And so, I think that’s going to be one of the things that’s going to keep the CET1 ratio from growing as much as it did in 2023. But we’re going to stay, we’re going to look for capital efficient Investments in the investment portfolio and if we have more loan growth, that’s going to help utilize or deploy the CET1 and some unfunded increase, but nothing like we’ve seen in the past.
Ahmad Hasan: Thank you for the great color. And a quick follow-up on that, within the loan book and unfunded construction commitments under $1 billion, should we expect a larger year-over-year decline in the balances in that segment versus the $53 million decline in ’23?
Malcolm Holland: No, we expect it to be flat, maybe a little growth, but nothing meaningful.
Ahmad Hasan: Sounds good. That’s it.
Malcolm Holland: Thank you.
Terry Earley: Thank you.
Operator: Thank you. And one moment please for our next question. And our final question for today will be coming from Michael Rose of Raymond James. Your line is open.
Michael Rose: Hey, everyone. Thanks for taking my questions. Just two quick follow-ups, I’m sorry if I missed this, Terry, but certainly understand the desire to bring the loan-to-deposit ratio down, what should we expect for or what are your expectations for non-interest bearing mix, I assume some of the growth is going to be in some higher cost categories. But do you have a sense for, and I’m sorry if I missed this, where that could drop out and what terminal beta expectations could be? Thanks.
Terry Earley: Yes, I would expect it to be pretty flat from here. Now if we execute well, I would expect it to be pretty flat. And that means our small business, our community bankers, our commercial C&I guys are hitting their targets. I would expect it to be flat. There’s always seasonality, like I said, at the fourth quarter, there’s some outflows in that that have come back in the first quarter already. But in general, we’re going to see those outflows again in the fourth quarter of 2024. So, Michael, that’s our best guess right now.
Michael Rose: Okay. That’s helpful. And then, just going back to credit quality, I know there’s the two Office CRE loans that comprise, I think 60% of your NPAs at this point, any sort of update there? And what’s the outlook for potentially moving those credits outside the bank? Thanks.
Terry Earley: It’s just one of them, right? It’s just that one. And we actually had that one, a note sale working on it. It fell out late, So we wrote it down to where the note sale was going to be. We do have a participant in that, partner in that, so we obviously have to work with them. But our anticipation is that, that asset will be gone this quarter either through — probably through a note sale of some sort. But we were really close to just fill out at the end.
Michael Rose: Okay. Great. And then, maybe just finally for me, I know this was kind of touched on earlier in the call, but Terry, do you have a sense for how, if we do, what the delta would be from kind of what you talked about in terms of rate cuts, kind of us being at 3%, forward curve being at 6%. What that delta could look like, A, if we don’t get any cuts and then B, if we get the full forward curve at this point, just trying to look for the sensitivity since I assume it’s not linear. Thanks.
Terry Earley: Well, I mean, if (a), it’s about million and a quarter for every basis point of NIM. And so, if it’s six cuts, you get 20 to 24 basis points in NIM reduction, there’s your math there. And if it stays flat, it’s there should be. Yes, it’s, and so — it’s kind of if rates were to stay flat, it’s pretty meaningful to NII and to EPS. But I don’t think anybody is thinking we’re going to end the year flat. So, that’s the best way I know to answer it, Mike.
Michael Rose: That’s very helpful, Terry. Appreciate you guys taking my questions. Thanks.
Terry Earley: Thanks, Michael.
Operator: Thank you all for your time today. This concludes today’s conference call. You may all disconnect.
