The Bank of New York Mellon Corporation (BNY) Earnings Call Transcript & Summary

I'm moving into the afternoon session now. I do have a disclosure to read, and then we will introduce our speakers. For important disclosures, please see Morgan Stanley research disclosure website at www.morganstanley.com/researchdisclosures. And if you do have any questions, please feel free to reach out to your Morgan Stanley sales representative. We are delighted to have with us today Emily Portney, CFO of BNY Mellon; and Paul Camp, CEO of Treasury Services at BNY Mellon. Thank you so much for joining us today.

Thanks for having us.

Pleasure to be here.

So Paul, as CEO of Treasury Services, you are responsible for offering global payments, trade services, cash management, foreign exchange. I think those are the top areas that you're responsible for. I'm sure there's more involved than -- to deliver those services to your clients. But maybe you can give us a sense of the overview of BNY Mellon's Treasury Services business, and how it fits in into the overall BNY Mellon offering?

Betsy, first, thanks for the invitation to join the assembled audience, we very much appreciate it. So Treasury Services at BNY Mellon, we are a $1.3 billion in revenue in 2020 business. We're about 10% of Bank of New York Mellon overall. It's a high-margin scale business with a global client base of over 2,500 clients. And the market, very importantly, is a large, dynamic, attractive, growing market, which is prime for disruption. So it's a really interesting space. It's a very interesting time. And we are a scale-based player in that market. What we offer are exactly as you said, it's payments, liquidity, trade finance, foreign exchange services. We help our clients to optimize their cash flow, manage their liquidity and, importantly, make payments and receive payments more efficiently. We enable our clients to move money around the world, and we do it at scale. So we move about -- more than $2 trillion a day in a very attractive market. Payments are currently about half of our revenue. It's our core offering. So we think of payments as the tip of the spear with a very strong focus on electronic payables and receivables. We're a top 5 player in U.S. dollar payments volume. We're a leader in immediate payments in the United States. And we handle FX -- as you mentioned, FX payments in over 100 currencies. Liquidity is a bit less than 0.5% (sic) [ half ] of revenue in the current rate environment. Clearly, that grows as rates move. And we provide both on- and off-balance sheet solution for our clients. So we gather stable, LCR-friendly operating deposits for the bank. Trade Services, which you mentioned, is relatively small for us, but it's growing. And what we find is trade really facilitates cross-sell. So think about trade as when we've got an importer and an exporter and they are transacting with each other, they know each other really well. They'll settle a transaction with a payment and that goes through our payment route. When they need financing or they need risk mitigation, they turn to our trade facilities, our trade business. And when we do that, we support our clients through their trade needs, we tend to see the cross-sell delivers about a 2x payment and liquidity revenue. So our clients really appreciate that support on the trade side. And our clients have very strong connectivity across the BNY Mellon franchise. So the majority of our clients in treasury services at BNY Mellon are also clients of the bank, very important. So clients who work with us, work with the rest of BNY Mellon as well. And it's that holistic relationship, which is really meaningful and really valuable. That's what we do

Okay. It sounds easy, but I know it's complex to deliver all those services. And when you said 100 currencies, that really piqued my interest. So we're going to dig into several of these areas. First, could you expand on the types of clients you serve and the -- and you mentioned the 100 currencies. Does that mean you're in 100 countries? Just give us a sense as to where your focus is both on the client and the geography side?

Sure. So let's look at clients, let's look at geographies, and then let's look at capabilities, which I think is the third question around currencies. So in terms of clients, we have a very diverse client's book, our segments that we serve. And remember, we are part of Bank of New York Mellon, so the clients are going to be quite consistent with Bank of New York Mellon overall. About 50% of our clients are financial institutions globally. So banks and financial institutions globally, both in the United States but also throughout Asia, Latin America, Europe, Middle East, Africa, et cetera. About 25% of our clients are what I would call nonbank financial institutions, insurance companies, asset managers, broker dealers, primarily but not exclusively in North America. And that actually very much leverages our strong relationships with that segment through the rest of the bank. And then about 20% to 25% of the rest of our clients are corporations, primarily large-cap U.S.-based companies. And it's a growth segment for us. So there are really some interesting segments in that corporate segment, which are nice growth segments for us like technology and healthcare that we are looking to do and we are doing more with. And then the remainder, because I had said 50, approximately 25, approximately 25, the remainder are in public sector. That's the client base. It is quite global. So about 20% of our clients come from APAC, which is a very -- a faster-growing segment for us, and about 15% to 20% are coming from other emerging markets around the world, Latin America and the Middle East. A very global client base. What we offer them, and you asked about capabilities, many of our clients use us primarily -- or they start by using us for our U.S. dollar payment capability. So think about U.S. dollar payments not only as a domestic payment currency but also as a payment currency that the world tends to leverage, and that could be because a beneficiary wants to receive dollars or it could be because dollars are a third currency between, let's say, a Chinese and a Brazilian counterpart. And so when we talk about 100 different currencies, some of these we do ourselves, some of them we leverage partners and some we do through our FX product capabilities. So depending upon the clients' need, if they have strong demand for a specific currency, we can offer them those currencies directly, or if they have occasional need for that currency, they'll often access that through our FX payment capabilities, leveraging a dollar-based account that they have with us. And that FX capability, it's something which, again, leverages the strength of BNY Mellon, leveraging our markets capabilities in the FX space.

So when you are going to market, when you are trying to convince that incremental client to join you, what is it about your offering that you think gets them over that hump, right? What brings them into BNY Mellon? What differentiates you from others?

Let's see. First, I would say our competition is a little different than what many people may think of as BNY Mellon competition. So we tend to compete against universal banks, JPMorgan, Bank of America, Citibank, HSBC, Deutsche Bank, not necessarily the traditional trust banks. So the competition suite is different. The other thing I would point out to is just the nature of how our clients buy. So it tends not be a winner-takes-all franchise, in that a client will very rarely consolidate down to fewer than 3 to 5 providers in the space and in many cases, will use significantly more. Clients like to manage their risk in this space by leveraging more than 1 provider. So I would also add this space is large, fragmented and growing. So where I had said we move $2 trillion a day, which shows how big we are, I would also say when we look at the global market for what we do, which is payments and cash management, we have less than 1% market share. And when we think about even the largest players having still very low single-digit percent shares, 2%, 3%, maybe 4% share. It's a very fragmented market. So how do we grow with our clients, and how do we differentiate ourselves in that space, which I think is the core of your question? The space that we're in is very technology driven. We invest in capabilities and platforms, and then we try to ensure that we're making our clients successful in their digital journeys. And many of our clients are digitizing themselves, so we'll offer them electronic payment capabilities. We'll offer them also, if they need them, paper-based capabilities, which differentiates us versus fintechs who will only offer a point solution. And we bring that to market in a very, very collaborative way with our clients, working with our clients around solving their issues. And so whether it's cross-border payments, domestic payments. And when there's a need for paper, we work with the clients. And by paper, I mean checks or collections, we work with the clients to facilitate that inbound and outbound activity and to transition them from paper to electronic to make them successful through that journey. Our clients know us as having really strong service offering as well, and we consistently invest in these services and products. So that's how we differentiate. We are a trusted provider for our clients, and we bring value-added services to them to support them across the spectrum of their needs with a focus on digitization.

And so the point about paper is interesting because it's rare to hear tech exec talk about paper as an opportunity. And your point is if I can bring them from paper to electronic, I've locked them in as a long-term client.

You got it, Betsy. You got it. So that's it. And what we had seen prior to the pandemic was clients had a lot of paper, and it was very forward-looking clients or new business units within large clients who were actively embracing digital. But often, our clients, if they were large corporates, for example, they had existing procedures, they had existing structures in place, and they were hesitant to make that leap from paper to electronic. The pandemic has actually sped that up and helped us. And so what we're hearing from clients is, hey, Paul and, hey, team, what you've been talking to us about for a series of years, we are really ready to embrace this now. We're very much ready to look at transitioning more from paper to electronic. We're interested in learning about your APIs, about working with you and your sandbox and around taking a paper-based process and transitioning it to electronic. So it's a really good time to have that message in the market. And where a point solution, whether it's a fintech or a new entrant is only interested in the electronic, we'll support the client for both, but we will avoid offering a solution which is only paper, which, in my view, would be declining. And we're very happy to work with them on that transition.

Got it. Okay. Let's just talk a little bit about the drivers of top line growth. You've got new accounts, you've got expanding products and services, you've got transaction volume, you've got interest rates. Can you speak a little bit to the mix of what's likely to be driving revenues here in your business?

Yes. And I think about -- Betsy, you had made a comment earlier about how complex the details are in this business. They are quite complex to manage, but I'm going to try and simplify it. So I'm happy to go into whatever level of detail you'd like, but I think about it as we've got fees and we have NIR. And we have fees and we are a very scale-based business. We build an electronic platform. We try to delight the client with their experience on that platform. And we bring high volume to that platform. I didn't price that at a slight premium because we're adding value to the client. Our goal is to never be priced as the low-price provider but to be priced for value. So think about the fees and think about the NIR. So fees is really price times volume with a focus on scalability and leverage as we grow priced at a slight premium for the value we add. Think about NIR as being driven by the balances and not just the rates on the balances, but the quality of those balances. And so for a series of years leading up to 2020, we were focused on growth of balances, and you'll see that across the bank, but what we're very much focused on in the last year or so is not just growth but very much optimization. So are the balances LCR friendly? Are they very much tied to payment flows, so they're operational balances? And that's what we focused on. And so all of that comes together into what drives the P&L., fees and NIR primarily driving it. Scale-based model, which shows -- which really drives a high-profit business. And that focus on delighting the client allows us to price a slight premium. And as an example, what I can tell you is, for example, our payments on average last year, the revenue per payment was up 6%. Why was it up 6%? It's because we worked with clients to improve the mix, we worked with clients really to show them where value was added and we worked with clients on that paper-to-electronic conversion, which is really paying off right now.

Revenue per payment is that kind of also looking at like revenue per dollars transmitted? Is that -- it's a denominator there?

It's really per transaction, Betsy. So when we think about payment transactions, how many payments are flowing through our pipes on a daily, weekly, monthly basis, and we tend to look at it on a daily basis, the revenue per payment is up 6%, which we're really proud of. It shows the value add to clients. And it shows that really we've been focused on higher value-added products and services, especially over the course of the last 1.5 years.

Yes. I have to say 6% sounds very high to me in that business.

It is. I'm not going to say it's something that we're -- that can be delivered every single year, but it's something that we focused very much on over the last year. Think about the focus that we've had and that our clients have had during the pandemic and that focus on paper to electronic. It's been a very good year to work with clients strategically around the optimization of their payment mix.

Okay. So when we're thinking about how you deliver value to your clients, the paper to electronic is one of those threads there, right? One of the channels for -- how else are you communicating to the clients the value you're delivering them?

It's also the service proposition, right? So our quality of service is quite high. We tend to score very high, and our clients tend to rate us quite high on service, but we're not complacent there. So we're continuing to evolve the service model to improve it and to invest in scalability. I mentioned APIs. So traditionally, our clients would have communicated with us through a variety of means, whether it's SWIFT or it's host-to-host connectivity or it could be by using our online banking channels. What we found is that our clients are increasingly looking at APIs as a level of connectivity with us for communication, for payment initiation and for reporting, and that Betsy moves us into a very strategic dialogue with clients. Because when you're hooked into a client and you're supporting them through APIs, you're not forcing the clients to have an experience that's business related and then turn to an online banking tool and enter payment instructions. You have payment which are happening because the clients' business is progressing. And that move to APIs -- and you talked about other ways we differentiate, that move to APIs, we feel is -- it clearly has started and it's accelerating, and we're really, really happy about it. It also broadens and deepens our relationships with clients so that our buyer is not the traditional buyer that it might be of an assistant treasurer or a correspondent banker, but it's complemented by business leads within our clients who are looking to expand their own offering and to make sure, as they are transacting, that money is moving seamlessly. It's a really fun time to be in this business

That's exciting. Another surprise comment, a really fun time to be in this business. I think that's great. And that leads me to my next question, which has to do with real-time payments. I mean some of what you've been highlighting here is that the world is changing in payments, You've got some fintech competitors we'll get into a little bit later. But the question here with real-time payments is do your clients care about it? Do they use it? Do they want it? Is this whole notion that the world needs to settle cross-border at T something that really is a huge demand or not?

Betsy, you've asked me a question I love to answer. So I would start by taking a step back and say we have a very basic but compelling view that within a series of years, whether it's 3 years, 5 years, 10 years, I don't know, but within a series of years, all of our clients will have the need, the expectation and the ability to send and receive money 24/7, 365 days a year with full transparency on, right, what did it cost me? Are there lifting fees? If there's an FX rate embedded, what was it? And it needs to be fair. And so to make it really concrete, we think within that period of time, don't know exactly how long, if you're in Canada and you want to send money to New Zealand over a weekend, you'll be able to do it, and you'll be able to track your payment, understand exactly what's happened. And so we are marching towards that as a vision. How we get there, we're not 100% sure, so we're making multiple bets. One piece of it, which we are more than doubled down on is real-time payments in the United States. So the U.S. has not been the world leader in real-time payments. You see this in other markets. Other markets have been faster. The U.S. market is the largest market, but it hasn't been the most innovative in this space. We see the U.S. market catching up quite a bit. We're driving that. So we have been and will continue to be a leader in real-time payments within the U.S. We're also very much engaged in real-time payments as it's happening elsewhere in the world where we don't participate in it ourselves. We're working with partners to ensure that we can connect to that real-time capability and connect that over time globally. We're working with an industry consortium, and we're making strategic bests. So it is still early days. I firmly believe in it. We're marching towards it. And we think very much our clients -- think about on the retail side, people have come to expect it. Our B2B clients, our B2C clients, our institutional clients will be absolutely demanding it, and we are there to support them in that march.

That group institution you referenced, is that Fnality?

When I said institutional, I really meant our financial institution clients. So that's really what I have meant. But we are involved with Fnality, as you mentioned. We are a shareholder in Fnality. And that's one of the paths -- one of many paths that we may leverage to get there. And our goal is to make it easy for our clients. So our clients shouldn't have to determine how they're going to get there. Our clients should be able to trust us to embed our payment capabilities in what they want to achieve, and we should be making that experience seamless for them and the payment movement successful, instantaneous, 24/7 and fully transparent.

That sounds great to me. I mean we did some -- we did do a note on this recently, and part of the reason was because we know that some institutions might be trying to do global real-time at T settlement promises this year. I don't know how successful that's going to be, but it's from the big tech side, so I like to see the companies I cover in the hunt.

Betsy, it's our job to make our clients successful and do that in a scalable, safe profitable way, and that's exactly what we're focused on.

So I just have a few other questions for you, Paul, before moving over to Emily, it has to do with pricing strategy and how you deal with that. Is this a bundled product? All of the above goes into a valuation that then is delivered to the client? Or is this piece by piece? You mentioned transparency as a goal in one of your statements earlier. So just trying to understand how it works today and what the path is to get to the goal you identified.

Betsy, there's not a one-size-fits-all answer to your question. So if the client wants a bundled price, we can absolutely do that. Some clients prefer that. Some clients like to see, right, much more transparency and like to manage that. And so we offer flexibility on that with clear visibility on our side so that we can work with the clients to provide them with pricing which works for them. Some do like bundled, some like to manage individual fees and individual line items, and we have the flexibility to do that. What I will say is that our client segments tend to be -- and I'm going to overgeneralize, but when we look at our different client segments, there are characteristics that are client segment specific. So corporates, for example, don't tend to like to pay fees because the fees tend to run through their income statement. So they prefer to pay via compensating balances and they may prefer bundled pricing. Our financial institution clients, on the other extreme, they very much like to pay and understand each line item and to understand it and to choose. So we're flexible based upon the client, but there is some similarity within a segment.

And then how do you handle the hard dollar versus soft dollar, right? I mean rates fell, obviously, precipitously last year in March. Does that just cut a revenue stream that doesn't come back, or how do you handle that?

No, not for us. It does not cut a revenue stream. So it does not. And how we handle it is, again, going back to those segments, and it's primarily, but not exclusively, the corporate segment that likes to pay via compensating balances, although we offer that option to all of our clients. What we find is we have a very clear way to calculate, right, what the bill would be, what the compensating balance amount would need to be to compensate us for that. And we work with clients to make sure that those levels are appropriate, working with them collaboratively. So it doesn't. We manage it quite well. And it does tend to be -- and I had said corporate for us is 20% to 25%. It tends to be about 20% to 25% of our clients that like to pay via compensating balances instead of fees, might be slightly more than that.

And that would be the shift from compensating to hard dollar or increasing the balances needed under the compensating that would be what the negotiation -- or not negotiation but discussion. And that would be over a several quarter period of time. Is that fair?

It's done on a daily and monthly. It's done on a monthly basis, actually. So it's fully automated. So it's quite automated. We agree with the client upfront, and that automation rides through the ups and downs of the interest rate cycle in a seamless way with transparency to clients.

Great. Okay. Last here for you, Paul, before moving over to Emily. Where are you seeing the most competition? And if I could sneak in another one, how are you responding to the fintech disruption that's in the payment space?

Okay. I'm going to answer these both in the same answer, Betsy, which may not be what you wanted. But I actually -- I'm going to give you an answer that may surprise you, I actually like having like really strong competition. I think it makes us better. And I am actually happy to see the fintechs bringing a real push to the industry to innovate. I think that level of competition makes us hungrier, it makes us focus more on value creation for clients and focused on differentiation. And so we do see competition coming from our traditional competitors, and I named those before, the traditional universal banks. We also see competition -- and I was going to say emerging, but in some cases, it has emerged already, from fintechs. What we find is the fintechs and the new entrants tend to offer a point solution, which I had mentioned before, whereas we do try to provide to clients a more holistic solution to make them successful. Our goal is to not only learn from what the competition is doing but to drive that innovation forward. And I think the industry has embraced that now. The industry is growing, it's vibrant. And there's a lot of space to grow if you keep adding value to clients. So I -- surprisingly, I'm going to tell you, I like having more nimble competitors. I think it keeps us fresh and focused. And I'm glad to see the fintechs. I think not only are they competition but we learn from them and we leverage their services, and sometimes, they are our clients as well.

Okay. Very good. Well, don't go away, Paul, because we might have a follow-up at the end. But Emily, I want to turn it over to you and ask a couple of questions here. Since the last earnings call in April, short end rates keep trending lower and that can have impact on trust banks. On the other hand, the markets are up, which is helpful for your fees. So can you give us an update on guidance in light of what's been going on with rates and markets, et cetera?

Sure, Betsy. And Paul is a hard act to follow. So in terms of guidance, I guess, I'd like to bifurcate that in terms of what we can versus what we can't control. And so first of all, when you take the rates environment, which obviously goes into the category of what we can't control, you're absolutely right in that the short end continues to grind lower. We're actually seeing the long end falling, too, in the last couple of days. In terms of just growth in balance sheet, the fed balance sheet, as everyone knows, has grown by $4 trillion since the beginning of last year. And we expect it probably to grow by another $1 trillion in the coming months. What's that meant for us and the deposit-taking institutions in general is that deposits have grown by about $3.5 trillion since the beginning of last year. Our deposits have grown by about 40% during that same time period. And we, like a lot of the other banks, are working with our clients to encourage our clients to move some of those deposits to off-balance sheet alternatives, and we've been doing so quite successfully actually. So as a result, money market fund balances have also hit about $5 trillion. And what's really kind of important to note about that is that money market funds are actually finding it very difficult to invest. T-Bills supply is in short demand. Gross yields just keep grinding lower. Actually, the best -- you can really see that play out by virtue of the balances held in -- at the fed's reverse repo facility. So that has hit in excess, I think it was close to $550 billion on Friday. So just to put that in perspective, roughly 10% of money market fund assets in the United States are being held at the fed -- or parked, I should say, at the fed for 0 interest. So I mean that just kind of -- so all of that, just in that backdrop, in terms of excess liquidity, what it's doing in terms of rates and the fact that rates obviously remain below what the forward curve had implied. It does translate into the fact that both NIR and waivers are going to be worse than we had originally guided in the second quarter. So a long-winded way, but really important to just understand the backdrop. And to really size that, fee waivers, we're expecting to be at about $250 million for the second quarter, and that will result in a negative impact to pretax income of about $40 million quarter-on-quarter. And then from an NIR perspective, we're expecting NIR to be down about 1% to 2% sequentially. Now the only thing I would say about the rate backdrop, putting everything I said into perspective, the fed has implied that they would be willing to adjust technical rates. They could do as early as this week, we don't know. So the future, the forward, the future in the second half is very uncertain at the moment, but that's how the second quarter, at least in terms of NIR and waivers, are playing out. In terms of what we can control, and I would put fee revenues and expenses -- or fees, ex waivers, and expenses in that category. In terms of fees, we posted a very strong first quarter, if you remember. The second quarter is also proving very strong on the back of volumes across many of our businesses, continued momentum in terms of our organic growth rate as well as higher market levels. So as a result of all of that, we do think that fees, ex waivers, are going to be roughly flat to the first quarter, and that means significantly up from the second quarter last year. The only thing I'd mention there is that as revenues and volumes increase, or are higher than anticipated, that also pulls up revenue-related expenses, or what I would call good expenses. So that, combined with a weaker dollar, will mean that expenses in the second quarter are higher than we had originally anticipating.

Okay. What about on the share repurchase side? I think you mentioned $600 million or so for 2Q, but that was based on the 4-quarter trailing rule that you still have to live with. And 2Q, obviously, adjusted for what earnings you do generate in 2Q. Maybe you could give us a sense as to how you're thinking about the forward look on buybacks, right? We are moving to an SCB framework. And in the past, I think you said that you're comfortable going below 5.5% Tier 1 leverage ratio for some time. So as we're thinking about your capital return capacity, can you expand a little bit on that? For example, how far below the 5.5% should we be anticipating? And over what kind of time frame?

Just a couple of quick points. So as you all know, Tier 1 -- the minimum -- reg minimum for Tier 1 leverage is 4%. We were at 5.8% in the first quarter of last year (sic) [ We were at 5.8% in the first quarter of this year ]. We've been very transparent with the market that we hold about 150 basis points in terms of buffer. That's to really protect or guard against the volatility in our balance sheet and OCI. We've seen a lot of that balance sheet volatility or growth. As I mentioned, deposits are already up by about 40%. I'd also mention that a lot of the deposit growth we've seen is really in excess, so nonoperating deposits that will recede when we get to a more normalized interest rate environment. So it does start to question about how much permanent capital you should hold against those what's ultimately excess deposits? And by the way, we've been very successful in the second quarter curtailing deposit growth. Even as the fed has increased liquidity in the system, but we've been very successful in curtailing deposit growth just by working in partnership with our clients to move some of those excess deposits into off-balance sheet vehicles. But based upon all of that, you are correct that we do see that the -- we do feel that we could utilize a portion of the buffer, if necessary, given the extraordinary liquidity in the system, and that's exactly what the buffer is really there for, for the growth in deposits and the volatility there. So if necessary, I would think we -- I would think about it in terms of we'd to support additional deposit growth from here as well as returns to our shareholders, we'd be willing to dip into the buffer to about 5% to 5.5%, to manage to 5% to 5.5%, if necessary and for a period of time. And finally, just in the last minute we have here because, really, I think the heart of your question is just capital distribution, ultimately, yes, we're all hopeful that the Fed does implement the SCB framework starting next quarter. If they do, we intend to return actually well in excess of 100% of our earnings in the next couple of quarters.

Okay. Right. Because that SCB framework will enable you to get much closer to your management level of capital that you think you need to hold. And so the underlying point there is how long can you -- how quickly can you get down to that level, and you're suggesting that it could be in the next several quarters.

The next few quarters.

Okay. Two, okay.

A few.

A few, F-E-W. Just want to make sure the transcript reads correctly as few. Okay. All right. Well, we have just a couple of minutes left here. And just looking past the moving pieces in the near term, how does the outlook look to you for BNY Mellon just over the medium term?

Sure. So I guess the first thing I'd say is I'm glad you're asking about the medium- to longer-term outlook because the near term, there's just a lot of noise. And we kind of almost see this year, 2021, as a bit of the bottom and a reset just given the pressure on rates and, therefore, how it translates in terms of NIR and waivers. So I think there's a really compelling story here. I'd like to remind investors, 80% of our revenues are comprised of stable recurring fees. We have leadership positions across most of our businesses. We've got a diverse franchise, and I'd argue there's certain businesses, like Paul's Treasury Services business, our Pershing business, which are probably underappreciated by the market, and it's my job and our job to do a better job educating the market. We've got conservative -- a very conservative risk profile. We have -- it takes very little capital for us to grow, so it's a very capital-light model. And likewise, we are capital generative and have committed to returning roughly 100% of our earnings to shareholders over time, more than that in the near term over the next few months. And...

Quarters.

A few quarters. And the last thing I would just highlight is that we are investing in our businesses. And you see that in terms of we're demonstrating that and seeing the fruit of that in terms of the momentum we're seeing in organic growth, organic growth rate. And by the way, that is all before you even talk about a normalized rate environment. We're in excess of $1 billion of NIR and waivers comes back into performance without any expenses. So I mean that's all without any of that.

Okay. Super. All right. Well, Emily, and Paul, thank you so much for your time this afternoon, sharing the Treasury Services business as well as the outlook here for BNY Mellon earnings and appreciate your time with us today. Thank you so much, and we'll move on now to the next session.

Pleasure, Betsy. Thanks for inviting us.