Jeffrey Jackson: Yes. So, non-owner occupied represents about 3% of total loans, so relatively small to begin with and nearly, I think, 98% is pass-rated. The two loans that paid off, I believe oh, gosh, I think, one was in [Louisville] (ph), the other was North Central West Virginia, and I believe they totaled about $20 million.
Daniel Weiss: Yes, and that did have an impact to the provision. The other thing I would add, just to give you a full sizing, we have about 300 million — 300 loans totaling about $425 million, which gives you an average loan size of $1.4 million in our office portfolio.
Jeffrey Jackson: Yes. So, when I say, larger loans, the total in $20 million, given our relative average size is $1.4 million, they’re larger for our portfolio.
Casey Whitman: Great. Thank you.
Jeffrey Jackson: Thank you.
Operator: The next question comes from Manuel Navas with D.A. Davidson. Please go ahead.
Manuel Navas: How should I think about the strong start of the year versus the mid-single digits to high single digits loan guide? Could you kind of get to the high end? Or you’re kind of also talking about some CRE payoffs rising. Just kind of let me know how you think about that range?
Daniel Weiss: Sure. Good morning, Manuel. No, we definitely think there’s a possibility we could get to the high-end for sure. I mean you never know what the year brings, but as we stated before, I mean, our pipelines are basically at all-time highs around 1.2 billion, so I definitely think that is definitely in reach.
Manuel Navas: And you talked about potential for more talent, I think, talking in the expense guide. Where are you kind of targeting some of that talent on the lending side? Any new regions, just adding to current regions, just any more color there would be great?
Daniel Weiss: Sure. I think we’re looking at both. So, we’ve had very good success with our LPOs. I know we’ve looked in Knoxville and Nashville, continuing to add in Cleveland, Chattanooga, Indianapolis. And then, we’re also looking at various parts of Virginia as potential openings of LPOs as well. But then if you look at our existing markets, we’re always out looking and talking to new talent that could potentially be additive to our company.
Manuel Navas: I appreciate that. How much of the deposit growth has come in from commercial lenders? Do you have that type of specific data? I know that 34% of total deposits are business, but how much of the new deposit growth is coming from the commercial lenders?
Daniel Weiss: It’s about 50%.
Manuel Navas: Okay.
Daniel Weiss: Yes. And as I mentioned before, we really had not incented them until third quarter last year to bring in deposits. And now we’re kind of seeing the fruits of that labor in the last three quarters.
Manuel Navas: Thank you. Thank you. I’ll step back into the queue.
Operator: The next question comes from Karl Shepard with RBC Capital Markets. Please go ahead.
Karl Shepard: Hey, good morning, guys.
Jeffrey Jackson: Hey, good morning, Karl.
Daniel Weiss: Good morning.
Karl Shepard: I wanted to pick up on Casey’s question on M&A. I think you said optimistic or getting something done. Can you just touch on — has the environment changed at all? Are you getting more [indiscernible]? Are sellers starting to raise their hands, can you just walk us through that?
Jeffrey Jackson: Yes, I would say, the reason I’m optimistic is I do believe we’re starting to see more opportunities. I do think that with this potentially hire for longer, that may have triggered some boards and CEOs to rethink potentially is now a time to sell and partner up with a great bank like us. So, I do believe the environment has changed. Obviously, the math has not really gotten any easier, but, I think there is a been a mindset. Once again, I think a lot of that’s interest rate driven where potentially six months ago we might have seen or three, six months ago we might have seen banks that were on the fence on selling thinking, all right, I’ve been through the worst of it, I think we’re going to get some rate cuts and that’s going to help me to now I think more uncertainty.
If you are sitting with a higher loan to deposit ratio and thinking of how difficult it might be over the next several years versus partnering up, I think maybe boards have started to become more open to partnering up with someone like ourselves.
Karl Shepard: Okay. And then, kind of pivoting here, I wanted to follow up on some of the loan growth commentary. The paydowns in CRE as it relates to new offices and new lenders, do you think kind of the higher rate environments kept a lid on what might be available for business from some of these new offices? And if that starts to thaw, does that take a lid off of kind of what’s possible or has that not really had an impact on some of the newer contributions?
Jeffrey Jackson: I think higher rates have definitely had an impact on some projects overall in the CRE space. But as it relates to office, I think there’s just based on what we went through with COVID and the work at home movement and different things going on in that environment, I just think potentially there’s just so much office space online available today, but if you’re a developer, you’re looking to put money in some other different type of property, whether that’s a retail development, multifamily, or some other type. So, I think part of it is availability today and the office space is kind of keeping a lid on some of that, and I think it’s also opportunity and what’s better for a developer to invest and put their money into. But outside of office, like I mentioned before, I think higher interest rates have slowed and stopped some projects, but we still see a nice healthy flow, depending on which market we look at.
Karl Shepard: Thanks for the help.
Jeffrey Jackson: Thank you.
Operator: The next question comes from Dave Bishop with Hovde Group. Please go ahead.
David Bishop: Yes, good morning, gentlemen.
Jeffrey Jackson: Hey, good morning, Dave.
Daniel Weiss: Good morning, Dave.
