Tim Coffey: So, I appreciate all the details in the press release today, especially the spot rates. If I were to look at the spot rates and apply them to period end balances, I started getting a net interest income number closer to $300 million. Is that a reasonable estimate for the profitability of that company today?
Jared Wolff: I don’t know that we are ready to say that yet. To confirm that number is being high or low, the reason being is there’s a lot of moving pieces. And I think, we understand why it’s difficult because we only had one month combined balance sheet with a whole bunch of stuff moving around. What we’d like to do is deliver a Q1 balance sheet and income statement. And I think it’s going to be much easier for us to guidance off of that. But to forecast today what Q1 kind of run rate TPNR, other things are going to be, we’re not — we don’t want to do that yet. We want to make a little bit more progress. Hopefully, people took away a lot of confidence from what we’ve I mean, I think what we accomplished in Q1, in Q4 was tremendous.
We did this at Banc of California. We always did it faster than we said we were going to do it. And I can’t promise that that’s going to happen here, but I have every level of confidence in our ability to execute and be successful. And so, I’d like to get through Q1, Tim, to be able to guide from there.
Tim Coffey: And then I also appreciate the cadence the cost saves throughout the year. I’m wondering as it comes to recession of balance sheet, redoing the balance sheet, is there anything coming up in 1Q of significance?
Jared Wolff: The FDIC assessment is pretty big. Isn’t it, Joe?
Joe Kauder: Yes. So, on the cost, the FDIC assessment, assuming we get that’s a very big run rate item. And then there’s — there are some other initiatives we have, which they come in throughout the year. There are other things that are happening in the first quarter. But I think were you asking about the balance sheet restructuring in the first quarter, because on that, I think you could see us deploying some of our excess liquidity against, for example, the BTFP, which is going to come due in March.
Tim Coffey: Yes, that’s actually what I was asking about, it was on the balance sheet side. Is it just the BTFP then that you’re, that’s front end of?
Joe Kauder: Well, there’s other higher cost broker deposits which are coming due in the first quarter and that’s I made a comment earlier about how we evaluate them as they come due. We look at the situation, the economic environment at the time and we make decisions what’s best to kind of manage the portfolio optimally on a day-by-day basis.
Jared Wolff: Tim, one other thing, we did mention that we are constantly looking at loan sales. And so I don’t know that we’re going to execute it. It depends on the price, but I wouldn’t be surprised if we did because we have opportunities to do that. But if we don’t get the right price, we obviously won’t do it.
Tim Coffey: And let be clear that the multifamily is off the market now, right? You’re going to hold onto that?
Jared Wolff : Yes. We’re going to hold onto that.
Joe Kauder: I would say there might be a very small subset of the multifamily that was that very small subset that there seems to be a lot of interest in that piece of it we may, but it would not be a large portion.
Tim Coffey: And then my final question is Jared on the size of the balance sheet, and I’m not being critical because I think he has what you do with pretty much unprecedented in banking this merger. But I thought at announcement the balance sheet was going to be smaller than it is today. And I’m just kind of wondering did you kind of just run out of time to do all the stuff you wanted to do? Or was this more, or was there a strategic reason for keeping it bigger?
Jared Wolff : Well, the first piece of it was keeping the extra piece of multifamily. And we have more cash I think, than we planned. But I do see it coming down. Like I said, we’re not — we’re really managing the profitability and to that 1.10% ROAA and obviously 1.10% ROAA on a bigger balance sheet means more earnings. So if we might need to bring down the balance sheet if, based on where we see earnings. And it’s a delicate balance obviously, because you get rid of assets and they’re earnings something and where are the expenses that go along with it. But we’re managing all of that to make sure we get to that 1.10% ROAA out to the gate at Q4 to start 2025. So I don’t know where we’re going to land, but I’m confident we’re going to get to our profitability targets.
Operator: And our final question is a follow-up from Timur Braziler from Wells Fargo.
Timur Braziler : Just one quick one. What are the assumptions for purchase accounting that are embedded in your estimates for ‘24?
Jared Wolff : I know that question wasn’t directed to me, so I’ll let Joe answer that.
Joe Kauder: So, in the deck we included a page which showed the how the accretion, we estimate the accretion will roll off. And so, I think on Page 29 of the deck, but I think, our current assumption is that we’ll have a we estimate that it’ll be about $0.15 EPS impact for the year, which includes loan marks consistent with in an aggregate way consistent with the yields that we’re seeing on our new originations.
Operator: And ladies and gentlemen, with that, we’ll be concluding today’s conference call and presentation. We do thank you for joining. You may now disconnect your lines.
