Tim Switzer: Okay, got it. And could you remind us or update us on what you guys believe the impact of rate cuts would be in the back half of the year to the NII and particularly if we only get, say, one or two rate cuts, how would that be different than if we got, say, a series of five to six?
Christopher Maher: First, it’s Chris and Pat will probably chime in as well. But I’d give you just a sense that whether it’s an incremental cut up or even down. So I think we’re looking and thinking about it both ways these days. Doesn’t make a big change. So we’re relatively stable outlook regardless of whether it’s two cuts or even one raise, right, those kinds of scenarios. So it’s not going to be a big impact. We do have a significant amount of loans that are maturing — contractually maturing in the last three quarters of the year. And I think one of the ways we’re thinking about higher for longer is some things we know for certain and some things we’re just going to have to see play out. But on the certainty side, we know what’s rolling.
And we’ve got about $700 million worth of loans rolling — fixed rate loans that are contractually hitting their maturity in Q2, Q3 and Q4, or the reset. So as a result, that $700 million is going to come up from where it is today. That’s a significant opportunity. On the other hand, there will be a lingering deposit pressure. I mean it’s abating, but it’s very hard to say exactly how that will look as the year goes on. So, higher for longer doesn’t concern us particularly. And one or two cuts or one raise doesn’t change the outlook much either. So it’s a relatively stable outlook for us. Pat, anything you’d add to that?
Pat Barrett: No, I guess I would just — I mean, yes, I would. I would just emphasize that the whole uncertainty factors that we’re really looking at is around the non-maturity deposit funding side. So on the term side — on the loan side entirely, the securities book entirely and CDs and other term funding. We’ve got pretty high level of confidence. It’s just the unpredictability of behavior of depositors in the interest-bearing space, non-interest-bearing space that has proven really difficult for us to predict. And it’s hard to see that confidence level building in the near-term. I think we’re just going to have to see some trends develop before we have better confidence. And that’s why you see that are working on our outlook for NIM. Be pretty cautious around stable. It might be a little compressing. I could have said that it might even expand a little bit, but I’m just a naturally cautious guy so.
Tim Switzer: Okay, got it. That was all really helpful. And one last question. Could you remind us what percent of your loans are repriced immediately or floating rate?
Pat Barrett: Up 30%.
Tim Switzer: Great. Thank you.
Pat Barrett: You bet.
Operator: Thank you for your question. The next question comes from the line of Daniel Tamayo with Raymond James.
Daniel Tamayo: Hey, good morning, guys. [Technical Difficulty]. Hey appreciate the guidance on the range for expenses in the $58 million to $60 million per quarter through the year. I was hoping if we can get a finer point on maybe the cadence of expense growth. Does it just kind of imply volatility each quarter through that $58 million to $60 million range? Or should we kind of expect a little bit of a ramp-up as we go through the year here?
Pat Barrett: No. I think you should expect it to be flat from — throughout the year, but it could bounce around a little bit. You just — you do have some volatility, but we’re going to work really hard to keep it below $59 million. So we put the range out there so that you can do the math and come up with $59 million, which is a pretty good average estimate. But you should expect that that’s the one thing every day that we know that we can control and it’s not up to customer behavior.
Daniel Tamayo: Appreciate that color. And then maybe additionally there, are there any timing of any additional initiatives that you guys are working through that are implemented through the year?
Christopher Maher: I would just — I mean, the only thing that we would anticipate doing over the course of the year is we always hire good talent when we find it in the markets. So if we find good talent, good commercial bankers, we’re going to hire them. We have some room in the budget to do that. We have other expenses that are coming down. So, if we’re hiring our typical pattern of a few people every quarter, we can hold expenses right where they are. If we find an opportunity to do something better than that, then we’ll change our expense guidance and let you know. But that would be, in our view, a very positive outcome. So, any volatility, any significant volatility in expenses would be linked to something that we think would be good news.
Daniel Tamayo: Appreciate the thought there, Chris. And then maybe lastly, just looking kind of at the fee lines here, kind of looking stripping out the noise of some of the equity gains in the trust sale and taking out maybe the fully gained during the quarter were kind of just imply a run rate a little bit under $9 million there. And kind of with the main variance being a little bit lighter service charges that we were looking for. Is that kind of $9 million level kind of fair to look at run rate going forward? Or was there kind of maybe some seasonality or one-time things service charges that may boost that going forward?
Christopher Maher: The seasonality would not play a significant role, but I’m always cautious on this line given our public policy around fees. And I would expect that as we continue the dialogue over which fees are more or less responsible than others, you could have some vulnerability there to fees we may decide to change to make sure we’re in line with the current regulatory thinking. But seasonality wouldn’t come into it. This is really just kind of listening to the — to our regulators and to their views on different fee lines may cause us to reexamine fees in the next few quarters.
