Steve Moss: Okay. Great. I’ll step back in the queue for now. Appreciate all the color. Thanks.
Greg Dufour: Great. Thanks, Steve.
Operator: Thank you, Mr. Moss. Our next question is from the line of Damon DelMonte with KBW. You may proceed.
Damon DelMonte: Hey. Good afternoon, guys. Hope everybody’s doing well, and Greg, congrats on an exciting time for you. I wish you the best in retirement and probably don’t have to move too far because Maine’s a common destination for retirees and you’re already there. So good luck with everything.
Greg Dufour: Absolutely. Thank you, Damon.
Damon DelMonte: So just wanted to start off on the kind of circle back on the loan growth side of things. So I hear you guys saying you’re focusing on relationships over transactions and think that’s a great approach. So as you kind of look at how things are shaping up here for the fourth quarter, I mean, do you expect to show positive loan growth to end the year and kind of how does that impact your outlook for 2024 growth?
Greg Dufour: Yeah. I — right now I would say we’re expecting flat loan growth, just trying to keep ahead of any amortization payoffs for — definitely the coming quarter. As we look out to what the next year will come into play, I think, that’s where we may see some opportunity, especially as people won’t have the deposit liquidity base to support loan growth. That may provide opportunities, but right now we’re kind of in a lack of a better term call it a holding pattern on loan growth. We’ll try to keep it flat, but only if the pricing makes sense, as well as the credit quality makes sense.
Damon DelMonte: Yeah. And then kind of tying that outlook for growth with credit quality, which continues to be very strong. I mean, how do we think about provision? You had the release this quarter or the negative what $0.6 million in the provision line this quarter. I mean, should we — do you think you’ll be at least booking some provision?
Mike Archer: Good question. I think we’re kind of looking at it, Damon, just as 90 basis points toward loans we feel pretty good at. We’re certainly cognizant and being aware of what potentially lies ahead and I wouldn’t see us probably going below the 90 basis points, certainly very much. I would think if anything, there might be a few basis points upside ahead of us. Again, it all depends on what happens around us from a macro environment. To your comment, asset quality looks really good, the credit trends within the portfolio look really good, we continue to be very proactive and really like digging in and doing some stress testing, other things that we can to identify any potential issues before they arise and knock on wood, we’re certainly not seeing that yet.
I think to the wild card to it certainly will be loan growth. I think I definitely agree with Greg. I think we’re kind of aimed and looking at probably something more flat for the fourth quarter. So to that end, holding at 90 basis points and anticipating minimal charge-offs, I expect the provision to be fairly low.
Damon DelMonte: Got it. Okay. And if I could just ask one more quick one on the expense outlook. I guess, Mike, could you just repeat your comments on the expected costs related to the CEO transition? And given the decline this quarter, I mean, are you factoring in those costs as like being operating costs or are you calling those out to be kind of like one-time expenses?
Mike Archer: Yeah. Good question. So just to repeat what I said there. So all in for 2023, we were estimating the total cost of the transition around $900,000 and then for 2024, $1.2 million, and then just year-to-date through 9/30 of this year, we’ve recognized about $600,000 of that. So you’ll call it another $300,000 probably in that arena for the fourth quarter of 2023. Some of those expenses are just, call the pure accounting of it. We just have to recognize it over several months. We can’t just take it in the fourth quarter, unfortunately. So we’ll see some of that play out into 2024.
