Brett Pharr: Yes, that’s kind of what I was telling Frank was the working capital is an area of asset-based lending, particularly where we think there’s some growth opportunities as there continues to be some stress in various types of industries where we can do some of these transactions that are higher yield. To remind everybody, it’s a heavily collateral managed using liquid collateral and we’re very good at that as part of our secret sauce. And when I can get those and get the yield for the right kind of transactions, I really like that asset class.
Eric Spector: Okay, that makes sense. And then just one last question. I’m just kind of curious, you talked about one rate cut in your assumptions. Just curious how you think about your operations as we begin to see a few rate cuts. Obviously, deposits will reprice lower, but loans will also. Just curious maybe if you could provide some color on just the margin trajectory. And then from a broader perspective, how you think about how that would impact loan growth and maybe some of the other businesses assuming rates come down?
Brett Pharr: Yes. So I think a few things. Remember that the cost of our deposits, the way our contracts are written in the accounting that we deal with it. If Fed funds goes down, the day it goes down, our cost goes down. So that’s the first thing that helps us. Secondly, we’ve got a book that has some duration in it and so actually, in the short and intermediate term, the rapid drop in rates would be to our advantage on the NIM side over a long time, obviously, then the rates come down in general. So from a rate and profitability standpoint, that’s the picture. Rates dropping will likely foster more economic activity that doesn’t bode as well for our working capital product, which but other products that we have, they’ll become more of the thing you might think about some of the leasing products and other term products our credit box view of that would be better.
And so we would do more of those. And that’s one of the beauties of our diversified loan product portfolio is when one is up, another may be down, when one is down and others up. And that’s we’ll deal with whatever rate environment comes and take the opportunities the market gives us.
Eric Spector: Yeah, that’s helpful. Thanks for taking the question and I’ll step back.
Operator: The next question today comes from Michael Perito with KBW. Please proceed.
Michael Perito: Hey, guys. Good afternoon. Greg, welcome. Thanks for taking my question.
Greg Sigrist: Thank you. [indiscernible] joining.
Michael Perito: Yes, I think a lot of the financial questions have kind of been asked and answered, and I apologize if I missed this, but just one quick maybe follow-up, just around the seasonality of kind of the EPS annually here and the expenses. Obviously, there’s the tick up in tax revenues, also the tick up in tax expense in the second quarter. But just wondering if there’s any kind of additional guidance or guardrails you can give us on kind of the expense growth for fiscal ’24. I know you guys have the 2:1 operating leverage target kind of unchanged, but just if we’re talking maybe just run rate here. Any additional thoughts you can provide?
Brett Pharr: Well, I guess what I would say is I think the Q1 is actually a pretty good run rate for us, understanding that we’re always going to continue to invest in human capital and technology, which is that 2:1 operating leverage that you mentioned. I think it was really one other caveat that besides that, which is, in the second quarter, you definitely have the tax pick up a little bit, but it’s also a little bit of comp and benefits just above and beyond that, which I think you can track, if you go back and look at the last couple of years, is the seasonality there. Over the balance of the year, other than some modest continued investment, I think that’s how I think about the run rate.
Michael Perito: All right. That’s helpful. And is there any — I think you mentioned, Greg, a comment about how you’d expect maybe some of the underwriting around some of the tax products to be improved. Is there any efficiency that you would target in the tax business? And if we look back to the prior year in terms of the pickup in cost or is that pretty much as efficient as it’s going to get at this point?
Brett Pharr: This is Brett. I think it’s about as efficient as it’s going to get. We did a lot of work around the operations of that several years ago and we’ve got that pretty lean and mean for what we get, and we’re pleased with — on the refund transfers and the approach of the ROs. It’s about as good as it’s going to get. We make some investments in technology to stabilize that area and keep it efficient. So I think past years on the expense run rate are pretty good indicators.
Michael Perito: Great. And then just kind of a philosophical capital question. As we look at a few of the moving pieces here. I mean you guys, particularly the margin neutrality plays out. I mean you’re pretty consistently pumping out a well north of 20% ROE annually on a balance sheet that really isn’t growing a ton. And I don’t necessarily not suggesting a right answer or wrong answer to this, but at what point do the buybacks, when does there need to be more tools kind of or arrows in the quiver here in terms of capital deployment? I mean how are you guys thinking about that. I’m sure you’re budgeting out at least 24 months, if not longer. And I imagine the capital creation is pretty significant. Just would love some updated thoughts around that as we kind of start your fiscal ’24 and as we think about estimates for the next couple of years?
