Byron Pollan: That’s right. Yeah. We’ll be approaching the high 2s as we exit the year, and as I mentioned, what we give up with fewer Fed cuts, we kind of get back with the addition of the branches that are coming on to the balance sheet. So some puts and takes there, but overall, I do see us continuing to grow margin. And I think on the year, we’ll be close to that low end of the previous guidance, as I mentioned.
Jeff Rulis: Okay.
Randy Chesler: The margin does grow, Jeff, and reaches that almost 3% in the fourth quarter, but then the full year margin is closer to what Byron is saying is the low — when you take the full year margin, that’s going to be closer to the $280 million in that range.
Jeff Rulis: Okay. And Randy, as you mentioned on this call and I think in prior calls, there’s momentum into ’25 as well as we kind of prior discussions, that’s correct as well.
Randy Chesler: Yes.
Jeff Rulis: Okay. And then — sorry for the follow-ons. The expense side, Ron, yeah, I just wanted to kind of range by. I appreciate the onetime expenses with the branch deal. But if we think about high end maybe in 2Q run rate of $146 million, what does that head to in — if you get some cost saves, but then you bring on HTLF or the whatever division they call that. Where does that head in the third quarter in terms of quarterly kind of run rate ex the transaction costs more core?
Ron Copher: Yeah. So in the third quarter, first of, the Rocky Mountain Bank branches that we’ll pick up, we only have them for five months. So we’ve said we’ll have a 38% cost savings overall, but we’re only going to have 50% of that occur, and then you only got five months. So it won’t be a big cost savings in that respect. It will show up in ’25 because we’re going to have 100% cost saves there because of the — being in the market, having to convert right away, it’s not a typical stock deal. So there will be some slight trending up in the third — in the fourth quarter, but I’m not ready to quantify it just yet. I want to see what we’re going to get when we actually close on the deal.
Jeff Rulis: Okay. One last one, Randy. It’s kind of a high-level question. I guess, we’re a year removed from kind of the liquidity crisis or the peak of that. And I think in early ’23, kind of circle the wagons with your team in terms of bringing customers back. And I guess just at a high level, do you feel like you’ve sort of reestablished the bank with those customers in terms of maybe some led away late in ’22? And just kind of feeling where you are competitively on the deposit side and kind of a year removed, if you will.
Randy Chesler: Yeah. Yeah, a lot has happened since ’22. I think the team did an excellent job of going back out after the — if you go back to some of the turbulence we had in the market, both with rates moving up quickly and people moving based on market rates and then the fear around the Silicon Valley Bank failure. The team, I think of all the customers we want to bring back in, have done a very good job of bringing them back. And in fact, I think that the current status right now is there are some very good customers kind of up for grabs in the market. And based on what other banks are doing, and so I think we’re not only feel good about holding on to the good customers that we had back in ’22, but growing some relationships with some new customers. So right now, it looks very favorable. I still think the banking environment overall could be a bit fragile. But as of right now, Jeff, looks very favorable.
Jeff Rulis: Thanks for the perspective. Appreciate it. Thanks.
Randy Chesler: Thanks.
Operator: Thank you. One moment for our next question. And our next question comes from the line of Matthew Clark from Piper Sandler. Your question please.
Matthew Clark: Hey, good morning, thanks for the questions.
Randy Chesler: Good morning.
Matthew Clark: Maybe just to close the loop on the margin. If you could give us the spot rate on deposit costs at the end of December and then the average NIM and — I’m sorry, at the end of March. And then the average NIM in the month of March?
Byron Pollan: Sure. Spot rates on total deposits on March 31 was $136 million. And then the spot margin in the month of March was 2.61%.
Matthew Clark: 2.61%. Okay. Great. Thank you. And then on the Heartland branch deal, can you help quantify the loans and deposits that are expected to come over, even if it’s somewhat of a range and then the related margin on those combined balances?
Ron Copher: Yeah, Jeff, Ron here. So on the deposits, we’ll pick up $463 million. I’m going to throw a $7 million in there for repo, but the deposits $463 million, the yield on that, that we’re getting just on the coupon is the $437. That’s what’s coming over. I’ll get to the fair value mark and accretion in a second. On the loans, $296 million coming in, again, a yield of 5.37%. On the deposits, the yield on average cost is 1.59%. They’ve had — in order to retain deposits, they’ve had to price up and also some migration as you can imagine. So on the loan marks, the accretable dollar amount is $17 million, that includes both the rate mark and the credit mark and combined $17 million fully amortized at over five years. So the margin should be pretty healthy, both actual and then the — with the purchase accounting marks as well.
Matthew Clark: Okay. Great. Thank you. And then just on your efficiency ratio. It’s higher than I’m sure you’d like it to be, I think, on an operating basis, about 72%, well above kind of your longer-term goal, 54%, 55%. Where do you think that efficiency ratio can get to by the fourth quarter of this year and then into next year?
