I mean, like I said, it wasn’t a great year for earnings, but we still made $1.68 a share. And so what, almost $30 million after tax in the face of a very difficult environment even while dealing with some credit issues. So that’s important. Number one is just to be a strong financial counterparty to your constituents who are very large players and need to make sure that you can handle their business well. How I think about the bank beyond that is like that — the value — look at our total cost of funds is roughly 1.4%. That measures up against — I mean, there’s very few banks that can outperform that. That’s a benefit of not just relentlessly pursuing balance sheet growth. And that liquidity and that low cost of funds allows us to inject liquidity into the network.
Now grants you that’s different than Visa doesn’t do that. Mastercard doesn’t do that. But at this stage, the ability to inject and use our balance sheet to facilitate transactions to empower the network is really valuable. And I don’t see that changing in the next few years. So what I can say with certainty is, you’re not going to see any new lines of business for us. The lines we serve are the ones we serve and we want to do that with excellence. You’re not going to see balance sheet growth. You’re going to see us continue to really focus on the right-hand side of the balance sheet and a very strong liquidity position and deposit base and try to be conservative and thoughtful on credit because we need to maintain a revenue base. I mean there is a reason we can invest $110 million in technology next year.
It’s because we have a very strong and durable revenue base to do that and to do that and still make profits as an enterprise. And so I’m not willing to put us in a position where we put any of that at risk in the near-term. And so I think you should expect a static balance sheet. You should expect us to compound capital as a result of not growing our balance sheet, and you should expect us to be very focused on the right-hand side of the balance sheet and making sure that we’re doing things that protect the deposit franchise and then make smart loans and we generally do. There were some things this quarter, and I’m not even distracted in the equipment finance part of the business, like the provisions we made there, when you look at that in the context of that whole portfolio and that team, that’s not distracting to me.
That’s just going to ebb and flow. But every time we take a credit loss, we need to turn that into tuition, and it is not lost on us. I’ll just end with this, that when you trade at the PE multiple at which we trade, we need to not be on this call talking about credit, right? The people — what the investors are looking for is to see the payments network grow and for the way we generate the rest of our revenue to be done in a safe and sound manner, and that’s how we think about it.
Michael Perito: Yeah. No, that’s all totally fair really thorough, Aaron. So I mean, just to kind of put some numbers and summarize it, I mean so the balance sheet will stay in this $5 billion plus range for the foreseeable future, and you guys would hope to be compounding capital and continuing to invest in all your initiatives for the next handful of years minimum.
Aaron Graft: Absolutely. Yeah. And right now, we have about $200 million in excess capital over — we have internal buffers over regulatory minimums. So that number should go up absent the use of capital for M&A or to repurchase shares. And at our current valuation, I don’t see that being something that we will act upon. And so M&A for us would be using that capital to do that without diluting our shareholders will be done if we think we can do it in a way that’s valuable for the long-term to the payments network. That’s how we think about the use of our excess capital.
Michael Perito: Great. Thank you, guys very much for taking my question this morning. Appreciate it.
Operator: [Operator Instructions] Our next question comes from Thomas Wendler from Stephens.
Thomas Wendler: Hey. Good morning, everyone.
Aaron Graft: Good morning.
Thomas Wendler: I just want to go back to LoadPay here for a second. Distribution seems to be a pretty big focus for you guys and a bit of an edge you have. Have you reached out to any of these power users and gotten any preliminary feedback on the distribution of LoadPay?
Aaron Graft: Yeah, we have. We wouldn’t talk about it with investors unless we had talked about it with customers first.
Thomas Wendler: Okay. Thank you. And then just going back to credit, I know you guys not terribly a big focus here, but the equipment finance and liquid credit balances both saw a decrease last quarter just due to tighter credit box. Can you give us an idea of how you’re thinking of how these loan categories moving forward?
Todd Ritterbusch: Yeah. So on the liquid credit front, we shared that we have taken the lessons learned from the loss that we experienced in the Fourth Quarter there, and we’re applying those lessons. So yes, we’re going to be looking at new credit opportunities and liquid credit very carefully. But we continue to feel that when the right market conditions exist and when we see the right credits, we have to be prepared to act. So you could see a time when we step back into that space, if that were to occur. Do we see that coming right now? No, there are no indications that we’d move into that kind of environment right now, but you never know. When it comes to equipment finance, we feel that we’re at really the depth of the transportation equipment cycle at this point.
And so we’re dealing with the fact that we’re at that depth. And we’ve prepared ourselves to make sure that in the event that the transportation recession lasts significant period longer, we’re ready for that. Our appetite to lend into the equipment finance space is still there, but we’ve got to have the right risk-adjusted returns there, and you’ve got to have strong borrowers. And so the production that we expect in equipment finance is lower for the next quarter or 2 than it’s been historically, but we hope eventually it returns to normal.
Thomas Wendler: All right. Appreciate you answering the question.
Operator: And our next question will come from Joe Yanchunis.
Joseph Yanchunis: Thank you for taking my follow-up here. Several quarters ago, I believe you discussed taking TPay International to either Canada or Mexico. Is that something you’re still considering? And if so, should we expect that to occur in the next couple of years? And then Additionally, are there any updates you could provide about your plans to monetize some of the transportation data that you aggregate?
Melissa Forman: Great questions. I’ll take the first one. In terms of international payments, we are making payments in Canada and in Mexico. And we are in active development on being able to take that to other regions of the world. And so you would expect to see that happen this year in 2024 as we support our growth and the shipper strategy.
