Rich Dutton: Tim, I want to make one clarification. Dennis said he thought it was of value. He did not say he liked where our stock price was.
Tim Switzer: That’s right. That’s right. Understood. Understood. Well, that’s all for me. Thank you guys. Have a good weekend.
Dennis Shaffer: Okay, thanks, Tim.
Operator: The next question comes from Manuel Navas with D.A. Davidson. Please go ahead.
Manuel Navas: Hey, thanks for the comments today. Just wanted to follow-up on the NIM a little bit. Are you saying similar compression to the third quarter and the fourth quarter and first quarter, or is that compression going to become a little less as you pursue other deposit opportunities. Can you just kind of clarify that a little bit, that progression?
Dennis Shaffer: Well, I think the compression was a whole lot more from one to two than it was from two to three. And I think what we’re saying is probably that 17 basis points of compression that we saw in Q — or over the course of Q3, is probably a good barometer of what we might anticipate. Or a quarter-to-quarter in the fourth quarter.
Manuel Navas: Right. And then perhaps a little bit less compression into next year.
Dennis Shaffer: Correct.
Manuel Navas: And then at the point, if we have no more hikes and we’re staying at 550 fed funds into 2024, is there a point in 2024 where you could start to see the NEM inflect or would it just stay stable after it’s done compressing?
Rich Dutton: I think it’d be more of a stable kind of a scenario, Manuel. We’re 100% loaned up-ish, so that makes it, there are a whole lot of levers to pull. Everything that, every bit of growth that we have, incrementally we’ve got to go out and fund it. And that makes it hard to expand.
Dennis Shaffer: Sure. And our modeling kind of shows that rates up, increase our rates down, it’s pretty neutral.
Rich Dutton: I think the only part right now, Manuel, is that we’re slowly seeing, as Dennis mentioned earlier, we’re slowly seeing our loan rates increase, you know, month-over-month from a production perspective. Obviously, all the ones that roll right now are rolling at significantly higher prices.
Manuel Navas: Okay. Can you talk a little bit about kind of the, where you’re focusing on for deposit gathering? Because I’m sure that’s kind of a wild card for you that you could have less wholesale funding if all the focus initiatives that you have out there on the deposit side outperform?
Rich Dutton: Yes, a couple things there. One, the commercial deposits that we mentioned, we’re really pushing hard to say, look, with certain banks not lending, we’re saying, if we’re going to do your deal, we’re going to have all these deposits. So we need those compensating balances…
Dennis Shaffer: and then we’re having success.
Rich Dutton: Yes, and we’re having pretty good success with that. We’re having pretty good success with that. So that’s one focus. We have streamlined our small business, the way we process small business loans. And that is set to kick off here in the fourth quarter. And we think that will make it easier for our people to go after those loans and process those loans. We’ll also look to almost check out a micro loan through our retail division, which we don’t have, because a lot of those small business loans are self-funding. So, you know, those are two areas where we’re really focusing on. And then we continue to work on our digital app to get, you know, we’re not fully maximizing its capabilities yet, but we’ll continue to work on that to add differentiating services that may drive people to that app. And we can open accounts through that app and things like that. So those are a couple things that we’re working on to try to gather additional deposits.
