Okay. Up next, we have BNY. We have the CFO of BNY, Dermot McDonogh, with me on stage. Dermot, thanks so much for joining us. Pleasure to be here. Good to see so many familiar faces in the crowd. Yeah. We appreciate you being at the conference. Dermot, maybe to start with, on the macro environment and the earnings call, I think you described the operating environment as dynamic, and you described it as constructive. Can you give us an update on what you're seeing in the overall environment today? Look, as I was saying to a couple of you before we came on stage, we've just wrapped up our summer board meeting. We held it in D.C. for the last couple of days. D.C., great place to be in. America's 250th. There was a lot of energy, a lot of optimism in D.C. You can see a lot of work happening on the regulatory agenda in a very positive way. You can see all the kind of noise in the early part of this year around the Fed chair, all that settling down. Look forward to seeing Mr. Warsh's first press next week. I think the markets have held up really well in what is a really tough geopolitical environment. I kind of describe myself, in CFO speak, a risk-adjusted optimist. I think there's a lot to be optimistic about. I think where we are with BNY in terms of the firm and how we're set up in terms of taking advantage of the environment, I feel very optimistic about that. There's a lot of things to be worried about. Overall, I think continuing on from Q1, I think the setup for the firm is quite positive. What is the risk-adjusted part of that? Is that, I guess, what we're seeing in the geopolitical environment? Anything else you're worried about here? I think the American consumer, to the surprise of most, has held up pretty well. The U.S. economy has held up pretty well. I think there was one commentator who I follow quite a lot in terms of the backdrop of trading and how people are setting up for the summer. People will look back on this time in their career as being a very seminal time in terms of an era of a lot of uncertainty in the geopolitics, huge transformation in the technology space. I think it's a very exciting time to be part of the market in that. One of the things that I put in my materials for the board is all the events that happened in the quarter when we track it. When you look back over the course of this year, if you were planning for 2026 in the fall of last year, you wouldn't really have expected it to have played out the way it's played out. I think firms who are able to be dynamic and adjust and react in a nimble fashion to the environment, which I think we have become over the last couple of years with our transformation, really allows you to take advantage of that environment. Also it comes back to clients. Clients continue to be active and doing a lot. With our strategic investments, we're able to support clients in a much more meaningful way. As you mentioned, transformation, and BNY has gone through a big strategic transformation as well. You've now entered, I guess, phase 2 of your transformation, to reimagine BNY to become more integrated, more de-siloed. Can you provide a brief overview of this transformation for those who are newer to the story and touch specifically on the platform's operating model and the commercial model? I like, again, two insights to how I think about things as well. The only thing that's constant at the moment is change, and it's not like when we say transformation, I think for us, transformation will be never done because we're always looking to change and adjust, and it's not like, "Okay, we're done. Now we go back to normal." We want to move on. As Robin said in his first shareholder letter, we've taken a decades-long view, which for shareholders and investors and people who follow the firm, that's a little bit like we're going to make long-term strategic investments. One of the investments that we made three, nearly four years ago now, was to move to be a platforms operating model company, financial services platforms company at the center of global markets. That's what BNY essentially does. The setup of the firm four years ago didn't play to that strength. Over the last three to four years, we've set around a different way of working, aligning on a platforms model, putting skills, tech, everything in centers of excellence, client platforms, enterprise platforms, de-siloing the firm, getting rid of duplication. That has many short-term benefits, but I do believe quite strongly that the long-term benefits of that are yet to be revealed. Just to be a little bit more specific, the firm now, Q2 of 2026, is fully active in the new way of working. The firm is now kind of speaking one language. Whereas before, with the transition into the new way of working, you had some people working in the old way, some people working in the new way, and that was kind of hard going for our people. Now we're all in one way, now we can really talk to the firm, talk to our platforms, really get the strategy going. I say a lot internally, for us being fully active in the platform operating model, it's the end of the beginning, and I'm very excited about the benefits that we can realize both for top line and continued redeployment and creating capacity. One of the little vignettes that I gave to the board in my update was, we have one platform, change of leadership, new person coming in, fresh eyes, which also is a very important part of our strategy, is leadership mobility. They took a fresh look at stuff and said, "Okay, we're going to move this, we're going to move this. I'm going to generate $5 million of capacity, and I'm going to reinvest that in our AI strategy for this particular platform." Four years ago, that leader would've come to me and asked me for $5 million to invest, whereas they created the capacity themselves. You can see AI strategy plus platform operating model plus commercial model working together to deliver a great outcome for the firm and for clients. Very pleasing to see at the moment. You can certainly see it in the operating leverage that you guys have generated over the last 2+ years. I think at 126 you had mentioned that about 70% of your employees had migrated over to the platform's operating model. Did you just say 100% now? Is that- I'll channel my inner accountant here. It's not quite 100. Okay. If you call it 99%, I think there's 200 or 300 people, stragglers left to go. To all intents and purposes, we're 100% in the model. Okay, fine. That's great. I guess, what were the last few areas to get transitioned over? I guess what you're saying is that the benefit of that is yet to come, right? The shorter-term benefits of some of it are yet to come. Then the longer-term benefits of everything are yet to come. I would say the last wave was mainly corporate functions. Yeah, largely corporate functions, I would say. We had five waves over three years. The maturity of wave one relative to wave two, wave three, wave four, now wave five, is very different. I think in two years' time, three years' time, when wave four is at the same level of maturity as wave one now, then I think we'll really see some great benefits for the firm, not just in terms of efficiency, but just how the firm operates and shows up for each other and for clients. I just think as a firm, we'll be able to move faster. That is really the power of the model, I think. Yeah, for sure. Very exciting. What about the commercial model? Can you talk a little bit more about how that's driving organic growth? Look, it's a big area of focus for everybody who's listening in this morning. I think if you look back to our organic growth numbers of 2022, 2023, 2024, and look at it on a sliding scale up, we're moving in the right direction. I know I was challenged quite a bit on the January earnings call. I used the phrase accelerating organic growth. I think one of the analysts wasn't that happy with the number of basis points equal accelerated. When you come from where we were in 2022, which was flat, to, I think last year was kind of three-ish, and I think we continue to grow that number. 10% of sales last year were with new logos. We announced in our Q1 earnings call a significant deal with AGI, which is a decade-long deal, which is a real partnership and allows us to grow our franchise in Europe. We're able to support the administration with a very important piece of public policy in terms of INVEST in America or Trust accounts, which will go live on July 4th. The reception in D.C. over the last couple of days has been very positive around that. That creates an environment where clients really want to know what's happening at BNY and how can you help us. The client dialogue, the client backdrop, what the leadership team is doing on the commercial model. You just remember we started the commercial model in terms of the way we're setting up at the moment, only two years ago. Last year was a record sales year. We had individual quarters of record sales. Q1 was a record sales quarter. What we're doing strategically inside the firm is showing up in the numbers. I believe we've got very strong momentum there. Part of it's talent, part of it is just going at it in a more strategic way, and part of it is just listening to what clients want and explaining to clients what we can deliver for them. Much more the bundle solutions, cross-selling. We had a 64% growth in clients who buy from three or more lines of business. We have a lot more data, and we can track it, and we can create a lot more accountability inside the firm to deliver these results for clients. I feel very positive about it, and I feel like the firm is kind of moving in the right direction. My next question is the full potential of the integrated model and the transformation, but you just told me that change is the only constant, right? You're constantly evolving there. I guess, as we go through these phases, what are the key KPIs that you're looking at that continue to show progress along the continuum that you expect. Well, top-line revenue is a good one to start with. For us, fundamentally, like to be consistent. Positive operating leverage is fundamentally the North Star. We talk to the market and to you in terms of positive operating leverage, margin, ROTCE, and how we want to move the needle on that. We updated our guides on that in January. We believe what we guided is entirely within our core competency within the medium-term timeframe. We're always looking to outperform. We're always looking to go faster, and look, in the world of AI and technological innovation and the leadership team we have in place, I just feel very comfortable about saying that. When you take that and you drill it into the platforms and the targets and the individual accountability, and how Robin has set the leadership team up to be very much in service of the firm and one BNY, and we work as a team. That really has allowed pillar number three, which is power our culture. It really is the transformation in the culture that's powering to run our company better and be more for clients. I'm here a little over three years at the firm. I feel like I've been at the firm a lot longer, not because it's been hard work, but because the enjoyment factor and the ambition level that Robin has generated in the firm is quite exciting. Yeah. Got it. Okay. We should talk about AI because the transformation program is deeply rooted in AI. You've spoken about your vision of AI for everyone, everywhere, and everything. Can you talk a little bit more about your AI strategy and where you are on this journey right now? Yeah. Again, I'm an optimist on AI. I actually think a lot is written about AI, about when we were doing the spring circus of investor conferences, there's some people in the room that I was meeting with. I can't remember what exact week it was, but it was the SaaS apocalypse week. Everybody thought everybody was going to set up new companies overnight, and what the moats were, and what's your moat and this, that. You kind of have to see through all that fog and be in a position to, in a way, red team yourself constantly. We live in a world of disruption, and it's important for everybody to understand that we recognize that we have to disrupt ourselves, too. Otherwise, you're going to get disrupted. We have a big tech budget. We have the power to invest. We believe we have a very good strategy, and we believe competition is good because it makes us better as a firm. We like healthy competition. We believe we have healthy competition in our segments, but we believe that we have a strategy, and so we feel good about our ability to execute that strategy. If you kind of go back three years for BNY, Robin, ChatGPT was the fall of 2022. Early 2023, we said AI is fundamentally important to our future, and we set about what you just said for everyone, for everywhere, for everything. The last couple of years has really been about how do you get AI as part of the cultural transformation so people don't feel threatened, worried, job insecurity. We've given people the tools, the training, the skills. We've built an agentic workflow model, Eliza. Very strategic, very powerful, gives us lots of capabilities and lots of opportunities. Close partnerships with the labs on the West Coast. We kind of feel we're at the center of the AI transformation. We're not fast followers. We believe we are setting the strategy, and I believe it's very CEO-led. I think for you to be successful in the world of AI, the strategy has to be toned from the top and CEO-led. I believe we have that unique set of combinations within the firm. We have a great engineering team who is kind of like, "What could be more exciting than transforming a 242-year-old firm in the age of AI?" We came from D.C., where we had our board at Mount Vernon, and we went through Ge orge Washington's artifacts, and we were in the National Archives yesterday morning seeing the Constitution, et cetera. We're in that zip code. Right. We know how to adjust and transform with the times. I just think we fundamentally believe AI is a superpower that we're going to harness to help us drive growth. We're excited about it and what it brings, and I think our people broadly don't feel threatened about it because we've invested in their upskilling over the last three years. What's the next thing as you think about Eliza and you think about AI overall, what's the next thing that you're most excited about? What's the next phase of this strategy? actually, Look, I'm sure there are a lot of firms in the room who have this as well, but to have large language models and COBOL coexist in the firm at the same time is quite exciting, because you want AI to be ab le to transform COBOL and Fortran and green screens and et cetera. Everybody was worried about the engineers who are experts in COBOL retiring because they're getting to the end of that. With large language models, you can do that transformation in a much more smoother way. I think engineering being able to use tools like Windsurf, to be able to deliver software faster in a more controlled way, being able to handle change management in a more controlled way. Just enabling your resources to do more and have more interesting work to do, I think that's a really fundamental part that doesn't get talked about enough. Giving our engineering organization more capacity, more tools to be able to be more innovative and more creative, and respond to client needs in a more dynamic way. That's really, really powerful, very important, and we 're excited about that. Having all our platforms being able to build AI into their strategic roadmaps about how they can serve clients, better client experience. I think the last time I checked, we have roughly somewhere between 250 and 300 AI solutions in place dotted around the firm, and some of them are very powerful. A lot of people talk about onboarding. We feel very sophisticated and very advanced in where we are on the onboarding, but a lot more to do. Client conversions, I think there's a lot more we can do there. A lot more in the payment space, AI plus digital assets together, I think there's a lot we can do there. All of those things will actually attract more talent to th e firm. There' s an important cultural dimension to it because it feels like BNY is the place to be at an exciting time. We're not talking about riffing, attrition, all that kind of stuff. We're talking about growing, investing, creating capacity, doing more with existing clients. We're on the other side of that ledger in terms of positive versus negative. Yeah, I'd say the mood inside the firm as it relates to AI is very constructive. Any challenges you're thinking about? One of the things that came up in this conference is token usage costs and eventually those costs will scale up. How are you thinking about that? Any other challe nges you're think ing about on the AI side? I think that's definitely part of the worry set of a risk-adjusted CFO. That's a bit like cloud as well in the early days. Cloud usage, cloud bursting. There are a lot of similarities, a lot of parallels. I would say the important thing there is to have a risk-adjusted approach to labs and LLMs, and not to be hostage to any one, because then you're a price taker, and at some point they will be competing with each other. For sure, I think token usage will go up over time, and then it'll become more of like, what's the ROI on the AI investment versus other ways? At the end of the day, it's just math. Yeah. As long as you feel like your AI strategy is set up to be, "Okay, you're too expensive, we're moving here," because there's a lot of people in the space. It's not like two people and one or the other. Somebody said to me last week, in two years' time, the worst LLM model in two years' time will be better than the best LLM model today. That's how quickly things are moving. You need to have a strategy that can adjust and be nimble and calibrate with that. You make the right financial decisions when you have the right data and the right return metrics to make those assessments. I feel like we've created the right infrastructure to be able to analyze that as we go through that next phase of pricing and token usage. Is it about developing some sort of harness and also training for employees or anything else? Yeah. I think I would say part of our strategy over the last couple of years is it's everywhere for everyone, for everything. Over time, you'll end up with more discipline of like, where are the strategic bets? What are the top three things? What are the top five things that we really want to get after where AI will really move the needle as opposed to just a super spreader everywhere. I see that as being an important next step as well, like anchoring on three or four big strategic decisions. Got it. All right. Let's talk about some of the core businesses, custody, collateral management, treasury settlement. You clearly have a breadth capabilities there. From a traditional finance perspective, where do you see the greatest opportunities to pull ahead? We spent a lot of time on this in terms of where I would say an opportunity for us is. We're number one, number two, number three in a lot of our businesses, in a lot of sub-segments of our businesses. You can get into the comp lacency mode of if you're number one, well, you're number one. In the world of only the paranoid survive, we're now becoming a lot more focused and granular in terms of the products. We've set up a product practice. Now in the same way we have targets by salespeople, we will have targets by product people. That is an exciting, I think, next phase for us next year in terms of really developing in a more sophisticated way our product chops, looking at TAM, where are we, how can we grow domestically, internationally, where are the c lients who are buying one and big in one space, but could do a lot of other things. AI can help us with that in terms of analysis. We're becoming much more granular about what the opportunity set is in each market. As a consequence of that, one of the things that we did with our board this week is if you take our medium-term target for margin being 38%, and you wanted to be the best of in everything that you do, even notwithstanding the fact that you are the best in some of them, there's still room to grow, then you can get higher than that. We're doing a lot of work to look for opportunity, new areas, new products, new markets. I think most businesses that we have have room to grow top-line. We're quite excited about that. In terms of, I would've said, look, Markets and Wealth Services, high-performing segment over the last three years, really good margin. I think roughly 50% margin for that segment. Do I think it can go higher? Absolutely. Custody. Four years ago, our business, even though we were the world's largest custodian, there was a lot of work that we had to do, and I think we've changed. I think Emily guided when she was the CFO at Goldman Conference in 2021, a margin that we've just blown through. We still feel like we haven't reached the end of that. If you were to do a measure of excitement inside the firm in terms of the opportunity, you would feel, "Okay, that's pretty good." Yeah, we feel very optimistic about our ability to grow across pretty much everything and segments I don't really talk about that much. Everybody wants to ask me the question about IWM, but you know what I mean? That's a business that the industry has been quite challenged over the last couple of years, and our margin in that segment has been quite challenged over the last couple of years. We believe that we can strategically ma ke better inroads in that over time, and Jose is doing the right thing, and he's making all the right calls. You have that segment not performing where it needs to be, but beginning to turn around in the context of a firm that's really performing well. When that starts to work as well, just think where organic growth can be. You're constantly challenging yourself to be better in every segment. You're making the right investments. You continue to execute on that. One area that you have been making investments in is digital assets, as you just mentioned. Can you give us a quick overview of your competitive positioning in this space and how your leadership in traditional rails translates to digital finance? Yeah. I think very important strategic focus for us. We've assembled a great team under Carolyn Weinberg over the last couple of years. Very important collaboration between Carolyn and Leigh-Ann, who's our CIO, engineering digital assets coming together. In a way, the way how I think about digital assets, is that it's in service of the firm. Because if you think of us as a financial services platform company at the center of financial markets, and we have the rails, we've been at the part of this for the last 240 years, and we want to write the next chapter. Each business has to think about how the next chapter is going to disrupt itself. Carolyn is really in service of all the lines of business in terms of how they, with AI, can disrupt over the next 5 - 10 years, and what is the consequential impact on P&L there. You're going to gain in some areas, you're going to lose in some areas, or you may leak in other areas. There's a lot of discussion like what does it mean for deposits, et cetera. All of that will evolve over time, and we believe by looking to support clients. You have some traditional clients who are not thinking about it. You have some clients who are digitally native, that's all they think about. They've come to our platform for thought leadership and are doing traditional business with us. We're kind of merging the two over time and working that, evolving that ecosystem because they're not distinct, where you're just going to cut from one to the other. The two will march in time. I would say, and this has been largely supported by the positive tone from the regulatory agenda and with this administration having a different view to that space. I just think that it's going to be very helpful to BNY because of the network effect that we have by being number one in a lot of the spaces. The world's largest collateral manager settling nearly 100% of the treasury market every day. Our payment rails are quite sophisticated, we will bridge that gap between the old and the new in a way that will be seamless for our clients, and I think that will allow more clients or attract more clients onto our platform because they'll want one-stop shopping and not have to worry about it, and we will deliver that resilient, safe, innovative product that will reduce friction for them, that will allow us to grow our platform and grow our revenue. I think our strategy will help clients and grow our business. One of the areas you mentioned for disruption, you spoke about deposits. A lot of your clients leave their liquidity with you, with BNY. How are you thinking about cash sorting in a world where you have more AI agents there? I think you need to think of cash sorting in two dimensions. There's the retail and there's the institutional. Our clients are already very, very sophisticated in terms of managing their liquidity. If you think of our deposit base as being two-thirds operational, it's a lot of velocity, a lot of movement supporting payments. We have a big balance sheet, we have a nice core set of deposits, but it's constantly turning, it's constantly being managed, and it's constantly being optimized by clients already. I don't really worry about the cash sorting so much for our set of businesses in a way that others do for theirs. Got it. All right. Perfect. I know we're reaching the end of our time. We've gone through a lot of the medium and longer term drivers for BNY. As we're thinking maybe to bring this more near term, rates have been moving around a lot over the past three months or so. How are you thinking about interest rate positioning for the balance sheet, and what impact does the higher belly and higher long end of the curve have on the income statement? Again, like taking the risk management hat, we talk about reducing the cone of outcomes. When we guided first in January, we kind of guided top line at the 5%. We didn't give a specific NII guide. At Q1, we talked about a 10% year-over-year. Feel very good about that guide. I said at the Q1 earnings that deposits probably moderate slightly into Q2. That's largely panned out as follows. Record sales quarter in Q1. Again, not necessarily expecting record sales quarter in Q2, but the client dialogue is very strong, and we feel very good about delivering that for the year. I would say we are largely on the impact of the rate environment on our overall portfolio. It's consistent with what I've spoken about before. We respond in a fairly dynamic way to it, look for idiosyncratic opportunities when they pop up, but largely feel pretty good about where we are vis-a-vis rates at the moment. Got it. All right. I think with that, we're out of time. Dermot, thanks so much for joining us. Pleasure. Thank you.