OneMain Holdings, Inc. (OMF) Earnings Call Transcript & Summary

Okay. So with us today is OneMain's CEO, Doug Shulman; and CFO, Micah Conrad. We're pleased to be hosting OneMain for the first time this year for a virtual fireside chat. OneMain is the largest independent personal lender in the industry with an $18 billion portfolio of receivables aimed at consumers with limited access to credit in the near-prime and non-prime segment. OneMain has consistently grown originations year in and year out and focused on a disciplined approach to underwriting that targets at least 20% ROEs. Doug and Micah, we greatly appreciate you guys taking the time to join us this year. And today's presentation will be a fireside chat.

Good to be here, Will. Thanks for having.

So maybe we can start on the credit environment. I think if I think back 7 months ago at the beginning of pandemic, The Street was writing about loan losses on par with those that were seen during the Great Recession. And we've all been pleasantly surprised to see consumer credit improve across the board really on the back of government stimulus. So can you talk about what you are seeing in terms of the health of the consumer and your customer base? And ultimately, what your expectations are for the way the credit unfolds over the next 12 months?

Yes, sure, Will. Thanks for the question. Look, as you said, back in March and April of this year, I don't think any of us would have expected consumer credit to be as strong as it's been for the year. We actually positioned the company very conservatively so that we remained profitable even in an '08, '09 type of downturn where consumer credit deteriorated, losses went up, which we have not seen. As far as our consumer, as we've talked to them, and one of the great advantages we have is, we have conversations with our customer because we are community-based national lender, we have a dialogue and a relationship with our customers, so we get to talk with them. The consumer is acting pretty rationally in this downturn. They're paying down debt. They're conservative in their spending. Part of that is because there hasn't been as much to spend on. People aren't taking vacations, they're not going to the movies, they're going out to dinner a lot less. And so spending has gone down. You've seen the statistics from banks that savings rates have actually gone up. And our consumers', specifically our about 2.5 million customers', debt-to-income ratios have come down consistently during the year. So our consumer, which is the non-prime kind of near-prime consumer has been in really good shape, and that's been reflected in our credit performance. Our payments are very strong. Our delinquency rates, both early-stage and late-stage delinquencies are down year-on-year by about 30 basis points. We've given new net charge-off guidance for the year, which is the lowest we've had in memory. And so the consumer remains to be in very good shape, and our customer specifically is in good shape. To your second question about kind of outlook. I think a lot of that depends on what happens from here. There's a bunch of positive things, which is, a, the consumer is stronger now with increased savings, lower debt than they were at this time last year; second of all, the vaccine news and the possibility a vaccine is starting to get distributed very soon and in the first and second quarter getting distributed widely gives us all hope that this could -- things could normalize in the future. With that said, government stimulus clearly help our consumer and all consumers. And we'd like to see another government stimulus. There's a chance that even without a stimulus, the consumer remains strong with their savings and with their decreased spending and their lower debt, but that's always a risk. And so what we've done is position the company very conservatively. So we have -- we put reserves on assuming a much higher unemployment rate than actually has played out. We continue to underwrite in the conservative side, anticipating that there will be some deterioration in our book. With that said, we haven't seen any deterioration yet. And so there's a lot of upside in our business if things remain as strong as they have been, and the consumer remains as strong.

Got it. So that's very helpful, and it's a good segue into the next question, maybe one financial-oriented question for Micah. So on the reserve level, 13.1% in the third quarter, up from 10.7% post CECL on Jan 1. Can you talk about the assumptions that are embedded in those reserve levels? And given the disconnect between what you're seeing in consumer credit and what's embedded in the reserve, what would you, as a management team, look for in order to be comfortable to have the reserve ratio normalize over time?

Yes, sure. Good morning, Will. Thanks again. So our reserves at September 30 relative to the reserves we put under CECL when we implemented on January 1, is almost entirely explained by future unemployment levels. This is determined by the relationship of our losses and how those relate to the unemployment levels from our extensive portfolio stress testing. The performance of our portfolio, as you've noted, which forms the baseline for our loss reserves, does not reflect what you would expect to see, with levels of unemployment that we're seeing. So our delinquency, as Doug noted, is running below 2019 levels since the pandemic began. Payment rates have been very, very strong. So that forms the basis for how we think about CECL. Our reserve assumptions as of September 30, assume that we see a return to more normal 2019 delinquency patterns versus what we've seen recently. It also assumes on top of that, from a macro stress perspective, high single-digit unemployment rates through 2021. And importantly, no future benefit of any government stimulus. We are -- I mean, we're confident in the resiliency of our portfolio. Certainly, we're confident in the adequacy of our reserves. Right now, we have $2.3 billion at the end of September, which reflects about 1.6x 2019 charge-offs on an annualized basis. That's consistent with our stress testing and what we saw from '08, '09, when we had 9% to 10% sustained unemployment levels. I think in terms of your question is what we would need to see, really, I think it's a lot more certainty of the future. There's still a lot out there. We don't know where unemployment is going to go. We're starting to see some shutdowns locally in different areas and just general uncertainty in the macro environment. So that clears itself up over the next 2 quarters. I think that could lead us to evaluate some different perspectives on our reserving.

Got it. And you touched on it a little bit, a question for both of you. Talks are ongoing on and off again about another round of government stimulus. How would another round of stimulus impact your business, I guess, from a reserving standpoint, but more importantly, how do you think about the impact that it has on credit performance and balance sheet growth?

Yes. So any stimulus that supports American consumers is going to be good for our business from a credit perspective, for sure. The exact impact and how that plays out will depend upon the magnitude of any stimulus and also the form. So for instance, if we saw stimulus checks or enhanced unemployment, those are likely to be positive for credit, but could challenge demand if consumers don't feel the need to borrow because they have a good amount of cash in their accounts. Stimulus done through infrastructure spending or similar through PPP and business support would likely be positive for both demand and credit, keeping in mind that our borrower seeks credit when they feel comfortable about their own economic situation and their sustained level of employment going forward.

Got it. That makes sense. And just another one, and this maybe the same answer, is what you need to see reserves come down. But you noted that you've been underwriting loans that meet your return hurdles in '08, '09 style performance. And so I think you said 25% of the book has been underwritten to that 20% hurdle at those loss levels. I mean, what does this mean if we actually don't see those losses materialize for the return profile of that vintage, first of all? And then second, what do you need to see in order to return to more kind of normal underwriting?

Yes. Look, we -- right now, around 30% of our book has been underwritten since the kind of pandemic began in early March. And we took a very aggressive, conservative stance in the early days. And we said, every loan that we underwrite based on stress assumptions, stress losses, needs to meet a 20% return on equity hurdle. And the reason we said the 20% is, a, we have return on tangible common equity around 30% overall as a business, so we want to ensure that at loan level we've got very healthy returns. It also gives us plenty of cushion because we have another constraint, which is we positioned the business over the last couple of years to remain profitable even in a very severe recession. And we've added to our stress tests and feel really comfortable with the business. Since March when we took, what I'd call, a hatchet, and we just said, let's just assume stress losses everywhere, we've actually refined -- and the refinements we make are on loss assumptions. We'd always have the 20% return on equity threshold, but we have different loss assumptions. Generally, it's different depending on geography, product type, customer type, the risk of the customer, but generally we say about 1.7x normal losses is what we experienced in '08, '09 and so that's what we underwrote the loans to. Since then we've taken certain geographies and certain industries and taken more of a scalpel approach and have been very precise in our underwriting. And so take health services where employment -- or unemployment went from maybe 3% to 5%, we've lowered the loss assumptions for those industries. And so we're still assuming some stress loss, but not as high as 1.7%. And then other industries like travel, which are more like in a depression, where unemployment has gone from 4% to 25%, we've actually taken the stress loss assumptions higher, similar with different geographies. And so we've actually recently relaxed the standards for the first time and opened up the credit box a little bit in what we consider low-risk industries. We generally have taken a conservative approach though and said we're going to be good stewards of shareholder money and shareholder capital. We're going to underwrite conservatively and have a conservative balance sheet. We pulled back early. With that said, given our proprietary data, our national footprint, our artificial intelligence-driven underwriting, our real understanding of the near-prime customer, we think we can originate a lot of loans profitably that others probably can't. And whenever we see kind of the coast is clear, and we're really feeling we're on the tail end of this, we think we're really well positioned for growth on the back end. So that's how we think about it.

Got it. And that's a good segue from credit over to some of the balance sheet trends. You saw a material improvement in volumes over the course of the third quarter. I think originations were down 29% in July and improved to down just 6% in September. Can you talk about how customer demand has continued to play out in the fourth quarter? And any changes in borrower behavior that you've observed in recent months?

Yes. So third quarter origination demand certainly did improve a great deal during the quarter, especially compared to earlier in the pandemic around the April-May time frame. That said, while originations were down 6% in September, we still feel and believe that overall consumer demand is down roughly about 15% from where it was a year ago. Some of the targeted initiatives we talked about on our third quarter call contributed to our own originations performance in the quarter. In terms of consumer behavior, we haven't really seen any major changes. And Doug mentioned some of this in -- earlier, but consumers have taken a conservative approach to their financial lives throughout the pandemic, discretionary spending and travel's down. Consumers continue to save and prioritizing debt repayment and improvement to their balance sheet. So that's clearly important to credit results, but it also is important to demand. And we expect demand to continue to be somewhat challenged until there's a little bit more certainty in the future.

Got it. And that makes sense. You referenced several strategic initiatives or actions that you took. One of them has been piloting a new Small Dollar Loan product. I think the average balance is around $2,500. And I think generally, you sounded pretty optimistic about the customer response. Can you talk about just high level where this product fits into the product suite? How you expect the return profile to kind of compare to your standard product? And overall, how large a piece of the portfolio can this become over time?

Yes. This is something that we've -- a product we've had in the past. And we think of it as a feeder product or a starter product. So there are certain customers who we would only offer a secured loan to because of their potential loss profile. So if we were going to give them $7,000 or $8,000 of cash, we would require security. Some of those customers kind of at the high end of the secured-only offers we've now offered a smaller -- small dollar, what we call a Small Dollar Loan, on average, $2,500. And so if you think about the profile of that customer, it's a customer who maybe has a little bit thinner profile, maybe has a little bit more blemished credit history, but we think is worth taking a bet on. Any losses we incur on that customer, obviously, we'd only lose $2,500 instead of, call it, $7,500. So we could have losses on 3 of those customers before the loss content actually is the same dollar amount. Because the payments on those loans are smaller than the payments on a bigger loan, generally, we have lower delinquencies and lower loss content on them. So that pays and then the good customers, we will graduate, and we might renew them for a $5,000 loan and then renew them again for a $10,000 loan. And so the way this will play out in the portfolio is it allows us to bring in more customers and have some growth at a lower risk. We've seen -- if on average, if we only offer you a secured product, let's say, the booking rate is 10% or 15% of people who we only offer a secured product will book a loan with us. We've seen 3x that booking rate if we offer them both, in our early test. What we need to see is more data on both loss content and renewal rates to get a real conviction. I think this could add several hundred million dollars to the portfolio, kind of that magnitude would be what it is. I think in this product alone, I think more importantly, we're always looking for ways. Our basic goal is to provide access to hard-working Americans who might have a blemish on their credit record. That's our business model. And we try to help people get into a better place by doing business with us. So this is a group of customers that we can bring in with lower risk. It can expand our funnel and bring in more customers, who need access to credit. And then the good customers, which we hope most of them are, over time, their credit score, it can help them build their credit history and then grow with us over time. And that's been a hallmark of our business. It's been around for 100 years, which is we're there for people when they need it. And so we think there's a nice tuck-in product and a complementary product for our portfolio.

Got it. That's helpful. And sticking with the theme of kind of widening the top of the funnel. I think you also mentioned in 3Q that you've been testing a product more and -- a little bit higher FICO bands than normal, I think, 650 to 725 is what you mentioned. And there may be an opportunity to kind of increase your conversion rates there to closer to levels you've seen in other FICO bands. I guess, how meaningful this -- could this be from an origination standpoint, be it conversion rates in that segment to similar levels of the rest of the business? And how do you think about kind of the return profile and the volatility of returns relative to your average customer today?

Yes. Look, first of all, just for clarity. We're not talking about going into super prime, where it's very competitive. Rates are very low, et cetera. That's not our target customer base. We're talking about kind of high, near prime or the lower end of prime. This is a segment that we've served consistently over the years because there's a lot of customers who grow with us, they come back to us. They like the service. They like that we're always there for them. They like that if they have trouble, we work with them. And so what we're always looking to do is test pricing, test elasticity of demand. And the obvious calculation on this is if you give up some basis points on yield, but bring in more customers and increase volume. And if it's a lower-risk customer that decreases losses, it can be something that's good for that customer and good for us. At the beginning of the pandemic, we had the competitive advantage of having an incredibly strong balance sheet with a lot of liquidity. We had $4 billion of cash on our balance sheet in March, when people whose business model was originating and then doing whole loan sales, their balance sheet had dried up. So a lot of people in this sector had pulled back. So we did take advantage of a market opportunity where people either had pulled back or they had increased our prices. So maybe our interest rate would have been 24%. Pre pandemic, some competitors had interest rates of 17%. They brought it up to 21% or 22%. We could drop it a couple of percentage points and be more competitive and pick up some volume. Still very early days of this testing. What I will tell you is this is part of our ongoing business model to see how do we stay competitive. Depending on the channel, it's more important on some of the internet channels, where people literally are seeing 3 offers in a row. There's a lot -- very price sensitive. And we're always looking at how we can increase kind of top-of-funnel pull-through, still have a profitable business and still provide a lot of value to our customers. And so this is one where, look, if you step away back, we said, okay, it's a global pandemic, business is not going to be as good for anybody and people in consumer lending. So how do we use this time where we're incredibly strong and know that on the back end, we're going to be driving growth and innovation on top of the great platform we have to double down on our innovation? And this kind of price testing and really honing our engine around pricing is one of the places that we've been using this opportunity to tune our business so when we come out the back end, we're -- that's going to just be a more refined tool for the future of the business.

Got it. That makes double sense. Maybe a longer term question. You've had pretty strong growth in originations kind of year in and year out. You have this kind of long-term growth target of around 5% to 10%. And I know you, as a management team, really set underwriting targets, not growth targets, but -- and can you just talk about what you view as the most important factors that have allowed you to grow the business at an above-GDP rate? And how you think about the sustainability of growth over the next 3 to 5 years?

Yes. I mean, look, first of all, to answer your second question first. We think there's a lot of growth potential in the business. And we think we're positioning ourselves that when we get to the back end of whatever this recession looks like, we're going to be on an even more powerful growth trajectory than we were going into it. We tune, and when I've said we don't manage to growth, we manage to performance, and then growth is an output, it's not just underwriting. So obviously, we are not going to just -- anyone in this business, we could be growing double digit right now by taking on a bunch more risk. But we've tuned the credit box where we think we're going to add a minimum and conservatively get 20% return on equity of the loans we make. And that's where we've targeted. Generally, there may be some experimentation where we can drop below that. There may be times in the cycle where it's a little below that, but that's generally the credit box is going to be what the credit box is. The places we've tuned the business is, one, just on the core business and the customer experience. So how do we track more people top of funnel, direct marketing, digital market, search engine optimization. Then how do we tune the customer experience? So when you hit our web page, funneling people to making sure they can understand the value proposition of the products, we monitor at a very micro level kind of every step along the customer journey. So people who start an application and don't finish, and we're always kind of tuning and testing and improving that. We've also added a lot of data and analytics capability into our business over the last couple of years. So things like dynamic routing of applications to either our central offices or other branches in the past, you apply, you get routed to the closest branch. If that branch has a ton of applications and a branch further away doesn't, you might not get to it for a couple of hours. Now it goes to one of our team members who can get on the phone quickly, explain the opportunities, set up appointments with people at multiple branches. We also have run artificial intelligence that shows probability of booking, so we can get to applications faster, who are the more serious applications, in need, who are going to book. And so we tune all the way through there. And then the ones that we've talked a lot about is just product innovation. And so we have a lot of people who apply, who either we turn down or they don't come all the way through with us because we don't have a product that's exactly right for them when they were kind of doing their broad search. So whether it's the Small Dollar Loan, whether it's some of the kind of upper end of near-prime or lower end of prime, pricing test, we have a new insurance product on the market right now that we're testing called Silver Safeguard that has identity theft, moving expense protection, some other kind of newer protections for people, and we're adding to the product pipeline. We've also done some partner -- distribution partnerships, where our main distribution channel is our business to consumer, direct-to-consumer. So you've seen, and we can talk about it later that we -- about 1/3 of our originations are now digital. So that's really widened the funnel to create growth opportunities. But we've also done a partnership with Intuit to send us potential applications. We've done a partnership with a company called Currency that helps people buy kind of off-road vehicles, ATV, snowmobiles, et cetera. And so we're continuing to tune the core business, add new products and expand distribution channels. So we think there's a big market, tons of room for growth, and we think we're well positioned to continue growing on the back end of this.

Got it. And maybe we'll skip around to some of the more strategically oriented questions. I think it's a good segue. As with everything over the past 7 months, the business has had to become more digital in a short amount of time, and I think there was a stat that said 33% of the originations in the quarter were remote closings. I guess, over the course of the pandemic how has your thought process changed on investments in digital capabilities? And are there any strategic investments that have been accelerated or reprioritized in this environment?

Yes. Look, we were either lucky or smart, but in 2018, we said we're going to take this branch-based lending platform, and we're going to add digital origination capabilities to it. And we set out on a vision to build an omnichannel distribution network. In 2018 and 2019, we did a lot of de-plumbing in the back end of this. So we set our systems so that, that system of record didn't have to have an attachment alone to a branch. We tested a lot of the customer interfaces so that people who usually would walk in and get a personal experience, how do we replicate that consultative educational experience in a branch. We set up the protocol so that we could have all of the hallmarks of our business, ability to pay underwriting, income verification and secured lending happen without people coming into a branch. And so we actually started originating digitally in the fourth quarter of 2019. First quarter of 2020, we had a conservative rollout plan to test things. I think what changed is in March and April of this year, people didn't want to come into a branch. And so we had built the capabilities that we could start originating online. Now our branches stayed open because we were deemed an essential business in all of the states that we operated. And we're really proud of our team members who went in every day, served customers, make sure people could get access to credit through these difficult times. But we really accelerated the digital originations. Some things that we were testing, we rolled out nationally. So 2-way video, 2-way chat, so people, if they didn't want to end up on a phone with us, could kind of chat back and forth. And then it turns out one of the most important and popular features is co-browsing capabilities. So Will, you're taking a loan, I'm the associate on the phone with you, you give me access to your computer, and we kind of go through and say, look in the upper right-hand corner and move the cursor, these are your options, these are your payments, here's your disclosure. What the co-browse does is allow us to really walk through the details of the loan. It helps the customer understand it and also make sure that our team members are following all of our compliance and our rules, et cetera. And so we accelerated that on the way through. For the whole business, we looked at our whole tech stack and said, "What do we want to continue, what do we want to stop? What do we want to accelerate, given that all of our kind of corporate team went remote in the spring?" And what we've really doubled down on is our digital business and our product innovation and our customer service innovation. Again, if you go back to Investor Day a year ago, all themes that we highlighted. And so I think we were always headed in this direction. But again, we took advantage of a little bit of a wall in business to really double down. So we're positioned well on the back end.

I guess, historically, the branch network has been a big differentiator for you, particularly in the face of a lot of the kind of online lender competition that you have. And you had a stat at the Investor Day, I think, that showed branch count down about 5% over the last 2 years. Has your thought process changed about the optimal size of the branch? And is there any kind of acceleration in plans to consolidate branches over time? Or I guess, how are you -- what's the latest and greatest thinking on where the branch network sits over the next 5 years?

Yes. Again, we had declared in 2018 that we were going to be an omnichannel business. And we're going to have digital distribution, we're going to have branch distribution, and we've got a very strong, 1,200-person strong kind of central call center staff, who does collections, originations, customer service, et cetera. So we can really operate both originations and servicing in-person, on the phone or online or on our mobile app. We've continually assessed our branch footprint. And so first thing I'd say is our branch network is a differentiator. We're always going to have branches. That's going to be an option for customers going forward. At the time that we integrated OneMain with Springleaf, we had 1,800 branches, we have 1,500 today. So we've been slowly kind of consolidating the footprint. Every year, for the years I've been here, we opened some branches and closed some branches, depending on geography, production, changes in demographics, et cetera. I think we've now really accelerated the digital origination that's happened. And with -- and the branches have played in a real role in that. We're also testing some different formats. So for instance, in Pennsylvania, we've recently closed about 10 branches, and we've moved them into a regional customer service center, where those team members have relocated into a central site that allows customers to -- allow those team members to kind of allocate work in a different way, really focuses on the remote originations with, we call it, digitally assisted. It's a little less expensive for real estate, and we think it's going to be able to kind of increase our originations in that area. I'd say over the next 9 months, we're testing a variety of formats. And I think you can expect to see us to continue evolve the business. I think it's too early to say like exactly what the footprint will be going forward. What I will say is we're going to have a lot of branches. We're going to be national. We're going to have an in-person presence, but we're also going to have a very strong digital presence to complement it.

Got it. And we have a couple minutes left. So I'm going to go a little bit into the lightning round here, but one of the things I wanted to hit on is just the innate operating leverage in the business. I think with a 5% to 10% receivables growth target, 3% to 5% OpEx growth, there's a lot of operating leverage that you guys are thinking about over time. How do you think about the sustainability and the kind of the desire to balance, generating positive operating leverage each year with the ability to make the kind of digital investments that we talked about today?

Yes. Will, so it's a good segue from what Doug just talked about in terms of the things we're doing with our business to continue to refine it and drive more efficiencies. We've got a long track record of being able to grow our receivables, manage our receivables while maintaining a required loan return framework for our loans and operating expense, of course, is an input to that required return framework. Any efficiencies that we've built over the years and continue to build allow us to then originate more profitable loans that meet those risk criteria. We talked a little bit about what we've done with the branch footprint. But just stepping back from an OpEx ratio standpoint, this is operating expenses measured as a percentage of receivables. Our 2017 OpEx ratio was around 8.5%. As of year-to-date 2020, that expense ratio is down around 6.9%, so moving right around 7% now. We expect, over time, on average and over time, that our expenses will grow by about 3% to 5% annually as we invest in the business, and that's offset by continued focus on efficiency measures. And that's not always going to be linear due to the seasonality of our business. Sometimes, we have the seasonal impacts of marketing expense ahead of growth periods, and how that lines up with business investment and cost saves will move over time. But we certainly would expect it over the long term, again, I think 5% to 10% receivables growth in our core business is a good number, 3% to 5% OpEx growth, netting investment and efficiency will continue to drive that operating leverage going forward.

Got it. And just to spend a minute on capital allocation, maybe another one for Micah. You've recently increased the dividend. You've been declaring special dividends each year. Can you just spend a minute on the capital return framework and any kind of inorganic opportunities for capital deployment you might have? And on the inorganic side, what are the types of things that might actually make strategic sense for the business?

Doug, you want to take that one, and I'll follow on?

Sure. Look, our business is a great business that generates a lot of excess capital. We've been pretty clear with our capital allocation framework. First, we're going to invest in loans that meet our 20% ROE threshold. Second, we're going to invest in the business, all the things I've talked about, product innovation, customer experience, technology and digital advancement and to digitize our business and provide better service and more options to our customers. We'll consider inorganic opportunities as they come along, I'll talk about it in a minute. And then we are returning capital to shareholders with a bias towards dividends. We've set up -- and we've used language very carefully, which isn't necessarily the conventional language of dividends. We have a minimum dividend of $1.80 annually or $0.45 a quarter. Most people call those regular dividends. What we want to signal is that's the minimum you'll receive. And we said that conservatively, we said that's going to be able to be paid even in a severe, severe, severe economic downturn greater than '08, '09. We've stress tested that. But we also plan to regularly distribute more than that in the first and third quarter. For the last 1.5 years, we've -- that distribution has been between $2 and $2.50 a quarter, our yield has been around 24%. And so I think from capital distribution, people can expect us to be a high-yielding stock due to the fact that we generate a lot of capital, and we've prioritized dividends in that. I think regarding M&A, we're quite active looking at both platforms but also portfolios. And so if we see a loan portfolio where we could acquire some customers and some balance sheet, we'll consider it. We actually looked at a bunch over the last 9 months. I think we want to be good stewards of our shareholders' capital. We basically said, given the uncertainty in the environment, we didn't want to take on excess risk, and it wasn't necessary for the business, but we'll keep looking at those opportunities as they come. I think from a platform, I think you can think about product. And are there products that would benefit our customers? You think about capabilities. So are there digital and technology capabilities specifically? I will say we've really built out a world-class digital team, our Head of Digital, we got from Amazon. We've brought on a variety of people in our technology team from world-class banks and other financial service institutions. And given how far we've come in building out our own digital origination platform that plugs into our back end and creates a seamless experience where a customer can walk into a branch, get on the phone while driving and do something else with us, and then when they park in a parking lot, get on a digital app and do something else. It's less likely that we're going to buy a digital platform, but never say never. As those properties come to market, we'll look at it. And then there's also teams. So I would say -- I would think of it as we'll be opportunistic, but we see a lot of organic growth ahead of us with the innovations we've been making. And so we're -- we don't feel compelled that we need to go out and buy something.

Got it. Unfortunately, we are out of time today, but I wanted to thank both of you for taking the time to join us, first time with a fireside chat at the Goldman Sachs financial conference. I hope we can make it a recurring event. And with that, I think we'll stand adjourned.

Thanks for having us.

Thank you.