Brody Preston: Got it. Thank you very much everyone.
Operator: Thank you. Our next questions come from the line of Manan Gosalia with Morgan Stanley. Please proceed with your question.
Thomas Cangemi: Good morning.
Manan Gosalia: Hi. Good morning. You noted the $3 billion contribution from banking as a service product for government entities. Can you talk a little bit more about the growth opportunity there, especially given that those are lower-cost deposits?
Thomas Cangemi: So we’ve done a really solid job on partnering with our fintech providers, and this has been a very good line of business for the bank as an alternative solution for funding the balance sheet. This particular program in the fourth quarter was driven off the California inflation stimulus benefit that was out there. We were a bank partner, been the provider along with a very large tech company that partnered into the money network card business. That will dissipate, but that was another program that we rolled up. Bear in mind, we’ve also made mention that we are the US Treasury been provider for money network cause going forward and anything that the treasury does on the card side. So we have the opportunity to continue to build the business.
As well as other municipals at the state level for a lot of the unemployment funds that we process under the money network cards business. So that business is going really well. We have a bunch of onboarding happening in 2023. I will tell you that it’s hard to predict what quarter they come in. So we don’t really count them because they come in, and they’re fairly large. And what’s interesting about this model is that not only do we ramp up the opportunity to work with our technology providers, but we’re also able to get our bankers into the municipal side of things, so the actual core deposit banking. So some of these relations resulted in a pure deposit relationship, either payroll for a state, doing some operating activity for the state, and it’s been meaningful in respect to the deposit opportunity.
This is something that we go up and give the top institutions in the country and all the top technology companies, and it’s an RFP process. And we’ve been very successful over the past 1.5 years, but it does take time to onboard. So I don’t want to give any, we’ll call it aggressive vision of how much can come on. But when they do come on, it becomes meaningful. So, for example, California was about $3 billion average balance and the cost of that was zero. We have some other programs that are coming in this year, depending on how quickly they ramp up US Treasury, that could be depending on what program is actually endorsed by the government, and we would be then the company that’s ready to go if the issue cause at their will when they’re ready to make a decision on funding.
So it’s an interesting program. It’s a good line of business. It’s one of our three pillars of the banking as a service business that we carved out along with mortgage and tech, and it’s been very successful. It started out back during the pandemic and we were a very large balance sheet provider for stimulus payments and we were able to hold some nice balances for a considerable period of time on the cards side, and we continue to leverage off of that.
Manan Gosalia: Got it. And can you just remind us of the seasonality within the banking as a service portfolio?
