Stuart Lubow: Yes. I mean we’re looking at SATs and projected SATs each month. I mean for this month, we’re probably going to have $40 million to $45 million in satisfactions and we’re looking — we’re getting requests already for next month. So I mean there is some activity out there, some transactions happening. And so — but it’s very chunky. So it’s hard to say it’s exactly when you’re going to see significant runoff. But suffice to say, we are seeing some amount of satisfactions each month.
Avinash Reddy: Pipeline.
Matthew Breese: I mean, can we just go back to one of the points you made there, I think you said historically, the payoff activity was 30% to 35% for Multifamily, making it effectively a 3-year duration type product…
Avinash Reddy: Yes. No. No, Matt, the comment there was two years back at the peak, the payoff rate was 37%. If you look at it over a multi-decade horizon, you’re probably between 15% and 20% is the true payoff rate on the multifamily side. Right now, it’s 5% to 6%. So — but as rates come down, they generally catch up. It’s more of a timing issue, Matt. And again, we’re pretty clear. We’re trying to give two to three years worth of a forward look in terms of where we want and see the balance sheet ending up. The thing that we can control is what we feed into the bucket. And so right now, we really have no multifamily loans in the pipeline. So…
Stuart Lubow: For the first time, I think, ever, we don’t have any pipeline in multifamily.
Matthew Breese: Got it. Okay. Just one more question on this topic. As the typical kind of multifamily borrower reaches the end of their kind of standard five-year fixed, are they willfully rolling into the floating and waiting for lower rates? Are you seeing them reprice into higher rates or go elsewhere? What is kind of the common behavior?
Avinash Reddy: Sure. So Matt, yes, we went back and looked at our 2018 vintage rate. So that’s basically matured or repriced in 2023. So around 30% to 35% of that is satisfying at this point in time and it’s around 65% that’s taking the repricing option. So it’s basically one-thirds, two-thirds in terms of the mix. Now we will say that there are competitors in the market right now that are in the low sixes to high fives, and as rates come down, you’re going to see more of those loans not take the reprice. They’re probably just kind of satisfy away from us given where the market is trending towards.
Stuart Lubow: Yes. I mean many of those viewed it as a short term, even though they’re taking a rollover, they view it as a short-term rollover because they figure not — why go through the expense of refinancing at these rates. But once rates do come down, they’re going to — they’ll pull the trigger and prepay.
Matthew Breese: Got it. I appreciate all that color. The last one for me is just conceptually, as the focus continues on business banking and moves away from traditional multifamily should we start to see the reserve reflect that and start to increase a little bit, 67 bps on today’s balance sheet makes sense, but if multifamily is 25% alone, does it make sense for the reserve to be higher?
Avinash Reddy: Matt, yes, absolutely.
Stuart Lubow: Yes. I mean our reserve methodology calls for at least 1% on C&I loans today. So as we put C&I loans on, we are significantly higher than what we’re reserving for multifamily. And that — so that transition will occur just naturally as part of our origination process.
Operator: [Operator Instructions] And I’m currently showing no further questions at this time. I’d like to hand the call back over to Stuart Lubow for closing remarks.
Stuart Lubow: Well, once again, I’d like to thank our dedicated employees who worked diligently through these challenges throughout the year and thank our shareholders for their continued support, and we look forward to seeing you next quarter.
Operator: This concludes today’s conference call. Thank you for your participation. You may now disconnect.
