Aleem Gillani
I think we continue to look at that very actively, Ken, through our ALCO process. As you know, we’re continuing to do new loans, so continue to grow the business and those come on, the majority of those loans come on floating. So deciding whether to fix them or not is sort of part of our overall balance sheet strategy and we did do a little bit in the fourth quarter, nothing overly substantial on that side. But we’ll continue to manage the overall balance sheet duration and continue to be opportunistic to the extent that we can.
If there are large moves one way or the other, we’ll consider that in our overall balance sheet strategy. In this, in the fourth quarter, we had some small action. In addition, you saw the security loss. That was basically moving level two HQLA into level one to make sure that we continue to stay compliant under the LCR.
So there a few of these sort of minor little actions going on back and forth. But as we go through 2015, if there are opportunities that make sense from a risk versus return trade-off, we’ll continue to take those.
Ken Usdin
Okay. Got it. And a follow-up on the curve.
Just can you give us out of context where and how the low 10 year affects your portfolio or not relative to peers in terms of if we stay here and at a lower than expected or hoped for 10 year, what parts of the portfolio should we be mindful of?
Aleem Gillani
I don’t know how it would affect us relative to peers, but when you look at us specifically, the 10 year rate affects us in a couple of ways. Number one, it affects us in terms of mortgage rates and mortgages that we put in our portfolio. Typically, we’re putting $200 to $250 million a month of jumbo mortgages within our portfolio and those are split, some fixed, some floating or some fixed, some arms. And the other place that the 10 year rate affects us is in the investment portfolio and as the rate drops, the mortgage backed securities we have in our investment portfolio tend to pre-pay a little bit faster and we reinvest that cash at slightly lower rates.
So with a dramatic drop in rates such as we’ve seen, we’ll get probably a little bit more public awareness, a little bit more publicity and some of that will happen a little bit faster. The offset to that from a nim and net interest income perspective of course is increased re-fies. And increased fee income in the mortgage business that I am hoping will act to completely offset the drop in net interest income from lower rates.
Operator
Our next question comes from John McDonald of Sanford Bernstein. Your line is open.
John McDonald, Sanford Bernstein
Hi, good morning, guys. I was wondering about just on the credit outlook, Aleem, I think you said — you kind of expect to maybe bounce around the charge-off level you’re at now. Is that maybe 30 basis points kind of in that ballpark, is that what you’re thinking about?
Aleem Gillani
I think for full year 2014, John, we ended up around 34, 35 basis points.
John McDonald
Okay.
Aleem Gillani
And we’re not expecting a substantial move from that. Our through the cycle l expectation for charge-offs is 40 to 70. Obviously we’re at a very strong point in the cycle. We’ve been below the bottom end of our range, and our current expectation is that we’ll stay around that kind of a number in 2015.
