Stacy Kymes: Peter, this is Stacy. I think the answer to be specific, I think that Marty has kind of provided the pieces there. But our view is that you’ll have more margin deterioration in the fourth quarter, less in the first quarter. And our current view is that it’s likely in the first quarter that both margin and net interest revenue are kind of where they trough and then we begin to build back from there, plus or minus, with not a high degree of precision around the absolute numbers, but certainly, directionally, we think that we likely bottom somewhere around the first quarter.
Peter Winter: Okay. Got it. Thank you. And then, Stacy, just expenses. If I think about the company and the strategy, and I understand with competitors pulling back and you’re taking advantage of this opportunity and investing. Is there any thought of maybe slowing down some of these investments spending next year just given somewhat of a challenging revenue environment?
Stacy Kymes: No. I mean, if you think about — I mean, Peter, you followed us for most of my career, it feels like, I mean, our view is we’re running this company not for the next quarter or for the next year, but for the next five years or 10 years or 15 years. And so you get these opportunities like this, you have to take advantage of it. And I understand the optics, but because of our mix of fee revenue, we’re not a sub-60% efficiency ratio company, we’ve never been. And so having a low 60s efficiency ratio, it doesn’t bother us at all because we’ve got 40% to 50% of our revenues from fee-based businesses that carry a higher efficiency ratio. And so we’re going to be prudent about expenses. We’re not going to do anything that’s imprudent there, but we’re going to grow the company, and we’re going to think about things from a long-term perspective, not a short-term perspective.
That’s may be the most distinctive advantage we have as a financial institution, and we’re going to take advantage of that.
Peter Winter: Okay. And just my last question, just deposit betas, I guess, the outlook was 64% by year end. I’m just wondering, if you could update that and how you’re thinking about it next year?
Martin Grunst: Yes. We are thinking about that still as 64%, 65% for the end of this year. And then we do expect that to slow quite a bit next year.
Peter Winter: Any idea where it kind of settles out at?
Martin Grunst: Yeah. It’s probably a little too early to tell, but quite a bit lower. When we saw some nice slowdown in September, and again we expect to see that slowdown continue.
Peter Winter: Got it. Thank you.
Operator: Thank you. Next question comes from the line of Jon Arfstrom with RBC Capital Markets. Please go ahead.
Jon Arfstrom: Hey. Thanks. Good morning.
Martin Grunst: Good morning, Jon.
Jon Arfstrom: Marc, maybe a question for you. In your prepared comments, you talked about some limits on commercial real estate concentrations. And I’m just curious, what that means for overall commercial real estate growth. And I’m particularly interested in the multifamily and industrial, because they’ve been such big drivers of growth for you guys?
Marc Maun: Right. What I talked about was we do try to manage our exposure in real estate to a certain percentage of capital, and we are at the upper end of that range. So we have seen growth — a lot of the growth that we’ve seen this year has been funding up of existing deals and construction loans and the number of payoffs that have slowed due to the situation in long-term markets. So we expect that we still have room for modest growth in that next year, but it’s not going to be at the double-digit rate that we’ve seen year-over-year in CRE so far. We are focused on multifamily and industrial. That’s where the growth has been. We don’t see those markets slowing down too much. We’re not focused on retail and certainly not on the office piece. So again, it will be something modest. It won’t be in the same kind of growth rate we had overall this year.
Jon Arfstrom: Okay. Also, on that same slide, talk about what you’re doing in office. I know it’s not huge exposure for you, but I do see it’s down. And you talked — you made a comment about a mini-perm option to solve some potential issues. Can you talk a little bit about that?
Marc Maun: Well, right currently, our office portfolio is very strong from a credit standpoint. If we reach a maturity with one of the office loans, at this point in time, they’re all in good shape, and we would have the ability to extend that loan for a short period of time until longer-term markets may open up. But we really have no significant credit issues at all in the office portfolio at this time.
Stacy Kymes: So Jon, for us, a mini perm would be some kind of 20-year amortization on a three-year term, a three-year maturity based on the property continuing to perform as agreed. And so the borrower doesn’t have to find a permanent refinancing source, we can give them a short maturity but a longer am consistent with the permanent markets to bridge them until when the permanent markets are more healthy.
Jon Arfstrom: Yeah. Okay. Makes sense. And then your stock is getting beat up a little bit this morning, and it’s on the NII and margin guide, I think, primarily, but you’ve been active in the buyback. I’m just curious, and you bought a lot higher, quite frankly. So I’m just curious, you kind of buyback appetite and capacity, especially where the stock is? Thanks.
Stacy Kymes: Yeah. I think you can assume that given where the stock is today and given where we bought it in the third quarter, we would have a very high appetite for repurchasing shares.
Jon Arfstrom: And capacity in general?
Martin Grunst: Yeah. We have very strong capital ratios, and we’ve got the capacity we need to do that.
Jon Arfstrom: Okay. Thank you.
Operator: Thank you. Next question comes from the line of Brandon King with Truist Securities. Please go ahead.
