David Morimoto: Thanks David.
Operator: Thank you, Mr. Feaster. The next question is from Andrew Liesch with Piper Sandler. Please proceed.
Andrew Liesch: Hey, everyone. Good morning.
Arnold Martines: Hi, Andrew.
Andrew Liesch: I just want to talk about the — hi — the deposit mix here. A lot of it was from — the increase was from the successful CD campaign. How should we look at deposits going forward? So that match loan growth as it did this quarter, and you think it’s going to be more weighted towards CDs? And then, I guess, over time, do you think the mix of CDs and non-interest bearing get back to like where they were pre-COVID? I’m just kind of curious how you think the funding mix is going to change?
Arnold Martines: Yeah. Andrew, this is Arnold. I’ll start by just saying that I think, near term, we’re probably going to see a 50/50 mix time deposits and core. Core coming mainly from new acquisitions, new customer acquisitions, top market right now. As I mentioned earlier, I don’t see it — this is a near term dynamic that us and every other bank has to manage through. I don’t see this as a longer term issue. I think, we’re going to get back as Fed’s start to ease rates in the future. We’ll get back to kind of where we were pre-pandemic. But it’s going to be a little bit of a journey. And we’re just going to manage that effectively in the near term. I’m not sure if David wants to add anything.
David Morimoto: Just maybe one additional point, Andrew. On DDA, there’s obviously a lot of interest in DDA. DDA as a percent are total deposits at the end of 2019. So, pre-pandemic, it was 28% of total deposits. At the end of last year, it was 31%. So, there’s 3% differential to pre-pandemic, that’s about $200 million, roughly $200 million in the in deposits. We think our baseline DDA ratio should be higher than pre-pandemic due to our outperformance on PPP lending. So, we’re thinking maybe we have $50 million or $100 million more normalization on DDA balances, and obviously we’re doing everything we can to keep that to the lower end of that range.
Andrew Liesch: Gotcha. That’s really helpful color. Thank you. And then, just related to that your margin guide, is that for the quarter or for the next several quarters or for the year? Just curious what that 310 to 320 range is good for?
David Morimoto: Yeah. Generally, it’s for the next couple quarters. That’s what we’re looking at. Obviously, an operating environment is very volatile and a lot of things can change, but that’s what we’re guiding for the next couple quarters, Andrew.
Andrew Liesch: Certainly that makes sense. And then good to see the new buyback. I guess, how active do you intend to be, been pretty active the last couple quarters? Is a similar pace of repurchases reasonable, or I guess kind of how you’re looking at that?
David Morimoto: Yeah. I would say similar. We’ve been repurchasing about 200 to 252 — 200 to 250,000 shares per quarter. Spending roughly about $5 million on repurchases combined with $7 million in orderly cash dividends. So that’s roughly the 60% return of net income that we’ve been targeting.
Andrew Liesch: Gotcha. That is really helpful. Thank you for all my questions. I’ll step back. Thanks.
Arnold Martines: Thanks Andrew.
Operator: Thank you, Mr. Liesch. The next question is from Laurie Hunsicker with Compass Point. Please proceed.
Laurie Hunsicker: Yeah. Hi. Good morning. Just maybe circling back to where David was asking on Swell, can you quantify a little bit more where your Swell balances are as of December 31st? It sounds like they’re not a lot there. But when you talk about ramping it up in 2023, what does that look like? And then, I guess off of that, I thought you were ceasing Mainland unsecured consumer. So, is this pilot testing then just in Hawaii, or help us think about that. Thanks.
