We just simply continue to hit on many different cylinders and it is evidencing of our ability to prudently produce a diversified portfolio. But certainly while remaining disciplined in our pricing and underwriting. But with that said, we remain optimistic about our ability going forward in this next quarter. David, you want to comment specifically on construction?
David Meredith: Yes, sir. Thank you. Good morning, Michael. This is David. And our construction and development bucket changed moderately over the quarter. It went from about 53% to 54%. It led to about $35 million in change quarter-over-quarter just about — only about 15% of our loan growth, yet that kind of 54% is not far off from where we would have seen historically our construction and development bucket somewhere 55%, 60% where we expect that number to be. So it’s not out of line from an expectation standpoint.
Michael Rose: I appreciate all the color. Great detail. Just as a separate follow-up. Expenses were down a little bit Q-on-Q and you guys have kind of talked about flattish. Any specific efforts or things that you’re kind of working on? I assume some of it has to do with, you know, mortgage, you know, related revenue being down a little bit, so incentive comp a little bit less, but anything that you guys are kind of working on the expense front. I know you’ve kind of talked about migrating the efficiency ratio back towards 60%. You know, just wanted to get an update there, just given some of the revenue headwinds that are out there for the industry. Thanks.
Kevin Chapman: Yeah. Hey, Michael. Kevin. So on the expenses, our focus really hasn’t changed. If you just look at the expense categories, we saw the decrease. You can see occupancy and equipment, salaries, employee benefits, both of which comprise, you know, collectively, they’re going to comprise 70% to 75% of our expenses. So that’s where our focus is. In Q2, we did — you do have the seasonality revenues, mortgage revenue was down. So, mortgage expenses, specifically mortgage commissions are down. So if you look at salaries and employee benefits line item, it’s down 1.2 million, but that’s not all mortgage. About $300,000 of that was expenses from the core bank. So roughly $900,000 of that is going to be attributable to mortgage, but there’s also a day count differential there.
If you add in the day count differential compared to Q2, our core salaries and employee — our core bank or just non-mortgage salaries and employee benefits is going to be down. It’s going to be down in the $500,000 just from the day differential. So there is real traction being made on our efforts to control and contain and reduce expenses. As we look out, our focus is still going to be the same. We don’t have an announced expense initiative. What we’ve announced multiple times that we are focused — we’re focusing on expenses and that you see that in our numbers if you just look quarter-over-quarter, there is some seasonality to it. But our focus has been on reducing expenses. When it comes to the efficiency ratio, our attention is now focused on the revenue side of that.
But we will continue to have an ongoing effort to reduce expenses and again, we’re just — we will just ask you to focus on salaries and employee benefits and occupancy and equipment. That is where our attention is going to be because that’s where the majority of our expenses are.
Michael Rose: Appreciate the color. I’ll step back. Thanks for taking my questions.
Mitchell Waycaster: Thank you, Mike.
Operator: Thank you. Next question will be from Catherine Mealor of KBW. Please go ahead.
Catherine Mealor: Thanks, good morning.
Mitchell Waycaster: Morning, Catherine.
Catherine Mealor: Just wanted to ask on the margin and just see what you think — what’s your outlook for the margin into next quarter and in the next year and really maybe a big picture, just thoughts for the margin is, how do you think about where the — where and kind of potentially when the margin should bottom? And also how you’re thinking about NII growth as we move into next year. Thanks.
