Operator: Thank you. Your next question comes from Stephen Ranzini from University Bank. Please go ahead.
Stephen Ranzini: Yes. Hey guys, thanks for having the chance to ask my last two questions. So, I noticed in your financials that your average price per share on the buybacks that you did was $9.88 Canadian, right, which is actually higher than the current price. And I noticed that during the year, you granted just under a million shares of options at $15.90 Canadian. I guess my question to you is, with the stock currently trading at $0.77 on the dollar book value, why not get a little more aggressive than just buying 195,300 shares to at least offset the stock option dilution?
David Taylor: Well, good question Stephen, and the answer is, it took quite a while to take the normal courses for bid into the United States, and it wasn’t anything other than just paperwork and regulatory approvals required. It now is in in place. Raymond James is out printing it for us. They’ve, of course, been blacked out, like we all are. But after the blackout, you’ll see RJ in there, and we’ve got about 1.5 million shares that we can buy. And as you say, it’s fantastic price. We might be able to buy them at 77% of book. So, we’ll be looking to pick up as much as we can.
Stephen Ranzini: Awesome. And then my last question is on net interest margin and changes in interest rates, right? So, in the short run, the impact for a bank like VersaBank is not fully reflective of what the longer-term impacts are of a shift in interest rates, as you know. So, I noticed that sequentially you had, I think it was five basis point rise in your net interest margin, right?
David Taylor: Yes.
Stephen Ranzini: I would assume that over a year since the bank of Canada rate rose 3.5% so far, that there’s a bigger impact as assets continue to reprice. Can you quantify in dollars, for every 1% rise in rates, what the immediate impact is, and then what’s the, I’m going to say, one term, sorry, one year impact is on net interest margin, please?
David Taylor: Well, short answer is that there’s hardly any impact on us on a rising interest rate environment in that we’re so precisely matched. We only run about 1.4 years asset duration and about the same in liabilities. So, we move very, very precisely with the interest rate environment by design. However, we do make out much better on the cash that we’re holding for liquidity purposes. So, that’s why you would see the margin on our loans the same, pretty well the same, maybe decline even a tiny bit, the margins on the loans. But the actual overall net interest margin of the bank improved to 2.81, which in Canada, that would be by far, the highest net interest margin of any bank. All of them are posting decline. So, there will be great continuing of time, and as I expect it will a little bit more in Canada. There’s a positive impact on our profit and loss, our net interest margin, and that we earn more on our liquid securities.
Stephen Ranzini: Okay. Thanks so much, and again, great work on a good quarter. Thank you.
David Taylor: Well, thank you. Look forward to getting together in person one of these days.
Stephen Ranzini: Thank you. I can actually come to Canada now.
David Taylor: Yes, yes. And we can go there – we can cross the border too, it seems. I crossed at the Blue Water Bridge not long ago and got a nice welcome. I don’t think it’s that many customers coming in right now, so I was well received.
Stephen Ranzini: No, the tourism business is way down.
David Taylor: Yes. Well, we’ll get back. It’ll get back. Look forward to seeing you, Stephen. We’ll have to have a nice lunch.
Stephen Ranzini: Yes, thank you. Look forward to it.
Operator: Thank you. Mr. Taylor. There are no further questions. You can go ahead.
David Taylor: Well, I’d like to thank everyone for joining us today, and I look forward to speaking with you at the time of our first quarter fiscal release. Obviously, we’re a very excited team of bankers here at VersaBank, as opposed to maybe our colleagues in our industry, in that we designed our bank, as we’ve sort of talked about in a little more detail on this call, we designed our bank to take advantage of what, for other bankers, are challenges. For us, it tends to be an opportunity. And that was demonstrated I think quite readily in how fast we recovered to have a record year in 2022, particularly with the growth in our point-of-sale business that came off the pandemic’s huge decline in volume. So, that’s sort of what you can expect with this – how this bank is set up to run, that when recessions come, our competition tends to be let’s say a little more myopic having to look at their own portfolios, and our source of deposits from the insolvency industry, which is – now we’ve probably grown our client base of insolvency professionals to most of the industry, most of the large insolvency practice in Canada now bank with us.
So, we’re in good shape to take advantage of what might be a tougher time for others. Again, thank you. Thanks for dialing in, and we’ll look forward to talking to you next quarter.
Operator: Ladies and gentlemen, this concludes your conference call for today. We thank you for participating, and ask that you please disconnect your lines.