We have one going on now, which is producing some decent results. But some of our small business platform is going to be a big focus for us as we go into ‘24, commercial C&I and some of the things that we’re doing in that sector and targeted and also with compensating balances on some of the loans that we have. Now there’s a massive push from the entire organization when I say from the entire organization, I mean, from our wealth group, insurance group, our commercial bank, our retail on deposits. That’s the #1 driver in everybody’s incentive plan as we move into 2024 because we all know that’s the greatest challenge that we face these days.
Operator: [Operator Instructions] Your next question comes from the line of Michael Perito from KBW.
Michael Perito: I apologize if I missed this, but are you guys able to give a little more incremental color on kind of where you’re originating new commercial loans today? And just broadly, Tony, what’s the kind of both sides of the appetite for loan growth in the intermediate future here. I mean, I guess, our clients kind of receptive to the pricing raises, I’m sure you guys are putting in across the board. And I guess from your perspective, just with NIM stabilizing the merger pending, what do you guys kind of feel like on loan growth that we should be thinking about? .
Tony Labozzetta: Mike, I would characterize that 4% to 6% would be a good target for you to consider in your modeling. I would say today, it’s a very interesting environment. If we untethered our thinking, we can probably grow our loans at about 15%, given all the activity and volume that we’re seeing. However, we’re — our underwriting metrics have tightened. The amount of commitments that we’re willing to put out there for construction has tightened. Relational banking has become more acute. So transactional volume that might have been a filler in the past is not bold today. So if we’re focusing our calories more on the relationships when it some to the deposits. And that being said, we have declined some loans that might have been acceptable just from a lending perspective in the past because we’re looking at it from a holistic approach.
And that’s the focus of our company today, and I think that’s important. But our appetite, to answer your question, the way we’re calculating it, is that 4% to 6% given how we’re approaching things today.
Michael Perito: Got it. And then do you guys have any — and again, sorry if I missed it if you provided it already, but just any color on kind of where the incremental commercial loan yields are that you guys are getting on the books today?
Tom Lyons: Last quarter, I think the average — I’m sorry, the average loan rate last quarter is about 6.75%. I think we’re seeing like more like 7.25%.
Tony Labozzetta: 7.62% is the pipeline, but then you have to kind of bring that down a little bit to reality. So I would say probably 7% to 7.25% is a good target range.
Michael Perito: And then just if we appreciate the update on the merger. If we just kind of assume that the transaction goes forward, how should we be I just — you don’t have to get too specific, I’m sure you guys will post close, but just wondering what kind of the investment road map looks like if you can maybe give us an update whether it’s kind of on the technology or the people side? And I mean, are there any areas that we should be kind of mindful of as we think about expense growth kind of post-merger for Provident? .
