When I take a step back and look more broadly, the portfolio on commercial in general is actually performing pretty well. The C&I side of the house has had its individual idiosyncratic issues. But in general, the strength of the portfolio is the result of our strong portfolio management and our low to moderate risk profile that we target. So I feel really good about the commercial portfolio at this time.
Stephen Steinour: So, Nate, it’s Steve. The charge-offs — gross charge-offs in Q3 and Q4 were $2 million apart. It was very, very similar. The difference was in all of their coverings. The pre-portfolio is performing very well. The office portfolio has had minimal losses, 23 bips for the year. Q1 charge-offs is outstanding. We’re very pleased with how the performance has occurred, and we’re confident going forward. Thanks for the question.
Unidentified Analyst: All right, thank you. And if I could just ask one follow-up on the criticized assets. So these also kicked up in the fourth quarter. Can you talk about what drove that?
Brendan Lawlor: This is Brendan again, Nate, as Zach said in the prepared remarks, it really came out of our commercial real estate portfolio. The impact of higher short-term rates has persisted, and that’s what’s reflected in those results. Again, we have been signaling through the second half of last year that we expect the criticize to move up, and that’s exactly how it played out. Again, we have good confidence in our client selection in that portfolio and solid reserve against it overall. So I guess I would classify that as just more credit normalization across the portfolio.
Stephen Steinour: Thank you for the question.
Operator: Our next question is from the line of Ebrahim Poonawala with Bank of America. Please proceed with your question.
Ebrahim Poonawala: Hey, good morning.
Stephen Steinour: Good morning, Ebrahim.
Ebrahim Poonawala: Just wanted to follow up on the loan growth guide, Steve. It does feel at the higher end of what we’ve seen over the last week from your peers. Not — sorry if I missed it, but give us a sense of how much of this is just market share gain that you expect versus the underlying growth that you’re seeing in these markets and your expectations, I guess, like the GDP growth?
Stephen Steinour: Well, we’ve had growth last year of 2%. If anything, I think the signal from the Fed pivot will foster further loan growth for the industry. We are in an advanced position. And so, we’ll capture a share from that, but we also have these specialty banking initiatives in the Carolinas, and they begin with no portfolio, so there’s no prepayment, repayment risk, obviously, and that’s all net long-run, but those groups are off to terrific starts. We’re very, very pleased with the quality of the colleagues who’ve been able to attract to Huntington, and I’m quite confident in our teams, both the core teams that they’ll deliver in our footprint, the speciality banking teams. And frankly, our consumer lending teams are outstanding as well. So as we come into the year, we’ve got momentum and we’re going to continue to invest in these businesses and that cumulatively should help us achieve or even exceed the goals.
Ebrahim Poonawala: Got it. And I guess what I didn’t hear, Steve, was any mention of fiscal stimulus, the Chips Act, et cetera, flowing through your market. Is that not as meaningful going forward around moving the needle on growth?
Stephen Steinour: The markets have — broadly speaking, we’re talking about 11, 12 states that were in with our network. But here in Columbus, which is what you’re referring with the [Intel] (ph) plant. That plant is well under construction, and the supply chain commitments will largely be made, we think, this year as they move towards opening in the following year. So we have some unusual factors that are strengthening the outlook here in greater Columbus. And we have very, very significant market share here and lead by a lot in most categories. But it will also benefit the broader region. And that’s one of just many sectors that have chosen the Midwest. Think about batteries from East Michigan, Ann Arbor, through Columbus, and some of the announcements last year, including the Honda joint venture here in greater Columbus on the battery front.
There’s a lot of investment that’s being made in the core footprint, all of which will generate economic benefit for the industry, and certainly for us with our leadership position in many of these areas. Thanks for the question.
Ebrahim Poonawala: Thank you.
Stephen Steinour: So I think we’re hitting the top of the hour. I’m just going to wrap. I want to thank you very much for joining us today. In closing, we’re pleased with the fourth quarter results as we dynamically manage through this environment. We believe we’re well positioned. Investments we made in 2023 will further drive revenue growth in 2024 and beyond. Our focus is on driving core revenue growth, carefully managing expenses to support investments in the business, and growing loans consistent with our aggregate moderate to low risk appetite. The management team is focused on executing our strategies that we previously shared. And as a reminder, the board executives, our colleagues, we’re not just shareholders. And that creates strong long-term alignment with our shareholders generally.
And finally, we’re grateful to our nearly 20,000 exceptional colleagues who delivered these outstanding results and our perennial award winners for customer service. Thank you all very much. Appreciate your interest and have a great day.
Operator: Thank you. This will conclude today’s conference. You may disconnect your lines at this time. Thank you for your participation.
