A – Jim Eccher: Thanks Jeff. Operator Thank you. Our next question is coming from Chris McGratty with KBW. Please go ahead.
Chris McGratty: Hey! Good morning.
Jim Eccher: Hey Chris.
Brad Adams: Hey Chris.
Chris McGratty: Hey Brad, Hey Jeff. The comments about earnings assets trailing loan growth, if I heard you right Brad, $50 million is coming off of the bond book, is it one? I mean it feels like that could fund mid-single digit loan growth by itself. So it sounds like no growth in Q1 kind of seasonally or low growth and then what mid-single over the course of year. Is that kind of flat earning assets or you think any assets will grow?
Jim Eccher: Yeah Chris, I mean historically we’ve been a shop that’s had pretty good loan growth in the second and third quarters. Yeah, obviously fourth quarter was pretty flat. I will say in recent weeks’ activity loan committee is picking it up. If you remember, we set out to double our origination capacity last year and we actually tripled it, going from about $500 million to about $1.5 million. I certainly don’t see that kind of production in 2023, but certainly could see somewhere in the $1 billion range in production. But, I’m optimistic. I think mid-single digit growth is very achievable.
Chris McGratty: Okay. And then on the margin, there was a comment in the release about upward pressure on deposit cost, but I think here the word was moderate. So I guess maybe a little bit of color there. I think the banks that have held out so far on deposit betas have more or less signaled an acceleration. Are you signaling, perhaps not the same degree of pressure Brad and margin lift from that 4.6.
Brad Adams: So, as you can see, we’ve seen a little bit of deposit attrition. It’s largely been concentrated in public funds, fewer districts, that sort of thing. And that is money that flowed in while the spigots were on full, right? I mean everybody saw that. Absent that we don’t have a lot of very high balance accounts here. We are €“ I’ve said this before, it’s a little bit folksy, but we are funded largely by $1000 checking accounts and that serves us well in times like these. We do have, you know from an outpost stand point we do have some time deposit contribution and the cost of that is early going up. There are 4%’s being thrown around in our market at this point. And you see the usual games, where people are basically gaming the Fed Funds Futures curve and trying to capture 10 basis points here and 25 basis points there, it’s the same old game.
We’ll keep some level of time deposit just to keep things balanced from an outgo standpoint. There is obviously some pressure, but not a ton. We are doing really well.
Chris McGratty: So, just to push on the margin again. You talked about perhaps taking some of the asset sensitivity off, but not making a huge bet. If the market is right, that we get another hike or two in the first quarter or two. I mean where do you kind of see peak margins?
Brad Adams: If we get two more, our margins go on above five.
Chris McGratty: Okay. And then one of your peers in Chicago I think has managed to balance sheet just very well like you. Wouldn’t that be the time to make a little bit more of a bet to lock in that really, really high margin?
