- T. Rowe Price has developed a broad, ongoing plan to reduce expense growth over time, aiming for low single-digit expense growth in 2026 and 2027.
- The plan includes reassessing organizational structure, streamlining processes, leveraging technology including AI, and outsourcing certain capabilities.
- Recent cost-cutting measures involved role eliminations in July, with limited impact on client-facing roles.
- The firm is also evaluating its global real estate footprint to control occupancy and facilities expenses.
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- KeyCorp emphasized its primary focus on organic growth, with bank M&A being a lower priority and only considering tuck-in deals that support its targeted scale strategy.
- Chris Gorman highlighted that the company's main goal is to improve return on tangible common equity through organic initiatives rather than pursuing large acquisitions.
- Management clarified that bank M&A is far down their capital priorities and would only be considered if it aligns with strategic and financial criteria, including minimal dilution.
- The company is actively supporting client backlog growth and investing in technology and relationship banking to drive organic expansion.
- KeyCorp's approach involves leveraging its strong capital position to support organic growth, with potential to accelerate returns through buybacks or balance sheet restructuring if macro conditions improve.
- This strategic stance reflects a deliberate choice to avoid high tangible book dilution and focus on organic earnings enhancement, setting it apart from peers more aggressive in M&A.
- Truist welcomed new leaders across various business units, emphasizing the importance of attracting top talent driven by the company's purpose-driven culture.
- Leadership changes are already making a meaningful impact, reinforcing the company's strategic growth and operational focus.
- American Express has achieved four points of operating leverage since 2023, reducing expenses as a percentage of revenue.
- Q2 expenses grew slightly faster than revenue, driven by investments in risk management and technology.
- The company plans to keep OpEx growth in the mid-single digits for the year, balancing investment and efficiency.
- Product refreshes and new benefits are managed with careful expense timing, with costs amortized over 12 months.
- Management remains confident in its ability to generate sustainable value through disciplined expense management.
- Redwood accelerated its shift towards a more scalable and simplified operating model, first announced at 2024 Investor Day.
- The company is reducing exposure to legacy assets, including multifamily bridge loans and third-party securities, due to their full valuation or underperformance amid rising interest rates.
- Approximately $0.79 per share of fair value and repositioning charges were recognized in Q2 from legacy portfolio wind-downs.
- Target to generate $200-$250 million from legacy asset sales by year-end 2025, with a long-term goal to reduce legacy investments to 0-5% by 2026.
- The move aims to redeploy capital into core platforms for higher quality, predictable earnings, and to support share repurchases.
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