Operator: Thank you, Laurie. Our next question is from Mark Fitzgibbon from Piper Sandler. Mark, your line is now open. Please go ahead.
Mark Fitzgibbon: Thank you. Good morning, everybody, and let me echo Laurie’s comments. Congratulations to Mark and also congratulations to Mary on your new role.
Ned Handy: Thank you.
Mary Noons: Thank you.
Mark Gim: Thanks Mark.
Mark Fitzgibbon: Ned, I wonder if you can help us think about how you’re thinking about your loan deposit ratio. I think its 1.02 right now. Is that likely to serve as sort of a governor on balance sheet and loan growth in coming quarters?
Ned Handy: Yes. I don’t think so. I mean I think we’re — we’ve got a strong commercial pipeline and strong — not as strong as historic resi pipeline. And we think we have to continue to serve our customers and prospects in the marketplace. We need to focus on deposit gathering, Mark, and fund that loan growth in a better fashion than we have been able to in the — certainly in the recent quarter. Obviously in the fourth quarter we had huge loan growth at a time when the funding source available to us was borrowed funds and/or increasingly expensive deposit base, so not the perfect scenario. So I think more focus on growing the deposit side of that question, than reducing the loan side in the short run. We think positioning the balance sheet for the long-term is important.
Serving the customers continues to be important. We can’t choose when to service them, we need to stay in the marketplace and stay active. But at the end of the day, we do have to be focused on loan-to-deposit ratio. And at some point, it could become a governor. I don’t see that in the near-term.
Mark Fitzgibbon: Okay. I guess I was just thinking about like your capital ratios are not as high as they’ve been historically sort of 580 TCE ratio. I know the regulatory ratios look good. But I just wondered if it may be made sense to kind of slow growth a little bit on the loan side to let deposits catch-up and let capital ratios build, particularly if we’re going into a more difficult economic period.
Mark Gim: So Mark, this is Mark Gim. I’ll take just a shot at the question about loan growth and kind of how we try to think of it in terms of long-term opportunities. Our credit quality standards have not changed at all, and we’re very mindful of the economic environment in 2023 and 2024 might worsen if the U.S. and global economies slip into recession. That said, we’re seeing opportunities particularly on the commercial side of the house from customers who we have not seen before, who are very high credit quality. And we think the ability to establish some of those relationships for the long-term, when we might not have had that opportunity is something we need to follow-up on. I’ll turn it to Ron for comments on capital and the difference between TCE and our regulatory capital ratios.
But just, with — again, with a comment that we’re very focused on credit quality we’re very proactive about trying to identify potential risks long before they happen. So we don’t go into this lightly.
Ned Handy: And Mark, this is Ned. Obviously, a lot of the asset growth in the fourth quarter was resi and strong high-quality resi. And obviously, we’re hopeful that at some point down the road, we’ll be back at a point where we’re selling the large majority of those loans and not growing the balance sheet as much as we have in the prior two quarters. So when that will happen, is anybody’s guess, it’s obviously rate-related. So it’s a good question, and I think we have to be thoughtful about all those angles and Ron on the capital front?
