James Beckwith: Sure, we didn’t really get a sense that anything was kind of being pulled from 2023 in terms of the originations Woody just that it was new business that happened within the quarter within the verticals in which we operate in. And I think it was just more of the same week. As I mentioned, previously, we have seen a, we expect a decline in originations in loan growths in 2023 and certainly where we are with respect to our pipeline, as we entered into 2023 is representative of that notion. So I wouldn’t say any pull through. It’s just business that was there. And we did it because it was good business.
Woody Lay: You have a really strong growth, good to see. Maybe moving over to the NIM. I know, it’ll get a little bit of a pickup from that redemption. But sort of excluding the impact from there. I mean, do you think the NIM is under pressure just from the intense deposit competition or any thoughts on your margin for the expectations in 2023?
James Beckwith: Yes. I think that every depository institution is on under some degree of pressure. We’re not immune to that. What we’ve seen is we’ve had some of our liquidity positions by some of our long term customers go out of the bank as they invested in treasury securities. At this point we’re unable to match what they can get on those short term treasuries. We do our best. But we’re mindful of the fact that it’s difficult for us to match those rates. Having said that, what we’re really interested is banking their operating accounts. These are businesses that have been around for a long time. We expect that liquidity potentially if rates do decline to come back on balance sheet. But it’s a very competitive environment right now.
And it’s not necessarily with other institutions, it’s really with the big brokerage houses that can create positions or ladders, if you will, treasury securities ladders for our clients. We’re in great standing with them. And we certainly understand what they’re trying to accomplish, but we think it’s a near term thing, hopefully. And so we definitely recognize the environment in which we’re in. but having said that, we’re also excited about what we’re being able to do on the business development side in terms of bringing in core deposits.
Woody Lay: Right. Okay. And then, last for me, I just wanted to touch on credit. I mean all the underlying metrics look super clean. Just anecdotally, are you seeing anything in the market that gives you concern at this time? Or is it really just a waiting game? And then just as a follow up to that I know, you’re adopting CECL in the first quarter. Do you expect that they have a material impact to reserve levels with implementation?
James Beckwith: Well, let’s take the first part of that question first. We’re very happy with where we are with respect to our portfolio and how we manage it. Our loan portfolio is different than others. We’re in some very well, I should say safer asset classes than other institutions that have a commercial real estate concentration. And you can see that when you add up mobile home communities and recreational vehicle parks, if you will, that represents about 40% of our CRE portfolio. We like that space. And when you add in storage, which we also think is very safe, we like our position. Our office book, if you will, which I think is the most risky part of any CRE portfolio right now, I think is around 6%. So I think we’re different than the I’m going to say the average bank in California with respect to the composition of our CRE portfolio.
And we know that those asset classes perform better in downturns. Historical data would suggest that they perform a lot better than other CRE classes. Now with respect to CECL, Heather you want to give some color on that?
