Brett Rabatin: Okay. And then just one last one for me on the funding side. I missed the number that you gave for the DDA growth, the gross DDA growth that you had, but you’re obviously being able to keep DDA balances relatively healthy versus maybe some others that have had more downside to that number. Are you — one is what was that number? And then secondly, you kind of think there’s mix shift change still from here, or do you kind of feel like you can grow the DDA to kind of keep the concentration levels the same?
Greg Robertson : Yes, the number was $43 million in total, new noninterest-bearing deposits gross for the quarter. And the second number I gave to that was that number helped us have an average of about $14 million per month so far, a year-to-date. And I do agree with your statement. That has allowed us to keep that noninterest-bearing like a lot of our peers have experienced that noninterest-bearing just declining even further. So we’re playing a little bit of offence and but playing defense on that.
Brett Rabatin: Okay. And then, Jude, comment on the outlook for that. Do you think you continue to keep that flat? Or what’s your thought on funding composition from here?
Jude Melville: Yes, I think we — that was Greg talking, but I think we are finished with a quarter. I remember at about 27% noninterest-bearing, and I think we anticipated maybe losing a percent or two by the end of the year, which is in line with what we’ve said last quarter and possibly the quarter before, but we believe we’ll finish up the year around 25% noninterest-bearing maybe 26%. And we’re not — it’s a focus of ours, and as Greg mentioned, we are opening a lot of new accounts, and with the new branches that we’ve opened, I think that gives us an opportunity to call on new clients. And so our goal would be to kind of remain about that 25% over time, if not improving it.
Operator: Our next question comes from the line of Graham Dick with Piper Sandler.
Graham Dick: Hey, good evening, guys. So I just wanted to circle back to the loan growth front. I apologize if I missed this. But I heard there’s a lot of payoffs this quarter. You’re still in some pretty good markets. Dallas needs to be growing pretty substantially still. How are you guys thinking about loan growth going into 2024? Is it going to be a pretty steady, 7%, 8%, kind of like what you’re looking at this year? Or do you think there will be a step down, maybe as the rate environment continues to work its way through bars? Appetite for new credit?
Jude Melville: We think we’ll return to kind of a 7%-8% range for next year. Our pipeline and connectivity are still strong. We’ve purposely chosen to manage capital and manage margin, which has meant that we’ve done fewer loans than we could. As we continue to work on earnings and grow within those earnings, that gives us more room for growth in loan book. And it hasn’t been a question of demand just dropping off cliff. There is some slowdown in demand, but we also have been selected. We feel confident that we can, again, we’ll have to have a little uptick in the fourth quarter to equal our 7%-8% projection for the year. An uptick would be, I think, in the 5%-6% range, maybe 4%-5% range. But then we feel well positioned to be able to kind of maintain that 7%-8% over the course of the year.
Again, to Greg’s point, we would have been at that 4%-5% without the unexpected payoffs. And I would emphasize the unexpected payoffs were all for good reasons. We just had developers that sold projects that came to fruition, which is how it’s supposed to work. So we are pleased about that.
Graham Dick: Right. Yes, got it. You mentioned on capital building internally, kind of if you guys have managed to this year, how are you thinking about capital priorities right now when it comes to, I guess a couple options? First, being organic growth. And then the second, maybe a bond restructuring type transaction. We’ve seen a lot of that recently. And then I guess third, you did put in that new slide on M&A. So just wondering what your thoughts are on that front as well. So do you guys have a way you’re thinking about capital allocation right now as it relates to those items?
Jude Melville: Yes, I think number one priority is funding organic growth at a good moderate but healthy base when it grows within our capital stack and within our retained earnings. We do analyze opportunities to restructure the investment portfolio from time to time and when that option seems to make sense, we’ll take advantage of that. We haven’t decided to pull the trigger obviously on that yet but it doesn’t mean that we’re not open to it. And then on M&A while it’s not our priority in terms of how to spend capital, we do believe there will be opportunities for us to review and partnerships for us to consider and we’re prepared to do that under the right circumstances but don’t feel like we need to do it. We’ll just do it if it makes a lot of sense for our strategic plans but number one priority is funding the organic growth.
Graham Dick: Okay, got it, helpful and then I guess the last one for me another I guess sort of big picture question, but it looks like the 1% ROA target is within reach this year. Is there anything you’re looking at for next year or the year after, any new sort of level you guys is targeting or new metric you guys are looking at achieving?
Jude Melville: I think it’s probably a little early. We’re in the budgeting process just kind of begun it and probably with the amount of uncertainty that’s out there now I think it would be a little bit too early to make any forecast of improvement there. I mean we’re going to, that’s our goal. We want to keep managing that and over a multiple year period at one reason we put in the chart about five-year improvement and across all the profitability metrics is that we wanted to show that we’re committed to that being the key driver of how we make decisions over time and so we’ll continue to work. We do believe that over the long run we’ll move closer to that to that 1.15%, 1.20% ROAA but in short run, it’s a little hard to predict given all the moving parts and again, we’re just beginning the budgetary process.
We feel like this year was a big step in terms of achieving that 1% kind of baseline and we’ll continue to work to build from there. I didn’t, we didn’t put the M&A chart into necessarily signal that we were getting ready to do M&A was, we did it just to show that over time the M&A that we have done along with other decisions that we’ve made have led to improved performance and I know from an institutional investor standpoint or from an analyst standpoint because we were quite active on the M&A front, I think there was some concern that maybe we were just doing deals to do deals. I’m being a little dramatic here, but we take it as a point of pride that the deals that we have done have made us a stronger franchise. And so we felt like we had enough information now to do a little look back and prove out the case for our combined M&A and organic growth strategies.
And we’ll continue to make capital decisions with those longer term goals in mind.
Operator: Your next question comes from the line of Kevin Fitzsimmons with D.A. Davidson.
Kevin Fitzsimmons: Hey, guys. Good evening. Okay. First, I just want to do a little housekeeping because I was trying to keep up with you as best I could, Greg, but I’m getting slower with my age here. But so, what you said about the fee revenue base, you said 8.4 is a clean run rate and good to use for going forward. Is that — am I correct there with what you said?
