I’d love to hear it.
Brian Harris: Yes. I mean, I’m happy to give you some inside baseball view as to how we look at these things…
Steve DeLaney: Sure. I’d love that…
Brian Harris: With the Fed moving 11 times higher in a row, obviously, we’re positioned pretty well with our corporate debt there, and that will carry us for years to come at this point with those fixed rates. So we have plenty of room, as you know, and we were pretty active when we came out of the pandemic. We started writing a lot of loans at the end of ’21. And so those end of ’21 loans are really coming up on their first extension now. So second quarter actually had quite a few of them. And any time we did extend somebody there were pay downs involved in those. But I would expect that as we get towards year-end, we’re going to have a better sense as to – I believe we wrote $1 billion worth of loans in the fourth quarter of 2021.
And so we’re going to make sure that we have enough capital around for those to refi and make sure now if there are more a default in our system, we don’t have the same pressures that a lot of competitors have because of the corporate debt structure and the unencumbered assets that we carry. So even that’s not terribly problematic, but it is something – it’s a conservative, flexible balance sheet. We are a little bit defensive, but we keep flexibility in the portfolio so that we can take advantage. And as we said, as we took in $300 million in payoffs this quarter, we can see that net interest margin. Now if you have 10% loans that pay off, it’s $30 million in interest. Unlike when interest rates were at zero, though, we now have T-bills at 530.
So it’s 10% – you lose 10% when you get 5.3 back right away. So it’s not as hard of a drag as it may have seen. And given where securities are trading right now, largely as a result of the Fed stepping away, they’re quite attractive and more attractive than situations right now. So – and the good part about securities as they settle three days later. So you don’t have to sign an application and then close in 90 days. So I would imagine – I think I’ve said this before, that we would probably start adding securities. We thought that was the best value in the space. And we also mentioned we liked our own corporate debt, which was trading pretty wide after the March regional banking issues. So the bonds have traded back, they’re in good shape now, and we began buying securities, and we can buy quite a few of those pretty quickly.
And the natural next step will be lending. And the dividend, I think we have plenty of room on right now. We are big shareholders internally, so we would like to raise it. It’s an annuity. I certainly don’t want to raise it then cut it. So you want to make sure you’re clear of all the problems that could or may or may not exist. But in addition to that, the returns we’re generating right now are well in excess of our dividend. So we like having a lot of cash around even – and – but keep in mind, having almost $800 million in cash, we probably have another $100 million coming out of CLOs in the next couple of weeks, too. So that’s going up even higher. We don’t want to carry too much cash even though it is easy to get lazy at 5.3%. So we began investing.
