Brett Rabatin: Okay. And then I heard your response on the expenses, but I wasn’t quite entirely clear on the outlook and just if there are things that you’re having to spend money on, either inflationary or that you want to get accomplished from either a technology perspective or operational that might change the expense level in 2Q either in the back half of this year or next year. Any color there?
Scott Wylie: Well, I’ll take a quick stab at it. Julie, and then if you want to add more, feel free. We had been thinking that we were going to spend about $21 million a quarter this year, including all those things you just listed. And we decided in, I don’t remember exactly, December, January, something like that, that we wanted to be more cautious than that. And that we wanted to be mindful of expenses. And if we had a vacancy, maybe not fill it too fast. If we had a project we were working on that we could stretch out, or if we had contracts that we could review and get some cost saves on, we would do that. And so we worked hard on that in. Well, we started working on it in Q1, and I think we were down 22 or 23 FTEs, I don’t remember the exact number now, in Q1.
And then in April, we said, okay, if we can get our expense run rate down to $19 million, what would that take? And then we did a kind of a formal process internally, and by the end of April, had completed that project, was fully implemented, and we came out with $18.5 million in expenses in Q2. And then the guidance we’ve given today for the rest of the year is that same number of $18.5 million, with a $0.5 million swing up or down. So the number we talked about was $18 million to $19 million, just because of the fact it’s a relatively small number, and you just don’t know from one quarter to the next. But we don’t anticipate some big expense that we have to make, and we do not anticipate any other big expense cuts that we want to make. We look at that as some changes we wanted to make for the outlook that we had for 2023.
Those are done, and they’re working, frankly, a little better than we had expected.
Brett Rabatin: So the guidance on Slide 11, would be inclusive of anything else, technology, other stuff?
Scott Wylie: Correct.
Brett Rabatin: Okay. And then just lastly, Scott or Julie, is there a level of capital that you want to get to, or have the regulators given you any input onto, hey, CET1, we want this level? Any thoughts on the capital levels?
Scott Wylie: We have not heard anything from regulators on capital. I think they’re happy with where we are, as far as we know, and our own internal feeling is that we would love to be buying stock back at some of the prices we’ve seen over the last 30 or 60 days. But it just seems wise for us and prudent for us to protect that capital for now, and continue to build our tangible book value, continue to build our capital ratios, and be ready to take advantage of the opportunities that we think are down the road, both in terms of organic growth, in terms of expansion, and in terms of acquisition.
Brett Rabatin: Okay. Thanks for all the color.
Scott Wylie: Yeah. Thanks for the question, Brett.
Operator: Thank you. One moment for our next question. And our next question will be coming from Bill Dezellem of Tieton. Your line is open.
