First Merchants Corporation (NASDAQ:FRME) Q4 2022 Earnings Call Transcript

Michele Kawiecki: Yes.

Brian Martin: That is helpful. And then just the run rate or just kind of the level of fee income today seems like pretty good level and it just builds off of this, is that, I know there’s ins and outs every quarter. But just in general, how are you feeling about where that’s at today or just how we should think about that?

Mark Hardwick: Yes, we have a couple of positive tailwinds in that space. Our private wealth business continues to grow around 10%, and that’s the target we have for the year. And then the mortgage business, we expect to originate over $1 billion in mortgages this year. And I think the numbers are, portfolio at about 85% of that in 2022. And we’d like to get back to our more traditional model which would be, call it, 60:40 or even 70:30. And that 60% and 70% we’re talking about is sold into the secondary market. So I felt like in 2022, we took advantage of an opportunity to use our balance sheet. We had the liquidity to do it. The customers were kind of, I think, in shock by how high the 30-year rate went and it allowed us to use our balance sheet. But now that’s moderated from as high as 7% to slightly under 6%. And I think it gives us the ability to move back into a fee-for-service model. And that should give us a little positive push on our non-interest income.

Brian Martin: Got you. Okay. That’s helpful. Okay, perfect. Well, thank you for taking the questions and congrats on a nice quarter and a nice year.

Michele Kawiecki: Thank you, Brian.

Mark Hardwick: Thanks, Brian.

Operator: Thank you. That concludes the Q&A session for today. I would like to turn the call over to Mark Hardwick, CEO for closing remarks. Go ahead, please.

Mark Hardwick: Thank you, Lisa. Just wanted to say thanks to everyone for tuning into the call, our employees, customers, our shareholders, our analysts. And we appreciate your interest in your investment. And we will €“ I guess you can count on this team to continue to work hard to deliver results for all of those critical stakeholders. Thank you.

Operator: That concludes today’s conference call. Everyone may disconnect. You all have a great rest of your day.