Clint Stein: The other thing I’ll add is that it really comes down to our bankers being proactive in managing their portfolios. We talk a lot — and a lot of banks probably do this, talk about relationships, but that’s really the value of having a relationship is that there’s ongoing two-way communication so that you’re operating under the premise of no surprises. And that’s part of that is, if we, through that process, it sort of does well for the 30 years that we’ve been in business, you find a borrower that maybe isn’t as forthright or isn’t communicative is what you would think. Well then, those are the types that we prune out just on an ongoing basis and trying to make sure that we have the best clients possible or the best portfolio within each vertical possible that we can.
And so, one area I’ll mention just specifically would be our builder banking area. That’s something that as part of our ongoing management was early 2021, that really started communicating with each of their clients about, what’s your plan if rates go up? What does it look like? How is your inventory going to hold up? What’s your exit strategy for projects. And as a result, those portfolios are performing very well. There probably was a little bit of pruning that occurred in late ’21, early ’22 as a result of those conversations. But the vast majority of those relationships are intact and part of the great metrics that you see. It also leads into other things that you see in the balance sheet. Now these are smaller portions of that dynamic.
But, for example, our builders are putting more of their own money into their projects. So that lowers their deposit balances, lowers their line utilization. There’s different things that kind of come into play that you can see at a macro level as you look at our financials.
Chris McGratty: Great. Thanks. Thank you for all the color.
Operator: And thank you. And our next question is Andrew Terrell with Stephens. Your line is now open.
Andrew Terrell: Hey, good morning.
Clint Stein: Good morning, Andrew.
Andrew Terrell: Maybe just to start, Aaron, on the FHLB borrowings this quarter, were all of the FHLBs added? Were they overnight funding? Or was there any term to the borrowings?
Aaron Deer: It’s all very short term. A fair bit of overnight, but it’s weeks, not months or years.
Andrew Terrell: Yes. Okay. And then, maybe just bigger picture, if I think about the balance sheet on a pro forma basis throughout the year, you will have marked the securities portfolio after the deal close, so that’s reflected in pro forma capital. Do you feel like that gives you maybe philosophically just greater flexibility to roll or sell a greater portion of the bond book, either to fund loan growth or maybe reduce the borrowing position throughout the year?
Aaron Deer: Yes. I mean, once marked, obviously, that arguably gives you more flexibility. That doesn’t mean that’s going to be the decision. And obviously, those cash flows on those marks come back and supports capital levels. But it’s — I mean, that’s going to be a decision dependent upon what the rate environment is and what the balance sheet trends are going forward. So — and — so I’m not going to presume just what that’s going to be just yet.
