And so, we would definitely be in the natural bias eventually. It’s just — the gestation period is a bit longer and sometimes it doesn’t work for both parties at the same time. So definitely still an appetite. Parameters are still the same. So, we are paying up to 8 times EBITDA pre-synergies in market, maximum outlay of $50 million. Now if something big did come along, we would obviously take a look at it. So smaller acquisitions, we can get our arms around it, we can integrate it, and it’s accretive with the high ROEs that we are posting at the moment. Obviously, the hurdle rates for the IRRs for the deals are still at 15%, but they got to be at a certain 15% in order to be accretive. And so, these things — these are not financial acquisitions, that are kind of strategic moves for the sellers and for us.
So yes, still definitely a handful of good opportunities, nothing to talk about yet. And maybe they end up going away and coming back again, who knows. But there is still appetite in the bank and the trust company.
Tim Switzer: Okay, great. And for the margin outlook, you guys talked about you expect a little bit of expansion still. It seems like in Q1, but what’s the trajectory over the rest of 2023, assuming we get maybe another 50 basis points of hikes or something from the Fed. If the Fed pauses, is there a moderation in the margin in the back half of the year, as deposit costs continue to rise, but loan yields settle out or do you think you’d be able to maintain the NIM?
Michael Collins: Yes. So we would see it as — the drivers of the NIM expansion really are, as you correctly said, you see a moderation in the loan, both in terms of new originations are starting to moderate at higher rates. And there is obviously a fixed component that’s flawed, if you will. But retail loans, on the exit run rate is still up a fair bit for us. What’s going to kick in, in a more meaningful way for us is the re-laddering of the cash as we see deposit stabilization. The exit run rate on the cash is pretty low, but it’s definitely getting there in terms of just the T-bills rolling over. And that will discontinue really as we roll into longer-dated fixed rate maturities. And then deposit costs, we would expect them to moderate in terms of cost for now, but it just depends on what the market then does.
We have to remain competitive certainly in fix income bucket. Obviously, that’s where we have the — this is the first rate cycle we have done since the ABN acquisition in sterling in the Channel Islands. And so, this is a bit of a learning experience. But I think our model assumptions are still very conservative. And as you can see on the asset sensitivity with another 100 basis point, even 200 basis points, we are not expecting — we are expecting moderation in the asset sensitivity but not flat lining, if that makes sense.
Tim Switzer: Yes. That all makes sense. Thank you. That’s all for me.
Operator: This concludes our question-and-answer session. I would like to turn the conference back over to Butterfield for any closing remarks.
Noah Fields: Thank you, Dave. And thanks to everyone for dialing in today. We look forward to speaking with you next quarter. Have a great day.
Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.
