Ron Farnsworth: Yes. In a normalized world, my expectations will be cash flow – interest-bearing cash flow would be about half of where they are now. So you get a sense of what we consider the excess on balance sheet. We think it’s prudent in this environment just given the uncertainties within the QT field deposit outflows. And I’d also point out that, that cash is sitting at the Federal Reserve, earning the 5%, 5.25%. So the net effect of that is that additional $1.5 billion is pretty small, talking maybe at $0.06 a penny on a quarterly basis. So we just think it’s prudent to hold that at this point just based off the environment till the outlook clears before we make some moves.
Janet Lee: Okay. That’s helpful. And in terms of your reserve levels, assuming no major changes in economic forecast, is the second level reserve ratio a good level you would like to maintain? I understand that reserve releases had some have to do with the loan sales, but in terms of the allowance for loan leases as a percentage of loans.
Ron Farnsworth: Yes. I mean based on CECL, right, with the economic forecast, that’s where we feel the reserve should be. I think it all else remains equal, which is a big if, right, up or down. It’ll stay about that level, if not drift down to closer to 1% over time. And when I say 1% over time, when I think about just long-term history of charge-offs and the duration of the loan book, it’s generally going to be about 25 bps over the course of 4 years, would give you at around 100 bps. So we’re a bit above that at this point based in part on the economic forecast based in part on the deal marks, etcetera. So near-term, I’d expect it to stay around the current levels, unless there is a significant change in economic forward.
Janet Lee: Okay, thanks. So my last question, how should we think about the loan growth for the rest of 2023?
Tory Nixon: Hi, Janet, this is Tory Nixon. I think I touched on just briefly earlier, the loan pipeline continues to grow, and we are looking at a lot of really good, strong opportunities in the company throughout our eight Western states. It’s full relationship banking. We’re not making loans for people who don’t put deposits with us, and we don’t provide fee income opportunities for us. So we’re looking at full relationship banking, which is we feel is the best way for us to carry the bank forward. We – I feel we have opportunity to grow the loan book, and it’s going to be mid to low single digits for loan growth. But I think good prudent loan growth that supports relationship growth and relationship banking is what we will continue to do throughout the footprint.
Janet Lee: Okay, thank you.
Operator: Thank you. [Operator Instructions] Our next question comes from the line of Jared Shaw with Wells Fargo. Your line is open.
Jared Shaw: Good afternoon, everybody. I guess, maybe looking at the mortgage revenue, how should we be thinking about revenue there with the normalized impact from hedging and the planned MSR sale?
Ron Farnsworth: Yes. This is Ron, and I’d say levels will be consistent. Again, assuming rates stay relatively consistent with where they are now. That’s obviously been the big story within mortgage lending over the last 1.5 years. We are targeting that sale of $4.5 billion of MSR just to reduce – continue to reduce future volatility. So that also played into the fact that you didn’t have the MSR fair value gain this quarter because we had locked in that price a bit earlier in the quarter before you saw some of the bond market. So still very much core product and Clint, you want to add to the…
