Brad Milsaps – Sandler O’Neill
Yes, no, no, that’s helpful and then just to follow up on your commentary around credit costs, I think you mentioned that you expect those to continue to go lower. Would that really just encompass sort of, were those comments more encompassing credit remediation costs OREO costs or would that also encompass thoughts around provisioning in light of your comments around potentially better loan growth in 2015 with sort of the adjusted reserve around 1-1/4 of loans? Just kind of get a sense of what those comments included. Did that include provisioning? You are around $1.7 million this quarter, it had been higher than that sort of looking at the second quarter absent what happened in the third. So any thoughts or color there would be appreciated.
Mark Sander – Senior Executive Vice President & Chief Operating Officer
Yes, Paul and I will probably tag-team this one I would say. My comments were around all of the above Brad, I guess I would say. So certainly remediation costs we expect to come down a little bit just through the pure dollars to move assets, if you will, right. The cost of operating the department has come down nicely. We anticipate further declines in ’15. The fourth quarter in particular had probably $0.5 million of elevated credit remediation costs to try to, to generate the outcomes that we did in terms of driving NPAs down. So that’s the remediation side of things.
Charge-offs certainly we expect to be lower in ’15 than in ’14. Where we will and won’t do, we will reserve release, I will leave it to Paul here in a second and then OREO is the other one. We had one write-down of $1.6 million on a property that we can chat more about if you like, but fundamentally, we think our OREO portfolio in general is conservatively valued at this point and don’t expect that we will see that kind of magnitude of charge-offs either or write-downs either. So kind of all of the above relative to…
Paul Clemens – Executive Vice President & Chief Financial Officer
Yes, let me pick out what you just said. So you covered the remediation costs and the charge-offs and so obviously, we saw our reserve release go, we were at an allowance of somewhere around $150 million. Now we’re down to around $124 million. You won’t see that repeat.
Somewhere in the $115 million to $123 – $124 million range we think is probably appropriate, depends on the credit metrics. But what’s helping that is the, so long story short, you’ll see a much closer match of provision and charge-offs and we’re delighted that the charge-offs are coming in where they are and where we think they’re going to come. So I think that you simply won’t see the reserve release and we should still hover somewhere around $115 million to $124 million. I would say somewhere $124 – $125 million.
Brad Milsaps – Sandler O’Neill
Thanks Paul I appreciate it, thanks, Mark.
Operator
Ladies and gentlemen, as a reminder, please press * 1 if you have a question. Our next question comes from Terry McEvoy of Sterne Agee. Please go ahead.
Eric Zwick – Sterne Agee
Hi, this is Eric Zwick on for Terry. Good morning. Just first, if I look at the comments in the press release, you mentioned that some of the benefit from the margin came from bringing on fixed-rate loans from Great Lakes and maybe potentially Popular as well. I’m just curious, I know we will get the updated asset sensitivity whenever the Q is out, but in the update did that have any material change on what was disclosed in the third quarter?
Mike Scudder – President & Chief Executive Officer
No. This is Mike, the addition of those assets to the pool have been a little bit offset by the fact that most of the loan volume that’s been coming on has been floating rate. So you shouldn’t see a material shift in what the asset sensitivity is around what’s been disclosed.
