Speaker 1: From the Bloomberg Interactive Burger Studios. This is Bloomberg Daybreak
Speaker 1: for Tuesday, May second.
Speaker 2: Coming up today, Janet Yellen warns the Treasury may run
Speaker 2: out of cash in a month.
Speaker 1: President Biden invites leaders in Congress to meet on the
Speaker 1: debt ceiling.
Speaker 3: Morgan Stanley plans to cut three thousand more jobs.
Speaker 1: And writers for some of the most popular TV shows.
Speaker 4: Walk Off the Job.
Speaker 5: Testimony continues in the civil trial AGAUS former President Donald Trump,
Speaker 5: plus a grim discovery as seven bodies are found in
Speaker 5: rural Oklahoma. I'm John Tucker. More Ahead, I'm John Stash.
Speaker 3: Aaron's Wards.
Speaker 5: The Devils shut out the Rangers in Game seven.
Speaker 6: The next played tonight, the Mets split, the Yankees lost again.
Speaker 7: That's all straight Ahead on Bloomberg day Break, the business
Speaker 7: news you need to sturn your day in just one
Speaker 7: fifteen minute podcast each morning on Apples, Spotify, the Bloomberg
Speaker 7: Business app and everywhere you get your podcasts.
Speaker 3: Good morning, I'm Nathan.
Speaker 1: Hager and I'm Karen Moscow. Here are the stories we're
Speaker 1: following today.
Speaker 3: Karen, we begin with a warning on the debt ceiling.
Speaker 3: The Treasury Department now says the US could risk default
Speaker 3: as soon as June one. Bloomberg's Doug Prisner has the details.
Speaker 8: Secretary Janet Yellen said her department's ability to use special
Speaker 8: maneuvers to stay within the debt limit could be exhausted
Speaker 8: as soon as the start of June. She also said
Speaker 8: since revenue and spending flows are variable, the actual date
Speaker 8: could be a number of weeks later than these estimates.
Speaker 8: The current statutory limit of thirty one point four trillion
Speaker 8: dollars was hit in January. Since then, the Department has
Speaker 8: been staving off a possible default by using special accounting maneuvers.
Speaker 8: Yellen's new timeline reflects Treasury's latest thinking on when that
Speaker 8: headroom is likely to be exhausted. In New York, I'm
Speaker 8: Doug Prisner, Bloomberg Daybreak.
Speaker 9: Y Doug.
Speaker 1: Thanks. Meantime, President Biden has invited top congressional leaders to
Speaker 1: the White House on May ninth to discuss the debt ceiling,
Speaker 1: and Bloomberg's Ed Baxter has that part of the story.
Speaker 4: This could be the first sign of any progress. Speaker
Speaker 4: Kevin McCarthy, Minority Leader Hackeim jeffrees from the House Majority
Speaker 4: Leader Chuck Schumer, and Minority leader Mitch McConnell from the Senate,
Speaker 4: but the White House was emphasizing before the summit that
Speaker 4: it does not mean a softening of the president's position.
Speaker 4: Spokesmen Kareeine Jean Pierre he's happy.
Speaker 1: To meet with mc McCarthy, but not on whether or
Speaker 1: not the dead limit gets extended.
Speaker 4: There are very few congressional days left after May ninth
Speaker 4: and before June first, so the pressure for a very
Speaker 4: short term solution is great. In San Francisco, I'm at
Speaker 4: Baxter Bloomberg Daybreak banks Ed.
Speaker 3: We now turn to a bevy of news involving the
Speaker 3: banking sector. The top US regulator wants a sweeping overhaul
Speaker 3: of deposit insurance. It's after recent bank failures drained some
Speaker 3: of the money used to protect banking clients, and the
Speaker 3: call comes after JP Morgan Chase had to rescue First
Speaker 3: Republic b and Y Mellen CEO Robin Vince says, we
Speaker 3: need a sound banking sector, so all of.
Speaker 10: Our interests to have a safe and sounds, trustworthy, reliable
Speaker 10: bankings to the sector.
Speaker 8: That's important.
Speaker 10: It helps to power US growth and USGDP. At the
Speaker 10: end of the day, it's to no one's benefit. To
Speaker 10: have an unsafe.
Speaker 3: Sector bnymel And CEO Robin Vince spoke with Bloomberg from
Speaker 3: the Milkin Institute Global Conference in Beverly Hills, California.
Speaker 1: In Europe, Nathan shares of HSBC are up five percent.
Speaker 1: The bank is planning a share buyback of up to
Speaker 1: two billion dollars after pre tax profit tripled in the
Speaker 1: first quarter. Speaking of Bloomberg, HSBC CEO nol Quinn says
Speaker 1: the results are proof he is the right strategy for
Speaker 1: the bank.
Speaker 11: We said all along that we believe fastest and safest
Speaker 11: way to get increased valuation, increased profit, increased dividends is
Speaker 11: by focusing on the current strategy, and I think the
Speaker 11: Q one results is powerful evidence of that statement.
Speaker 1: HSBC CEO nol Quinn says the bank will also resume
Speaker 1: paying quarterly dividends for the first time since twenty nineteen.
Speaker 3: Back here in the US, Karen Moore job cuts are
Speaker 3: on the way at Morgan Stanley, Bloomberg News has learned
Speaker 3: senior managers are discussing plans to eliminate about three thousand
Speaker 3: jobs by the end of this quarter. Morgan Stanley currently
Speaker 3: employs roughly eighty two thousand people.
Speaker 1: Well, Morgan Stanley's not the only one cutting jobs here.
Speaker 1: Nathan City Group CEO Jane Fraser says she is willing
Speaker 1: to make adjustments to staffing levels inside the investment bag.
Speaker 1: City and its rivals are dealing with an industry wide
Speaker 1: slump and deal making and underwriting activity, So.
Speaker 9: This pens up demand is building and building. I just
Speaker 9: don't think it's.
Speaker 12: Going to get released as early as we would like
Speaker 12: it to, and it's more certainly builds much more like
Speaker 12: the back end of twenty three for all of us
Speaker 12: than as we'd all kind of beat hoping would be
Speaker 12: early falls. I think, like every institution, you make some
Speaker 12: adjustments around the capacity. But we're playing a long game
Speaker 12: in investment banking.
Speaker 1: City Group CEO Jane Fraser spoke with Bloomberg at the
Speaker 1: Milken Conference in Beverly Hills, and we'll bring you more
Speaker 1: in that conversation coming up in just a few minutes.
Speaker 3: IBM expects to pause hiring Karen. It's examining roles that
Speaker 3: could be replaced with artificial intelligence in the coming years.
Speaker 3: In fact, CEO Arvin Christa tells us about thirty percent
Speaker 3: or seventy eight hundred back office jobs at IBM could
Speaker 3: be replaced by AI in five years well.
Speaker 1: The FED begins its two day policy meeting today. Nathan
Speaker 1: and economists expect the Central Bank to raise rates for
Speaker 1: a tenth straight time. Steve Off, chief investment officer for
Speaker 1: equities for Federated Hermes, says the central Bank is likely
Speaker 1: done after tomorrow.
Speaker 13: We think it's their last hike. They've been a backward
Speaker 13: looking operation all through. This relate to the hiking cycle,
Speaker 13: which is one of the reasons we're having all these
Speaker 13: problems now in the banking system because they've just forced
Speaker 13: people to adjust their books way too quickly, and you know,
Speaker 13: they're still backward looking and on a backward basis. Probably
Speaker 13: another hikes in order. But the good news is I
Speaker 13: think this is pretty much probably the end.
Speaker 1: Steve Off at Federated Hermes thinks the Fed may actually
Speaker 1: cut rates at the end of the year and the
Speaker 1: market degrees pricing in a cut as soon September.
Speaker 3: Finally, Karen Hollywood is on hold. This morning. Members of
Speaker 3: the Writers Guild of America have gone on strike. They're
Speaker 3: demanding better pay, saying the studios have cut their salaries
Speaker 3: with the transition to streaming TV, and the writers say
Speaker 3: the studios are also stonewalling on issues like artificial intelligence
Speaker 3: in scriptwriting. Time now to take a look at some
Speaker 3: of the other stories making news in New York and
Speaker 3: around the world. For that, we're joined by Bloomberg's John Tucker.
Speaker 5: Good Morning John, Good Morning Dathan. Authorities in Oklahoma have
Speaker 5: discovered the bodies of seven people. It came during a
Speaker 5: search for two missing teenagers, and they were believed to
Speaker 5: include the girls and a convicted sex offender. The bodies
Speaker 5: are likely to include fourteen year old Ivy Webster and
Speaker 5: sixteen year old Britney Brewer. They were believed to be
Speaker 5: with a body of thirty nine year old Jesse McFadden
Speaker 5: and four others on a rural property near the town
Speaker 5: of Henrietta, oaklub Mogi County Sheriff Eddie Rice.
Speaker 14: We believe that we have found the persons. We just
Speaker 14: started waiting for.
Speaker 5: A comprom well. Sheriff Rince won't say how they died
Speaker 5: or provide other details. A dust storm that blew through
Speaker 5: southwest to Illinois caused dozens of cars to crash in
Speaker 5: a massive pile up. At least six people aren't dead
Speaker 5: over thirty injured south of Springfield. Montgomery County Emergency Management
Speaker 5: Director Kevin Schantz is the biggest challenge for the first
Speaker 5: responders was reaching the victims.
Speaker 15: Multiple vehicles involved, some were on fire, so we had
Speaker 15: vehicle fires to extinguish. We had to search every vehicle,
Speaker 15: whether they were involved in the accident or just pulled
Speaker 15: over to check for injuries.
Speaker 5: Kevin Shoant with Emergency Management says, clean up we'll continue
Speaker 5: throughout the morning. On I fifty five, after a judge
Speaker 5: denied a defense motion for a mistrial, the testimony resumed
Speaker 5: at former President Donald Trump's civil trial in New York.
Speaker 5: During cross examination, writer Ejen Carroll, who claims Trump raped
Speaker 5: her in the nineteen nineties, to that she didn't report
Speaker 5: the alleged attack to police because she felt it was
Speaker 5: shameful to do so. In New York City's water belt
Speaker 5: forgiveness program, designed to recoup hundreds of millions of dollars
Speaker 5: owed by customers, is being extended. Mayor Eric Adams says
Speaker 5: that the program has collected eighty million dollars of the
Speaker 5: one point two billion outstanding from customers since January.
Speaker 3: We want to make sure.
Speaker 4: That every new Yorker can pay their.
Speaker 10: Water bills, so DP has extended the embassy program by
Speaker 10: one extra month.
Speaker 5: May thirty, first, Mary Adams is threatened to shut off
Speaker 5: water to customers who haven't paid their water bills. After that.
Speaker 5: Global News twenty four hours a day, powered by more
Speaker 5: than twenty seven hundred journalist and analysts, you know, over
Speaker 5: one hundred and twenty countries. I'm John Tucker, and this
Speaker 5: is Bloomberg. Nathan.
Speaker 3: Thank you, John. Time now for our Bloomberg Sports update.
Speaker 3: For that, we bring in John Stash.
Speaker 6: Are all right, Nathan tookom those three decades for the
Speaker 6: Devils to get some Game seven revenge on the Rangers,
Speaker 6: the first Game seven between the two teams since nineteen
Speaker 6: ninety four double overtime with the Garden. This Game seven
Speaker 6: was in Newark. It was still scoreless midway through the
Speaker 6: second period of the Rangers were on a power play.
Speaker 3: Oh here's a takeaway by Pullot Crop Fox recovering Thoughie Skrider.
Speaker 3: It's taken back by Pullott Plot still with. It was
Speaker 3: in Fus one of.
Speaker 2: A Cloud backhead start michaelback Cloud, It's what nothing.
Speaker 6: DEVLS Radio McCloud's first goal of the series later in
Speaker 6: the second period, the first of the series for Tomas Tatar.
Speaker 6: The Devils added two late goals, and after the Rangers
Speaker 6: won the first two games of the series, both by
Speaker 6: four goals, the Deviles last two wins of the series
Speaker 6: were both four nothing victories and shutouts for the young
Speaker 6: Devils goalie Kira Shmid. The Devils win a playoff series
Speaker 6: for the first time in over a decade. They'll play
Speaker 6: Carolina in Round two, Game two Nixon Heat tonight at
Speaker 6: the Garden. Last night, Philadelphia won Game one and in
Speaker 6: Boston as James Harden scored forty five points, he hit
Speaker 6: the game winning three with eight seconds left. Denver beat
Speaker 6: Phoenix for a two to nothing series lead. Another loss
Speaker 6: for the Yankees, and this one included a questionable managerial
Speaker 6: decision by Aaron Boone. Domingo Herman was two outs from
Speaker 6: his first career complete game. He allowed no runs, two hits,
Speaker 6: had thrown on the eighty eight pitches. Boone took him out.
Speaker 6: Cleveland rally scored three in the ninth and one three
Speaker 6: to two. The last place Yankees have lost seven of
Speaker 6: their last nine, and Aaron Judge is on the injured list.
Speaker 6: Mets and Brave's played two. Atlanta won nine to eight,
Speaker 6: a game with seven home runs. Mets got the split
Speaker 6: win he five to three.
Speaker 4: John stash Elle.
Speaker 5: Bloomberg Sports.
Speaker 7: Live from coast to coast, from New York to San Francisco,
Speaker 7: Boston to Washington, d C. Nationwide on siriusxam, the Bloomberg
Speaker 7: Business app in Bloomberg dot com. This is Bloomberg Day Break.
Speaker 7: Good morning, I'm Nathan Hager. Wall Street leaders continue to
Speaker 7: express confidence in the US financial system, and the CEO
Speaker 7: of City Group, Jane Fraser, is no exception, and in
Speaker 7: conversation with Bloomberg Shnelli Bassic at the Milk and Global Conference,
Speaker 7: Fraser called the US banking system the envy of the world.
Speaker 7: That's after the collapse of First Republic Bank. She also
Speaker 7: discussed your outlook for recession in the US, a potential
Speaker 7: economic rebound, and the future of artificial intelligence in banking.
Speaker 7: So let's bring you part of that discussion with the
Speaker 7: CEO of City Group, Jane Fraser.
Speaker 16: Right now, if you think about that first rescue that
Speaker 16: was made by eleven large banks just weeks ago, why
Speaker 16: wasn't there an inclination to step up and say first
Speaker 16: Republic a second time.
Speaker 9: Well, it's always a.
Speaker 17: Sad day when you see a bank fail, but we
Speaker 17: are all very pleased to get the major source of
Speaker 17: uncertainty that was remaining from the recent.
Speaker 9: Bank term all addressed.
Speaker 17: And that is a good thing because fundamentally the US
Speaker 17: financial system is sound. This is a case of a
Speaker 17: small handful of banks that were poorly managed.
Speaker 9: And getting this address is very important.
Speaker 17: When we stood up, I think it's a statement that
Speaker 17: the major banks, the eleven major banks in the country
Speaker 17: in thirty hours, for thirty billion dollars to work to
Speaker 17: buy the time to get the right solution and answer
Speaker 17: put in place.
Speaker 9: And that was our intention. It wasn't to provide the answer.
Speaker 17: It was to give the time for confidence to get
Speaker 17: restored and our regulators to do their job.
Speaker 14: Which they did with First Republic being out of the way. Now,
Speaker 14: certainly that was the wail in the room.
Speaker 16: But what do you expect next in terms of any
Speaker 16: future fag failures or even hiccups down the road.
Speaker 9: So I am I'm more optimistic around it.
Speaker 17: I do think the US financial system is extremely strong.
Speaker 9: The large American banks globally are.
Speaker 17: In an enviable position. Our financial system has a particular
Speaker 17: structure to it. Large banks, regional banks, and commodity and
Speaker 17: community banks.
Speaker 9: Everyone plays a different role.
Speaker 17: We played different scale, different customer basis, but it's a
Speaker 17: strong system. I am anticipating there will be some more consolidation.
Speaker 9: We do have over four and a.
Speaker 17: Half thousand banks, and it's likely that the minimum efficient
Speaker 17: scale will rise, but I don't think that brings into
Speaker 17: question a system that is the MV.
Speaker 9: Of the world.
Speaker 17: This is a strong and highly desirable financial system, which
Speaker 17: it works.
Speaker 16: The big just got bigger today, right, this is JP Morgan.
Speaker 16: Rather than regional banks consolidating among each other. Does that
Speaker 16: create more competition for the smaller banks?
Speaker 14: Given that the big are getting so big in this country, I.
Speaker 17: Think there's room for everyone to play their roles. And
Speaker 17: you know, the larger banks are also.
Speaker 9: Playing on a global scale.
Speaker 17: When I look at our own bank, our strategy is
Speaker 17: around being the pre eminent partner for clients of crossworld
Speaker 17: and needs. That is a very different role from the
Speaker 17: role that a community bank plays, which is also very
Speaker 17: important in the context of the local economy. I think
Speaker 17: it's about different banks playing different roles and let's make
Speaker 17: sure that we have a strong and successful system that works.
Speaker 16: There's a lot of worries about the credit contractions that
Speaker 16: could be seen in the United States, particularly among that sector,
Speaker 16: small medium sized banks. They tend to smart a bake
Speaker 16: small and medium sized businesses. Do you expect that there
Speaker 16: will be a significant contraction and how do you handicap
Speaker 16: the ripple of backs.
Speaker 14: To the economy?
Speaker 9: So certainly the risks now are more to the downside.
Speaker 17: Than they were at the beginning of the year, and
Speaker 17: no one anticipated the turmoil that we've seen so far
Speaker 17: this year at the beginning, and I think it certainly
Speaker 17: makes the second half is not going to be a
Speaker 17: strong macroeconomically or in terms of investment, banking, wallet and
Speaker 17: the like that we had hoped. That said, I think,
Speaker 17: as you say, one of the big questions will be,
Speaker 17: to one extent, does credit titan and you know if
Speaker 17: that is material that will have a on the economy.
Speaker 17: We're anticipating a recession at the back end.
Speaker 9: Of the year.
Speaker 17: But the amount of pent up demand, the amount of
Speaker 17: the strength of the corporates, the strength of the consumer
Speaker 17: coming into this the usual amplifiers of a contraction.
Speaker 9: And not in place.
Speaker 17: And I think we'll see the US economy, unlike others,
Speaker 17: pull out of whatever a recession environment could be pretty quickly.
Speaker 16: So the so you see that recession finally come nearer,
Speaker 16: what exactly does it look like always impacted.
Speaker 14: What feels pain?
Speaker 17: Well, I think we'll see, as everyone always does, more
Speaker 17: pain being felt in among some of the consumers at.
Speaker 9: The lower PI COO. The benefit we've got at.
Speaker 17: The moment has been very strong employment, and that's terrific,
Speaker 17: But the health of the consumer and that has remained
Speaker 17: the same.
Speaker 9: The corporate sector is particularly strong, and I think that's
Speaker 9: why you hear so many.
Speaker 17: Of us talking about this being a more manageable or
Speaker 17: moderate recession if one does indeed come about, and one
Speaker 17: in which the economy should be able to pull out
Speaker 17: a bit pretty strongly.
Speaker 16: And to the extent that you're preparing for a recession,
Speaker 16: you know, City Group itself has just written off a
Speaker 16: lot of credit card debt to begin with in the
Speaker 16: first quarter.
Speaker 14: Do you expect you're.
Speaker 16: Going to have to tighten lending standards even more for
Speaker 16: consumers and even corporates.
Speaker 17: We are a long way from being in a situation
Speaker 17: where the credit levels are even normalized where they are
Speaker 17: pre COVID, So we're probably only seventy percent of the
Speaker 17: way to the pre COVID levels of normal credit losses
Speaker 17: that you expect, So there's still quite a there's a
Speaker 17: lot of room still to go before we start using
Speaker 17: the stress word. The city is probably a little biased
Speaker 17: towards the crime. Eighty percent of our customer base in
Speaker 17: the States is prime, so we don't tend to see
Speaker 17: the lower Fiico as much, and there will.
Speaker 9: Be a little bit more strous there and everyone's going
Speaker 9: to need to keep an eye on that.
Speaker 16: I want to pivot a little bit here and talk
Speaker 16: about other area of stress that it's being seen in
Speaker 16: one of the safest markets in the world, that is
Speaker 16: the treasury market.
Speaker 14: You have a front row seat here.
Speaker 16: It's a kind of the ripple effects that are being
Speaker 16: built in Washington from the discuts around them dead limit.
Speaker 14: What does that look like from your view, Well, I think.
Speaker 17: The market is stilting to have a sense of humor
Speaker 17: failure around some of what's going on. So we've certainly
Speaker 17: seen more than we have in recent debt ceiling concerns
Speaker 17: and impact on the treasury market in the short term.
Speaker 9: The pricing for the.
Speaker 17: June September has definitely come down. The CDs market is
Speaker 17: seeing quite.
Speaker 9: Unprecedented why thing there, So there is a lot more concern.
Speaker 17: I'd say the last week or so we were seeing
Speaker 17: three times a volume of questions for investors and it's
Speaker 17: silli early, but it is a concern around it.
Speaker 9: This could be quite dire.
Speaker 17: For consumers, for corporates, and indeed for the markets if.
Speaker 9: This goes down to the wire or worse.
Speaker 16: How does the rest of the world look at this
Speaker 16: dispute in the United States and invest in the treasury
Speaker 16: as the last thing that the world needs right.
Speaker 9: Now, particularly in the market.
Speaker 17: So, you know, we want to see strength in the
Speaker 17: US capital markets. We want to see confidence in what's
Speaker 17: going and the banking sector very well positioned.
Speaker 9: The banks are very strong as we see.
Speaker 17: So we're in a position, as we did in the pandemic,
Speaker 17: as we did in the turmoil, to be there to
Speaker 17: support markets, to be there to support our customer bases,
Speaker 17: consumers and corporates. So I think from that perspective we're.
Speaker 9: In a good position.
Speaker 17: But it is the last thing that the world and
Speaker 17: America needs is to have a debt sealing crisis.
Speaker 16: The other classer and gore to the treasury market is
Speaker 16: another big bed meeting and the prospect of even higher
Speaker 16: interst rates. Where do you think the direction of travel
Speaker 16: has had a.
Speaker 17: Services inflation is painfully persistent. We've seen the goods inflation
Speaker 17: come way down. Supply chains are now in far better
Speaker 17: shape than they were. So it's really about services inflation
Speaker 17: and the tightness of the labor market and Shair and
Speaker 17: how it has been and we.
Speaker 9: Need him to stay resolute on inflation.
Speaker 17: This is not good to have long term inflation into
Speaker 17: the US economy. Some is fine, but his resoluteness is
Speaker 17: something I think we can bank on. So we're anticipating
Speaker 17: higher than the market would like, for longer than the
Speaker 17: market would like. There's so much pentof demand in the
Speaker 17: market at the moment and it keeps wanting to get
Speaker 17: ahead of this, but that's just not where the economy is.
Speaker 16: So do you think that the market is discounting the
Speaker 16: potential for higher rates for longer and what does that
Speaker 16: mean for asset process?
Speaker 17: Many of us here at Milkin do believe that the
Speaker 17: market is too enthusiastic here, partly because the economy is
Speaker 17: so resilient. This is a strong resilient US economy, and
Speaker 17: that is part of the challenge. We anticipate, you know,
Speaker 17: a tough end of the year and a recovery in
Speaker 17: twenty four.
Speaker 9: From the market.
Speaker 17: Perspective, though it tends to enter debate these things, so
Speaker 17: towards the end of the year, the market should be
Speaker 17: anticipating the recovery and in stronger position, just a little later.
Speaker 9: Than it would like it to be.
Speaker 14: I just want to.
Speaker 16: Reset here for a global Bloomberg TV and radio audiences.
Speaker 16: I'm here with Jane Fraser, the CEO of City Group. Jane,
Speaker 16: I want to give it back to the cigaret and
Speaker 16: your business plans. You had mentioned kind of the softness
Speaker 16: expected to the end of the year.
Speaker 14: How do you expect that.
Speaker 16: To weigh on investment, banking, and particularly not just activity
Speaker 16: but jobs.
Speaker 17: Look, our corporate clients come to us from the full
Speaker 17: way dilemma, and that's or the cash that they have
Speaker 17: on their balance sheets. Their balance sheets are in good health.
Speaker 17: Should they be keeping us cash for a cushion, Should
Speaker 17: they be doing dividends and buybacks, Should they be paying
Speaker 17: down debt because they anticipate being more expensive for a
Speaker 17: little while longer, or should they.
Speaker 9: Be investing in transformation.
Speaker 17: Our pipeline in investment banking is bigger than it was
Speaker 17: pre COVID, and it's big transformational transactions.
Speaker 9: There's a lot of pent up demand. We're seeing it.
Speaker 17: A little bit more IICO activity and interest a little
Speaker 17: bit more in leverage finance, the investment grade markets better.
Speaker 9: So this pent up demand is building and building.
Speaker 17: I just don't think it's going to get released as
Speaker 17: early as we would like it to.
Speaker 9: And it certainly feels much more like the back end.
Speaker 17: Of twenty three for all of us than as we'd
Speaker 17: all kind of be hoping would be early whole.
Speaker 14: And what does that mean for the dance story?
Speaker 13: Then?
Speaker 16: Do you keep the bankers on board until that comes
Speaker 16: back or do you think you're going to have to
Speaker 16: make some reductions were I think, like every institution, you make.
Speaker 17: Some adjustments around the capacity. But we're playing the long
Speaker 17: game in investment banking. I'm very like to say, we
Speaker 17: have a lot of talent that wants to come and
Speaker 17: join us, and we've been bringing some terrific talent in
Speaker 17: in the healthcare sector, in the technology sector and investing
Speaker 17: in that.
Speaker 9: Now.
Speaker 17: Yeah, we're playing the long game here, So I think
Speaker 17: that's important.
Speaker 14: I think there's another part.
Speaker 16: Of the business that's we're talking about. It's your treasury
Speaker 16: and trade services business. You're a lot of people don't
Speaker 16: realize you will for trillion dollars worth of money for cooperations.
Speaker 14: And clients around the world. But how do you get
Speaker 14: the market to value you for that?
Speaker 17: Yes, so it is a This business is a thing
Speaker 17: of beauty. It's for five thousand multinationals four trillion dollars
Speaker 17: every single day in payroll, in cash.
Speaker 9: Management, in recurement and supply chain.
Speaker 17: It's also very very sticky, which is I think of
Speaker 17: note at the moment, because there's a lot of services
Speaker 17: attached to it. There's data, it's embedded into the clients businesses,
Speaker 17: into their technology systems. It helps make them more efficient,
Speaker 17: manage risk, manage.
Speaker 9: What's going on.
Speaker 17: So this is a highly desirable, very very sticky deposit
Speaker 17: base that sits there, and I think the market's.
Speaker 9: Beginning to realize that this is a thing.
Speaker 17: Of beauty that has absolutely been firing on all cylinders
Speaker 17: as we've been investing behind it in the last few years.
Speaker 9: It's unique.
Speaker 16: Is this the race that you're going to win at
Speaker 16: Because the beginning of your tenure was really marked by
Speaker 16: exiting certain businesses. So what is the new City Group
Speaker 16: story to hold on to to kind of bring that
Speaker 16: stuck and line the performance of your life.
Speaker 17: We have never been clearer about what our strategy and
Speaker 17: our vision of our firm is. It is the pre
Speaker 17: eminem banking partner for clients with crossworder needs. The focused
Speaker 17: set of businesses that connect very well together with strong synergies.
Speaker 17: It's a better quality business mixes diversify, It's resilient with
Speaker 17: a very very good balance sheet beneath it.
Speaker 9: This is ninety.
Speaker 17: Percent of our credit is investment grade internationally, eighty five
Speaker 17: percent of the corporate credit is investment grade, and our
Speaker 17: consumer businesses prime. So it's a strong balance sheet off
Speaker 17: the back of a business model that is resilient, and
Speaker 17: we'll be there to meet our medium term targets.
Speaker 9: So we're on a very clear path. We know exactly
Speaker 9: who we are, we.
Speaker 17: Know what we need to do, and we've been getting
Speaker 17: a move.
Speaker 9: On getting it done.
Speaker 17: So I'm pleased with the progress, but we've still got
Speaker 17: a bit more to do.
Speaker 14: I want to look to future technology.
Speaker 16: How are you thinking about the renewed interest around AI
Speaker 16: got on by track.
Speaker 9: Gto this is a game changer.
Speaker 17: And I think in a way when we look at
Speaker 17: blockchain and some of the other technologies have come in
Speaker 17: the last decade, they've been part of the tool kit.
Speaker 17: But I think we're all beginning to realize what a
Speaker 17: transformative nature that generative AI in particular could be. It's
Speaker 17: early days because we have to understand what does this
Speaker 17: mean in terms of jobs, what does it mean in
Speaker 17: terms of business models, But this is certainly the one
Speaker 17: that all of us, you know, the leaders in the
Speaker 17: industry are looking at and recognizing that there's incredible potential here.
Speaker 16: And lastly, just in a minute here, Jane, is there
Speaker 16: anything that can really change your view of this mild
Speaker 16: a session going into a deeper one.
Speaker 17: Yes, if something happens on a gea political front. None
Speaker 17: of us anticipate in the war in Ukraine life last
Speaker 17: year and that had major impacts, second and third order
Speaker 17: impacts on energy security, on food security and the other pieces.
Speaker 17: So I think we've all learned never to never to
Speaker 17: say never anymore, but nothing will surprise us. So you know,
Speaker 17: if something happens on that front, that could be very challenging.
Speaker 9: Let's hope that same minds prevail.
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