STI
#<UNK>, thank you.
We absolutely did.
As you know the market in January and February was decidedly weak and decidedly volatile, and we certainly felt that in the first two months of the quarter.
But as the market stabilized in March, our teammates absolutely came through.
And this has been a 10 year strategy for us, investment into our CIB business, and bringing our one team approach across all aspects of commercial, CRE, and corporate banking has really helped.
I think, <UNK>, we've grown market share over the last 10 years, certainly, over the last year also, and that growth in share really showed up this quarter.
I'd add to that what <UNK> said, it's really a continuation of the strategy.
We've had record quarters in the last two quarters, relative to CRE and commercial banking, and the activity that they're doing to contribute to that investment banking line.
And also the continuation of the strategy, year-over-year, our average fee, meaning we're sort of improving in relative importance.
So even if the units aren't the same, the value of those units are a lot higher.
It's up almost 35% year-over-year.
So the strategy also is manifesting itself, and moving down that left side, relative to importance to our clients.
Yes, I mean, relative to this quarter, or to this line item, investment banking specifically, I would expect this is a good jumping off point.
I would expect the second quarter to be better than the first quarter.
All that being said, these are choppy markets.
I mean, we ---+ this was a tale of ---+ the last third of the quarter was really good, and the first two-thirds of the quarter were not.
So we're heading in the quarter with some momentum.
I would expect it to be a little bit better.
But against the second quarter of last year, which was a record, so I'm not sure we'll be at that level.
But I think we can improve relative to this quarter, and have that be a good ---+ as you said launching pad for the year.
Good morning.
<UNK>, I'm not sure how much of that relates to hedges.
I'll tell you one of the reasons why oil field services for us may not be performing as badly as you would expect relative to others.
Part of our oil field services business includes clients who don't cover solely the energy industry.
They've got other businesses as part of their overall business.
And so, even though we categorize that for us as oil field services, it's perhaps a lower risk base, and a broader client base than you might see at other firms.
Yes, well, the overall loan growth in ---+ we think about this segment as sort of consumer direct, LightStream, GreenSky, credit card, other products that fit into our overall consumer direct strategy.
And loan growth there, in that business has been very substantial.
It's a 20% year-over-year loan growth, and we're very happy with that business.
We're very happy also, by the way with the credit quality that we're seeing in that business, and we're continue to expect to be able to meet more clients needs, and broaden out that business over time.
I don't have that number right off the top of my head, <UNK>.
We'll ask <UNK> to get back to you on the yields, in the components of that business.
Well, the way that the submission is structured, as you know there's a extremely adverse case, it's a hypothetical case that the FRB and regulators create, that required to submit against, that assumes basically, not just a recession, but a depression.
And assumes therefore, very high levels of provisioning and charge-offs.
Incorporated within that case, we incorporated a sensitivity on our energy portfolio, and so submitted that.
Our, whatever our result is, and our ability to grow our pay out ratio over time, already incorporates that number within it, <UNK>.
So if we receive a positive result in June, it will already had included that number with that.
Yes, <UNK>, I don't ---+ we sort of start as a framework.
We've been fiduciaries for over 100 years.
So our private wealth business has sort of been dominated by our fiduciary component of our business.
So it's a concept that we're certainly comfortable with.
We're obviously diving through the order, and spending some time.
Our team has been thinking about this for a long time, in terms of structural changes, and being ready.
So I think this is in the highly manageable category.
Will it have a marginal impact.
Maybe.
Will it also have some opportunity, relative to others.
So I don't think this is going to be a big story, in terms of change in direction of our private wealth business.
Well, <UNK>, we've talked with several of our owners, and the kind of feedback that we've received over time, is that they've liked our balanced approach.
They've liked the way we've been able to grow dividends and buyback over the course of several years.
And we would anticipate that, that type of a balanced approach is going to continue to be what our owners would like to see from us in the future.
Well, not a specific one, <UNK>.
A couple of points, and when you think about total pay out ratio, in the past SunTrust has been running between 60% and 80%.
We're glad that we've moved up within that band last year, and we hope to continue progress this year.
And specifically to dividends, you're aware of the regulatory guidance that anything over 30% will require ---+ or will receive increased scrutiny.
I'll tell you, that I don't know exactly what that means, but I know that I don't want it.
So you can probably anticipate that we'll keep that in mind.
The consumer direct.
Yes, the credit metrics overall ---+ well, I think probably the biggest point to make there, is when you think about charge-offs.
Charge-offs for our LightStream and GreenSky businesses combined in the first quarter of this year were less than $2 million.
So if you think about $3.5 billion in portfolio, and less than $2 million in actual charge-offs, that's a pretty terrific set of credit metrics.
And <UNK>, it's also, as you know this is prime, super prime portfolio focus.
So the average FICO scores in LightStream and GreenSky are 760, 750-plus.
So this is sort of a different strategy, related to this portfolio for us.
Well, <UNK>, as we think about expenses you know what we do, is we focus on the efficiency ratio, rather than sort of individual expense line items.
And our philosophy is to continue to try to improve operating leverage, and improve the efficiency ratio overall.
Having said that, if I think about the expense line for this year, one of the things that we've said early this year, is we expect our quarterly expenses to average between $1.3 [billion] and $1.35 [billion], with that number being contingent on revenue, obviously as we focus on the efficiency ratio.
I don't think that there's much of a change to that.
With stable revenues, I would be thinking ---+ I would continue to think about expenses averaging ---+ and I say that carefully ---+ averaging between $1.3 [billion] and $1.35 [billion].
We might get quarters higher or quarters lower.
But that kind of expense base for us, I think is a fair number for you to anticipate and model.
Well, if you look at this quarter, <UNK>, our provisioning for energy was about $30 million, and about half of that was a charge-off, and about half of that was a reserve build, to give you a sense of sizing, that's how to look at Q1.
And if I think about going forward from here though, the rest of the year, our overall energy reserves, I think can play out a couple of different ways, assuming there's no oil price shock, right.
Assuming that energy prices are relatively stable to where they are now, I think a couple things can happen.
One our energy reserves can be relatively stable.
As we have charge-offs, we continue to provide for those and maintain our reserve coverage about where it is.
Or two, energy reserves could decline, as we work through certain credits, and as the formation of problem credits from here slows.
So I think, excluding a big decline in energy prices, I can see either of those scenarios from here.
