All right, I think we'll get started here. Good morning everyone, and thanks for joining this session with Goldman Sachs. I'm very pleased to welcome back again John Waldron, Goldman Sachs President and Chief Operating Officer, and also newly, or recently appointed member of the Goldman Sachs Board. Congrats on that, and thanks very much for coming back to the conference. Thank you for having me. It's always great to be here. Congratulations on another great year, great attendance, and I look forward to the conversation. Fantastic. Maybe John, we'll just start big picture on the macro. The operating environment, to put it mildly, is evolving. What is your current view of the current outlook, and kind of what are the key areas of focus for your clients? Okay. So, I mean, I think that we're seeing a pretty disruptive change in U.S. policy. You know, the Trump administration is definitely disrupting a lot of what would be the conventional wisdom of how U.S. policy making, you know, traditionally goes. The trade policy obviously has gotten the most attention, for good reason. I would characterize their trade policy position at the start, you know, let's say around Liberation Day, as a maximalist approach. I think we're now shifting to a framework that appears more manageable for global economies to adapt and adjust to. Still higher tariff levels, but more manageable. I don't think this is gonna be a straight line from the maximalist approach to the more manageable. I think there's gonna be a fair bit of volatility along the way. You'll see individual tweets on tariffs. We saw overnight, you know, court challenge. That won't be the last of that. I'm sure that'll ultimately get to the Supreme Court, and there'll be an adjudication. We're gonna learn a lot more, and it's gonna be volatile. I think we're just gonna have to live with that volatility, you know, for some time. I think we're gonna go towards a 10% universal baseline tariff, with individualized targeted tariffs on top, with individual countries. We're about to see a series of those trade deals. We'll see how the court ruling, you know, kinda impacts those discussions. Our economic research would suggest that effective tariff rates are somewhere between 10% and 15%, which is up from 2%, you know, before the Trump administration began. We're obviously living with higher tariff levels. I think that means we're gonna have short to intermediate-term slower growth, higher inflation. You know, we kind of term that slowflation. That's kind of the scenario that we think is the baseline scenario. I would have to say the U.S. economy and the U.S. consumer is showing tremendous resilience. Somewhat surprising to me, but I think you have to say the resilience in the economy is pretty pronounced. We still have a significant fiscal impulse. Right. We still have very strong employment. We're moving, as we said, towards more manageable tariff levels. I think that all likely leads to economic growth. I think we're likely to avoid a recession with this baseline set of facts. The volatility remains, and so it's still a little bit uncertain. I would say in parallel, we now have a big U.S. budget debate. While all the attention was on tariffs, I think the attention rightly is shifting, certainly in the bond market, to the U.S. budget debate and the fiscal picture, which I would characterize as somewhat concerning. I think that we're gonna run larger deficits pretty clearly, as far as the eye can see. We're gonna have more U.S. Treasury borrowing, which you can see in the bond market, is starting to, you know, have some implications for how people feel they wanna price the treasury rate, particularly on the longer end. I think the big risk on the macro right now is actually not so much tariffs. I think we now better understand the, the, the kinda guide, guideposts where we're, where we're gonna land on tariffs. I think the big risk is longer-end rates continuing to back up, and the cost of capital in the economy rising, and fundamentally that becoming more of a break on economic growth as opposed to an accelerant of economic growth. Okay. Slowflation, deficits, higher rates, sounds like a, a tough, tough backdrop. How are we thinking about your strategy at Goldman Sachs, and any changes in light of the operating environment? We have had a strategy that I would say has been very consistent for a number of years now, and it really has three key pillars. First is to harness what we call One Goldman Sachs, which I hope we will spend some more time talking about later, to serve our clients with excellence, really to drive continued improvement in our wallet shares. That is kind of fundamental pillar number one. Pillar number two is to run world-class, differentiated, and durable businesses. We have two large businesses: global banking and markets, and asset and wealth management. We believe that they are both differentiated. They are both becoming more and more durable, and we are increasingly going to demonstrate the synergy between them, which will be an important element of our strategy going forward. Third, and equally important, is to invest to operate at scale. What that really means is driving automation and operational efficiencies through the firm to drive higher margins, higher returns, and better financial outcomes. We are clearly in a dynamic and highly uncertain environment, but our strategy remains very clear and consistent, which is important. We do not really want to deviate our strategy. We think we can run this strategy through the volatility and the challenges and the dynamism that are going on around the world. When laser-focused on execution, and feel very good about the progress we have made over the last couple of years and see a fair bit of growth and opportunity in the forward. I would say our strategy is really set up to drive higher share of wallet with our client franchise, more durability in our earnings, and higher returns. Okay. I would just say as a compliment, just last comment, 'cause, you know, we talk a lot about strategy in a more tactical sense. I just, at a higher level, in terms of obviously executing on that strategy that I just outlined. J ust a few things that I always think about that are important to remind, remind everybody about Goldman Sachs. Goldman Sachs is really one of the premier brands of any business on a global scale. We have an extraordinary talent factory. We have a unique culture. We have a premium client franchise. We have over 156 year history of proven track record of delivering through cycles, no matter what the weather environment is, we will deliver. I think that's important to just keep that in mind in the context of our firm. Good stuff. Yeah. I do wanna dig into One Goldman Sachs and automation later. Just before that, how are you thinking about risk management in this environment? Are you seeing any pockets of stress that are worth noting? Yeah. I would say, again, we're, as I just said, we're 156 years old. Risk management is core to our firm. It's a core competency. It's a core part of our heritage. We have a deep-rooted risk management culture in our firm. And I think a demonstrated history of doing really well managing risk through some pretty difficult periods. To us, risk management is what happens before the unexpected risk event unfolds. So it's a lot about people, processes, and preparation. We spend a lot of time before the risk event happens, making sure that we have our act in order. We have extraordinary experience in our firm. Our senior risk managers, for the most part, have been doing this for 20 to 30 years, some of us longer. And so we benefit from a lot of experience, which means we've seen a lot of cycles. We kinda know what patterns to look for. Importantly, we empower our risk and control functions as equal to the businesses. That's a really important element of the firm is there's a real balance between those that are on the risk and control side and those that are more on the commercial side. We have a very well-organized risk infrastructure in the firm. We do extensive modeling. We have clear risk limits across different elements of the risk components of the firm. We do broad-based stress testing. We have a mark-to-market culture. We like to know kinda what we think at any moment in time a position or a set of positions are really worth in the marketplace if you had to liquefy them. We have many eyes across the firm-wide risk positioning, you know, from different elements so that we're not reliant on one set of eyes or one, you know, set of biases. I would say at the moment we're relatively defensively positioned. We've got heavy liquidity. We've got significant capital buffers. We're running more muted risk in certain and important pockets in the firm, given the uncertainty and the elevated volatility we talked about a moment ago. I would say our experience tells us that the full impact of this disruptive policy change that we think is going on more broadly takes time to materialize. You see first-order impacts right in front of you. The second and third-order impacts take longer to work their way through markets. We're watching carefully for those second and third-order impacts, which is another reason why we run, you know, a little bit higher buffer and a little bit more cautiously in an environment like this. In terms of areas to watch, there are many. I would say if I had to pick one, it would be leverage in the public sector. I think coming out of COVID, the public sector stimulus from governments around the world to, to rejuvenate the economy was really, really important. That's led to an enormous amount of leverage in governments in many countries around the world. We're starting to see some elements of that public sector leverage play through. There's a lot less fiscal headroom in the world today than there was, you know, back when we were coming through COVID in a pretty peaceful environment, relatively peaceful environment. we've got, I think, some risk of dislocation in bond markets, particularly as you go out in duration, which I think bears more, you know, more watching. Okay. How do we think about that in terms of near-term activity, given your defensive positioning? Any comments on quarter-to-date activity in investment banking and markets? Our franchise is performing very well. Not surprisingly, the second quarter is not quite as strong from an activity level as the first quarter, given, you know, the macro environment we talked about at the beginning of this conversation. In investment banking, our engagement levels are actually still very good, you know, despite the uncertainty and the, and the volatility. Our pipelines remain quite strong. Elevated volatility in investment banking terms really creates uncertainty on the timing of execution of transactions. When you have this kind of volatility, you just fundamentally have a harder time prosecuting transactions that may be in your pipeline, but they do not happen as quickly as you might otherwise expect. I'd say the M&A market is showing strong resilience. There is a lot of pent-up demand for M&A, you know, in the world. There is more resilience than you might guess, given the backdrop in the capital markets arena and equity capital markets and high-yield capital markets. Activity levels were much slower in April than they were in the first quarter. I'd say we've seen in recent weeks a real pickup, you know, in both equity capital markets and high-yield capital markets, which is a good, you know, sign that things are starting to heal. In FICC and equities, our client activity has remained robust really pretty much throughout the year. I'd say particularly in equities. In FICC, we're seeing slightly softer levels of activity versus our strong results last year at this time. We will see how the rest of the quarter plays out. We still have, you know, a fair bit of the quarter to go. In asset and wealth management, in equity and debt investments, given this elevated volatility, as we discussed, it's a much tougher harvesting backdrop. And so similar to last quarter, the same kinda basic dynamic. I expect results this quarter to also be more muted. Okay. Very helpful. Let's then dig into the client franchise and One GS. I think it's six, seven years ago at this conference, you debuted some of that stuff to the public in something that you've backed heavily. So just give us an exa—give us some examples of how One GS is helping drive, you know, wallet share gains across the business, how it's a differentiating factor for Goldman Sachs, in terms of commercial outcomes. And then looking forward, where do you see—where do you go from here? Okay. One Goldman Sachs is pretty fundamentally important to our strategy and our execution. Just a quick explanation, maybe a touch of history, just to put it in a little bit of a frame. When we started leading the firm over six years ago, we wrote a memo to the firm that outlined One Goldman Sachs. It had three basic priorities. These are pretty simple, but they're important. First was client centricity. We felt that the balance of the firm between clients and our own worrying about ourselves was off. We wanted to put clients back at the center of everything that we do. The second key priority was holistic service, integrated approach to clients, meaning we cover clients as a firm. You get all of Goldman Sachs. You don't get a desk, a product, an individual. You get the entirety of the firm, which sounds easy and obvious, but is much harder for banks of our size often to deliver. The third was to have a long-term focus. We felt that the lens of our focus on our clients was too short-term. We were too focused on short-term transactional activity and not enough focus on the long-term relationship and building partnerships with our clients. Those were three important priorities. We laid those out as priorities. We knew that we had two major areas of focus that we had to deliver to execute upon this. One was to desilo the firm. We had tall walls between businesses. We did not really have as much horizontal working across platforms in the firm to serve our clients. Our incentives were probably not perfectly aligned to deliver upon those three, you know, key priorities. To start, we built a program that had 30 clients. And the 30 clients was really a pilot program. These were large, multidimensional clients that would touch the firm in many different areas. We prosecuted that pilot program to prove to ourselves and to our clients that we could actually deliver more value. That pilot went well. We subsequently expanded that pilot to over 100 clients, which is kinda where it is now. Again, these are large-scale global clients that touch us in multidimensional fashion. This now, I would say, has really become the operating ethos of the firm. Even though we have this program with these 100 or so clients, really in every client interaction, this is the fundamental way we try to serve our client base. It has really, really worked, consequentially in terms of our share of wallet. Our wallet share gains are now over 350 basis points from the time we started this in 2019 through the end of 2024, in a hotly competitive, you know, intense environment. It's not as if we've got weak competitors. We're running a couple of programs that are focused on particularly our large institutional clients, the top 100 clients, the top 150 clients. The essence of those programs is to make sure that we're really ranked in the top three with those large, most important clients that do the most business, you know, kind of on the street. We started that program in 2019. We were running in the top 100 with 44, ranked 44 with top three ranking and with 44 of the top 100 clients. That went to 77 or so. When we expanded it to the top 150, we were at 75 or so. We were now at close to 120. So we've really improved our ranking from not in the top three with too many of those clients to in the top three with most of them. It's clear that it's working. I would say now One Goldman Sachs is really about proving the synergies between banking and markets and asset and wealth management. In the strategy question, I outlined, you know, how we wanna try to drive that synergy. That's the 2.0 strategy of One Goldman Sachs. There's a couple key elements. One is to source more deal flow, particularly from our investment banking business, but increasingly from across the firm for our private asset franchise and asset management. We run a large private equity, private credit, real estate infrastructure, growth equity investing franchise. We can source more deal flow from our investment banking business and otherwise to drive more alpha generation in that business. We can drive more referrals between wealth management and investment banking. We are measuring those referrals both ways where we have relationships that help, you know, and we help our clients be able to do more with the firm and we deliver more value for our clients. We think we can do a better job raising capital from our limited partners by virtue of a much broader set of holistic relationships where we are serving them in a number of different ways. We are sharing risk management capabilities between the two businesses, which is increasingly important to think about risk more broadly across those two important businesses in the firm. We are sharing talent, a lot more talent mobility moving between the two businesses, which is increasingly important. I see very good early signs of success and progress in the 2.0 part of One Goldman Sachs. I think One Goldman Sachs has been definitional to our success thus far. I think we'll be an accelerant to our future growth given that synergy between the two businesses. Okay. Let's go back to the competitive landscape and go and talk about each business. In an investment banking business, obviously, it's been a great franchise for Goldman Sachs, a very global one. In a world where you have geopolitical, political tensions, tariff questions. H ow are you seeing the competitive landscape, particularly in areas like Europe? Yeah. I would say our investment banking business is very strong. I think the outlook remains quite good. I've been traveling a lot this year, kinda all over the world, seen a lot of corporate clients, larger clients, more mid-market clients. The pipeline is strong all over the world. There's a lot of bias for action and activity. As we've already said, the elevated volatility makes it hard when you think about it spot to feel great about what's gonna happen this week or next week. If you take a slightly longer-term lens, you can see with strong pipelines and the need for companies to raise capital to deal with some of the dynamism, to do M&A transactions, there's a fair bit of a positive bias to transactional activity. It just may take a little longer to materialize. As we said, the M&A market is more resilient. Much gets said about the volumes in the M&A market just to level set in reality. In the sector above $500 million, which is the M&A market we tend to focus on, so transactions above $500 million, volumes are still up 30% year- to- date. Obviously, in the second quarter, it's been much slower than in the first quarter. That is biased by a stronger first quarter. Nonetheless, even post-liberation day, we've worked on a number of very sizable, important M&A transactions: Worldpay, NRG, Sunoco, and more recently, Informatica, which are sizable transactions that have gone very, very well. The market has absorbed them quite well. I still think there's a pretty strong, resilient M&A market. If we get a little bit more certainty in the backdrop, you know, you could see a pretty good size lift in volumes. Private equity activity, which is an important component, probably 30+% of the M&A market today, is still very good. Activity's picking up. We're seeing steady flow. There's a lot to do. There's over $3 trillion of enterprise value sitting in private equity and venture capital portfolio. Hence, t hose entities have to get transacted upon. There's an enormous forward pipeline that is there. Obviously, more certainty, better economic backdrop will allow us to prosecute more of that sooner. Large-cap consolidating transactions, which are also an important feature in the M&A market, are harder to do right now for a variety of reasons. Many of these industries will consolidate further. It's pretty clear to me that scale is becoming an even bigger element and factor in many of these industries. And we see in our dialogues a bias for more consolidation. It's really just a question of timing. I wouldn't be overly bullish, bullish spot about large-cap consolidation, but I would be very bullish in the intermediate to longer term. Capital markets, as we said, started more muted in the second quarter than the first quarter. As I said, we've seen signs of improvement. We priced eight IPOs last week. That's a pretty good sign that things are starting to thaw. Our pipeline remains very strong. I think just a matter of time on the capital market side as it is on the M&A side. Most importantly, what we measure, we tend not to get too hung up in the short-term gyrations around activity. We tend to focus on our pipeline. We tend to focus on the, the strength of our relationships. I feel exceptionally good, particularly as I've been traveling around this year about the strong client franchise that we have in investment banking, which I think is really in tremendous shape. Okay. Good stuff. Moving on to the markets business, probably where we've seen the most significant share gains and probably where there's the most skepticism about sustainability long-term. You know, what gives you confidence in the resilience of this business, over time, particularly in a very uncertain micro backdrop? Yup. I grew up as an investment banker. I had more comfort with the dynamics in investment banking. I have to say, now having spent close to seven years, you know, really living inside those markets businesses, they are much more resilient, much better equipped to be more predictable than the marketplace gives them credit for. I think if you look at our results, particularly over the last five years, we've really delivered almost every quarter very strong results in extremely different market environments, a lot of different weather environments that we've been through over the last five-plus years. Still, we're delivering quarter over quarter, which I think, and I've learned, is really because of the strength of having breadth across all businesses all over the world. You have to be big and strong in all different elements in these markets, in these markets businesses because you never know in any quarter which part of those businesses will be more in favor and which part of those businesses will be more important to clients who need to, who need to prosecute their activities. Having that strength really clarifies that you are more important to your clients, back to the One Goldman Sachs ethos. You can deliver and execute for them across anything they wanna do anywhere in the world at any time. That's a really important thing, which only a few firms really have that capability. We're certainly one of them. We've also grown our financing footprint in our markets business considerably. We've seen over a 15% compound annual growth rate in our financing activities in our markets business, which used to be very heavy of risk intermediation business. Today, over 30% of our business is now prosecuted through financing activity, which really is business that is more durable, it's stickier, and it really strengthens our client relationships meaningfully. With One Goldman Sachs, we've seen tremendous wallet share gains as we talked about. I think the floor of that business is just idling at a much higher rate. With 300+ basis points of share, you're just running at a higher level of share of wallet and a higher level of activity. With all this skepticism about the industry wallet, the industry wallet's grown a lot over the last five years. The industry wallet over the last five years is kind of an average of $135 billion. The prior five years before that, it was more at $100 billion. You have seen pretty good size growth in the wallet. Our shares are a lot higher. Our positioning in this business is materially stronger. I'd say our risk intermediation activities, which historically have gotten a lot of attention as more volatile, have become much more consistent. I think that has a lot to do with One Goldman Sachs, better client relationships, more financing. I think having this breadth and strength across all the different elements of the business. When we look at our risk intermediation business, we do a standard deviation of our results over the last five years. That standard deviation is 6%. If you went back to prior 10 years, it's 24%. You're talking about a business that is much more banded with higher share of wallet and, and actually growth in the industry wallet. We feel, we feel quite, quite good about what we've seen over the last five years. When we look forward, we see significant opportunity for America. Even though we've grown our wallet shares considerably, there is opportunity, which gives me optimism we can really keep going. There are many areas and segments of the business, insurance, where we really have had suboptimal share and we're starting to see real improvements in share, active ETFs, where I'd say hand on heart, we were a little slow to get going there. We're really starting to build and see significant growth in that, in that business. Retail wealth, which has not historically been a hallmark and a strength of Goldman Sachs, we're doing much more to serve the retail and wealth client. Corporate derivatives, where we continue to build bigger businesses and are doing really well. Asia- Pacific, more broadly, I just came back from Tokyo and Korea. I was in China the month prior. I see our business in Asia- Pacific continuing to grow and take share. We have a lot more running room there than we certainly do in the United States and Europe. There is a lot of opportunity ahead. I think you'll continue to see us grow share, grow our financing business. This platform, I think, has plenty of running room in front of it. Okay. Let's switch to the asset and wealth management business. Spent a lot of time on that last year. Has anything changed in how you're positioning that business, particularly again, given the sort of macro market backdrop? Yeah. As you said, when you and I were together last year at this conference, we spent most of the time, you know, trying to feature this business. I would say our strategy has not changed at all from that conversation and is not likely to change in the near future. We've got, just as a reminder, we've got a large-scaled franchise with about $3.2 trillion in assets under supervision on the platform. What's unique about our platform is we're very sizable in liquid active asset management. We're also sizable in private assets and alternatives. Most firms are big in one, not in the other. We have scale in both. We have a full suite of solutions that we can offer our clients, whether they're institutional clients or wealth clients in either public markets, active or private markets, which we think is a pretty unique position. We also have a super attractive wealth management platform focusing on the ultra-high net worth wealth management clients with about $1.6 trillion in client assets on that platform. That's the integrated asset and wealth management business that we're running today. We're really working hard to have an integrated platform. This was an amalgamation of three different businesses in the firm that over the last three or four years we've put together and pulled into this unified business. We're really trying to serve institutional and wealth clients on an integrated platform that is more of a chassis that can really run and, you know, a scalable franchise on top. We're focused on capturing secular growth opportunities in what I would say are three key areas that we, we think are really interesting. One is obvious, which is alternatives and private markets. Many people talk about that. We're not alone. We have over $2 billion in management and other fees in, in private markets alternatives, growing double digits. That's up from about $1 billion five or so years ago. That business continues to grow. We see a lot of running room there. Wealth management, really two components. We have our own, as I said, ultra-high net worth business, which is a tremendous business, growing double digits. It's really a jewel of a business focused again on the wealthiest people and family offices in the world, benefiting from a lot of secular growth as wealth continues to grow in the world. We're gaining share. We've got, we think, the best business in ultra-high net worth. Many people can, you know, suggest they can compete for that. We see we're underpenetrated still. There's a lot of share gain that we see there. Away from our own ultra-high net worth platform, we've got a big opportunity in third-party wealth, where increasingly we're putting Goldman Sachs solutions on other people's wealth platforms. I often joke, or say, that our single biggest strategic partner in wealth is Morgan Stanley. Right. Which, you know, some people kinda say, "How could that possibly be?" They have been a fabulous partner. We have a lot of Goldman Sachs solutions on their platform and increasingly on many other wealth platforms. That is going really quite well. We see a lot of secular opportunity there. That is another double-digit growth opportunity that we see in front of us. The third area would be what we call solutions more broadly, which really speaks to more customization in important areas like direct indexing or tax loss selling, where we have a very strong product offering, active ETFs, where we continue to grow our capabilities, and multi-asset solutions, whether it is OCIO or other multi-asset capabilities that, again, offer double-digit growth opportunities across our asset management platform. This asset and wealth management is going to be a significant growth driver for the firm. We have management fees now in excess of $10 billion against a firm that had about $54 billion of revenues. Our private banking and lending revenues are now about $3 billion, growing at about a 13% compound annual growth rate over the last five years. Between management fees and private banking and lending revenues, we're at over $13 billion of revenues. We characterize those as more durable revenues. We're really managing towards growing those more durable revenues at an accelerated pace. We've grown that durable revenue category at a 12% CAGR over the last five years. We think we can continue to grow it at a high single-digit to 10% rate for the foreseeable future. We're pretty bullish about our ability to continue to grow that durable revenue base, which adds to a lot of durability and stability in the firm. We think that asset and wealth management is a pretty unique opportunity. You look at a lot of businesses, this is a business that can grow revenues, high single digits. It can expand margins and drive much higher ROEs in that business and obviously throughout the firm. Our margins are now roughly at our initial target rate of mid-20s. Our ambition is much higher than that. The margins should be higher than that. We're still in the process of integrating these businesses and growing these businesses and getting to scale economies. We've got to drive to higher margins. Last year, asset and wealth management represented about 25% of our firm's profitability. We will continue to drive that higher. Our job is to continue to drive that to be a high, a significant portion of the firm, much larger than 25% over time, which strengthens the durability and predictability of our earnings and will continue to drive our firm-wide returns higher. Okay. Let's talk about a couple of initiatives that the firm has announced. I think one is the Capital Solutions Group that you announced earlier this year. Remind us again, the rationale behind creating that and ultimately, any progress so far and how should we measure progress going forward? Yeah. This is, to me, the best current example of One Goldman Sachs in action. We pulled together all of our wholesale financing businesses across the firm, which we were prosecuting in various parts of the firm into one unified platform. We called it the Capital Solutions Group. This is really the combined power of all of our origination and sourcing capabilities, plus our risk management and structuring capabilities, plus our distribution capabilities in one place. We have an integrated team now that are advising our clients, corporate clients, institutional clients, etc., across a range of alternatives for their financing. They can look at public capital markets. They can look at structured private markets. We can do that all in one meeting. We can show them the full panoply of, of alternatives that suit them most, you know, most importantly. We have a broad base of relationships with a number of asset allocators all over the world. Our job here is to partner with those asset allocators as we continue to source and originate interesting opportunities. We will partner with our clients all over the world and create interesting opportunities for them based on our sourcing. We see enormous financing needs globally. I mentioned earlier that the public sector is more levered, has much less fiscal headroom. The world needs enormous capital. There are kinda three themes I would highlight. There are many other places where capital's needed, but to me, three big super themes. One is obviously AI and the need around investment to drive this generative AI explosion that we're seeing. Two, which is a corollary of that, is power and energy. Power and energy more broadly, there's a big, large amount of growth. A bunch of that will go to fuel the AI, the AI boom. Three is just raw physical infrastructure, including in places like the United States, where we have a lot to do from a raw physical infrastructure standpoint. Certainly, in a bunch of emerging markets around the world, there's enormous needs. We think origination is the scarce resource and the driver of value. There is tons of capital out there. Origination is what's in short supply. Goldman Sachs benefits from powerful sourcing. We have, we think, humbly, the best origination sourcing capability in the world. Now we have it housed in one place. Our job here is to turn that sourcing into opportunities that serve our clients as well as serve our asset management franchise, sometimes catalyzed by our own balance sheet to make these transactions go. We will drive more client business through this sourcing. We will accelerate the growth of our asset management franchise at the same time, which really is a clear example of One Goldman Sachs 2.0, helping our clients and driving our asset management business and doing that in a symbiotic fashion. You have to have the sourcing and the origination in order to execute upon that. I would say we're probably two months in, or so to, you know, to the Capital Solutions Group platform. In that short period of time, we're seeing a number of quite interesting and I would say very sizable opportunities that are inside our firm right now, reflecting the power of this effort. I think over the course of the summer and the fall, we're gonna have some very interesting transactions to talk about, which kinda demonstrate the power of what we're trying to put together and how we can serve our clients as well as our own asset management ambitions symbiotically. Sticking with the financing theme, fix financing has been another source of real strength for the business. Remind us again the sort of macro dynamics to the driving growth in fake financing, how you think about growth going forward. Whenever investors hear financing growth, people worry about risks. Sure. Talk about that as well. Yeah. fix financing really I would characterize as collateralized lending, really providing financing to our clients secured by assets of some type. The way we think about it, there are really five sleeves that we really look at as the drivers of fix financing and that collateralized lending. First is capital calls and net asset value lines for private alternative asset managers, which is an explosive growth opportunity. Second is commercial real estate. Third is residential real estate. Fourth is private credit more broadly as a narrowly defined opportunity set. Fifth is consumer finance. We've seen multi-faceted growth actually across all five of those sleeves as we see tremendous financing needs across the economy. The largest area of growth undoubtedly in those five sleeves comes from the AUM growth of alternative asset managers. Global private capital AUM is now upwards of $13 trillion at the end of 2024, growing at about a 13% rate over the last five years. That is expected to grow to $23 trillion over the next five years. That is an extraordinary amount of growth in private capital hands. All of that growth needs to be financed. None of that growth comes without any leverage. The leverage attachment points can be different depending upon what those alternative asset managers are trying to achieve, but it all needs to get financed. There is an enormous underlying backdrop of financing that we see as a super attractive opportunity. This will feed our financing of private credit, which is one of the sleeves. It will feed our financing of capital call facilities. It will feed our financing of NAV loans, GP Financings, etc., etc. There is a lot to do in and around financing that growth in AUM. We also think there will be continued growth in consumer finance as the economy continues to expand. There is obviously tremendous growth in residential real estate all over the world. We are starting to see some signs of recovery in commercial real estate, which has obviously been a tougher area, but we are starting to see some signs of growth there. There is enormous leverage in there that needs to get recapitalized. There will be some interesting opportunities to finance the recapitalization in CRE. You mentioned risk. We talked about risk earlier. We are laser-focused on risk managing this book. Most of what we do here is investment-grade credit. It is important to say that essentially we are financing investment-grade rated structures, and most of this is highly structured and highly risk-managed. We manage our leverage attachment point carefully. We're constantly looking at what is our loan-to-value, and we're constantly scrutinizing value. One place people get in trouble is they fail to scrutinize value. They think about loan-to-value, but they fail to scrutinize the value part. We have very strict underwriting criteria. We're highly focused on what are we really doing and what are we not doing. We benefit, as I said, from a lot of origination. One value of that origination is you do not have to do everything you see. We see a lot. We do very little. We're really picking and choosing the things that we think are most interesting, most attractive, most helpful to our clients that we're willing to risk manage and absorb. That's important. We spend a lot of time on concentration risk. We do not like having overly concentrated risk. We're hugely focused on diversification, and we do an enormous amount of tail risk modeling. What could go wrong from a macro that would start to impact any of these themes that we've talked about? I would say we feel very good about the complexion of this risk profile. We stare at it a lot. I certainly spent a lot of my own time on it. We'll risk manage this appropriately over time. I think you'll see us continue to grow this business, but it will grow more prudently. It will not grow likely at the rate that it's grown over the last five years. I think you'll probably see us migrate more of that growth into funds so more of this activity can live in asset and wealth management over time, which is a capital-lighter, more efficient way to attack what I think will be continued growth in the overall opportunity set. We'll probably approach it, you know, a little bit differently over time. Interesting. Sticking with the financing theme, clearly private credit, direct lending has been a key trend. I think Apollo was presented just before you. Can you talk through your positioning on private credit and then growth opportunities going forward? Sure. This doesn't get as much attention. Certainly, a firm like Apollo, you know, would run assets at $700 billion or so in private credit. We are a large player, not that large, but a large player. We're one of the larger players. We've got about $140 billion of assets on our private credit platform. We're scaled. Importantly, we've got over 30 years of experience of doing this. People think about private credit like it was, you know, started last week. This has been around a long time. It wasn't called private credit back in the day, but we've been doing this for quite a long time. We've got a very strong track record navigating through credit cycles. We haven't seen a credit cycle in a while. I'm sure we will see one at some point, but we've seen them and we've risk managed through them. We've got a very broad set of offerings. We do a lot of senior lending. We do a lot of hybrid lending. We've got a big mezzanine business. We kinda run the gamut from senior all the way through to mezzanine. It's, to me, quite strategically important, particularly in this day and age as we've talked about all the growth in private credit, to have the capability to go to a client and offer them a capital markets public solution alongside a private credit solution and to have all that in-house. We don't have to outsource it. We don't have to JV with anybody. We don't have to partner. We have all those capabilities in-house. Strategically very valuable for us and increasingly valuable for our clients. This private credit platform will be a big beneficiary of the Capital Solutions Group. You asked me about the Capital Solutions platform. Private credit will be a big, big beneficiary of the origination that comes from that capability. We have a stated ambition to grow our private credit from $140 billion- $300 billion. Certainly gonna see enough market growth for us to get there. It'll be incumbent upon us to execute effectively. You know, I think that the opportunities are really centered around kinda three broad areas. One is asset-based finance, which often gets termed private IG or private investment grade. There are a range of estimates out there. This is a $10 trillion-$30 trillion marketplace. You think about all of the liquid fixed income that sits on the balance sheets of insurance companies, pension funds, and other asset allocators. That is the addressable market where you could offer a private investment grade opportunity that might have a higher yield, a higher level of alpha, well-structured, as a component of your liquid fixed income or your broad fixed income bucket. This is an area of particular unique sourcing for Goldman Sachs. I think we will do well here. The second area is what I would call hybrid capital, where, as we talked about, there's all this enterprise value in private asset owners' hands. All that enterprise value has got levered balance sheets. Those levered balance sheets have to be adjudicated. They're either gonna be adjudicated through an M&A transaction, or they're gonna have to get recapitalized, or resorted in some way. There's enormous opportunity for fresh capital to come in and to be a new player in, in that capital structure. We will be really well-positioned to do that based on our platform, our origination, and our capability in hybrid capital. Third-party wealth, which we talked about earlier. Third-party wealth is the untapped enormous growth opportunity for private credit. A conservative estimate of U.S. advisor-managed assets would be $35 trillion. 2-3% of those assets are managed in alternative forums. There is an enormous opportunity for that 2%-3% to grow. Every 1%, if you take that $35 trillion, is $350 billion of asset growth. There is significant runway in the marketplace to scale in private credit more broadly. We think plenty of runway for us to get to $300 billion. We are obviously always analyzing risk and mindful of credit cycles. I said we have a demonstrated track record of navigating through those cycles. I think you should expect if there is a credit cycle that Goldman Sachs will perform exceptionally well relative to that cycle. Great. Let's switch to talent. Goldman obviously is known for its, its, it's a talent bench both at the top and through the organization. How does Goldman stay competitive from a talent acquisition perspective and making sure that remains a differentiator for the firm? Yeah. I appreciate this question because I think we spend a lot of time talking about financials, and we don't spend enough time talking about what makes the place go. I think talent is an enormous important differentiator for Goldman Sachs. People and culture have really defined our success over our 156 years. We are consistently investing and attracting, retaining, and developing great talent globally. We attract extraordinary talent all over the world. The numbers are almost hard to believe. We have 875,000 applicants for experienced hire positions in the firm. We hire less than 1% of those people. Similarly, at the more junior level, we have 300,000 applicants for our summer internship programs. We hire less than 1%. We are very choosy in terms of who we wanna bring into the firm. I spend a lot of time, as a number of our senior leaders do, on campuses. I have to say when I look at campuses and I look at our young people that are in the firm already, the quality of the young professionals we have in our organization has never been better in my 30+ years in the business. Maybe, maybe it was before, but it isn't, at least in my experience. Our brand is exceptionally strong on campuses right now. I'm really pleased when I go to a campus and I see the outpouring of interest and focus on Goldman Sachs, which I think is important for us to continue to have that talent generation at the, you know, at the front end. We make a significant investment in leadership and development. We obviously wanna attract the talent, but then you've gotta do something really effective with the talent. We have something called the Pine Street Leadership Academy, which we've had for a number of years, and we make a big investment there. We have a concerted effort to invest in culture. COVID was hard for us because we were not physically connected, and this firm really operates best when we're physically connected, which is why we were so ambitious in trying to bring people back to the office. We ran something called the Cultural Stewards Program, which started with the partnership of the firm at the most senior level to really define and narrate what is the culture of Goldman Sachs in the modern era. What do we want it to be for the next five, 10, 15, 20 years? We started with the partners, and we are now working our way through the firm to make sure that that cultural stewards concept and narration really drives throughout the entirety of the firm. We do an enormous amount of succession planning. We now succession plan for about 300 of the top roles in the firm. We just made a series of promotions onto our management committee, reflective of really a next generation of succession planning, and a next generation of leadership coming through the Pine Street Leadership Academy as well as our leadership succession planning process. This is an extraordinarily impressive group of professionals coming from all walks inside the firm that I think will be really instrumental to the growth of the firm in the next five to 10 years. We are obviously focused on compensation and wealth creation over time. It is important to think about it as wealth creation over time. We are living in a very competitive talent market. Goldman Sachs talent is hugely attractive to outside parties. We are investing to ensure that we remain at the top of that pyramid from a wealth creation standpoint so we can obviously retain and grow and develop that talent if we want to. Good stuff. Expenses, maybe not as sexy a topic. How, how you imagine expenses in, in this environment? Yeah. Not as sexy a topic, but a very important topic. I feel certainly in my job, I feel like we're always navigating short-term focus on expenses to drive better financial performance with a clear need to make long-term investments to make the firm stronger over time. That balance and that tension's a healthy balance, and we're always navigating. I think we've proven over the last handful of years to be pretty adept at balancing that tension. We are driving better ROE performance in the short term, which is important. We're also making, I think, really important strategic long-term investments in the firm to make the firm better, you know, three, five, 10 years from now, which is important as stewards of the firm and also important for our shareholders over time. Currently, we're working on a three-year efficiency plan. There are really three areas of focus there. One is what I'll call organizational structure, which is kind of your traditional spans and layers and pyramid work, which we always are looking at, and we're doing a refresh of that right now. Second is spend management. We're doing a lot of work around vendor, managing, purchasing. We actually hired a Chief Purchasing Officer for the first time in the firm's history. We are doing some work around our spend. Then automation, which is elusive. Certainly as a Chief Operating Officer, I always find it more elusive than I would like. I think probably the most important long-term productivity enhancement in the firm, and I think really important that we get it right. This kinda three-tiered approach to operating efficiency will definitely result in some short-term cost savings and should improve our, you know, our returns in the short term. I think even more importantly, it will create, if we do it properly, consequential gross efficiencies over time. That gives us the flexibility. We're using gross efficiencies as an important term. It's purposeful, because it gives you the flexibility to either bank those efficiencies as savings or invest them back into the firm, to drive better returns and better cap, you know, better outcomes over time. This, to me, is a really good example of us investing to operate at scale, which was the third pillar of our strategy. This really is driving scale economies, driving margin improvement, and getting higher returns on capital. This is, while not sexy, I think incredibly important for us. Right. Speaking of automation that's elusive, maybe AI might, might help, solve that. Yeah. Curious what you're seeing so far in terms of sort of practical. Yeah. I would say, we have a very clear investment plan, across a large number of use cases. We started with an enormous number of use cases, and we whittled it down to the use cases that we wanna spend money on. We have built our own platform, which we call the GS AI platform, that enables us to run the latest models, securely and responsibly and to drive business-specific AI solutions with tooling, you know, on top of them. We think having a human in the loop is really important. We would characterize it as a critical safety control and also an important way to make sure that that tooling is being utilized properly. We have kinda got a two-pronged approach. We're scaling that GS AI platform quickly, but we're also utilizing important strategic partnerships with some of the obvious players out there, which gives us access to the best external capabilities and the latest, most important and impressive models so that we can use our data, use those models with our data, and actually get the best possible outcomes and continue to be on the front edge of what's happening quite quickly. The earliest signs of progress we see are in software development. We're driving over 20% productivity gains with our coders who are developing and coding with this Copilot tooling. They're seeing, you know, quite robust gains in productivity. I think we'll start seeing some real progress this year in areas that include knowledge worker productivity. We generate a lot of content in the firm. You can imagine the knowledge workers and the content creation that we do, research, analytics, quantitative investing. You know, those would be some areas that I would highlight where I think this year in our plan, we'll start seeing some of those efficiencies coming through. It'll be better in 2026 and 2027, but this year will be the first, the first year of progress. I'd say importantly, we're beginning to experiment with the agentic tooling, which really, you know, it's early, and you don't wanna be overly optimistic too soon. You know, we're seeing some pretty early signs of enablement of this tooling to give you the ability to do multidimensional processes across the firm with many fewer people, and have a much more automated, you know, kinda series of processes. I'd say overall, we're gaining a lot of confidence. We expect AI will continue to become a significant tailwind in the firm. We're gonna invest to automate, and we're gonna drive efficiencies and productivity gains. Really, the question will be, how do we reinvest those productivity gains back into the firm over time? Okay. Given we're nearly out of time, I'll try and squeeze one last one in here. We're just bringing everything together here. How do you think about some of the targets that you've already put out, in terms of re-evaluation, higher, lower? We put out targets quite a while ago now that are really mid-teens return targets through the cycle. We still feel very confident we can execute to that level. We have, as I said, these two large businesses, global banking and markets and asset and wealth management. They're both performing very well. Global banking and markets now delivering demonstrably through different weather environments, mid- to high-teens. I think that's important to just kinda restate. Those businesses are delivering mid to h igh teens through some pretty interesting and challenging market environments. We talked about asset and wealth management, which is progressing towards mid-teens. We're not there yet. We still had significant balance sheet that we were working down. We're trying to create those scale economies. We're driving durable revenues, and that business will progress towards mid-teens. That's an important component of getting to our mid-teens returns targets. We're making investments to continue to raise the floor of our returns, and we're improving the durability of our returns, both of which are important. We want high returns, higher returns, but we also want durability of returns. I think we're making really good progress. Those targets are still very much in our frame. We're highly focused, and I would say highly incented to drive value creation for our shareholders over the medium to long term. We appreciate those of you that are shareholders, and we will continue to perform well. Thank you for the time. Fantastic. With that, we're ended. Thank you. Thank you.