeing a holistic partner and help them create a new product, raise money in that product, trade the product, finance the product, but now we can also go back and do help their employees. So think about private equity, the portfolio companies are great workplace clients. The partners are great, high net worth clients. And so putting that all together has been a real passion of Ted and Andy and I, we put one of our best people, Mandell Crawley, to run it because we -- what we had as ingredients is we had a culture and we had real clarity of strategy, but we did feel like we had to put a little organization around it. And I think you'll see it in the results.

Great. On that note, please join me in thanking Dan for his time today.

Thank you.