Russel Gunther: Okay. That’s a great color, Phil. Thank you. Maybe just switching gears on the expense conversation that was had. I understand the directional guide, but from a big picture strategic perspective, kind of where do you stand in the digital transformation phase and that spend, that I believe is now in the run rate? Are there ongoing projects below the radar that are captured into that flat expense guidance? I know when the spread was more challenged, I think you guys had strategically pushed some things a bit further. So just curious from a big picture perspective, where that all stand?
Daniel Schrider : Russell, this is Dan. What we rolled out and kind of fully completed in ‘23, in the end of the — beginning of the fourth quarter, was everything retail related, retail online banking, retail mobile, P2P capabilities, integrated online account opening. So those are all running and there will be obvious iterations to that, but not at the same expense rate as the initial build. On the planning side of things is taking that platform and building out our small business and then our commercial online capabilities. That’s in the design phase right now. And in all likelihood, the build out of that would probably not begin to occur until very end of 2024 into ‘25. And then within that run, so that’s not built into that run rate for ‘24 conversations what I’m trying to say.
And then what is built in are a number of smaller projects that are just aimed at helping us to put into practice some of the digital capabilities we have in terms of automated underwriting, automated small business delivery and those types of things. And those will be things that are being built out throughout the course of 2024.
Russell Gunther : Okay. Got it. Dan, that’s very helpful. And then the last one for me, just on the loan growth side of things. I think I missed your comment in terms of where your — what your target is, but if you could share kind of what you’re directionally looking for from a loan volume perspective mix, and then just kind of overall comfort zone from loan to deposit ratio, if that’s ultimately going to be the endeavor?
Daniel Schrider : Yes. I think going into 2024, and I think we’re going to stay flexible as to what we see happening in the market, both from a pricing demand and then having obviously the funding side of the things also be a driver there. But our plan was to be somewhere in the mid to upper-single digits by the end of the year in loan growth. Driven predominantly by our C&I work, our owner-occupied real estate, probably low-single digits on the commercial real estate side of things really overcoming runoff that we see in that. We could see some growth if depending upon what the long end of the curve does and in the mortgage space and have a more of an appetite to put some 5.1, 7.1, 10.1 type of arm product in the portfolio.
But that’s really going to be driven by what we’re able to achieve from a profitability standpoint. So there’s a little bit of, — so from an overall plan standpoint, mid to upper-single digits that could move more favorably if conditions allow that to happen. On a loan to deposit ratio, we actually — the last handful of months, we’re tracking on either side of a 100%. And in our case, we always have a little deposit runoff particularly within the commercial book at the end of the year, which has what kicked the it back up. We went into December with it right around a hundred. Over time, we think that needs to come down into the mid-90s, but we’re not sprinting towards that. We just think that will happen over time.
Operator: Our next question comes from the line of Manuel Navas with D.A. Davidson.
Manuel Navas : Can you talk a little bit more about the kind of comfort on the deposit side and kind of where you’re seeing the core inflows that kind of drives a little bit better growth expectations on the loan side next year?
Philip Mantua : Manuel, this is Phil. As it relates to the current flows within the deposit base, they continue to be in the feature time deposit products that we’re offering predominantly on the retail side. Kind of mid-term one-year to two-year type of maturity tenures currently with the best offered rated at around 5%, but I don’t know that we’re looking for that particular rate to last a whole lot longer into the future. Still seeing good growth on the high yield savings account that continues to lead the way. Our other interest checking products are fairly stable. The money market area still is one that we think needs to kind of turn the corner and go in the other direction. That’s been a little more difficult. And then I think we’re optimistic about the things we can do on the demand deposit side here given the nature of the type of lending we want to do going forward and how that should alter the view towards the complementary type of deposit gathering that would go along with more true commercial lending.
I think that’s part of where we are at in kind of how we see it moving forward as well.
Daniel Schrider : Hey, Manuel, this is Dan. I’ll also mention that we’re really optimistic about what our digital capabilities are going to provide in the generation of new relationships. And with ‘23 being, what it was with the noise around deposit outflows or disintermediation, our integrated account opening that we kicked off with some of our new digital technology. We opened for us significant, over 2,200 new accounts in the over the course of time since we kicked that off. But over half of that, or — I’m sorry, about a third of that are checking account relationships. Over half new client acquisitions, about 46% are deep in the existing relationships. So we have our teams in retail and commercial mortgage and wealth laser focused on digging into the relationships that they have within those verticals that may not have full banking relationships.
