Jerry Plush: Thanks, Sherry. So on our last slide today, I’m going to give some comments on how we see 2024. So starting off, we view this year is very significant as we transition from what has been a multi-year transformation phase over to execution and profitable growth. With the FIS conversion and much of the physical infrastructure changes nearly complete along with the executive leadership team now in place, this allows for our primary focus to be all about execution. The first two quarters of 2024 will reflect increased investment in business development personnel to drive incremental growth in both the commercial and consumer banks. There are considerable opportunities for solid relationship growth in the markets we serve and we’re seeing a lot of interest from quality people wanting to join our team.
The first half of 2024 will also reflect the incremental expense post conversion as we decommissioned from previous systems. And now the emphasis shifts from the conversion to accelerating our digital transformation efforts. We have a great team on board driving our efforts and utilization of AI as part of this will be something we’ll update everyone on throughout the year. We are focused on improved self efficiencies as well as front and back office efficiencies as our top priorities. And as far as an update on physical distribution, we’re finally opening our new locations in Downtown Miami, Fort Lauderdale, and Tampa in the first quarter of 2024, and also our new regional offices in Tampa implantation. So, now we will shift and talk a little bit about the second half of 2024.
We expect to show the growth and profitability that results from the execution of our plan. And in closing, we are reaffirming our commitment to be the bank of choice in the markets we serve. We have been retooling and building for some time to have something very special here and we believe this is our year to show how it all comes together. So with that, I’ll stop and Sherry and I will look to answer any questions you have. Daryl, please open the line for Q&A.
Operator: Thank you. We will now be conducting a question-and-answer session. [Operator Instructions] Our first questions come from the line of Michael Rose with Raymond James. Please proceed with your questions.
Michael Rose: Hey, good morning, everyone. Thanks for taking my questions.
Jerry Plush: Good morning.
Michael Rose: Jerry. Good morning. Maybe we could just start with the loan sale in Houston. I think when it was announced, it was a pretty large percentage of what was there and just given what we’ve seen you do in New York in terms of kind of pulling out of that market, I just wanted to get a sense for what the strategy for Texas is. Is this a market that you’re going to look to continue to be in or is the focus kind of be to just focus on core South Florida operations at this point? I would just love some overarching thoughts. Thanks.
Jerry Plush: Yeah. So, Michael, we emphasize that this portfolio of loans were really, sort of — we’ll call it non-core. They were not broad relationship based. We don’t have full relationships with the sponsors. The remaining portfolio that we do have associated with Houston is and we believe that there is solid and it makes sense for us in terms of the operations there. I would also make the remark that I covered earlier again that we felt that Houston was in terms of loans versus deposits, not really self-funding and we think this gets us much closer to rightsizing the operations there. Look, we have great opportunities we think in all of the markets we serve. Clearly, we get far more brand recognition right now because of all the steps we’ve taken in South Florida, but that doesn’t mean that we’re not looking at opportunities across the entire footprint.
Michael Rose: That’s helpful. And then maybe for Sherry, just kind of a modeling question. Certainly a lot of moving parts on the expense side. I appreciate the color in the slides to get down closer to a 60% efficiency ratio by year-end. But can you just help us from a run rate perspective in the first quarter, just given that there was so many moving parts what we should be kind of be using as a base, and just given that you guys have some additional investments, it looks like in the first half of the year. How should we think about at least expenses over the next quarter or two? Thanks.
Sharymar Calderon: Sure. So what we’re seeing in terms of forecast for 2024 is that we should be, let’s say, either stable or even slightly higher closer to the 68% in the first few quarters of the year. And this has driven, you’re going to see some drop off of some technology costs or a re-composition of the expenses and higher investments on the people side, as we work towards growth on later on in the year. So I think using a 67% to 69% should be a good range for expectations in the first half of the year.
Michael Rose: Okay, very helpful. And then maybe just finally for me just, Jerry, stepping back, I mean you guys have done a lot over the past couple of years really since you kind of took the reins. Are we done with the majority of the large moves and, a, could we start to see some cleaner results once we get past the first couple of quarters of the year and I think when I put the pieces together, just given what is shaping up to be your expectations are for a pretty strong balance sheet growth this year, both loans, deposits. It looks like you’re going to have a fair amount of positive operating leverage, beginning as we get into the back half of this year and really into 2025. So just wanted to comment where you think you are with those efforts?
And then it looks like you should be able to get sufficiency ratio kind of sub 60% driving ROA above 1%, drive pretty good kind of returns that. Not asking for explicit guidance but it does seem like the path forward here, especially once we get into 2025 is pretty powerful from an earnings perspective and just wanted to get some color and thoughts from you? Thanks.
