George Gleason: It’s really across all the business lines. As I mentioned, this corporate and institutional banking group that we’re building under Brannon that as a combination of our asset-based lending, equipment finance, capital solution and what we’re now calling fund finance group is the kind of the foundation for a lot of new talent we’re bringing in, including leadership at the top of that group from other banks, bigger banks that have a lot of experience and have a shared commitment to credit quality and profitability that aligns with us. So we’re adding there. We’ve begun to add a lot of business bankers in the retail team. We’re adding more staff and more branches on the retail side. We had Cindy and her team did an excellent job generating $2 billion of deposit growth in the quarter just ended, really nice number with our existing branch network.
But we’re going to be generating $2 billion a quarter in deposit growth in future years. We’re going to need to continue to develop our infrastructure to do that, and we’re doing that. So we’re doing the things that we need to do to continue to grow and grow in a very safe, very profitable manner going forward. And I’m very proud of the fact that even though we added 40-something people and over the last year when a lot of banks have been cutting staff, we’ve added north of 110, close to 120 new people. Our efficiency ratio in the quarter just ended with sub-33%, and that just speaks to the significant revenue generation capabilities of our franchise.
Michael Rose: That’s helpful. And then maybe just as one follow-up. I saw that you guys are not going to be doing buybacks at this point. It sounds like the efforts are clearly focused on growing out your businesses, whether it be RESG or the others. Anything else that we should be thinking about in terms of why not just have a buyback in place as a tool, just given where the stock is trading, even if you don’t use it? And then I think you just mentioned that maybe deposit growth could be a little bit stronger as we move forward. How does that all kind of interplay with the decision, not the Board’s decision not to at least just have a buyback in place in general?
George Gleason: Tim is the king of capital.
Tim Hicks: Hi, Michael, yes, you saw our comments there and really the first 30 minutes of this call, I’ve been talking about how our — we’re focused on growing organically. And that’s just really our primary focus, a lot of internal efforts around there. So we don’t have any plans to buy back stock this year given our growth last year and continued expectation for growth this year. So we’ll ask our Board at a later time when we’re ready, so there’s no reason to have a buyback in place if we don’t have any plans to use it.
Michael Rose: Totally get it. If I could just squeeze one last one in. George, would you say that you’re more confident in the ability to grow EPS and PPNR or NII this year at a kind of a record rate than you were maybe back in January, just given the strong first quarter, is that a fair characterization?
George Gleason: Michael, we’re going to spend some money, and there’s a lot of uncertainties about the economy. So I would take a cautious outlook about that. The guidance we gave in our January call was that we expected our EPS and net income for the full-year of 2024 to be a record over 2023. And of course, we had record numbers every year in 2023, coming off a record quarter in Q4 2022. And we started out this year really good with a record. It wasn’t a huge improvement, a $0.01 share basically improvement over Q4. We’re going to continue to grinding work and I think we’re taking a cautious view of it, and I would reiterate guidance for full-year of 2024, we expect to be at a record EPS and net income number on top of 2023’s record EPS net income number.
But I’m not sure about every quarter. We would love to put up a little bit of improvement every quarter, but I can’t guarantee it will be a linear deal, but we’re confident about our guidance for the full-year of ’24.
Michael Rose: Great. Thanks for taking my questions.
George Gleason: Thank you.
Operator: One moment for our next question. Our next question comes from Manan Gosalia with Morgan Stanley. Please proceed with your question.
Manan Gosalia: Hey good morning.
George Gleason: Good morning.
Manan Gosalia: I appreciate the new disclosure on the loan floors. I think you might have mentioned this, but those floor should keep migrating higher in a higher for longer rate environment. Is that correct?
George Gleason: Yes, definitely.
Manan Gosalia: Okay. And then how do you think about the dynamic between capital market exits in these loan floors as we go through the next couple of years, with the loans that have higher flows automatically move into the capital markets when rates move below those floors? Would there be — would some of these loans exit rather than remain on their floors? Or am I thinking about that the wrong way?
George Gleason: Brannon, do you want to answer Manan’s question?
Brannon Hamblen: Sure. Well, certainly, our borrowers love to pay lower interest rates as they can. But you have to look at — it’s a very complex topic, where the project is in its construction phase, where it is in its lease-up phase. And also, where they think rates are going to go and how fast they’re going to go. They are all influence that. So in a real simple world, yes, if they fall and they hit their floor, then they would be looking, but there are other considerations. And you have to remember, in our projects with the low loan to cost that we have, they would be looking not just at the rate they’re paying, but also at the proceeds they’re going to get. So there are multiple motivations involved in that. So look, we’re happy for our loans to be repaid to have a successful sort of life cycle to them.
