And then we had four projects that the sponsor decided not to move forward on the vertical construction and so paid off the moderate balance that would have been outstanding — nominal balance that would have been outstanding at closing. So, and I would just say in terms of how long they’re staying on, look, it’s, you look back over time, there have been times where our average age has been longer than it is today, and there have been times, and it’s been a bit shorter. But it all makes complete sense in terms of the environment that we’re in. And as George alluded to, the — when you’re locking one down for a while, you sure want to try to get it lower than the rates are today. And so it’s playing out really as we expected it to and we’re very happy, as we said, to be making the return while they’re on our balance sheet.
Timur Braziler: Great. Thanks for the color. And then just one follow-up on the credit side. You mentioned just now land loans and conversations around going vertical. Maybe just provide some commentary as to what you’re seeing in the land portfolio and some of the updated conversations you’re having with sponsors about their decision to go vertical?
Brannon Hamblen: Yeah, there’s a mix there. We gave you some pretty good color, I think, on the land portfolio and the appraisal stats that we included in our comments in terms of — we had, I think, four different land appraisals that were completed that showed stable to declining LTVs at the end of the day. And as we’ve noted in the past, a significant portion of our land portfolio is as, you said, initial shorter-term land loan with the thought that the sponsor once they have plans drawn up and costs sort of circled would move forward. And we are, as I said, seeing some of those move forward. But I also mentioned we had four that did not move forward. So it’s, we’re still in a period where just like with refinances moving forward with a construction loan in today’s rate environment, and some of the economic uncertainty certainly makes one think two, three and four time for moving forward, and we’re seeing some of those decisions, say, what we’re going to wait.
It’s — the deal is just not got enough room in it for us to want to move forward. And at the same time, we’re seeing a number that are going to move forward. And that’s, whether that’s land loan situations that we have that move vertical or outside our portfolio. I think there’s some, you can deduct some information from our thoughts about originations in Q4. So again, it depends on the market. It depends, it all comes down to the return that one can make and versus the cost that it takes to develop and there’s more room in certain markets and product types than there are another. So it’s a mixed bag there.
Timur Braziler: Great. Thanks for taking my questions.
Operator: And thank you. And one moment for our next question. And our next question comes from Catherine Mealor from KBW. Your line is now open.
Catherine Mealor: Thanks, good morning.
George Gleason: Good morning.
Catherine Mealor: I just wanted to switch over to the funding side of the conversation. Just ask about how you’re thinking about funding growth as we look through ’24, it’s really nice CD growth. Of course, that’s coming in at a higher cost. How do you think about kind of the, if let’s say, Fed fund stay stable from where we are today, where do you think ultimately the blended kind of cost of funding peaks for you as you continue to reprice a 5%, 5.5% pace as you grow CDs?
George Gleason: Well, Catherine, what I would tell you is our guys are doing a great job on the deposit front, and we’re growing deposits nicely as almost all banks are experiencing or the vast majority, these higher rates available on CDs or other alternative investments for customers are sucking money out of non-interest-bearing and lower interest-bearing time and savings are non-time and savings in money market accounts. So that trend is an industry trend. We’re experiencing that. We are, as you mentioned, having great success growing CD deposits, we expect that that will continue, and that will put some upward pressure on our deposit cost as we’ve talked about since the April call last year, as the Fed has raised rates, deposit costs will go up and because CDs have staggered maturities, the impacts of last quarter’s Fed increases or if there is Fed increases this quarter, those will be felt three or four quarters down the road, when CDs issued in that time frame roll over and get repriced in connection with that last quarter increase or whatever.
So there’s an upward trajectory there. We know it. That’s why we’ve said that we will give back some of this very nice expansion that has occurred over four or five of the last six quarters, and our net interest margin and core spreads expanded broadly as loans reprice faster than deposits last quarter and we gave some of that back, as we said would happen. We expect that would continue to happen. So I don’t know exactly what the Fed’s going to do. I don’t think the Fed knows exactly what they’re going to do. And it’s hard to know exactly where that goes. But the trend is up for deposit pricing because we’re rolling over CDs now that were priced two, three, four quarters ago, and their market rates are higher now than they were then. So I think our guys are doing a great job of funding our balance sheet, and doing it in what is a very cost-effective way, particularly considering how much we are growing our balance sheet.
So we feel super good about that. And Cindy, [indiscernible], Drew Harper, the other guys on the deposit team, the guys in the retail branches, there are 1200, 1500 people in those retail branches, they are doing wonderful workforce and we’re very pleased with it.
Catherine Mealor: And you’ve been one of the few banks that’s been able to grow NII since your NIM has really held in better and then also you’ve grown so much. But I assume that — we’ve talked about this in the past calls that would reflect potentially this year just as the NIM falls just from deposit cost catching up a little bit on the industry, but the inflection should be in the next few quarters. But could you argue that with the higher — the better origination volume you’re seeing and the better growth that we could still see another few quarters of actual dollar NII growth?
