Steven Alexopoulos: I wanted to start — I appreciate all the comments on what the CRE portfolio could do under different stress scenarios looking forward. But if we stay with what actually happened this quarter, I know you guys have roughly $8.5 billion coming due this year. What came due in the first quarter and walk us through how did it play out? What percent of these refinanced, what paid off? What did you have to extend because they couldn’t refinance? Could you just give us some color on what actually happened this quarter in the portfolio?
Daryl Bible: Yes, yes, I can do that. I think we had about $2.3 billion mature in the first quarter. Out of that $2.3 billion, I would say, 56% of it was basically extended and out of that was extended, there was about — 9% that was in upgrade. We had, I think, another percent, maybe 23% actually paid off. And then we have the residual that we’re working through right now and that’s going to either be extended out or paid off. So very little incremental went into criticized, small portion. But for the most part, our teams are working very closely but that was the impact of the maturities we had for the first quarter, and we hope that plays out through the rest of the year.
Steven Alexopoulos: Got it. And when you say extended, do you mean refinanced or they weren’t in a position to refinance so you gave them another year as an example?
Daryl Bible: So typically, when we extend, you always try to get more equity and more recourse from the customer. So fees wanting to extend out a year, we’re going to try to right-size the debt service coverage ratio and they’ll put more equity in or give us more tangible assets to protect us as we move forward is kind of how the negotiation goes. And typically, we extend anywhere from six months to a year after willing to support it.
Steven Alexopoulos: Got it. Okay. Thanks. And then just on the margin, as I heard you earlier said you thought and it would be mid to high 3.50s for the rest of the year, but it’s funny, when you look at deposit cost, it slowed materially. It seems you’re fairly close to market. And when I look at the components of earning assets, right, loan yield 6.3%, C&Is coming in way above that. You’ve already outlined securities coming in higher. Why is the outlook not more robust for [indiscernible]. It just seems like you’re there on the deposit side, you have a lot of room for earning assets to resize higher. Just curious what’s on the other side of this. Thanks.
Daryl Bible: Yes. I’m trying to give you the best color that I can give you with what I know. But I — at the end of the day, the biggest factor, and it’s been this way my whole career in asset liability management. How deposits behave, especially the non-maturity deposits really drives your interest rate sensitivity. And while it’s slowing in the commercial, we’re still going to see growth in the retail CD book just because you’re over 3%. So you’re going to have that. Now to offset that, we are paying off some of our brokered deposits, which is a good guy to counteract some of that. But this disintermediation piece is just really hard to model. And we put our best guess out there is what we think is going to do there. Obviously, we could outperform, but I’d much rather under-promise and over-deliver right now.
Steven Alexopoulos: Got it. It sounds like you’re being conservative. Okay. Thanks for taking my questions.
Daryl Bible: Thank you.
Operator: Thank you. Our next question comes from Matt O’Connor with Deutsche Bank. Please go ahead.
Matt O’Connor: Good Morning. I was hoping you could talk about the recent action by S&P to lower your ratings to — or a negative outlook. There was no rating change, but just a negative outlook. I mean, obviously, capital is strong, earning is strong, liquidity is strong. So a lot of those boxes are checked, but I do think they — one of the things they flagged was the CRE concentration. But — so maybe just address that topic overall and how you think you can alleviate some of their concerns? Thank you.
Daryl Bible: Yes. So Matt, we actively meet with all of our rating agencies, all four of them on a very frequent basis. S&P did put us on negative outlook. But I think we feel very comfortable that, that won’t result in a downgrade. We think we have a good handle on both our CRE exposure and the amount of criticized that we have and what we’re working towards right now. So I think we feel that where we’ve got strategies in place to, over time, get that to be less of a risk in the balance sheet from a credit perspective. But rating agencies are one constituency, it’s an important constituency. We also have to deal with our other constituencies as well, too. But we’re all doing the right things. We come to work every day, and I’m excited to be working with the professionals that we have in our commercial and credit teams.
They were working their asses off each and every day. I answered the call, your question earlier about going through the 2.3 billion maturities we had in the first quarter. We really worked through almost all of those to fruition and had very minimal impact as we move forward. We’re going to continue to just grind it out and do a good job, and we’ll just see how things play out.
Matt O’Connor: Okay. And then just separately, on the trust fees, you talked about them being a driver going forward. Maybe just like frame how much equity drives that business, what some of the other drivers are? Because obviously, like the underlying trends are a little tricky to see because year-over-year, as you mentioned, you had a sale linked-quarter, I think there is some seasonality that maybe has a drag from like annuity sales or something. But just talk about some of the underlying drivers of that business and what gives you confidence that being a key driver of fees this year.
