Kenneth A. Brause - Executive Vice President of Investor Relations John A. Thain - Chairman and Chief Executive Officer Scott T. Parker - Chief Financial Officer, Chief Accounting Officer and Executive Vice President

Bradley G. Ball - Evercore Partners Inc., Research Division Christopher Brendler - Stifel, Nicolaus & Co., Inc., Research Division Henry J. Coffey - Sterne Agee & Leach Inc., Research Division David S. Hochstim - The Buckingham Research Group Incorporated Mark C. DeVries - Barclays Capital, Research Division Kenneth Bruce - BofA Merrill Lynch, Research Division Donald Fandetti - Citigroup Inc, Research Division John W. Stilmar - SunTrust Robinson Humphrey, Inc., Research Division Michael Turner - Compass Point Research & Trading, LLC, Research Division Bill Carcache - Nomura Securities Co. Ltd., Research Division Jeff K. Davis - Guggenheim Securities, LLC, Research Division

Good morning, and welcome to CIT's First Quarter 2012 Earnings Conference Call. My name is Frances, and I will be your operator today. [Operator Instructions] As a reminder, this conference is being recorded for replay purposes. I would now like to turn the call over to Ken Brause, Director of Investor Relations. Please proceed, sir. Kenneth A. Brause: Thank you, Frances, and good morning, everyone, and welcome to CIT's First Quarter 2012 Earnings Conference Call. Our call today will be hosted by John Thain, our Chairman and CEO; and Scott Parker, our CFO. After their prepared remarks, we will have a question-and-answer session. [Operator Instructions] We'll do our best to answer as many questions as possible in the time we have this morning. Elements of this call are forward-looking in nature and may involve risks, uncertainties and contingencies that may cause actual results to differ materially from those anticipated. Any forward-looking statements relate only to the time and date of this call. We disclaim any duty to update these statements based on new information, future events or otherwise. For information about risk factors relating to the business, please refer to our 2011 Form 10-K that was filed with the SEC in February. Any references to non-GAAP financial measures are meant to provide meaningful insight and are reconciled with GAAP in the press release. For more information on CIT, please visit the Investor Relations section of our website at www.cit.com. I'd now like to turn the call over to John Thain. John A. Thain: Good morning, everyone. Thank you for being on the call. We had a solid first quarter despite the GAAP reported loss. As our press release states, the quarter included $620 million of charges related to the prepayment of $6.5 billion of high-cost debt. If you exclude those prepayment charges, our pretax income was $214 million. We originated $2 billion of funded volume in the quarter, $2.5 billion on a committed basis. Our Commercial Real Estate and our Equipment Finance businesses, which were new businesses for us or restarted businesses, were both off to a good start in the quarter. And our Corporate Finance business, on a committed basis, originated volumes that were up 23% quarter-over-quarter and up 93% year-over-year. Our commercial assets grew for the second consecutive quarter, and pricing remained attractive across our business lines. Our credit quality -- the credit quality of our portfolio improved. Our non-accruals, charge-offs and additions to non-accruals were all lower, and we made excellent progress on our debt restructuring. We repaid all of the remaining Series A debt, which resulted in most of our debt becoming unsecured. We issued $1.5 billion of unsecured notes in addition to another $3.25 billion that we had issued earlier. We did get upgraded by the rating agencies, although not far enough and we will continue to work on that. And if you include what we've already done or announced in this quarter, we will have repaid or refinanced $24 billion of high-cost debt since the beginning of 2010. Continuing on our evolution to a more bank-centric model, CIT -- we originated over 80% of our U.S. volume in CIT Bank. CIT Bank's Internet deposit gathering is now over $1.1 billion of deposits. And just to give you an idea, those deposits have an average life of about 1.5 years and have a coupon of about 1.1%. Our expenses were generally in line. We did have a small restructuring charge in the quarter. Our capital ratios remain very strong, 17.6% on a Tier 1 basis. We continue to be very liquid, $7.3 billion of cash. And on the regulatory front, we believe that we have substantially satisfied the requirements of the written agreement, and the Federal Reserve of New York is in the processing -- the process of verifying our work. With that, I'll turn it over to Scott. Scott T. Parker: Thank you, John, and good morning, everyone. We continued to make good fundamental progress this quarter. As John mentioned, we grew commercial assets, funding costs continued to decline, credit quality further improved and we continued to grow CIT Bank. We reported a $447 million net loss or $2.22 per share and a pretax loss of $406 million. The pretax loss was driven by approximately $620 million of charges associated with our liability restructuring actions. This included $597 million of accelerated FSA debt discount and $23 million loss on debt extinguishment. Excluding these charges, pretax earnings were $214 million, down from $230 million in the fourth quarter. The decrease came as lower FSA accretion, increased provisions for credit losses and charges in Vendor Finance more than offset increased gain on asset sales and lower funding costs. Let me get into the key operating drivers and focus my comments on the sequential trends, as they are more relevant. Total assets decreased slightly to just over $44 billion, reflecting a lower cash balance as we made a significant debt repayment in March. Total financing and leasing assets were essentially unchanged at just over $34 billion as the Commercial portfolio grew roughly $550 million to $28.4 billion, and the consumer book contracted to $5.7 billion due to the sale of $500 million of student loans in the quarter. Growth in the Commercial portfolio came as $2 billion of organic lending and leasing volume more than offset the quarter's $1.2 billion of combined collections and depreciation and $500 million of commercial assets sales. Growth also benefited from the bank's purchase of a $200 million portfolio of loans secured by aircraft. Net finance margin, excluding FSA and prepayment penalties, was 197 basis points, down 10 basis points sequentially. We continue to see margin benefit from our lower funding cost, about 10 basis points this quarter. That benefit is lower than recent quarters due to the timing of our debt actions, which led to an increased negative carry. Specifically, the average cash and investment balance was up about $400 million sequentially due to the lag between the $3.25 billion we issued in February and the subsequent paydown in March. However, the funding cost benefit was more than offset by 20 basis points decline in the pre-FSA asset yields that was largely driven by 2 factors. First, we had an adjustment in the interest revenue in the Vendor Finance business, which reduced first quarter margin by about 15 basis points. Although the charges predominantly relate to prior periods, the cumulative adjustments were booked this quarter, impacting the margin. Second, interest recoveries came in at a particularly high level -- high fourth quarter level and accounted for 10 basis points of sequential decline but still exceeded historic norms. On a positive note, our portfolio continues to shift towards a greater proportion of higher-yielding commercial assets and lower non-accruals in student loans. So just to recap, lower funding costs added about 10 basis points to margin but was mitigated by 20 basis points of portfolio yield contraction, resulting in a net 10 basis-point decline in margins. Other income was nearly $250 million, up from the fourth quarter on strong gain on sales. We sold about $1 billion of loan and lease equipment, which was evenly split between commercial and consumer assets. These gains totaled $165 million and included a slight gain on the student loans. About $150 million of the gain came from the completion of the multi-phase loan portfolio sale in Corporate Finance we discussed last quarter. We also benefited from sales of Transportation equipment and Vendor assets, which are part of our normal fleet and residual management activities. Excluding gains on loans and lease -- loans and equipment sales, non-spread revenue was down $15 million sequentially to $85 million, due in part to reduced benefits from FSA-related items. Both pre- and post-FSA credit trends showed similar trends as charge-offs, non-accruals, loans and inflows to non-accruals all declined sequentially from the prior year. However, the provision for credit loss rose from the fourth quarter levels as we increased the allowance for loan losses to $420 million. The increase reflects the fact that this quarter's commercial asset growth was driven by lending, whereas last quarter's growth was primarily leased equipment. As a percent of finance receivables, the reserve is flat with year end at 2.05%. The remaining non-accretable discount on loans is no longer significant at about $45 million. As John mentioned, operating expenses were $223 million, up slightly from last quarter on higher compensation costs due in part to FICA restart as well as equity incentive awards. Headcount was flat, and professional fees were down. Finally, our first quarter income tax provision was $40 million, was driven by international earnings. We continue to record valuation allowances against the deferred tax assets resulting from our U.S. net operating losses. Turning to the segment results. We added a new table to the press release this quarter which highlights the amount of accelerated FSA debt discount allocated to each segment. Remember, that discount shows up as an increase in interest expense and is driven by our debt repayment activities. Given the volatility of these allocations, my remarks will focus on the sequential trend, excluding this impact. Corporate Finance's adjusted pretax income fell slightly to $177 million. Higher gain on loan sales and improved finance margin were offset by decreased FSA accretion, lower recoveries on assets held for sale and higher credit provisions on asset growth. As John mentioned, new business activity continued to be strong. Committed and funding volumes were up 13% and 23%, respectively, with 82% of the volume originated in CIT Bank. About 52% of the U.S. Corporate Finance portfolio is now on the bank, up from 21% a year ago. Lending and leasing assets increased $300 million despite asset sales, reflecting strong new business volume. New business was split roughly 60% cash flow, 40% ABL, and new business yields were generally stable. As John mentioned, our initiatives in Real Estate and Equipment Finance are off to a good start, each closing multiple transactions during the quarter. In the C&I space, we are winning an increased share of the overall market's refinancing activities and are seeing increased activity from manufacturers. Deal flow also continues to be strong in our energy and entertainment groups. Credit quality metrics improved with charge-offs and non-accrual balances coming down. All in all, good progress. Turning to Trade. Adjusted pretax income decreased to $4 million, primarily due to higher provisions as the prior quarter benefited from a reserve release. Factoring down -- volume was down sequentially due to seasonality and relatively flat to first quarter of 2011. Despite the seasonal drop in volume, factoring commissions remained stable. Net charge-offs were only $1 million, and non-accruals declined significantly. Transportation Finance adjusted pretax income increased to $81 million, reflecting reduced impairments and generally solid operating trends. Leased equipment levels were essentially unchanged from year end as we had fewer aircraft deliveries this quarter. But Loans grew to over $1.7 billion, bolstered by the $200 million portfolio purchase. Air utilization rates remained strong with only one aircraft off-lease. We are seeing some near-term pressure in the demand for certain aircraft but remain well-positioned with all our remaining 2012 deliveries placed. Overall trends in rail are improving. Utilization remains over 97%, and rental rates continue to rebound. There was some softness in the coal market due to a mild winter and lower natural gas prices, but demand for other energy-related cars remained strong. Finally, on Vendor Finance, we had a $14 million pretax loss, reflecting the adjustments in the Mexico portfolio and lower non-spread revenue. While profitability was down, portfolio assets increased, and credit quality remained strong. New business volume increased 17% from a year ago but declined sequentially, reflecting seasonal trends. New business yields remained strong and stable, and margins are attractive, with CIT Bank originating virtually all the U.S. volume. Asset quality continued strong, with non-accruals essentially unchanged and continued modest net charge-offs, although up from a historically low level in the fourth quarter. Finally, we continue to make progress funding both our U.S. and international Vendor platforms more efficiently. And that's a good segue to discuss overall funding. As John mentioned, we achieved a major milestone this quarter with the redemption of all the remaining Series A debt, which resulted in our Series C Notes and revolving credit facility becoming unsecured. We also announced the redemption of $2.1 billion dollars of 7% Series C debt that will result in an approximately $130 million of accelerated FSA debt discount and related charges in the second quarter. That will leave us about $650 million of discount on the remaining $6.7 billion of 7% Series C debt still outstanding. We continued to access diverse funding sources at attractive rates. We issued $4.75 billion of bonds with a weighted average maturity over 5 years and a weighted average coupon of about 5.2%. We expanded our online deposit offerings with the launch of a new high-yield savings account, and our Internet deposits exceeded $1.1 billion. Total deposits now account for about 21% of overall funding, double from last year's level. In addition, during the quarter, Moody's, S&P and DBRS each upgraded our counter-party rating by one notch, bringing us closer to an investment-grade rating. Our liquidity and capital ratios at the bank and bank holding company remain strong. And we remain focused on executing on the balance of our liability restructuring roadmap. With that, I'll turn it over to Frances, and we'll take your questions.

[Operator Instructions] Our first question comes from the line of Brad Ball with Evercore. Bradley G. Ball - Evercore Partners Inc., Research Division: Scott, quick question on credit quality. So we came in again this quarter, I think, much better than the expected net charge-offs for the long term, 42 basis points versus you've talked about 75 to 100 basis points in the past. Can you give us a sense as to how much longer to expect this lower-than-normalized net charge-offs? And is the new business that you're putting on -- you increased the provision this quarter. Is the new business coming in, in that range of around 100 basis points net charge-offs? Or is going to be lower? Can you sustain those levels? Scott T. Parker: Yes. As I think we mentioned before, I think these levels are kind of not our steady state. So I think if you look at some of the details, we have experienced, especially in the Vendor business, some high recovery rates that have kind of lowered the charge-off number. But I would say on the provision, the new business that we're originating is kind of in line with the long-term targets that we set out there. And so the reserve build is commensurate with that expectation. And again, it could be a little bit better, a little bit worse than that over time, but we feel good about the assets we're putting on the book. Bradley G. Ball - Evercore Partners Inc., Research Division: And would that reserve coverage ratio begin to work down from the roughly 2% range down to around 1%? Scott T. Parker: 2% is kind of, Brad, is the overall. And so as we kind of transition the mix of lower kind of consumer assets and more commercial assets, I think it's -- whether it's at that rate, maybe a little bit higher, but I don't think that there's an expectation other than mix that it would kind of drift lower than what we currently have. Bradley G. Ball - Evercore Partners Inc., Research Division: Okay. And then just one quick follow-up. Can you give us a sense as to your plans for redeeming the remaining Series Cs? My sense is that you moved much quicker than we had thought coming into the year in redeeming the As and some of the Cs here this quarter. Is it basically redeem the high-cost debt as quickly as possible? Or what's the posture there? Scott T. Parker: Yes, I mean, we'd like to redeem it as fast as possible, Brad. I would say that there's kind of 3 elements to kind of that process. I think number one is just the continued, kind of runoff of the legacy Corporate Finance and Vendor assets in the U.S. perspective. Number two is we do have several international funding efforts under way for our Vendor business that's currently funded at the parent company that would free up some cash. And as always, we are always looking at the capital markets to see if it's attractive to issue. So I think there is many areas that we're focused on, and I think the timing, we would hope to be able to kind of get through those over the next 12 to 18 months. But if we could do it faster, that's our preference.

Your next question is from the line of Chris Brendler from Stifel, Nicolaus. Christopher Brendler - Stifel, Nicolaus & Co., Inc., Research Division: A question on fees and other income. The Other Fee Income line was down 50% or so sequentially, from 64 to 65, sorry, to 35. Was anything lumpy in the last quarter that was driving that? I just wanted to know if we -- is 35 the better run rate or is there anything else going on that line? And a similar question. Where do we stand on recoveries of pre-emergence loans? Is that stockpile starting to decline? Or is it just -- obviously, it's lumpy quarter-to-quarter. Just wanted to know if you expect the $10 million to be the better run rate for this year. Scott T. Parker: Yes. So I think, yes, in the fourth quarter, there was some items related to kind of the portfolio sell that we had as well as other recovery -- interest recoveries through -- that run through that line. So that one was, I think, an elevated level. I think the fee and income, overall, I would say, as we mentioned, the $250 million is -- includes $150 million from the structured sale that we did. And so as you look at our assets held in -- held for sale, excluding kind of the student loans and the portfolio that we have for Dell Europe that's in the process of transitioning, there's not much left in the assets held for sale. So I think that the gain on sale perspective cannot stay at the elevated level. So on the recovery line, it is somewhat lumpy, but it has come down. I think the further we get away from the emergence period, I think as with FSA, I think just naturally the opportunities come down, but there might be -- on a quarter-to-quarter basis, there might be a big recovery we get. But it's very hard to forecast those. Christopher Brendler - Stifel, Nicolaus & Co., Inc., Research Division: Okay. And if you can, I know this is a usually a difficult topic to address, but is there any sort of timeline you can help us think about when it comes to the Fed? And also in conversations with the rating agencies, recently you've had -- S&P and Moody's taking a little bit of a different approach, it seems like. Are there any issues that you can think of that are potentially going to be addressed in the near term? Or it's just a matter of time before they get more comfortable? It seems like the core profitability is certainly turning the corner here, there was obviously a lot of capital. I'm just not sure what their issue is. And are the 2 related? Are the Fed and the ratings agencies kind of related, and the rating agencies see the formal agreement as a negative in their outlook? Can you just give me a little color there, please? John A. Thain: Bob, I'll answer the question as to the Fed. We really can't predict when we're going to get an answer from them. They're reviewing all of the work that we did, come -- really up to the end of the year. It's an ongoing dialogue with them that we have, and so it's just a process, and we can't really predict what the timing will be. Scott T. Parker: And I think the rating agencies, if it's -- you can read their published notes, I think one is continued sustainability of the franchise, which I think is more around kind of the portfolio growth that we're starting to experience in the assets. I think it's continued stabilization on the credit side. So I think we've had several quarters, and the trends have been, as we talked about, improving. And then I think also, it's just more buildout of the bank-centric model. So I think as we do that, I think those are things we have. I think in general, as you mentioned, there is a lot of views around the financial sector that we get as part of that. But I think it's mainly sustainability and overall macro views on the financial sector.

Your next question is from the line of Henry Coffey from Sterne Agee. Henry J. Coffey - Sterne Agee & Leach Inc., Research Division: Obviously, great progress here, and it sounds like it's just going to continue. The biggest question we get surrounds sort of the performance of the leasing assets. That's a mark that you're going to have to live with for a long time. Can you give us any insight into what the actual market values of those assets are? I know all lease assets are different, I understand rail is performing extremely well, et cetera, but maybe you could just create some color around that for us. Scott T. Parker: Henry, it's Scott. I'll try my best. I would say on the rail side, as you know, we took a pretty good market at the fresh start. I would say that because of the market trends, probably -- if you look at the appraised value, it would be up versus kind of what we're marketing it at. On the aircraft, it was -- it's kind of plane-dependent, and I think there's what was in 2009 versus where we are today, I think in aggregate, we feel the market is very appropriate. But it would be very hard to kind of, because of the different 2 years out and the different aircraft types, to kind of give you the specifics. But I think in general, we feel very good about the value of the aircraft and as well as the rail car. Henry J. Coffey - Sterne Agee & Leach Inc., Research Division: Great. Utilization is high, but when you look at the sort of pending order books, are there any issues on the horizon that could challenge values? Scott T. Parker: I think in the market, I would say it's more of it might be a little bit of pressure on the lease yields if there's a supply-demand challenge. But I don't think -- from an overall industry perspective, the demand for travel has not come down, and as well as I think overall, the rail loadings are kind of, in the first quarter, on par with first quarter of last year. John A. Thain: Okay. Let me just add one comment. With the exception of coal cars, which Scott talked about, and center-beams, which carry lumber, which we've talked about before, generally, all of our other rail cars, the leasing rates are higher as we're re-leasing them. Henry J. Coffey - Sterne Agee & Leach Inc., Research Division: Just sort of unrelated, as you look to refinance the 7% notes, given where your capital is, do you have a particular bias towards either short-term or long-term funded sources of debt? Scott T. Parker: Well, I think what we would say in regards to our debt maturity stacks, we're very focused on ensuring that the maturities in any given year kind of are within a reasonable tolerance of refinancing when we get to those years. So it's one of the reasons why we paid down the 2017. That maturity stack was over $4 billion, and we would feel more comfortable with stacks below $3 billion dollars. So I think on the debt issuances, it would be a matter of potentially kind of replacing some of the existing Series C with new debt in those maturities or potentially looking at other maturities. But I think it's going to be based on kind of the pricing and what the market demand is for different maturities.

The next question comes from the line of David Hochstim from Buckingham Research. David S. Hochstim - The Buckingham Research Group Incorporated: I wonder, could you give us some more detail or color on the Corporate Finance volumes? Pricing in the quarter, you mentioned it was stable, but just more specificity. And how much did you originate in the new businesses, real estate and the construction equipment? Scott T. Parker: I mean, it was part of the overall volume that we talked about. As I mentioned, we did several transactions in both the equipment and real estate. But I would say with regards to getting those numbers out there, it's probably not relevant to the conversation. I think overall, as you know in the overall Corporate Finance middle market, volume in the marketplace was down in the first quarter sequentially. And I think we did a really good job at winning a lot of new customers as part of the overall activity in the first quarter. And as I said, I think pricing is relatively stable. I mean, there's pockets of pressure, but as we've said, there's also others -- other areas where there's some benefits. So I think in general, I think it's consistent with other views, other people's views on the market. David S. Hochstim - The Buckingham Research Group Incorporated: Okay. And then can you give us an update on what you're seeing in the way of European banks trying to sell assets and you finding any opportunities? And then with $200 million of aircraft loans related to that? Scott T. Parker: Yes, I would say that there's been a few, I think, transactions that have happened, but not the extent, I think, of people's expectations. So I would say that we do get a look at a lot of the activity. I think our general view is that a lot of the assets that are in the market have pretty low yields relative to our expectations. So where we find portfolios like the aircraft loans that we feel meet our return expectations, that's really where we've been very focused on versus the general overall market. David S. Hochstim - The Buckingham Research Group Incorporated: So at this point, it's not very likely, it sounds, that you're going to have a big opportunity for growth from banks dumping assets? John A. Thain: Yes, I wouldn't say it quite that strongly. I think that it depends a little bit on whether or not the banks will sell the assets at a discount. So as the liquidity facility in Europe gets closer to its maturity, there may be more pressure on the banks to actually sell assets. But so far, because the portfolios generally have relatively low yields, they're only attractive to us if they trade at a discount, which the banks really haven't been willing to do up until now, but we'll see.

Your next question comes from the line of Mark DeVries from Barclays. Mark C. DeVries - Barclays Capital, Research Division: Could you give us a little clearer sense of what the run rate is on the margin, if we kind of back out all the noise you mentioned around the impact from the Vendor business in Mexico, the maybe normalized recoveries if you had a full quarter of interest savings from debt paydowns and also, I guess, the negative carry you mentioned? Scott T. Parker: I think in the first quarter, as you said, there was a lot of activity in the line. So I think as we go into the second quarter, you'll get the full benefit of the actions that we took in the first quarter on the $6.5 billion and the timing of the debt issuance. There'll be a little bit of timing related to the $2.1 billion, because it's not -- you're not going to get the full quarter benefit on that. So I think you'll start to see, and you can do probably the math on the interest, the funding benefit will come through. I think the 2 areas that are very hard to -- or one area that's hard to predict is the interest recoveries. As we've said, there have been at higher levels than our historical norm, and that could come down or should come down over the next couple of quarters as we get through the portfolio. And then #2 is, which won't happen in the next couple of quarters, but as we transition the assets that are held for sale in the Dell portfolio, that suspended depreciation benefit is in the margin, we'll transition as those assets do. That will be kind of later in the -- later in 2012. But I think we'll get closer to a kind of a, what I want to say, a more pure net margin later in the second half. Mark C. DeVries - Barclays Capital, Research Division: Okay. And could you give us a little more color on kind of what your expectations are or what you're working towards this year on fee revenue growth and what the key drivers for that are going to be? Scott T. Parker: On the fee side, as I mentioned, I think the expectation for gains on portfolio sales as we are trying to grow the book and we have very few assets in held for sale will come down. I think our core fees is really around commissions, factoring, so it's going to be a driver of both the volume as well as the market around the commission rate. We do have fees coming out of the Corporate Finance business, both from an agency perspective, kind of other fees associated with both ABL and cash flow transactions. It could pick up in regards to potential syndication fees around arranging certain transactions. And then, as I said, it's -- part of our normal kind of operating business is that we kind of manage our aircraft portfolio for both risk and other reasons, so we do have plane sales most of the quarters. And potentially, there's gains on sale on those as well as the Vendor end of term. So those are kind of, what I would say the kind of the recurring things. And then recoveries, as we mentioned before, is going to be lumpy. But I think as we get further from the pre-emergence, post-emergence timeframe, we're going to see that opportunity come down. I think those are the core bases.

Your next question is from the line of Ken Bruce from Bank of America Merrill Lynch. Kenneth Bruce - BofA Merrill Lynch, Research Division: My question is -- we get a lot of feedback from market that lending in the non-bank arena is very attractive just from a yield prospective. And it appears just based on the move by CIT to try to become a little bit more bank-centric that you're moving up in quality in terms of what your Corporate Finance lending is. And I wondered, do you feel that there's a risk that you're going to possibly overshoot and become too high as the asset quality and maybe miss some of the opportunity that's available in the market today? Scott T. Parker: Well, I don't know if I agree totally with what you said. But I would say that the portfolio that we're originating in the bank today is consistent with our overall portfolio. Over the last couple of years, I think there -- with the lower cost of funds, it does give us a better opportunity to look at some higher-grade kind of credits in the BB market. But I don't think it's one where it's going to be -- being pushed there. I think it's going to be based on our overall portfolio management, looking at the kind of the pricing on that, risk-adjusted returns, that is going to be more the driver than it is doing that. Because as we've talked about before, our expertise is really kind of in the structuring and the underwriting of the credits. And I think as you move up the spectrum, that expertise, you don't get paid for, per se, on the same compared basis that we would think. But it's not saying we won't do that, but I don't think it's going to be a big portfolio shift. Kenneth Bruce - BofA Merrill Lynch, Research Division: I guess my point is that I would agree with you that there are more opportunities to extract yield out of from these restructuring or from the restructuring efforts in some of the, well, I guess it would be deemed lower-quality credits. And just listening to the comments in terms of where loss rates are and where there's pricing pressure, I just wonder if there's a risk that you're maybe trying to become too bank-centric in the process. And I understand that in the current situation, there's a backdrop where you've got to kind tack that way for purposes of making regulators and rating agencies happy and the like. So I'm just trying to understand from a longer-term perspective where you want to -- really, where you see yourself participating in the market. John A. Thain: I just would add 2 other thoughts. I think that the improvement in the credit quality of portfolio is really a couple of things. One is our credit underwriting and the quality of our credit team is much better now than it was historically, and we're doing a really good job analyzing the credits. Second of all, we have been pruning the portfolio, and so the -- we have sold off a lot of the non-performing assets. And I think that the third thing is the overall economy is improving, and so some of the very low levels of charge-offs in non-accruals is a function of where we are in the economic cycle.

Your next question is from the line of Don Fandetti from Citigroup. Donald Fandetti - Citigroup Inc, Research Division: Yes, John, you've had some time to sort of get a better sense on expenses, turn around the company capital originations. I was just curious if you still feel confident in your sort of long-term ROE targets. I think they're 10% to 15%. And I was just curious if 2014 is still in the realm of realistic possibilities for sort of a normalized earnings environment. John A. Thain: The simple answer is yes. When we look at the yield and the returns on the new originations on the assets that we're originating now, we are hitting those targets that we put out. And so I do think that those are -- those continue to be realistic. Donald Fandetti - Citigroup Inc, Research Division: And in terms of kind of putting a timeframe on when you could potentially be sort of base-case for normalized earnings, would that be '14 is still in the realm of possibilities? John A. Thain: Well, as you know, we don't provide forward advice or guidance, and so we've never really said specifically about any one year. But as you can see, this is a gradual trend where as we get rid of the high-cost debt, as we originate new assets, as we put more assets in the bank, the returns get cleaner and cleaner. I think that the one thing I would say is on the capital side, given the level of capital that we have, we're not going to get to the 13% capital target without some ability to return capital at some point in time.

Your next question is from the line of John Stilmar from SunTrust. John W. Stilmar - SunTrust Robinson Humphrey, Inc., Research Division: My question dovetails more towards the last one as well, Don's last question. If I look this quarter, you guys originated about $1.8 million or, call it $2 billion dollars. So it gets this -- if I assume an average life of about 5 years across your entire product mix, including the long-gated rail and transportation assets and maybe short of that for some of your other commercial businesses. And I get to kind of like a $36 billion asset base. Is that sort of the right way -- or do you agree that that's sort of the right way of what your origination capability can kind of service, at least in terms of the loan portfolio? And then sort of along those lines, should we think about getting to that ROE ultimate trajectory, how should we prioritize the balance sheet growth and consumption of capital versus capital action plans to get back to our targeted ROE? Scott T. Parker: I guess, John, I think there's -- your math, I think because of the proportion of our transportation as you kind of look at the $2 billion that we did in this quarter, we had very low aircraft deliveries and railcar deliveries, where in the fourth quarter, we had significant. So I think if you look at the kind of the operating lease business and look at that, that would be a longer duration than kind of what you mentioned. So that would be kind of more the -- probably somewhere between 10 and 12, depending on asset class. On the loan portfolio, I'd say the Corporate Finance kind of is probably closer to the number you put out there, but depending on what the market environment is and refinancing activity. I mean usually, facilities are kind of put out there for that term, but they may not last that long, so it could be 3 or 4 years depending on the marketplace. And then on the Vendor business, it's probably lower than that, it's probably more in the kind of 3-year range. So I think when you blend them altogether, it might be over the 5%. But the math is not -- I can't say the math is not inconsistent, but I think as we've talked about on the organic portfolio, it's going to be a combination of our existing capabilities and some of the new products we've talked in regards to Real Estate and the Equipment Financing as well as growth in the global environment. But we've also said that we probably need some kind of inorganic growth in regards to have above-market growth rate, which is what, in essence, that's saying. John W. Stilmar - SunTrust Robinson Humphrey, Inc., Research Division: Okay. And then in terms of your Transportation business, recent presentation had talked about the historical CAGR for that business as being somewhere around 9%. Is that what we should be thinking about as we sort of think about the CIT transition? I know it's a lumpy business, given deliveries, but is that sort of a base case? Or was it -- is that really kind of a reflection of maybe a different time in the global economy? Scott T. Parker: I think that growth rate probably going forward is a little bit high. But I would say it'd probably more in line with kind of the overall market growth in regards to passenger miles. But I would probably -- probably more in the 5%.

Your next question comes from the line of Mike Turner from Compass Point. Michael Turner - Compass Point Research & Trading, LLC, Research Division: Most of my questions have been answered. I just wanted to loop back on the Vendor Finance. How much of that $5 billion is funded at the parent level? Scott T. Parker: At the parent level, I'd probably say -- probably most of it, because we -- what we have the International business that's -- we do have a few funding facilities for that, and then we just transferred the portfolio in third quarter of last year. So I would say that probably the kind of -- over 50% of that's probably in the parent company. Or probably more, probably like 60%, 70% is probably at the parent company. And that's really one of the things I mentioned in my remarks is the big effort for us is to, now that we've made so much progress in the debt side, on the Series A and the Series C as well as some of the credit rating gives us a lot more ability to fund a lot of our international platforms. John A. Thain: Yes. Just to remind you, we only moved the U.S. origination platform into the bank last year, so it's really only the new originations from, really, beginning middle of last year. Now that will get -- that will improve a lot, because we're originating almost all of the U.S. assets in the bank now. But the portfolio shift, that's going to take a little bit more time. Michael Turner - Compass Point Research & Trading, LLC, Research Division: Okay, yes. I guess that's what I was sort of trying to get at, is how much potential funding opportunities are there to secure additional lines? Is there additional financing you can do for the international Vendor business that might free up capital to pay down some of your notes? Scott T. Parker: Yes, as I mentioned yes, that's a big focus for us in 2012.

[Operator Instructions] Your next question is from the line of Bill Carcache from Nomura. Bill Carcache - Nomura Securities Co. Ltd., Research Division: Post the emergence, we've seen that book value growth has been flat to positive and really, the effect of your aggressive retirement of high-cost debt has been basically offset by -- the negative impact of that's kind of been offset by the core underlying growth in the business such that, that book value growth has remained positive to flattish, and so kind of this quarter, we saw that decrease in book value. And I wonder if you could kind of frame for us as we look forward, given the remaining FSA impact that we expect to flow through in your remaining high-cost debt retirement actions, should we expect kind of more quarters like the past, where that adverse impact from the retirement of high-cost debt is kind of offset by the fundamentals of the business such that book value growth doesn't -- isn't negative, it's at least flat to positive, and so kind of we can look at book value here as kind of a decent floor? Or is there the potential that we'll see more quarters like this one, where there's a potential decrease in book value as a result of that? John A. Thain: So I think the way to think about is we're pretty close to the end of the FSA. So you sort of already know there's only $650 million of FSA charges left in our debt, and we've done so much of the refinancing already. And we certainly -- when we started, we were sensitive to how much of the debt charges we could take versus driving -- potentially driving down the book value number. I think at this point, I think it'd be better for us, better for our shareholders to get rid of the remaining noise in our P&L as quickly as we can. Obviously, we expect to continue to be able to earn money, so we'll offset part of it. But I think at this point, we would rather get rid of the remaining piece of the FSA that's in the Series A debt -- sorry, Series C debt, and clean up our P&L so we have a cleaner P&L going forward. Bill Carcache - Nomura Securities Co. Ltd., Research Division: That makes sense. And separately, can you give a little bit more color on what drove the yield adjustments in looking at the sequential decline in economic margins? And what's the potential for similar adjustments as we look forward from here? Scott T. Parker: As I mentioned, I think you've got a -- the 2 that I mentioned, one, we don't expect to kind of follow with us going forward, which was really the revenue adjustment in our Mexican portfolio. And that really relates to a cumulative adjustment we did in the first quarter that kind of dates back several years -- over the last several years. The second piece was really the interest recoveries. And as we mentioned, the interest recoveries have been at a kind of historical norm high, and those will come down, but those are really a function of the specific accounts where that happened. So I think over time, I think we get to a more pure kind of margin number.

And your next question is from the line of Jeff Davis from Guggenheim Securities. Jeff K. Davis - Guggenheim Securities, LLC, Research Division: Just a little more color on the aircraft leasing yields that were referenced. You mentioned that you were starting to see pressure on a few planes. What type of planes? And then if press reports are to be believed, we may see more airline bankruptcies globally towards the end of the year. Any sense that pressure on lease rates start to broaden out in '13, '14 from more aircraft on the market? Scott T. Parker: Well, I don't -- I would say that we try to give that color -- I wouldn't say it's very kind of specific to certain aircraft when they come back, timing of when they come back and in regards to whether you re-lease it with an existing customer or you have to find a new customer. But I would say that we feel still, overall, the portfolio is in -- well-positioned. In regards to kind of the outer years, as you've seen, I think there's a large re-fleeting effort going on, and the overall macros for kind of aircraft or airline travel continues to be pretty strong on a global basis. So I don't think it's a big change. I think it's just all we wanted to say is there is some isolated kind of pressure in certain of aircraft or relative to who's returning or re-leasing that aircraft. Jeff K. Davis - Guggenheim Securities, LLC, Research Division: Okay. So fair -- not to put words in your mouth in a sense of, at least this point, transitory, if you will, just for a handful of aircraft. What -- and then the second question, American-U.S. Air combination, does that have any impact on the business? Potential combination? John A. Thain: Not really, because I think we've mentioned, our customer base in the U.S. is pretty limited in regards to where we lease our aircraft. So it could be a potential opportunity. But I wouldn't say we have kind of minimal exposure either of those airlines.

And at this time, there are no other questions in the queue. I'd like to turn the call back over to management for closing remarks. Kenneth A. Brause: Well, we'd like to thank you all for joining us this morning. If you have follow-up questions, please call me or any other member of the Investor Relations team. And we hope to see many of you at our Investor Day in New York on June 14. Thank you very much.

And ladies and gentlemen, this concludes today's presentation. You may now disconnect, and thank you for participating.