Leo Salom: And Meny, I would just add, the NIM for the quarter came in at 3.13%, so very strong, 92 basis points of last €“ on a year-on-year basis, 51 basis points on a quarter-on-quarter basis. As Kevin described, deposit margin expansion, clearly driving that. Also, we’ve had some good gains in terms of improvement in treasury returns on our investment portfolio. And those two things, obviously, have driven the results. As we look forward, I agree with Michael, we will continue to see some additional pricing power if the forward curve holds. I would expect though that beta begin to increase in the medium term. I’d say as we think about the balance of the year, there is going to be increased pricing sensitivity, certainly amongst mass affluent, high net worth and sort of institutional commercial clients. And so I would expect to see further improvement in NIMs, but on a more gradual basis over time.
Meny Grauman: And Leo, just following up on that. I think we’ve heard from other banks that betas haven’t changed as much as we would have expected given the rise in rates. Is that what you’re seeing right now? And you’re talking about an expectation for that to increase in the future?
Leo Salom: I would say that was generally true. I am seeing in the fourth quarter, I do think we saw a little bit more inflection at the industry level. Obviously, our own franchise is very core checking account dependent, which gives us a little bit more pricing resiliency than some of our other peers. But the reality is in that mass affluent high net worth client in the large institutional, there is greater search for yield and greater search for alternative investment opportunities. And so I would expect that to crystallize a little bit more over the subsequent quarters.
Meny Grauman: And then just as a follow-up, broadly, we’ve heard some banks talk about positioning for potential declines in rates. How exposed is TD to declining rates? And I’ll leave it there.
Kelvin Tran: Yes. So we look at that. But €“ so I would say that it is reflected somewhat in our net interest margin disclosure. You would see a shock of rate hike or rate decline impacting our net interest income. So there is sensitivity there.
Meny Grauman: Thank you.
Operator: Thank you. The next question is from Paul Holden from CIBC. Please go ahead, your line is open.
Paul Holden: Thank you. Good afternoon. So actually, I’m going to continue with that line of questioning, but just ask sort of a different question. Would you consider hedging some of that rate exposure, so taking advantage clearly of the upside today, but maybe some point within the next year if you think rates have topped out, you could protect and lock in some of that margin? Is that something you would think about doing?
Kelvin Tran: It’s Kelvin. Yes, we look at that at the margin, but you have to look at both upside and downside. And so on one hand, if you lock it in, if rates decline, then you benefit. But inflation continues to be persistent and break hike, then that would go against you. So it’s a fine balance that we monitor.
Paul Holden: Got it. Okay, thank you. Next question is with respect to your HELOC exposure, and I guess, particularly in Canada, there has been a lot of discussion lately around variable rate mortgages. But for TD, I’m more curious on the HELOC exposure, assuming it’s also variable rate. What kind of impacts are you seeing on your customers or changes in behavior? Is this something we should be focusing on and worried about from a credit perspective?
Ajai Bambawale: Yes. It’s Ajai. Let me start, and I will talk a little more sort of broadly around housing. You may have noticed from our macro outlook, we have revised our housing outlook downwards because of higher rates. We are not expecting a crisis. We are definitely expecting an unwind of some of the gains that have occurred since COVID. But when I look at quality and when I look at quality across, whether it’s HELOC, whether it’s fixed rate, whether it’s variable, I would say that asset quality is strong. So, we look at distribution of scores. We look at how much equity customers have in homes. We look at debt service levels. And yes, there is a bit of an uptick, but it’s generally robust delinquencies, formation charge-offs. So, across all our books, our quality is strong. I don’t know, Michael, if you wanted to add something?
Michael Rhodes: Ajai, I think that captures it and nothing else to add.
Paul Holden: Great. I am going to sneak in one more, if that’s okay? Just curious on the increase in the LCR ratio this quarter, not unusual to see it jump around maybe 2 points or 3 points from quarter-to-quarter, but 7 points is a pretty big move. So, maybe you can help unpack that for us.
Kelvin Tran: Yes. It’s partly because of prefunding for the First Horizon transaction and also in Wholesale Bank and TD Securities.
