Maritza Arizmendi: Well, thank you, Timur, for your question. This quarter included about $7 million in the charge-off of 2 loans that were previously reserved and we discussed during our last call, in the second quarter, we talked about these loans that were ported in all accrual. And we completed the restructuring of one of them during the quarter, and it requires about $4.2 million in charge-offs. The other one was transferred to held for sale at the end of the quarter, and it requires about $2.7 million in charge-offs. That loan was already sold on October 18. So that reserves were already established in prior quarters. So if you exclude that 2 loans, our net charge-off is about 0.62% for the quarter, which compares really good with the prior quarters.
And as we look forward, I think we are starting to see a more normalized level of charge-offs compared to 2021, 2022. But we need to keep monitoring that trend to see what would be the normal trend. We think the credit conditions continue to be benign in Puerto Rico compared to prepandemic levels, and that’s how we see it.
Operator: Our next question will come from Alex Twerdahl with Piper Sandler.
Alex Twerdahl : First off, just it sounds to me, José, now like you’re fairly committed to being above $10 billion. And I’m just curious how you’re thinking about the overall strategy, the overall growth strategy. If that’s no longer sort of an upper level on assets, how you think about how the balance sheet might transition over the next couple of quarters as you continue to deploy the excess capital that you have.
Jose Rafael Fernandez: Yes. So yes, look, the way we look at the $10 billion mark this year is very different from the prior 2 years where we managed below the $10 billion mark. And it has everything to do with where interest rates are and how the — kind of how the balance sheet from the loan side in terms of loan growth and also the deposit side how it’s playing out. We feel that it makes sense for us to cross it right now and just make sure that we take advantage of the opportunities to grow the balance sheet from the loan side, particularly here in Puerto Rico. And that’s what we’re committed to do. We see good opportunities on the commercial side as well as on the retail side. So managing it into next year — I’m not sure what exactly you mean by the question on how to manage it into next year, but I can tell you that we will have — our balance sheet will be north of the $10 billion, and it will be impacted by the expected loan growth that I’ve guided to in my original remarks.
So if there is a follow-up, please feel free because I’m not sure if I understood your question.
Alex Twerdahl : Yes. I mean it looks like sort of just high level on the balance sheet that you guys added some borrowings, added some securities. I don’t know if leverage is the right term there or maybe it’s just sort of a mismatch in timing. But I guess, as you look to grow loans, how are you thinking about funding it the complexities there?
Jose Rafael Fernandez: I get it. I get it. Now I get it. So that’s a very valid and good question, Alex. The way we look at this is the scenario of interest rates that we are using and we expect our interest rate forecast is for interest rates on the Fed fund side to remain kind of plateauing at these levels, 5.25, 5.5, and we also expect into 2024 interest rate to start ticking down the second half of the year. So when we look at that scenario and us being an asset-sensitive bank, we felt that it was prudent to put in some — now with MBS as yielding 5 60 and north of that with short duration, 4.5, 5 years duration, it will be prudent for us to protect ourselves in an environment where interest rates start moving down. Just recall, 1.5 years ago, we kept dollars cash and we did not go long on duration and that was the prudent right thing to do.
