Up next, we have Northern Trust. I am delighted to have with us today Tom South, Chief Information Officer at Northern Trust, and Dave Fox, CFO. Thanks so much for joining us.
Thank you.
Tom, maybe let's start with you on the technology function. I think you were last on the stage with Betsy in about 2023. Clearly, a lot has happened since then. Things have evolved a lot over the last three years. Let's start with you. I think with the One Northern Trust strategy, it's built on three pillars, right? Optimize Growth, Drive Productivity, and Strengthen Resiliency. I think technology enables all of that. Can you break down your core strategic priorities and where the technology function is overall at Northern?
Yeah, I'd be glad to. By the way, I want to thank you in advance because I made some pretty bold predictions when I was here with Betsy; some came true, and some didn't.
Perfect.
I'm glad not to have to defend any of those.
You can do all of them.
We've been just a little bit of a look at how we've been prioritizing over the last few years in terms of focus. We've had a pretty meaningful focus in three areas, primarily. Risk and resiliency were a big one. I talked about it back when I was here then. There was a couple of big cyber events in the world in 2020 and 2021, and we really upped our game in that space, and that's been running at an elevated level since that time, really since 2020. Our modernization journey has been another one of those we've been on.
Those two bundled together to make sure we're a safe, secure, reliable partner with whom to do business, whether you're an institutional client, a personal client, or a sovereign wealth, et cetera. Critically important and sort of like what we would consider job one.
You have to get those things right, cybersecurity in particular. Otherwise, everything else you're doing becomes a little bit perfunctory. We've had elevated investments in that space for the last few years. Really, going back to 2021, you can see a pretty big jump in tech spending in that timeframe. The other part of that has been in efficiency and productivity, which has had an elevation at that time, but significantly lower than where we are today. We still think about those dimensions really critically in terms of what I'll call the tech-driven investments. The place I think we're adding the most incrementally right now is in emerging technology. I know it's been almost 90 seconds in and we haven't mentioned artificial intelligence yet, which is maybe a record for a tech conversation. It isn't just AI.
It is AI, and it's a lot of AI. We're interested in making sure we're looking around corners up the curve a little bit. Thinking about quantum, which is starting to gain some acceleration. I often tell groups I wish I could take 10% of the AI mania and switch that into quantum mania because I think quantum AI and digital assets are likely going to have a moment in which they start to converge. It's not this year, but it's not so far off that we aren't starting to think about that a little bit. We think about those core investment themes in that arena. If you want to think forward a little bit, by the way, I should note, lots of folks in this room probably know this. We've been running post-2020. We started running at a very elevated growth rate.
I think the peak year-over-year was about over 13%, and in a range of about 8%-13% generally over the last five years. It's because I think posting some of those big cyber events in the world, we really dug in on resiliency broadly, cyber reliability, and recoverability, critically important. Those are important both because of the exogenous issues in the world at that time, and by the way, it's not like it's a nice, quiet environment right now from a geopolitical and other perspective, but from a brand reinforcement perspective too, right? At some point, one of the rationales for being a client of Northern Trust is it's a safe place to be in the most troubled of times, and we want to make sure we are investing enough to keep up with the risks around that.
As we look forward, it isn't like those things are important. They're critically important. We actually moved into the range in which we're performing on the reliability side at the highest level we've ever recorded, for example. We still have improvement targets every year, but we're performing at the highest level ever recorded at a level of change in our environment that's triple what it was when we started measuring that five years ago, against this plan. We've achieved some of the metrics that told us we could start to level that growth and start to tilt that growth towards emerging tech and towards more business growth unlock over time. It's not a big shift in one year, but we are seeing that tilt. The other thing you should see from us is we are seeing some abatement in that growth rate.
That 8%-13% is one we're trying to drive single digits this year. We expect it to be single digits this year, and we'd like to aspirationally move into a range of about 4%-6% or 4%-7% on a sustained basis. You may wonder, boy, in this era of AI, even my time spent here, tech is such a critical component of the success of the firm. How are we seeing that number come down? We're getting efficiencies in the IT space that are pretty substantial, and they're giving us hope that that new range is more sustainable. It's hard to predict that far out. Like I said before, even some of the elevated spending was driven by external factors, not so much internal factors. We always have that.
Dave stresses, and I think it's awesome, a flexible financial model to adapt to adverse conditions. I think Dave often refers to that as adverse economic conditions, but there are other kinds of adverse conditions in the world that we have to react to. With the Glasswing out there, the industry's reacting to an adverse condition right now. That flexible model has to lever not just economic conditions as they change, but non-financial variables that we have to deal with, and we're flexible enough to do both.
Tom, you started on the cybersecurity side. Maybe let's dig in a little bit there before we move on to the modernization and AI. Well, I guess cybersecurity, I think you have to talk about it.
Sure.
With the AI perspective, just given all the headlines around Mythos and everything that's happening out there. How are you thinking, maybe delve one level deeper on the cybersecurity risks, what you did before, how things have evolved now with AI, and where-
Yeah.
You're spending your time.
I'll be candid, that's a bit of a chunky topic. It is hard to extract cybersecurity from artificial intelligence and artificial intelligence from the kind of future prospects of the firm on both the top and bottom line. Let me start with cyber and AI and what we're doing on that front. Like every new emerging technology, I've been around the firm long enough to have seen a couple of generations of these now, almost every one of them is a double-edged sword in some way, shape, or form. We have been extremely excited, like a lot of firms, about the prospects of both productivity, efficiency, and new products and services as it relates to AI. I can talk about those in a minute.
If you're not careful, these things come around on you, and the Glasswing and Mythos revelations over the last few months remind us that the other edge of this is out there. The risks associated can be profound and have to be managed. Large regulated firms, that can't be accidental. It's got to be quite thoughtful and proactive in many cases. I saw a really great article last week from Jen Easterly, who used to be the head of CISA under the last administration. She is clear-cut a cyber expert as you'll find out there. She wrote this really great article saying, "You don't really have an AI problem with Mythos.
You have a legacy of 30+ years of deficient or vulnerable software that was created and is operating in all of our businesses." All Glasswing's efforts are doing are taking what would've been years of exposure or discovery of those and compressing them into a very tight window. I happen to subscribe to that characterization of where we're at right now pretty energetically. To talk about what we've been doing in the years leading up to this, I'm thankful we were building out more robust programs around vulnerability management, cybersecurity, hygiene, I'll call it for folks that would hear that word in that space. Your hygiene in cybersecurity.
If you're coming at it from a robust position, particularly in vulnerability management, but other areas, if you're coming at this from a pretty robust position, yes, this is an urgent activity in terms of scanning your environment, discovering these vulnerabilities before someone else does, and fixing them, right? Super important. If you came at this from a standing start, boy, that's really a challenging thing to do. We're fortunate enough to have built out a robust program around this. I was telling a couple of clients late last week that we already had five scanning tools we were running every single day to try and find gaps in our environment, and a whole program around remediation around those.
We come at this from a sense of we had a really good program, but this is new. What's new about it is the time frames, right?
The time from discovery to exploitation was measured in weeks and months, and has been in the industry for a long, months usually in the environment that we've operated in. That window is about to go down to hours, days, weeks at best. We're going to have to adjust our position in terms of how we clean our environment, remediate our environment. This is what I always tell people is our goal right now. We're doing the same as probably every other firm. We built intelligent scanning tools. We're using every frontier model provider that's out there to try and inform these tools. But our goal as a financial institution, the brand promise to our clients, is not to be the number one discoverer of cyber vulnerabilities. It's to provide them a safe, secure environment in which to operate.
That means you have to be as good at cleaning up what you find as you are at discovering it. I don't think people talk enough about that, and I don't see enough printed about that in the press. Because it's not as sexy as I'm working with Anthropic, or I'm working with OpenAI, or I'm working with Google on this. I really think that end-to-end treatment of this is what we're really focused on. Yes, we are, to Dave's chagrin, a little bit. We're investing a fair amount of unplanned energy and time, treasure, and talent in this right now at our firm to make sure we're ahead of the inevitable release of these tools into the hands of adversaries that would do us harm.
I want to, just because we're here at the AI junction, talk about. I don't want to be a storm cloud on artificial intelligence because there is this thing. We have to deal with it, and we are in a pretty strong position to deal with it. There are tons of other opportunities we are still pursuing. It's not like we said, "Well, okay, cancel the AI party. We're going to stop. It was a fad, and we're going to do something else." Our conviction, certainly on a long time horizon, is still very high on both top and bottom- line returns in this space. I would say, because I've been asked this question a few times today in meetings with a handful of folks that are here today in the room, where are we seeing impacts of artificial intelligence in our business today?
Well, by far the top impact is in IT, right? The tools for our developers have become quite sophisticated quite quickly. Our folks are kind of using the AI as a partner programmer in a lot of cases, and a partner engineer. As a consultative partner in some cases. We have seen, as our teams have started to adopt this, the rate of change in our environment is going up pretty dramatically. You can literally see the charts as when kind of a pre-AI, post-AI. The metrics we get out of there tell us that change volumes are up dramatically. Good news is code quality continues to maintain to be very strong.
That was a concern for us. We're seeing a pretty big impact in information technology, and it's probably not super obvious in the earnings because a lot of that's CapEx, and it gets a bit diluted by the depreciation schedule. We are definitely seeing that. By the way, our conviction, basically talking to a lot of these AI model providers, is we're at the beginning of this, not at the end of it. I think there's a lot of what I'll call revolution and transformation in software engineering still to come at this point. A lot more on that horizon. There are opportunities. We're pursuing agentic orchestrated solutions in almost every area of our business. I'll give just a couple of those. We're doing some work in our risk and compliance space that I think is going to be interesting.
A lot of that's internal, much like the software development piece. Our audit team is starting to get involved in this. A lot of good internal use cases where we thought there were lower risk, and that was stuff we were really starting to work with late last year, as we were more in that experimentation mode. Now that we're in implementation mode, we're excited to be building things for our wealth management business to enhance our personalization. I think if you saw our earnings last time, Michael Grady talked about hyper-personalization. We've got some really slick tools that we're developing and deploying to help our advisors personalize, refine, and enhance the advice they're giving to our clients in near real time. That's combining the brilliant The Northern Trust Institute body of knowledge we've built over the last couple of years.
You've probably heard from Jason Tyler at some point around that. With the deep knowledge we have about our clients, their goals and aspirations, their behaviors, their transaction history, all those things coming together, then semi-public and public information about them to build maybe the best advice we can. Not just depending on our advisor, but our advisor plus a digital assist, an AI assist in that case. Then, in our asset management business, we've already got doing research across in our municipal bond space. We're reasoning across the 90% of the data that people can't afford to get to with purely human efforts around that. We're tapping into data we never could have covered before on the research side to generate outcomes for our clients in the asset management space.
I expect that it is like a lot of asset managers expect that to permeate all facets of everything from research to portfolio construction to portfolio deployment to portfolio maintenance and compliance, and everything around that. We're again at the early stages on that. Mike Hunstad, who runs that business, and I are very bullish on what we can accomplish there, even in the next 6- 12 months. We should continue to have what I'll call a series of key components we deliver, key announcements we can make around capabilities there to the benefit of our clients and the consumers of those products. I don't want to make it sound like it's a dark cloud of cybersecurity concerns.
They're absolutely real, but we've got a good program to manage those, and there's a lot of upside that we're pursuing pretty energetically. We, like a lot of firms, are talking about last year was an experimentation and education year and a bit of evangelism by the IT folks. This year is an implementation, and I think we're now embarking upon this re-imagination, right? To really extract that game-changing value, you've got to do some re-imagination of how you deliver those services. We're entering into that phase now.
Okay. You covered a lot there, so I'm going to-
I did.
Around a little bit with my follow-up questions. Let's just wrap up the topic of cybersecurity. I guess, how long does it take to find the vulnerabilities? It feels like it takes maybe hours or days at this stage, but how long does it take to fix them? Is it a continuous process, given that there is legacy code over probably several decades at this stage? Is it an ongoing process that's going to take years? Is it going to take just months? How is AI going to help that process?
That's a really great question. The discovery process, once we started deploying these tools, they lived up to the billing. They are incredible at discovering what were unknown, what might've been categorized as low likelihood exploitable vulnerabilities. The discovery process is kind of expensive, candidly, but very effective and pretty fast. I think the harder part of that is that back half of that, which is fixing those. Finding and fixing are somewhat discrete today. We would like to bring them together, and we are bringing them together very quickly. The only way to keep pace with the really efficient engine of discovery of vulnerabilities is to start to get, and that's happening at machine speed, is to start to move towards machine speed on remediation. We originally did like a lot of firms.
We built a team to start doing automated intelligent code scanning, and probably within three or four weeks, we realized we needed to build a team that was pursuing with equal zeal the fixing of those, the remediation of those issues. We're building both at once, and we've got a couple of strategic partnerships we're leveraging right now with some of the largest firms in the world. They had to see this problem the same way, that this is an end-to-end problem, not simply a discovery problem. We're moving very rapidly towards a lot of automation on that remediation front. You're asking a really great question, which is how long are we in this state? It's hard to say at this point because I probably could answer that question for us on the code we've built and deployed, and how long that's going to take.
That's months, not years. That's the best I can do to quantify that. The entire global financial system is an ecosystem of tons of large financial providers, financial market utilities, lots of big vendors that we all depend on. There's a lot of commonality in terms of large providers, and I think that could be a longer window. It's hard to predict right now, but for all of that ecosystem to be uplifted in terms of the quality of the code, the vulnerability assessment and remediation process. I think it could be longer than that. I don't want to make a big prediction around that as I did on stage last time I was here, but I think it'll be longer than our own in-house scanning and remediation will be.
I think until those firms start coming to the same conclusion we did, which is AI helps me find this, AI has to help me fix this. I think that's going to be a longer period of time. When we're done, though, really important, when we're through this, however long this takes, we will have a much healthier, much more resilient global technology platform upon which the industry runs, not just for Northern Trust, but for all the firms that we depend upon and interact with. That'll be better for our clients and, quite frankly, better for the sort of Western financial system as we think about it.
Okay, perfect. There's certainly a lot more to dig into there, but maybe let's talk a little bit about the modernization effort and the investments there. When you think about the tech investment curve, you've moved, as you noted, past that double-digit growth in equipment and software spend. Where are you headed from here? Is it mid-single digits from here?
That's the aspiration was that mid-single- digits, but we're not there yet. We'll be single digits this year and continuing that trend. That's the model we have right now. I didn't characterize it earlier, but because it's a hot topic, talking about AI investment right now, it's a relatively small part of our overall tech budget, but it's the fastest-growing by far. It grew triple this year. We expect that to be double or triple next year and probably the same for the next couple of years. While our aspiration is getting to that mid-single- digits in terms of growth, it's very possible as our businesses start really getting energized around reimagining the processes that the demand may spike for some period of time. I'm not ruling that out.
The model tells us right now that we think we're going to keep it at mid-single- digits. I think the other piece that's worth noting is we've been on this modernization journey, as you mentioned, we still have some work to do. Just under half of our applications are running on the cloud- based today. That's not where we aspire to be. We aspire to be higher than that. We still have some work to do on that. Every time when we migrate things, there's always this bubble between the things we're still running in our on-prem and the things we're running outside of our four virtual walls. There'll be a bit of that bubble, too. I think when I say we'll get to that mid-single digits, the time frame on that's a little challenging for me to predict right now.
We want to get to single digits this year and sustain that because it's been five years since we've been to single digits. That's the start to that. When we get to that mid-range, it might be 2027, it might be 2028, it sort of depends on some variables outside of our environment.
I guess a follow-up to that, Dave, I do want to bring you in here as well, is when you think about the spend that's falling in to run the bank versus change the bank, how is that changing, and how has that changed? What does that mean for operating leverage as we go forward?
Well, I'll start with the run change. There's actually about three different ways we slice tech investment. I gave you the four buckets of what I'll call the IT-driven investment. We want to make sure that we continue to invest enough in the businesses to continue to have them grow. When we tilted a few years ago into this resiliency and cybersecurity-heavy accelerated investment, that tilt of business-driven kind of change went under 50% for the first time in a long time. I'm happy to say that's tilting back over that 50% range. To us, a little bit less about running and changing right now. It's a little bit more of what's driving us. For a while there, cyber risk and resiliency were driving us, the majority at least. That's tilted back to business-driven initiatives.
We hope that's a good unlock around both productivity and growth in those businesses. I think that's probably how I characterize it. From a run change, I'll just give you this because everybody talks about this in the industry. We've gone from 60/40 to 40/60. In over 20 years at the firm, I've seen it at 60% run and 40% change, and I've seen it at the inverse of that. We're somewhere in the middle of that right now. I will say, again, during that tilt towards resiliency, some more of this became run as we added incremental capabilities on the run side. It is starting to tilt back again. We're seeing the same tilt on business unlock is the same on run versus change.
We won't get to our desired range, which is closer to that 60/40 on the change side, until we finish some of this modernization work. That's got another couple of years at least left to it. We're tilting the right way, but we're on a journey, and it's a few years out still.
Got it. Dave, anything on the operating leverage side as you think about the investments that are required, but also the underlying operating leverage that you're generating in the business? How should we think about that?
Yeah. When I think about operating leverage, obviously, we gave the guidance above 1%. If you think about how we do our planning on what he can spend and what other folks can spend internally, I think you remember this from the call: we start with productivity, right? Productivity informs the amount of investment we can do. That investment we do will define the expense growth, right? At the end of the day, the investment we make in the year is large, but the productivity is equally as large, right? From my perspective, maintaining the operating leverage isn't just holding people back on their investment dollars. It's also doing what we're doing already more efficiently, right? That productivity really drives the fact that we can reinvest in growth and in technology at the same time.
The other aspect, and we can dig into the AI investment spend here, the other aspect is as you drive more productivity on the AI side, you also have to think about the cost of tokens. How are you tackling that right now? Is that a priority? Will that be a priority later on? How should we think about that?
Well, I'll start, and if Dave has a comment, he can chime in. We have started to. I know the buzzword is tokenomics now, and I'll use it sparingly. It is a new variable for us to try and manage at this point because our consumption is going up rather rapidly. Again, it's not material this year, but it's quickly going to become so. Maybe more importantly, it's really influencing prioritization right now. One of the examples we've often given is with most new tech innovations, it comes out, and it's generally the most expensive it's going to be when it hits the market, right? You can think of any innovation in the last 25 years, and the unit economics that get better as it gets produced in more scale by more providers.
In a lot of ways, you look at NVIDIA sort of had the market on GPUs, that created scarcity. We said, "Okay, that's the most expensive it's going to be, and AI cost should come down dramatically." That is not entirely clear that that's going to play out here because there are a lot of other variables. In this case, one, the demand for this technology is kind of the likes we've never seen before, at least not in a very long time, and the outlay of capital around data centers and those kinds of things, infrastructure in general, is really substantial. Then this is one of those few technologies where there's power and water, and there's a bunch of other sorts of commodity or pseudo- commodity things that influence this.
It isn't completely clear to us that the economics of this are as sharply downward as virtually every other tech innovation has been over long periods of time. The reason I bring that up is we are having to prioritize. As Dave mentioned to a group earlier, the range of ideas we want to push through in terms of AI development is very large. The funnel has a filter on it, and one of the filters has to be whether this thing you want to automate, or you want to build, actually is going to be affordable to run, based on the fact that I have a global operating model and may not be. We've thrown out things we've built already because running it was more expensive than the people that were doing it.
Yeah.
That's a weird place to be. By the way, generally, in my 20-some years at the company, we would've lived with that. We would've taken that business case because we assumed the cost of that tech was going to come down over time. The uncertainty around tokenomics and how this plays out has us a little more circumspect on just taking neutral business cases and assuming they're going to become positive over time. It's forcing us to do more prioritization in a way we maybe haven't had to before. I'd say much like the cloud era of 10 years ago, when that started to hit financial services, we're more interested maybe in speed and capability than we are in hard savings in day one. It wasn't my phrase, but I'll reuse it here.
These are assistive technologies we're building for the most part right now, which means they're largely elevating our people, not eliminating our people. Maybe that's five years from now change, but that's where the economics have us right now.
Got it. I think you went through some of the more impactful initiatives across some of the businesses, but maybe if you can double-click on that across the three different businesses, which of the areas you're deploying more AI, which of the areas you're deploying more tech, and where are you in that life cycle?
Yeah, I probably jumped into that a little bit earlier. Again, I think the place we moved the earliest and fastest was in asset management. I talked about certainly a lot of the research there has been, is assistive, I'll call it. We're not losing researchers. We're just researching across far more information than we ever did before. I think that's going to move up further into more of the asset management activities over time. I talked about that a little bit already. On the wealth management side, this one wealth advisor tool that we're building that's growing, that's going to help our advisors continue to be assistive to them. You can imagine that to, over time, to make them more effective and be able to have broader coverage.
We're also pursuing some strategic partnerships with some of the larger AI firms to build some other tooling in the wealth management space. I won't jump the gun and announce any of that, but I think we're excited about the fact that it's clearly an area Dave and Mike have talked about, an area we need to grow, organic growth. We've got investments directly aimed at helping assist that over time. I'll say stay tuned on that, and I'll let that be Jason and Mike and Dave's news to share when those kinds of come about. Let's not forget that a big chunk of our company's operational and technology is a big part of that too. There are a number of initiatives there.
I think the one that maybe is most exciting for me is this fund transparency tool that we're starting to build out that will give our clients visibility into the life cycle as we're generating NAVs for them, asset valuations for their funds, give them visibility into the sort of supply chain as it's happening every day or every hour as we're doing that. They've been wanting that for a long time. It's generally done by email and phone conversations. Today, it's going to become entirely automated and digitized over time, which we're excited about. In Mike's presentation from our last earnings talked about alpha as one of the three themes for outcomes we're generating. Absolutely, we should think about that as investment alpha, where we've been aiming. I do think there's a lot of operational alpha opportunity out there.
We have not mined a ton of that yet, although we certainly have a lot of work in progress there. Think about that as a turbocharge of the digitalization work that we've been doing for the last three or four years, where this is a technology that just makes it faster, more efficient, and, quite frankly, the build-out of it just accelerated. We're excited about that. We think there's operational alpha generation. Again, I'm not prepared to make any big pronouncements, but more to come on that over the next 12 months.
Maybe last question on the tech side. You mentioned quantum, and you mentioned wanting to invest more there. What exactly should investors be focused on from a quantum perspective?
I think in the early days, there always have been in tech circles this, all of your encrypted data that somebody may or may not have seen before is going to be able to be decrypted, right? That's absolutely true. For those of us that are spending a lot of time on quantum now, we're moving past that. We're moving past that partly because quantum's starting to become more real, right? I know that there have been firms that have been hyping this for five or six years, but the material science issues are being solved more quickly. Frankly, there's a lot more diversity in the approaches being taken. We're starting to get ready.
I think there still is a security concern, but it's going to be less about decrypting old data and more about the way we all interact with each other, and that you're going to have to have far more variability in encryption technologies. I don't want to bore this audience with all that. All that's going to mean, though, is that the way we send data in a trusted sense today has been fixed for a long time. It's going to become variable, and it's going to require us to start to work together in ways we haven't before. Us and our clients, us and other financial firms, and us and other financial market intermediaries. That's an area where it's starting to be talked about more.
I think I expect in 2027, a lot of people to come to the realization that there's a lot of work to be done for us to start to move in some sort of lockstep around that. Having said that, I think there are going to be product, service, and investment opportunities on the top-line side. I do think it'll be broadly in financial services. There are firms already making some moves in this space, but there will be the types of optimization and products we haven't contemplated because they simply couldn't be performed before. Now, whether they're economically viable, I think it's just like AI. It's a big question. These are expensive infrastructures to run, and so that's hard for me to see.
That's why we're starting being with preparedness using the NIST guidelines and our own interaction with our counterparties and a number of other academic institutions to make sure we're ready when variable encryption methodologies are required. Sort of post-quantum preparedness is the term you'll hear a lot about. We're in that, and I know a lot of our peer firms are too. I do think there's top-line opportunities. We've got to start to mine those because we're going to spend a lot of money on the preparation end of this.
Tom, that's a fascinating world, and I'm sure there's a lot more to dig into. Maybe we should bring this back to the environment. Dave, can you give us an update on where you see the environment today, how you're thinking about the second quarter as we're about two-thirds of the way through?
Yeah. Well, it's been less than 50 days since we reported earnings. You're really saying what's happened in that period of time. When I think about the current market environment, the word that comes to mind mostly is sustainability. That's the thing we think about mostly is we've had a good run. The first quarter into the second quarter, the market conditions have been very conducive. You could call it a Goldilocks- type situation for banks with our kind of financial model, right? I had that information at earnings as well, and so from my perspective, everything I said last time still holds, and my conviction is still there. What I'm looking for, I think, going forward in terms of full year is more sustainability, right? A lot of different things are moving in different directions.
Certainly, rates look like they're going to be stable, which is great. The market is still very volatile. Even though it's trending upward, it's still volatile. Happy to see earnings where they are. Our capital plans really haven't changed. Our NII strategy is still there. I think it hasn't been that much time actually, since we gave the guide. I think we're sticking to our guns, and we're hoping that there's some sustainability built into this, and it continues to trend in the right direction.
Can you just remind us on the Visa sale gains and the payout ratios and how you're going to use that?
Visa, when we talked about the payout ratios of our goal of 100% for the year, that did not include the Visa gain, right? That wouldn't be something that would be included in there. Obviously, there is going to be a gain. I think you guys generally know what the number is. What we do with that is something we're, as I said in the earnings call, we're thinking about and what the game plan should be. I continue to think about the 100% as it relates to the ongoing earnings of the firm versus the one-time gain process.
All right. Perfect. With that, we're out of time. Tom, Dave, thanks so much for your time here.
You bet. Thank you.