U.S. Bancorp (USB) Earnings Call Transcript & Summary

Moving right along, very pleased to have U.S. Bank with us, from the company, Gunjan Kedia, CEO, who became CEO April of this year, so not that long ago; John Stern, Chief Financial Officer. Thank you for being with us.

We'll put up the first ARS question that we've been asking all the companies. But Gunjan, maybe I'll start with you, 5 months on the job, certainly as CEO, maybe just start off by catching us up on what you've been up to since mid-April, key lessons learned so far in your new role.

Well, it's been a privilege to step into the role of the CEO of a wonderful company, and thank you for having us. And I think we have passed over the fire alarm, so good sign. So, Jason, as I stepped into my role 5 months back now, we had come off of 2 years of quite intense focus, first, on the Union Bank integration and then on building the capital back up again. And this time last year, we had built on that and articulated financial targets for the medium term. So that was the context in which I had stepped into my role, and I articulated 3 key priorities to achieve our medium-term financial targets, and that was expense stabilization, organic growth and payments transformation. So your question on what I have been up to for the last 5 months has really been putting in place a very talented leadership team, not just at my level, but a level below and reviving the organization for more urgent execution. So that's sort of been my focus for 5 months. I'll tell you, as I have spent an enormous amount of time listening to all our stakeholders, I am very encouraged by how well our brand and our culture resonates with our clients. So our thesis that we have enormous opportunities to deepen these client relationships by interconnecting our products is very strong and real. I've also spent a lot of time with our investors. And there, we have some work to do -- consistently delivered.

I guess, as a follow-up to that, you talked about these 3 strategic priorities for the near term. Maybe you can just update us on those and the kind of the progress you've made?

Yes. So the first one is expenses, and we are really in very strong shape there. We have now reported 7 straight quarters of stable expenses, and that has allowed us, Jason, to both deliver a positive operating leverage targets and invest into organic growth. We have runway with expenses. That program is executing very well. So we're in a very, very strong shape there. The second priority was organic growth. Our fee growth trends are strengthening quarter-by-quarter, so we are very pleased there. What's very important to us is how the mix has evolved over time. We are really a fee-heavy franchise. We were at about 42% last quarter, and it's very balanced across these 3 pillars: payments, which has been a historical overweight on fees; trust and investments and capital market-related fees, which we are really doubling down on growing; and then, consumer fees, which remain strong, but we don't have as much dependence on them because they're more volatile and have some regulatory pressures. So the fee growth story is coming along very, very nicely. Last quarter we took some substantial actions to reposition our balance sheet, so that has set us up for much better NII growth. So organic growth feels well underway as well. And then the third priority is payments transformation. We are very differentiated. Our payments franchise is quite unique and quite difficult to replicate, either through acquisition or organic growth elsewhere. So we are focused on transformative strategies there. We have 2 leaders for 2 parts of the business, and they are executing to that agenda. So we feel very good. We measure our success on those 3 priorities by our medium-term targets, and quarter after quarter, the progress we are making. And as you saw last quarter, we are just really, really delivering strong progress there.

Got it. Maybe put up the next ARS question. I guess as a follow-up to what you just said, though, you mean -- you mentioned organic growth and expense management, both strategic priorities. You mentioned 7 straight quarters of stable expenses, which I guess, on one hand is good. I guess, on the other hand, I don't know. Any kind of impact on revenue growth from kind of focusing on expenses? And just how do you balance the two?

Yes. We are not at a point when we need to balance the two because the expense stabilization is not a matter of trade-offs right now for us. It's very much real productivity. Jason, you've been following us for a long time, you know we have spent an extraordinary amount of investment dollars for the last 5 or 6 years and building out a wide array of digital capabilities. That gives you a lot of opportunities to drive real productivity. Most of these capabilities are being adopted. The operating processes around them are being designed to drive productivity. And then you add to it some of the new tools available, like AI, like transformative. I thought he was going to come on. So it's expense question, let me keep plowing on here. So it's very real, and I don't think you need to worry at all about the trade-offs. In fact we are generating enough expense savings that not only are we delivering from a stable trajectory, we are investing a fair amount, and you'll see that show up in sort of various business lines as well.

I guess one of the things that we learned at Investor Day was spending about $2.5 billion a year on investments. I mean, have we kind of reached a tipping point there? And just, where is most of these investments going? Is it more offensive to drive growth, more defensive? And just how should we think about that?

Yes. So just to piggyback off of what Gunjan just said, the tech investment is a very important story for us in terms of our spend levels. That level you cited, $2.5 billion, is our annual run rate that we spend. It's a sweet spot for us in a couple of different paths, Jason, because on one hand, it's 2/3 offense, 1/3 defense to use the words you used offensively to create products, enhancements and things of that variety, defensive to create -- to have system maintenance and the like. The other part of it is that, that cost is embedded in our run rate. And part of the reason that we have had this 7 quarters of flattish expense and working on an eighth is that we have these opportunities to invest in the business and get that productivity that Gunjan mentioned. We're really focused on a number of different areas. We're focused on simple architecture. So how do we utilize the cloud to help our mainframe and following up the core and all those sorts of things. Second thing is about product development and making sure we have all the right digital apps and capabilities available to us. And the third, that is really a differentiator for us, is the reusability. We think the reusability of technology is a very important concept. We use it a lot in our businesses, such as, Elan, such as our co-brand, our partnerships with State Farm, Ed Jones, those sorts of things. So a long way of saying this is the long-term investments we're making in technology is helping that productivity, and it's a meaningful player in how we're gaining positive operating leverage going forward.

Can I add one other point, Jason, to it? Where -- there was a time 5 or 6 years back when we really needed to focus on the digital capabilities, and the $2.5 billion of capital expense was very important. I also want to point out, we invest a lot of operating expense into growing our franchise. And just to build off of what has already been built, you will see us investing more in sales, marketing, building brand, building distribution presence, being more front footed with partnerships. So there are lots and lots of ways of investing in growth on top of the $2.5 billion, which was very specifically focused on an agenda of catching up and surpassing really the quality of the digital products and capabilities we had.

I guess, maybe just talk to payments, it's like 1/4 of the revenue, so clearly a differentiator versus kind of other regional banks. Yes, we kind of, I guess, haven't seen kind of consistent year-over-year growth that we'd expect from some of those businesses. Maybe just kind of update us in terms of kind of your payment transformation, progress, and what we'd expect to see there.

I'll start. So let me start with our sort of strategic commitment to the payments, which is very strong. And we think of it in 2 ways. One, it's a stand-alone, very attractive product set and a growth business for us, very high returns, fee oriented. It's also the first set of products that today's young customer uses to interact with the financial services system. So if you think about how our kids -- they don't start with a checking account necessarily. Years before that, they've started using some kind of a payment mechanism, a P2P vehicle or a credit card. So we have this view that in the fullness of time, as you're trying to evolve your client franchise to a Gen Z or a different type of audience, the payments products will become the more real anchor point of loyalty, longevity, more frequent connection with the bank. So our philosophy is payments need to both be embedded in every other products that we have as a way of interacting day-to-day with our clients and be a business unit that delivers very good financial returns. So deep commitment to the franchise. It is 2 very separate things. I'll start with merchant because I have discovered that most people think of merchant when they're thinking of payments. That's about 6% to 7% of our revenue base, but strategically very important to a small business franchise. Sort of the heart of the American economy is the small business, a very important segment for us. There, the transformative strategies are about narrowing our focus from what used to be a broad-based global acquiring-only horizontal business to a more software-led business that creates a lot more value, so less commodity, and we're focused on 5 verticals. And the reason for the focus is that these software capabilities are very unique to the needs of the end customers. So you have to really think about their operating models and embed your payments products into their front office. So you don't want to be dilutive, and these are very -- 5 very large sectors of the economy. And that focus is creating some very meaningful re-acceleration of the business. More than 1/3 of that business now is the software led, and the growth rates there tend to be 5 to 10x the rest of the acquiring only business. The margins, the pricing holds up. The last thing I'll say about merchant is, I have heard from the investors some amount of misconceptions about the business. It is not an unprofitable business. It's not a loss leader. We actually run it for a very high margin and very attractive set of margins. And perhaps that is the trade-off with the volume growth that most people think about. The second thing is that business is one of the core beneficiaries of the build-out of the digital capabilities. We intend to continue investing in the business, but it's in the run rate now. So it's neither a disproportionate user of profit margin or investment. So very sustainable franchise. It really anchors many, many parts of our banking franchise, and so we're deeply committed to that business. So that's sort of merchant. On the other side, we have the larger of the 2 businesses, which is our card issuing business, and this is credit cards for small businesses, U.S. Bank and Elan, which is our white label platform for 1,200 small banks. So we are -- let me just start with Elan. Elan's digital technology and product was materially upgraded and rolled out December of last year. The user experience has skyrocketed from sort of some very modest numbers to a very world-class experience. We have new leadership in place. We have built out that team. So we expect that to really start to perform much, much higher rates than the past. So that's one strategy. The bigger strategy is the -- just the U.S. Bank branded cards. Historically, our product set was designed to drive loan growth because it was a balance sheet play. It's a very attractive set of products for revolvers. Our loan growth there has been very attractive, yes, at par or better than the industry. What we are doing now with this transformation is augmenting that with a new set of products that is equally attractive to transactors. And now we are competing not at the highest level of affluence and wealth, but really at the young affluent and connecting our banking products with our credit card. This is a suite of products called Smartly. And as that rolls out, these pipelines, we are seeing the increase in active accounts, and the revenue follows 4 or 5 quarters after that. So that buildup, and that's the transformation to go from sort of a revolver-heavy mindset to a revolver and transactor heavy. So very good progress there, very differentiating franchise. And you'll see some real acceleration of that business over time.

I guess, maybe as an adjunct to that, stablecoins has been coming up throughout the conference. Do you think this could be a disruptor to the overall payment ecosystem? Just how you think about using them? I'd just love to get your perspective given your kind of role in the payment space.

Well, I always start by asking where the client need is because it's a very fundamental way to think of prioritizing investments and focus. And I will tell you, Jason, I'm hard pressed to find one single client who's saying, I just really need stablecoin from a bank right now. So the demand is not present and real with consumers. Now, where there's interesting conversations is global corporates, with cross-border payments. Most of the use cases are anchored around that. Most very large companies actually have very efficient cross-border payment systems because they are not feeling sort of the big cost of cross-border payments. So it really has become, in our minds, a new payment rail, one that we expect to participate in, and we are expecting to pilot some limited edition stablecoin transactions yet this year. We are doing both a pilot U.S. Bank stablecoin and also a sort of a partner led. There's quite a lot of capability available in the market to be able to do that quickly so that we are ready as and when the market develops. The underlying protocols of what the payment rail is going to look like is a collaborative effort in banking along with our industry partners. So in many ways, it could be a more efficient disruptor of the institutional cross-border payments type of business, which is a very small footprint for us today, perhaps an opportunity for us going forward. What we really don't see yet is a path, either from a market structure or adoption, with everyday retail payments, especially in the U.S., which is sort of our bread and butter. So all I can say is it's quite interesting. It's a lot of conversation around it. We are very front footed in learning and experimenting and putting pilots out, but yet not seeing fully the economic models and how they might evolve.

Got it. So we're at the halfway point, so I'm obligated to ask. Two weeks left to go in the quarter. John, I guess this is you.

Yes.

Maybe provide us an update on kind of business loan growth trends. What are you hearing from customers regarding the operating environment?

Sure. Sure. So when we look across the board, there's just been a lot of activity, renewed activity, and it is very helpful from a loan growth perspective. We've seen, in particular, on the C&I front, M&A is picking up. Pipelines are strong. Small business loans are growing. Utilization rate is hanging in there. So all the things are point to strength in the C&I categories. I would also say that payment trends continue to be strong. So there's a lot of payment activity, both on the consumer as well as on the business side of the equation. And so what I would say there is that the payment trends from -- particularly in the consumer is helping loan growth there as well. And so those are the positives. There are some components such as real estate, commercial real estate, I should say, and auto loans that continue to drift a little lower. But all in, our loan growth should be in that industry HA data range, and we are seeing that growth, which is positive. The other thing I would say is we are watching the employment situation. We're watching the labor markets. We do acknowledge the softness. But importantly, the unemployment rate itself is favorable, and there's no concern from a credit standpoint as a result of it. So the economy is resilient. Our clients are resilient, and we're excited to see them pull through here, as we look through the third quarter.

And I will say that compared to April, right after the tariff discussion started, the mood has shifted, Jason, to sort of a sense that our clients can get their arms around what is happening and some of the extreme caution that we saw in the April and May timeframe has given way to sort of more front footedness with clients, so optimism there.

I guess, maybe before I delve more further into the drivers, just you guys gave that earnings guidance slide in your deck with kind of bunch of 2025 and 3Q '25 topics. Maybe just -- I guess, does it all remain intact? You talked about revenue growth for the year growing at the lower end of up 3% to 5%. Is that still the right way to think about it? And just any updates you want to provide.

Sure, sure. So the -- there's no change to our guidance for the third quarter or for the full year. But maybe just to give some color to the third quarter, we gave a range of net interest income of $4.1 billion to $4.2 billion. We expect to be at the high end of that range given a number of different variables I can get into. But the fees as well as expenses are coming in favorable as well and as expected for us. And that all leads to very meaningful positive operating leverage for us in the third quarter. So on the full year, as you mentioned, no change to that on the revenue guide, the 3% to 5% is still intact and on the lower end as you mentioned.

Got it. So -- all right. Because of -- I guess, if 3Q NII fees and expenses all doing a little bit better than expected, any chance we can get that revenue towards the middle of that 3% to 5%?

Yes. I think the lower end is the appropriate amount. But importantly, we're going to be in the high end of the range from a net interest income standpoint. And a lot of it has to do with the favorability we're seeing on the asset side. We're seeing some of the strategic actions we took in the second quarter helping out in terms of the loan sale and the investment portfolio of movements we did. The loan mix favorability is improving. I mentioned C&I loans and credit cards improving, and that's really helping the mix side and yield side of the asset side of the equation. And then, our fixed asset repricing just continues to be favorable, a little bit more better than it was in the first half of the year. And so all those things kind of lead to the improvement we're seeing in the NII side.

Got it. Maybe talk about deposits a little bit. Last quarter, you talked about some competitive pressures on the commercial front. Has that moderated? It's kind of felt -- it felt like that maybe U.S. Bank saw that a bit more than peers and just, I guess, balances mix, kind of what we're seeing on that front.

Sure. So the deposit portfolio that we have, we feel very comfortable with it. We actually feel better about it now with rate cuts very much in -- coming in, in September here. And it looks -- from a market standpoint, there's going to be several cuts moving forward, that's all beneficial to us. We benefit more from rates coming down and a steeper yield curve. So that's all coming together nicely. The one thing I would say about deposits is that if I just step back, we utilize deposits as a really important part in our clients' relationship. And so it really anchors those clients. And so when you get into situations like we did last quarter where there is some competitiveness, we're going to protect those sorts of deposit holders because they have multiple services and products with us. And that shows up in our fee categories such as Corporate Trust, Fund Services, Treasury Management, things of that variety. So we're not shy about the deposit profile. We still optimize it for cost, obviously, but we're going to protect it from a relationship standpoint as well.

I guess, you touched on this, but I'm told it's going to cut next week, and maybe I would assume, again. I guess, on the way up, you had one of the higher betas. I guess, as the Fed beings to cut, do you expect kind of the same beta as you laid out in Investor Day? Or just how you're all thinking about that? This cycle has been a little bit different. It's just like 9-month pause.

Sure. Exactly. It's been a very different cycle than -- a year ago, we were talking about all these sorts of things. When I was looking at our beta performance, I was actually pleasantly surprised. We were right -- from a peer group standpoint, we're on the upper end from -- on the up-rate cycle. And actually, on this cycle heretofore, we've been actually on the upper end as well or the better end of it as well. I think that's a testament to the business model that we have and how we operate in our deposit side of things. I agree with you that this cycle is very different than what we would have said with the pause that we have here versus the 3 or 4 cuts that we had prior to last year. So if we get sustainable rate cuts from here on out, then that -- we certainly see a path to getting to that beta that we talked about last year.

Maybe put up the next ARS question. So -- right, no good deed goes unpunished. You pointed to the higher end of NII for the 3Q guide. I guess, as we sit here today and start to think about 2026, you talked about this 3% NIM at some point. It was $2.66 in the second quarter. Maybe just talk to just how you're thinking about next year that NIM improvement story and just how kind of rate cuts play into that?

Yes. So maybe just to start with the current quarters, we expect sequential growth here in third quarter, as I mentioned, in the fourth quarter as well. We haven't given guidance, particularly on -- specifically on '26, '27. However, given where we're seeing the rate environment evolve to, we definitely see a path to getting to that 3% net interest margin in the 2027 area. That is where -- and the speed in which we get there is really going to be dependent on what the cuts look like, what the curve looks like importantly for us. More cuts in a sustained manner is beneficial along with an upward sloping curve. I always look at SOFR versus the 5-year treasury. I think that's an important data point for us and how our balance sheet is constructed. And so those are kind of the puts and takes. And it's really because we get the benefit of that fixed asset repricing that we talked about. Our mix of assets are changing and improving to more higher growth, higher yielding in terms of card and/or commercial and industrial type loans. And so those are the things that are going to benefit us as we move forward.

Got it. And then maybe on the fee side, Gunjan, you talked a lot about on the payments businesses, but maybe there's obviously other fee categories that have done that contribute capital markets. For example, you've talked about mid-single-digit growth. I guess, John, maybe alluded to a little bit better than that. Maybe just kind of flesh out the fee story.

Well, the premise of the fee acceleration is deepening our client relationship. So our approach here has been, Jason, to see where we are deploying balance sheets and sometimes deposits to support a client relationship. The relationships are healthy, and they would do more with us if the product sets were there. So those areas would point us to doubling down on expanding our capital markets capabilities. We are definitely underweight our fair share of that fee line relative to the size of the balance sheet. So we expect to see some healthy growth there and very good progress there. Treasury management is another one that has seen very good growth, and that comes from just the products that having been strengthened quite materially over the last few years. So we are seeing good growth in treasury management. California is beginning to deliver very nicely for us from a regional standpoint across all products. Payments, in particular, has been a very consistent story of taking a very attractive, very affluent, very small business-focused customer base that we acquired from Union Bank and beginning to deepen there. So that is a growth area. And then partnerships where we're very unique. We talked about Elan and how much -- how good we got with providing these white label credit card services. With State Farm, we developed the banking multi-partner platform. Now, with Edward Jones, we are standing that up. So many different products in terms of product expansion, but the bigger lever is really sort of deepening of the client relationships. The number that we shared, it's just above 40%. That number should be much higher given the strength of the brand and strength of the franchise. So those are the areas that you'd see publicly reported outside acceleration, but of course, internally quite a lot of momentum in all categories, like trust and investments, just to give you that fee category has done very consistently. The macroeconomic environment has been favorable and market share gains have been. And that's our private credit focus. You -- we have a lot of conversations around the balance sheet growth parts of private credit. But with that comes a lot of our corporate trust business, a lot of our fund services business. So that's sort of an interconnectivity at play right there. And another one is healthcare. Last year, we bought a small bolt-on acquisition called Salucro, which gave us some very good merchant capabilities. That's been a traditional sector, very, very compatible with the bank's culture and data privacy rules, and that creates momentum as well. So many, many areas of sort of driving fee growth.

One thing I might add as well is on the -- it's in the other revenue category, but our Impact Finance business, which is really more about tax credit syndications, transferabilities, things of that variety, that has been a meaningful driver for fee growth as well. That's -- it's in the other revenue category. It's a little bit harder to see. We'll try to provide some more color on that going forward.

So, I guess, you talked about $3 billion for the second quarter and kind of mid-single-digit growth target over time. Is that still the right way to think about it?

Yes. On the fee side of the equation, you have mid-single digits is the way to think about it. It's consistent with this year, it's consistent with our medium-term targets.

And then just the other target you've talked about is kind of 200 basis points plus of positive operating leverage for this year. It feels like that's intact. But just how do we think about that number, maybe looking out to next year as you kind of imagine beginning the 2026 budget process?

Let me begin.

Yes.

So, Jason, we are not really sort of managing to sort of a specific positive operating leverage number. We are marching towards some medium-term target goals and stable expenses. And as such, we expect that the positive operating leverage will be intact as you say. The exact level will depend on sort of revenue growth expectations. But really, we are creating a sustainable, attractive EPS growth model. So in certain cases, you might see sort of us leaning in more into operating expenses to drive revenue growth. What we are very committed to is positive operating leverage without necessarily quoting a number. As long as it is accretive to a healthy, responsible EPS growth profile, we are happy to spend expenses as needed.

So, I guess, we've seen -- John alluded to, we're going to see the eighth straight quarter of stable expenses. I mean, do we see 12 straight quarters of stable expenses? Or you're okay to spend as long as the operating leverage is there?

We're okay to spend as long as -- and we won't -- we are not trying to sort of get to 12 quarters of stable expenses. This -- the expense breakout has just been sort of institutional productivity. And we've gotten quite a lot of questions around whether we are sort of squeezing investments to get the expense ratios. And I just want to say, you don't. At our size, we have considerable scale without the complexity in the businesses that we operate in. A lot of times, we are compared to these large global players. When you're not in 100 regulatory environments, where you're trying to manage that kind of complexity, you should operate in what we think is a sustainable mid-to-high 50s efficiency ratio. That's a business model assertion of ours. And so the expense flattening is important to get to balance in where we are going to be. And after that, we hope very much to drive the very diversified, very differentiated, fee-intensive model that lends itself to good growth.

Yes. 6 minutes left, 6 questions, so we're going to go rapid fire here. That's the only one of them, sorry. Credit quality, been stable. I guess, any areas that we should be focused on?

There's really no areas. It's stable. It's improving. It's in certain areas. So it's quite stable, and there's not a lot of areas that give us any concern at this point. Trying to keep you on.

Yes. No, we're good. We're good. I guess, capital return, share repurchase has been fairly modest, I think $100 million a quarter for the last several quarters, a modest amount of earnings. Historically, share buyback has been like 30%, 40% of earnings, now it's been like 5% of earnings. How do you kind of -- is 30% to 40% still the right way to think about it longer term? And like when do you think we can get back there?

Yes. Yes, from a policy standpoint and the way we think about capital return, ideally, we would like to be at 35% to 45% on dividend, 30% to 40%, as you mentioned, on the share repurchases. Right now, we're on -- we're right where we need to be in the dividend payout side. We -- on the buyback, we're on the lower end. We do aspire to get up to that level. But we're still building capital to get to that category 2 level that we've been migrating toward. It's been a 2-year journey. We still have a little -- kind of the last leg kind of approaching here. And so as we approach that, we do intend to move that percentage up. How and when that occurs is going to depend on the macro and how loan growth is doing and kind of all those other things that are important when you're making these sort of decisions.

Because, I guess, adjusted CET1 in the second quarter was 8.9%, is there kind of a number you want to get to before you kind of ramp up the buyback? And you've actually taken a fair amount of actions to kind of improve capital position. Is there more we could do there?

Sure. Yes. I think we've made considerable progress. We wanted from 8.9% to get to 10%. I think the buyback, back to your question, we're going to eventually get to that 30% to 40% range as we move forward and march through time. Again, back to what I just mentioned, the timing of when that happens, it's just going to depend on loan growth, the macro, all those sorts of things. But the intention is to glide back up into that realm once we get very close to our levels.

And then another use of capital is bank M&A. U.S. Bank has a long history of doing bank deals, albeit not recently, just how do you think about the acquisition landscape? How does that play into the growth strategy?

I was reflecting on the audience survey on what's the most important thing to get our valuation up, and it was sort of delivering on our medium-term targets. So our focus is very much on organic execution towards the targets and consistently delivering to the promise. The outside of sort of big bank M&A, we are always open to sort of bolt-on M&A. We do that very well, too. We see that more in the realm of payments or institutional world, and that's opportunistic, and we are always looking at any properties that might augment either scale or the product capability, but the focus right now is organic growth.

Good to hear. And then one question we get asked a lot is just how you're preparing for the category II designation? When do you expect to cross that? Any update there?

Yes. Certainly, we continue to grow. We have no restrictions on growth. We're -- we -- and along with what our forecast indicates, we think, no earlier than 2027 is when we cross that $700 billion mark to get into category II. There's been a fair amount of investment that we've made in terms of reporting, in terms of infrastructure and all those sorts of things. Some of the technology questions that I answered earlier in this has gone into the development of that, as we get ready for higher regulatory expectations is what our expectation is at this point. And -- but we're -- we have that all embedded in the run rate. But again, no earlier than 2027 is when we expect to get there.

Got it. And just put up the last ARS question. But, Gunjan, maybe to wrap up, you've -- we've talked in the past about kind of restoring investors' confidence in U.S. Bank's narrative, and execution is your top priority. In your view, kind of what aspects of USB story do you believe the market may be overlooking or underestimating? And what will you -- do you think it will take to get the stock back to its premium valuation?

Well, let me begin by saying I am very committed to restoring investor confidence. I hear the concerns, I accept them, and we are quite focused on that. In the immediate term, we need to just deliver consistent financial results marching towards our medium-term targets, and that is credibility building on execution. Once that confidence comes back to the investor base, the true strength of the franchise will come through. It's a high return, low efficiency ratio, very risk-managed franchise. And when you combine that with a diversified, fee-oriented mix, the impeccable culture, the memorable brand, and just a long track record of consistent performance, I think the investor story will be very, very strong.

Great. On that note, please join me in thanking Gunjan and John for their time today.