Jon Arfstrom: Okay.
Marty Grunst: Jon, sometimes we tell you don’t use the end of quarter trading level as the way to think about the future. This quarter, it’s probably better than the average.
Jon Arfstrom: Okay. Very helpful, guys. Thank you.
Operator: Our next question comes from Brady Gailey with KBW. Please proceed with your question.
Brady Gailey: Hi. Thank you. Good morning, guys.
Stacy Kymes: Good morning.
Marty Grunst: Good morning.
Brady Gailey: I understand the dynamics of having a net interest margin that moves a little lower in the back half of this year. But I’m wondering, as we look to next year, the Fed will be done deposit costs will probably have peaked could you see an expanding net interest margin into next year, just because your asset reprice is higher and the NIM could be actually headed higher next year?
Marty Grunst: Yes. So, that’s possible. And I would again, focus on net interest revenue is the way to think about next year. And if you play out the comments that I made earlier, you can see that be on a growth trend. And the percentage, sure it’s possible to see that higher especially, if you get less of an inverted curve that’s going to help as well.
Stacy Kymes: You get a couple of factors there. I think Marty’s reinvestment rate, we’re getting what roughly $400 million, a quarter in cash flow from the securities portfolio that’s reinvesting at 250 to 300 basis points higher, than what we’re receiving today. That’s going to help you a little bit. The trepidation in answering the question is really just understanding, how deposit behavior is going to be as we grind higher for longer. If we’re through the worst of that from an industry perspective then I think you’re right, there’s upward opportunity on the margin, if deposit pricing continues to grind higher in a more meaningful way than that could be the offset to some of the favorable benefits that we see.
Brady Gailey: All right. And then intra-quarter you guys had a couple of announcements expanding into San Antonio, also expanding into Memphis maybe just the rationale behind those new markets? And is this something we should expect to see going forward putting new markets on the map organically?
Stacy Kymes: Yeah. I think they’re probably a little bit two different stories. San Antonio is a market that we buy for a long time. We have a strong presence in Dallas-Fort Worth and Houston. Central Texas has been a gap for us, and we’ve just been looking for kind of the right way to enter that market. We’re excited about the team we’ve acquired there, and we’ll have corporate commercial treasury wealth both in San Antonio and Austin, we’ll have a complement of between 15 and 20 folks. They’re in Central Texas that will be an opportunity for us to meaningfully expand our presence there. And so that’s going to be full-service banking and the beginning of another key market for us in Texas. I mean, Memphis really was an opportunistic chance for us to grow our fixed income sales and trading platform that wasn’t necessarily on the radar screen as we began the year.
But as things unfolded and opportunities presented themselves, we really saw it as additive to the current operations we have in Little Rock Milwaukee and Stamford Connecticut. It fits very cleanly. They have very little sales overlap with our existing portfolio and we’re excited for the team that is going to come on board there to help us in that area.
