Kevin Hanigan: Yes, it’s been moving around, Michael. For Q1, it started off pretty bad and rallied really nicely in late February and throughout March to pull that average up probably $60 million or $70 million more than we were thinking when we talked back in January. I’d say for Q2, I’d peg a number of around $900 million on average for the quarter. Through last night, we’re somewhere in the $870 million, $873 million, $874 million average so far for the quarter. Rates have ticked up. I might have gone a little higher than $900 million, but with this tick-up, I think $900 million is probably a safe average number.
Asylbek Osmonov: I just want to correct. One — yes, for the loan start of $1.5 million to $2 million, that’s annualized would be on the $6 million to $8 million, not $12 million, I said, I just want to add to that.
Michael Rose: I was thinking about total.
Asylbek Osmonov: Lone Star that will be $6 million to $8 million annualized.
Michael Rose: Got it. Okay. Helpful. And then maybe just finally for me. Asylbek, I appreciate the expense guide for the second quarter. But as those cost savings are realized, I think, more in earnest in the fourth once you get past operational conversion, is it plausible that non-interest expenses would kind of stay in that think you said 141 to 143 range kind of through the end of the year. Is that fair balancing the kind of the puts and takes on the cost savings with just normal expense growth? Thanks.
Asylbek Osmonov: Yes, I would agree. I think that right now, sitting in project now cost, I think, $141 to $143 quarterly, I would say, throughout the year, will be good guidance unless something changes.
Michael Rose: Great. Thanks for taking my questions.
Operator: The next question comes from Dave Rochester with Compass Point. Please go ahead.
Dave Rochester: Hey, good morning guys. Congrats again on the deal close. Just wanted to go back to your comments on the margin. You gave a lot of good color on the accretion and the 6- to 24-month look. There are a lot of moving parts of the deal coming in. And just with everything baked in, what do you think is a good range for the NIM for 2Q at this point?
Asylbek Osmonov: For 2Q, I think what we see in the past few quarters, our margin accelerating. So I would say probably sitting right now with the information we have another 4 to 5 basis point increase in margin in the second quarter.
Dave Rochester: Okay. And is the idea to continue to run the securities book down and use that liquidity to fund either loan growth or reduction on the borrowing side?
Kevin Hanigan: Yes. Longer term, yes, we are still building a little cash, as David said at the onset for regulatory purposes. They’d like to have a little higher cash. We’re getting closer on that cash build. But longer term, that’s the use of the bond proceeds. We paid down the debt if it’s not being chewed up by loan growth.
Dave Rochester: Yes. And then how much cash do you guys think you need ultimately?
David Zalman: It’s a work in progress. I think what makes the regulators happy. But our gut is somewhere around…
Asylbek Osmonov: $1.5 billion to $2 billion, I think that’s the range we’re working on right now.
Dave Rochester: Okay. And then switching to capital real quick. I think you’ve only been above a TCE ratio of 10% for more than one quarter, maybe once that I can remember, and that was about five years ago, right, before you announced another deal. So I was curious, it sounds like you’re still interested in deals. What do you think your prospects are over the next year at this point, just given where rates are and whatnot, what are the conversation levels like today? And do you still think you need to build capital from here to do a potential deal? Or can you just maintain these ratios here and maybe start returning a little bit more capital through a more regular buyback?
David Zalman: There’s quite a few questions in there. I’ll try to take the first one. There still are conversations. We had conversations going even working, trying to close to Lone Star. I would say we did — sometimes you just get frustrated with all the hard work that you have and you want to — should you keep doing it. But the truth of the matter is, yes, we are, we’ll continue. We’ll probably start pursuing it more than we had. I think we wanted to get Lone Star done, and we still — even right now with Lone Star we’re trying to get it put together, talking about the operational integration, and then we’ll start working harder on some of the deals that we have been working on. But the odds are good, that we will be able to enter into something.
I don’t think there’s any question about that. It’s just — again, I think before we do something, we just really want to be thoughtful what we do, and it does — it’s accretive to the bank, to the shareholders, and it adds to the value of our franchise. So those are just the considerations that we’re looking at.
Dave Rochester: And in terms of the buyback, what do you think about that?
David Zalman: Okay. The buyback, we do have a lot of money now. I think things have stabilized. Everybody — after the Silicon Valley deal and the Signature going public, I think everybody was worried about everything. I think things are becoming more stable right now. People are starting to feel better. And with that, I think if our stock price becomes — if it goes down, you saw how many shares we bought in the first quarter, and I think that I think will continue to be buyers of our stock, too. I think we do have — we do have a high-class problem with a lot of capital, but we’ll use it when we think it’s a real opportunity to buy our stock back.
