Robert Gorman: David, you’re talking about €“ if the rate gets up to around 5% or so. Yeah, it really be dependent on what losses were actually coming through. The model will be very sensitive to that unemployment rate, and we would be increasing, obviously, the allowance for the additional potential of losses as a result of unemployment, which would indicate that it’s a fairly significant recession going on. So we would definitely be raising the allowance for credit losses accordingly.
David Bishop: Appreciate the guidance of 6% to 8%. Just curious where you see the best prospects for growth either by loan segment or maybe geographic regions in 2023?
John Asbury: It’s going to come out of the commercial bank. Dave, do you want to speak to where you see opportunity. I think we’ve done a good job of diversifying the bank. We have our new business lines as well, which provides supplemental growth. I’m feeling pretty good across the board. What do you think, David? David Ring is Head of Wholesale Banking, which is what we call commercial.
David Ring: We actually grew in every vertical and in every region in 2022. So each region currently has pretty strong momentum. So there isn’t anywhere in Virginia we don’t feel pretty comfortable generating growth in 2023.
John Asbury: I will say several things. The greater Washington region is to us like Atlanta is to the deep south banks. That’s kind of the big market. So we’ve got plenty of room to run up there. Asset-based lending definitely has upside. That’s something we’ve been working on for several years. We have additional capabilities there. So I think it’ll be a pretty good diversified play. But, generally speaking, it’s fair to say the larger markets tend to do better than the smaller markets. That’s just a fact of the size of the economies.
David Bishop: Operating expenses, I know there’s some noise in other expenses. Just maybe, I don’t know if you can quantify the dollar amount this quarter, maybe what we think a good run rate in the first quarter might be as the expenses reset?
Robert Gorman: From that point of view, David, you would expect to see seasonally increase in the expense base, kind of the run rate we’re coming out of the year with €“ for fourth quarter, it was $99 million, probably looking in $4 million or $5 million on top of that in the first quarter due to FICA resets and the like, and then start kicking in at the end of the €“ in March. So, that’s our thought. Now, the FICA resets and unemployment resets start to dissipate over the remainder of the year. So, you’ll see kind of a spike up and then it will start coming down second, third, fourth quarter.
Operator: My next question comes from the line of Catherine Mealor with KBW.
Catherine Mealor: I wanted to go back to fees. You talked a little bit about some of the initiatives that are increasing fees for this year. But it looks like your fee guide is a little bit more conservative today than it was last quarter. If you could just talk a little bit about where that’s coming from.
John Asbury: It’s kind of a an apples and orange kind of thing. We changed up how we looked at it. If you look at the previous guidance, we said we would grow after we excluded the impacts of the sale of our RIA business. This time around, what we basically said is €“ we took that out of the equation and said, okay, we’re about $910 million of non-interest income in 2022, that’s going to come down mid-single digits, as we say. So we basically just took that out of the equation if you take that out. It would actually have grown if you adjust for the RIA reduction due to the sale to Cary Street Partners or the investment we made in Cary Street Partners. So it’s really apples and apples when it comes down to the absolute number. But the way we described it, we changed how that got put into the deck.
