Gary Small: 12/31 to 12/31, the average growth would be much better than that. Loans would probably be another 1% above that, but securities will bring down at least 1%.
Brendan Nosal: Yes. That’s perfect and super helpful clarification. Then just on the cost outlook. I think you said 3% to 5%. I mean, kind of the midpoint of that suggests that the run rate would kind of hold around the fourth quarter level, it’s not even a little bit better. Just can you talk a bit the about some of the leverage you’ve had throughout the year to kind of hold that cost run rate roughly in line with the fourth quarter?
Gary Small: Sure. I might have misspoke. I actually had 3.5% relative to the growth range for the year. We have some opportunities from a cost perspective as we rightsize a few segments of our organization and acknowledge the situation that we’re in and some projects that are a little less crucial going forward might be put on a partial delay and so forth. So nothing that’s going to change the strategic or the direction of the organization, but the normal trimming that you will do with throughout the organization and throughout business groups where it’s appropriate to be doing. So that, combined with just our normal good diligence, but it’s kind of in our DNA. We’re always looking for the lease value added 2% or 3% of what we’re doing and how to redeploy it to the best or the next 2% or 3%, and that’s still important to our organization.
I think we got 4.6% up over the prior year. That’s probably going to be a pretty reasonable number versus what the industry as a whole delivers year-over-year. That would be an indication that I would expect we’d be on the better side of that average.
Brendan Nosal: Yes, yes, all right. Fantastic, thank you for the clarification there. On the 3.5%, much appreciated.
Gary Small: You bet.
Operator: Thank you. And we have another follow-up from Michael Perito of KBW. Michael, please go ahead. Your line is open.
Michael Perito: Hi guys. Thanks, sorry. And I apologize if this was in Gary’s guide, and I just missed it. But just on the tax rate for 2023, should we be assuming more something in line with the full year versus the fourth quarter? It looked like the fourth quarter was a bit lower than normal?
Paul Nungester: Yes. I mean you can use a 20% effective tax rate estimate, and it will be plus or minus from there. It won’t change much.
Michael Perito: Okay, perfect. Thank you, guys.
Operator: Thank you. We have no further questions. I’ll hand back to Gary Small for any closing remarks.
Gary Small: Well, thank you. And I do have a closing comment or maybe something to just keep in mind for perspective. I would suspect that over the next 12 to 24 months, inflation is going to resolve itself or at least to the amount of distraction we currently are involved with. And the inverted yield curve will abate and the cost of funds curve will return to something a bit more normal for us. And that will be a good day. However, the business that we booked over in ’22, the 20% growth clients that we brought on board, the clients we’ve served, that’s going to be with us for the next 7 to 10 years. And the value that, that will bring to the organization over that period of time, I think, will outweigh the bumps that we’re experiencing right now.
