Kevin Riley: Well, seasonally, if you go back, I mean, as you know, the pandemic through all sorts of seasonal trends out of whack. So if you go back earlier a week before the pandemic seasonally, we see a little bit of decline in the first quarter. And then we start seeing deposits start picking up in the second quarter and faster in the third. That’s kind of the seasonal direction. So that’s kind of what we’re expecting this year because I think what we have seen as the excess deposits go out in 2022, that’s slowing down. And then go back to our data in a sense where a lot of our deposits, we increased our deposit pricing a while back with the index money market account and CD rates. So a lot of our customers have been already migrated over to some of these products and are satisfied.
So we’re just expecting maybe a little bit of seasonal decline in the first quarter, but I feel like things will start moving in the right direction once we start going further into the year.
Adam Butler: And then moving over to credit. I know you mentioned that the uptick in criticized here isn’t a concern, but I was wondering if you could provide some additional commentary on kind of where that came from? Was it several credits geography or sectors?
Kevin Riley: Okay. We’re going to have our Chief Credit Officer, Michael Lugli kind of address that question, Michael?
Michael Lugli: Yes. So overall, the portfolio, there was no overall decline in the portfolio. In fact, it did fairly well. It was really driven by 3 relatively large credits that totaled a little over $98 million, which drove down our criticized performance that increased that by a corresponding $38 million. So you can’t net those three credits out. But if you look at the overall portfolio, the trend was actually positive in criticized.
Operator: And the next question goes to Andrew Terrell of Stephens.
Unidentified Analyst: Hey, Kevin, and Marcy. This is Zack on for Andrew. Just some housekeeping questions here. Do you have the monthly December NIM available?
Marcy Mutch: Yes. Monthly NIM was in the low-3.40s ex-purchase accounting.
Unidentified Analyst: And then do you happen to also have the spot on the interest-bearing deposits at 12/31?
Marcy Mutch: Yes, it was in the high-70s.
Operator: And the next question goes to Todd Milliken of RBC Wealth Management.
Todd Milliken: I appreciate it. Today’s results were clearly a sizable operational miss on earnings reflected in the stock price today. Prior calls that I’ve listened to you guys have been very optimistic about the operations. It seems to me that there’s a notable change in that viewpoint. Can you address why investors should have the same kind of confidence in you based on this quarter’s results as they should have maybe previously?
Kevin Riley: Well, that’s pretty — I would say that the operating performance is strong. It might not be — if you go back and look at the earnings projections as people under thought what we were going to perform earlier in 2022 than they might believe they overestimated what we’re going to end up. The performance of the company really hasn’t changed much. The only thing that I would say that’s different is that we had some deposit outflows in the fourth quarter that we didn’t anticipate, but the fundamentals of the operation of this company have not changed at all, and quite frankly, get stronger and stronger month by month.
Todd Milliken: Well, I get that, but this is clearly an operational miss by a significant amount. And I guess I’m a little bit taken back by why that’s surprising?
Kevin Riley: It’s not an operational mix by much by us. So that’s just your perspective.
Operator: And the next question goes to Bruce Zessar of Advisory Research.
