Mark Fitzgibbon: So of the teams that you’ve hired, those six teams that have brought in $300-and-some-odd million of deposits. What do you think those teams are capable of doing once they’ve — their books have kind of fully matured and migrated over?
Avinash Reddy: Yes, sure, Mark. So you go back to September 30, we were at $250 million on the teams at December 31, we were $333 million. Today, we’re $375 million. So it seems like a steady build of $70 million to $80 million per quarter at this point. I mean the good thing is we look at it on a client level and an account level basis, and it’s really not slowed down yet. So we expect to see continued growth in the quarters ahead over there. Again, they’re very heavily focused on DDA. At this point, it does take time to move over clients. So I think so far, they’re really meeting the expectations that we set out and they become profitable very quick. And really, the opportunity for us is to continue to grow that. But now that they’ve been here for a while, hiring new groups. And as Stu said, that’s going to be additive as well pretty quickly overall.
Mark Fitzgibbon: Okay. The last question I had, Stu, is there’s been a lot of dislocation in the banking space and your balance sheet has obviously held up well. Are you thinking about M&A at all? Is that sort of a priority, you think, for Dime over the next several quarters?
Stuart Lubow: Look, obviously, M&A has — the talk about M&A has certainly picked up. There’s still issues with marks and the balance sheets that are out there. I mean, certainly, for the right transaction, we’re certainly interested. And would explore opportunities. So I do think, over time, and particularly in the next several years, there’s going to be much more activity in the M&A space. And once the Fed kind of levels out and has a direction, I think there’s going to be much more discussion out there. And certainly, given where we are in the marketplace and the strength of our balance sheet, I think there’s certainly going to be an opportunity for us.
Operator: Our next question comes from the line of Manuel Navas with D.A. Davidson & Company. Your line is now open.
Manuel Navas: Hey, good morning. Just thinking about the overall deposit base. It’s great that you’re having success with the new hires and those teams are adding a lot. When would we see kind of an inflection for the rest? And what’s driving the trends that caused some of the deposit outflows recently? Just kind of comment on deposit growth next year.
Avinash Reddy: Yes. Look, I mean, Manuel, we grew deposits by $275 million in a year that was very challenging. I think, for the industry overall, if you look at the overall groups that we brought on, they brought on around $330 million, right? So on a net-net basis, we were flat in the rest of the bank. So I think if you look at that holistically, that’s pretty reasonable in this environment. We’ve seen DDA really stabilize across the entire bank. And so I think when you start 2024, you’re not — whatever is left behind is really core DDA at the bank operational DDA. So that gives us a lot of comfort going forward with that. I think the opportunity here to grow deposits is really building our private and commercial bank as Stu said.
We have $1.5 billion of deposits in that business. The branch business is important as well. And so I think as rates stabilize and normalize, we should be doing well over there. Obviously, over time, we’ve looked at our deposit base and conceptually where there are higher rate, chunkier deposits, we’ve kind of tried to normalize our deposit base over there like everybody else. All that’s behind us in 2023. The important part is also looking at the loan-to-deposit ratio, right? I mean we’re at 102 at the end of the year, we’re actually closer to 100% right now. So we feel pretty comfortable from that perspective that we have the deposit growth to fund the loan growth that we’re projecting for 2024.
Stuart Lubow: Yes. And most importantly, you see quarter-over-quarter DDA is stable. So I think there are not a lot of banks that can say that their DDA balances have remained stable over the last two quarters. And we see opportunities to continue to grow that base.
Operator: Our next question comes from the line of Chris O’Connell with KBW.
Christopher O’Connell: So I think in your opening comments, you talked about the ROA getting up to 110 to 125 over time. Is that assuming that to get there, that’s below 3s NIM that you’re talking about as well longer term?
Avinash Reddy: Yes, Chris, correct. Yes.
Christopher O’Connell: Got it. And how are you guys thinking about, I know no quantitative guidance, but the pace of NIM expansion once the Fed starts cutting and if it’s in a methodical or kind of gradual way, does that accelerate over time? Are you guys getting a full benefit in the first quarter of Fed cuts? You talked a little bit about kind of preparing your deposit book for this process. I know you won’t give the quantitative guide, but just thinking about the pace of a magnitude as the Feds cutting would be helpful.
