Charles Christmas: Well, I think it’s always a possibility, but I think when we look at the trends that we’ve seen in our deposit balances from that particular segment going into other segments, it has definitely slowed over time. And a lot of those deposits tend to be the operating accounts of businesses as well. And while I think they’ve, I think what we’ve seen is, we haven’t seen a reduction in the number of deposit accounts, non-interest bearing checking accounts. I think what we have seen is businesses looking at saying, “Hey, we have some excess balances sitting in non-interest bearing checking, we’re going to take a portion of those monies, the excess portion, and put that into higher interest earning account — deposit accounts, such as money market rates that they want, lots of liquidity or maybe even some of that into time deposit — relatively short-term time deposits if they want a little bit of a higher rate.” So I would say that, given where we are in the interest rate cycle, my expectation is that, a significant portion of balances that will have moved under that — under those scenarios have likely moved already.
Erik Zwick: Got it. Appreciate the color there. And I guess another potential use of some of those excess funds can potentially be paying down some draws that they have or higher rate debt, which I think you called out in the press release. So just kind of maybe using that thought and transitioning to the expectation for loan growth, if I just look at the kind of $357 million of unfunded commercial and residential construction loans that you have, just that in itself that fully funded would be high single digit growth, but you mentioned there’s also the opportunity and likelihood of still seeing pay downs and prepayments. So just curious, maybe more from the organic aspect of what’s not already committed, and I think you mentioned that kind of market share gains are the real opportunity today.
If you could just talk a little bit of color about in terms of where you expect that type of market share gains to come from? Which of your competitors you’re competing against most and also maybe just any themes that you’re seeing in terms of specific industries or categories that seem to be having the strongest opportunity today?
Raymond Reitsma: Yes, this is Ray. The strongest opportunities for growth that we’re seeing are related to ownership transitions. Sometimes groups coming in, buying companies that we’re funding. Also ESOP ownership transitions and the like. So that’s been an area that we’ve done well in over the last year or two and sort of bunched up in the fourth quarter in terms of actually funding. But the competition that we see there is from regional banks primarily, and the larger national banks have been less active in the markets that we serve, so that has helped us create an increase in market share. So as I mentioned in my comments, the growth is definitely more towards those types of events that are market share related for us than an organic growth within our customers’ borrowing needs, which are pretty stable.
As it relates to the backlog numbers that you talked about, those numbers are right in line with what we’ve experienced over the last, I’m going to say, eight quarters, probably even longer. And as we’ve alluded to in this call on a number of occasions, the payoffs that come in and tamp that down from a funding standpoint are unpredictable, but they’re absolutely out there. They remain out there. So I think if you look at our funding levels compared to our backlog levels over a reasonable period of time, like a couple of years, it wouldn’t suggest that our growth rate is going to change a lot, but it does provide a firm basis to say that we will continue to have growth.
Erik Zwick: Thanks, Ray. And one last question for me and then I’ll step aside. Technology continues to be very important in community banking and likely requires almost annual kind of ongoing spend at this base. So just curious if you have, as you look at this year and maybe into next, any material upgrades you need or is it more just kind of a constant renewal of contracts and how you think about how you’re positioned relative to your peers today from a technology perspective?
Raymond Reitsma: Yes, our investment has been very consistent and we expect it to continue to be. From time to time you get things that are new, but it tends to be more along the lines of shining up the objects that we have rather than buying new objects. And continuing to meet the types of needs that our customers have presented for a long time in better and better ways. We’re constantly striving to make our bank an easier one to do business with, easier to connect with no matter where you are. And those types of expenditures are the types that we continue to make. I would expect that the levels would be fairly consistent with what we’ve done in the past, certainly not moving outside of an order of magnitude up or down, but quite consistent. And our long-term investments — our long-term consistency of investment allows that to be the case.
Robert Kaminski: Yes, Eric, this is Bob. As we talked about on numerous occasions, Mercantile has always been committed to making those investments when we have the opportunity to provide additional tools and resources for our clients and our team to be able to serve those clients. And that’s certainly not going to change in the future. And we’ll remain committed to that strategy.
Erik Zwick: Excellent. Bob, Chuck, Ray, I appreciate all the answers today. Thank you.
Robert Kaminski: Thanks, Erik.
Operator: Thank you. [Operator Instructions] Our next question comes from Damon DelMonte with KBW.
