Brian Klock, Keefe, Bruyette & Woods
Alright that is fair, that is fair. So I mean, I am just thinking that is where we should start I think somewhere in the 4.35% range and then think about the other margin pressure that could be there because of the interest rate environment we are in?
Robert Sarver, Chairman and CEO, Western Alliance Bancorporation
It should ebb off, I mean we have talk about this for a while, but, but —
Dale Gibbons, Chief Financial Officer, Western Alliance Bancorporation
In 5 years.
Robert Sarver, Chairman and CEO, Western Alliance Bancorporation
Yes okay. I am crying the wolf here I guess, but at the same time I mean, with the money that we have on the balance sheet, we are looking for a net interest income to certainly earn through that contraction of 4 basis points or whatever.
Brian Klock, Keefe, Bruyette & Woods
Got it. Okay and last question. The mortgage warehouse lending looks like it was up and I am kind of guessing somewhere around $60 million I guess. Is there a thought process of kind of where that portfolio would go or do you expect that to — where do you expect that to go going forward?
Robert Sarver, Chairman and CEO, Western Alliance Bancorporation
It was up a little high for the quarter because these rates came down a little more so activity was up. We picked up some more customers too. That number — well under $400 million in balances. That is probably a pretty good number. I think we are only projecting that to grow this year from that height, about 10%. But with that portfolio, the month end, the quarter end numbers are not really as important as more the average because there tend to be a lot of fundings at the end of the month, at the end of the quarters. That books about $300 million dollar average outstanding balance book for us and should grow on the average 10% to 20%. It is just more volatile on a day-to-day basis for most of the other items, but, so yes it was $358 million at year-end.
Brian Klock, Keefe, Bruyette & Woods
Alright thanks for taking my questions guys I appreciate it.
Operator
And then our next question is from Brett Rabatin of Sterne Agee
Brett Rabatin, Sterne Agee
Hi guys good morning. I wanted to ask, you have been talking about potentially some new lending initiatives the past quarters so as you are looking out into what you can do on the risk adjusted basis that makes sense. Are you guys any closer to adding anything there material and as you grow in Northern California, does the VC and private equity markets, does that attract you any vis-a-vis what you currently doing and other central lines of business?
Robert Sarver, Chairman and CEO, Western Alliance Bancorporation
Well, yes you kind of warm there. We have got 4 different types of initiatives that we are in different stages and discussion on so. Due to the issues around them I cannot get into details.
Brett Rabatin, Sterne Agee
Okay. I guess the other part of that question is just would any of those new initiatives be kind of acquisitional oriented, i.e. acquisition that can kind of get you into this new businesses as well?
Robert Sarver, Chairman and CEO, Western Alliance Bancorporation
Could be yes. Yes I mean, the key to this thing –we typically study — before we got into each of this niches were, we study for a year. And then we put a plan together and the key part of that plan is going to be: what are the opportunities but mainly who are the people we have to have to do this. And so a lot of this centers around people. And those are really the opportunities you are looking for. The right niche that can be priced properly, that is not overly competitive and that you have the right people that know that business and can relate to customers, can sell it, and also can manage the risk in it better than your peers. There are two ways of doing that, you either buy them or you hire. So we are looking at both.
