Stephen Scouten: Yes, makes sense. Great. Appreciate the color everyone. Thanks so much.
Erik Yohe: Thank you.
Operator: And we’ll take our next question from Woody Lay with KBW.
Woody Lay: Hey, good morning guys.
Erik Yohe: Good morning.
Woody Lay: Just wanted to follow up on mortgage. Its great to see the gain on sale margin pick up in the quarter, just what are your expectations for that margin for the remainder?
Jeremy Ford: I think as we as we look at it, and I tried to highlight it in our comments were — I think we seen it we saw an improvement in overall penal sale margins, obviously to 216 basis points. What we are seeing is again, with each, with each kind of increment in the overall mortgage rate, and it’s pretty volatile at this point. We’re seeing customers may kind of real time decisions whether they buy down the rate pay points and down the rate that generates more origination fees or we’re able to take that — take that loan to market and garner a higher secondary sale. So we’re looking at it really to some extent on an aggregate revenue basis of about 375 basis points is where we’ve been here recently. And so, until we see aggregate revenue, start to move material higher, I think our view is customers are going to make those decisions.
We’re going to support those decisions and help them get loans executed. But one of the revenue components moving higher, while the other necessarily almost offsets it dollar for dollar, I think just puts us in a similar spot. So we are seeing more variability around the mix of revenue, but the aggregate per loan revenue, again remains reasonably resilient and consistent between 370 and 380 basis points.
Woody Lay: Got it. That’s super helpful. Maybe shifting over to credit. It looks like classified loans were down a little bit in special mention one ticks up, was that mostly just some small dollar movement or any detail you can share there?
Jeremy Ford: There’ll be more detail that comes out in our queue, but it — overall, we are seeing notwithstanding the loan I spent some time on in my comments talking about and we spent some time last quarter talking about notwithstanding that loan, largely small or related movement. Again, we don’t see any material industry concentrations or geography based concentrations. What we see is, individual situations and kind of items that have popped up whether it be ownership or otherwise, that cause credits to otherwise underperform. We’re seeing and I think we’ve stated this in the past, the pressure of higher rates on cash flows, and that’s permeating the portfolio. So we do expect to continue to see some downgrades and pressure from that. Again, there’s nothing within the industry or geography perspective right now, that causes us to be overly concerned.
Woody Lay: All right. That’s all for me. Thanks for taking my questions.
Jeremy Ford: Thank you.
Operator: And we will take our next question from Matt Olney with Stephens.
Matt Olney : Hey, great. Thanks. Good morning everybody.
Jeremy Ford: Good morning.
Matt Olney: I want to go back to the deposit discussion and non-interest-bearing deposits. Still some pressure in the first quarter at the bank, but also just the industry overall. In the guidance, I think you reiterated the same commentary about just seeing additional pressure throughout the year. But it looks like the 1Q average NIB deposit balance is already at the midpoint of that range that you mentioned for the end of the year. Just trying to clarify if you expect incremental pressure from here and we should be thinking about moving towards the lower end of that guidance? Or you think we could stabilize here at these 1Q levels? Thanks.
Will Furr : Good question. And you know as we look at it, we’re evaluating a few moving parts. First, customer demand to kind of move into our sweep products and out of non-interest-bearing kind of as a primary order matter. And then second, what we’ve seen is in our treasury products, and those customers are using our treasury services, they’re penchant to be willing to pay fees and then shift their deposits, their non-interest-bearing deposits into sweep products has also increased during the first quarter. So our expectation is we’re going to continue to see a steady, but modest, I think, movement into interest-bearing products out of non-interest-bearing. So, again, we think the range is reasonable and appropriate. Where we land in the range, I think, will be determined by customer activity, but we are continuing to see customers with an appetite to move into higher rate products and out of their NIB deposit accounts.
Matt Olney: Okay. Thanks for that, Will. And then within the NII guidance, I think it’s now down 4% to 8% for the year. I was hoping to kind of parse that out. I’m curious what you think are the major drivers, the major variables within the guidance that could push the actual results onto either side of that guidance.
Will Furr : Yes. So, the most significant driver is going to be our overall deposit cost. And we continue to manage it closely. Our objective, again, remains to continue to grow and attract new customers to our franchise. And as a result, we’ve got to be competitive. I think where we are currently positioned, we feel comfortable. We’ve got some products that do have kind of 5% rates on them, but largely the products are below that. Certainly, in some of our competitive markets and some of our competitors have got rates higher than that across both their CD products and in certain cases their money market products. So we are, again, not top of market, but we believe competitive. But again, customer demand for higher interest rates persist.
