Brad Milsaps: Okay. All right. Thank you, guys. I’ll hop back in queue.
om Broughton: Thanks, Brad.
Operator: Thank you. Our next question is from David Bishop with the Hovde Group. Please proceed with your question.
David Bishop: Yes. Good evening, gentlemen.
Tom Broughton: Hey, Dave.
David Bishop: Hey, Bud, I think you said in the pre-envelope, I’m not sure I heard you right, but it felt pretty good about just maybe the outlook for at least the direction of loan yields over the next year or so? Did I hear you right? It looks like the loan rate was 5.41% at the end of the quarter, but just curious maybe as you look out in the quarter or two and assuming the Fed stops maybe in this quarter or next? I’m just curious what’s the impact on loan yields in terms of the lagging catch up in terms of what you’re booking right now at market?
Bud Foshee: You’re talking about new loans or just what will reprice from the Fed mix change?
David Bishop: Yes, new loans and how that may rolled into the overall average loan yield over the next few quarters?
Bud Foshee: Yes. Well, our new loan should go on at least at prime at 7.5% from that standpoint. And when Fed raises rates over one month period, we have about $4.2 billion that reprices — that we were repricing. You take — you have about $2.1 million of either reprices and take $1 billion that reprices during the next 30-day period.
David Bishop: Over the next 30-days, I think —
Bud Foshee: just based on the new loan volume, I don’t have that projection.
David Bishop: Got it. And then just curious, and I think I heard you right, you’re expecting maybe low double-digit deposit growth. As part of that maybe just drilling down this quarter, what were some of the trends in the correspondent banking division of those balances and maybe a number of new relationships you’re able to add this quarter?
Rodney Rushing: Yes. This is Rodney Rushing. We grew the corresponding relationships throughout the year in the fourth quarter. I think our total number of new banks we added was seven for the quarter. Our total number of existing correspondent relationships is right at 340 probably all one or two that close. And for the fourth quarter total fundings for correspondent grew by, I think, $140 million for the quarter. And for the year, correspondent balances were down mostly in the DDA balances, because banks didn’t have to keep near as much in their analysis account. Rates going up as fast as they did in ’22. We moved some of that into Fed funds and then some moved out. And as my correspondent banks their liquidity has been put to work and has declined just like I was getting 22%.
The corresponding business continues to grow our relationships and we’re looking at a couple of new markets in 2023 that we haven’t finalized, which one we’re going to go to yet. But still growing it and we anticipate it continuing to grow.
David Bishop: Do you have the dollar balance at year end?
Rodney Rushing: Two point — just shy of $2.5 million, I think it’s $2.468 million.
David Bishop: Got it. And then on the credit front, just curious within the outlook for high single-digit loan growth. Any areas where you’re being more conservative, more cautious pulling the reins back from an underwriting and credit perspective?
Bud Foshee: I think kind of across the board and more specifically in commercial real estate sticking with core customers, who can have deposits and have loans with us and seeing our businesses where we’re focused this year.
Tom Broughton: Yes. Dave, this is Tom. Just to jump in is — we can be more selective today than ever. So it’s really an outstanding time. I mean, that’s why my old partner said things are better when we need deposits, because you make better decisions and we certainly can be very selective on the loan side and we can be much more proactive in pricing, rate structure today than we try not to ever give own structure, but we could certainly be more proactive than we’ve ever been in a long time. How about that?
