M&A Outlook
Q: How strong is the M&A pipeline ahead?
A: Ted Pick notes that the pipeline is clearly growing across sectors and on a cross-border basis. " He believes they are in the early innings of a multiyear M&A cycle " , with activity expected from both financial sponsors and corporate clients bidding for assets.

Competition from Private Credit
Q: How is private credit impacting your leveraged finance business?
A: Ted Pick acknowledges that the competition is real " , but he believes global investment banks will continue to have a large role in underwriting securities. " He asserts there's ample room in the ecosystem for both private credit and investment banks.

Expense Management
Q: How are you optimizing expenses and margins?
A: Sharon Yeshaya discusses efforts to rationalize the expense base by consolidating marketing dollars, professional services, and making big-picture decisions on space and resources. " They are focused on achieving a 70% efficiency ratio " , with an emphasis on strategic investments and delivering earnings growth. Ted Pick adds that they are actively talking about the income statement and aiming to generate operating leverage. "

Wealth NII Stability
Q: Is NII in wealth management stabilizing?
A: Sharon Yeshaya notes that they are reaching the frictional level of cash " , and client behavior is following expectations. She states there are no large changes or movements in real client behavior, suggesting NII is stabilizing. "

Wealth Assets vs. Revenue
Q: Why is wealth management revenue growing less than client assets?
A: Sharon Yeshaya explains that different assets have different fees, and as assets move from brokerage to advice-based accounts, revenues will grow over time. " The focus is on growing the funnel and deepening client relationships, with record high asset management revenues demonstrating the model is working. "

Client Cash Deployment
Q: What's the opportunity as client cash is redeployed?
A: Sharon Yeshaya says client cash levels are high relative to pre-COVID levels, currently at 20-21% compared to historical 17-18%. " There is room for deployment of cash over time into the market, which could enhance revenues as clients invest. "

Trading Growth Opportunities
Q: How can trading results continue to improve?
A: Sharon Yeshaya mentions growth opportunities in corporate solutions, financing, and offering private credit. " Ted Pick adds they're focusing on expanding in credit, prime brokerage, and derivatives, working closely with financial sponsors and alternative asset managers. "

Institutional NII Decline
Q: Why is firm-wide NII declining despite stability in wealth NII?
A: Sharon Yeshaya explains that trading NII depends on products and funding sources and differs from business-driven wealth management NII. " The decline in firm-wide NII is due to the nature of trading activities, which are managed differently. "

Family Office Flows
Q: Can you provide context on family office flows?
A: Sharon Yeshaya highlights that half of the flows came from the family office offering. " This reflects efforts to offer institutional-style products to ultra-high-net-worth clients, leveraging capabilities from both institutional and wealth management divisions. " Ted Pick adds that this integrated approach helps keep funds in-house and provides clients with institutional-style capabilities. "

Impact of Higher Rates
Q: Do higher rates affect your optimistic outlook?
A: Ted Pick says it depends on why rates are higher. If rates are elevated due to sustained growth in the U.S. economy, it supports their optimism. " He believes companies need to act after being quiet for 3-4 years, and higher rates can be absorbed within a growing economy. "