Ameris Bancorp
NASDAQ:ABCB
If you don’t study any companies, you have the same success buying stocks as you do in a poker game if you bet without looking at your cards.
Utilize notes to systematically review your investment decisions. By reflecting on past outcomes, you can discern effective strategies and identify those that underperformed. This continuous feedback loop enables you to adapt and refine your approach, optimizing for future success.
Each note serves as a learning point, offering insights into your decision-making processes. Over time, you'll accumulate a personalized database of knowledge, enhancing your ability to make informed decisions quickly and effectively.
With a comprehensive record of your investment history at your fingertips, you can compare current opportunities against past experiences. This not only bolsters your confidence but also ensures that each decision is grounded in a well-documented rationale.
Do you really want to delete this note?
This action cannot be undone.
| 52 Week Range |
42.09
71.79
|
| Price Target |
|
We'll email you a reminder when the closing price reaches USD.
Choose the stock you wish to monitor with a price alert.
This alert will be permanently deleted.
Ameris Bancorp
You don't have any saved screeners yet
Hello, everyone, and welcome to the Ameris Bancorp's Fourth Quarter 2017 Financial Results Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today's presentation there will be an opportunity to ask questions. [Operator Instructions] Please note that this event is being recorded.
I would now like to turn the conference over to Nicole Stokes. Please go ahead.
Thank you, Stephens, and thank you for all who joined our call today. During the call, we will be referencing the press release and the financial highlights that are available on the Investor Relations section of our website at amerisbank.com. I’m joined today by Ed Hortman, Executive Chairman, President and CEO; and Dennis Zember, our Executive Vice President and Chief Operating Officer. Ed will make some opening comments about the quarter and the acquisition announcements made this morning. I’ll spend some time going over the details of the financial results. And then Dennis will further discuss the acquisitions and our strategy going forward.
Before we begin, I’ll need to remind you that our comments may include forward-looking statements. These statements are subject to risks and uncertainties and the actual results could vary materially. We list some of the factors that might cause results to differ in our press release and in our SEC filings, which are available on our website. We do not assume any obligation to update our forward-looking statements as a result of new information, early developments or otherwise, except as required by law.
Also during the call, we will discuss certain non-GAAP financial measures in reference to the Company’s performance. You can see our reconciliation of these measures and GAAP financial measures in the appendix to our presentation.
And with that, I'll turn it over to Ed Hortman for opening comments.
Thank you, Nicole, and good morning everyone. Not the correct Nicole, but I would add that Dennis Zember is also the CEO of Ameris Bank, and he's the Chief Operating Officer of the Company. And Nicole that you just heard our new Chief Financial Officer will assume the new role today after her much deserved promotion in January 1st of this year. So I make some opening comments about the quarter and then discuss acquisitions announced that we've made earlier today.
Before I do that, I want to talk a little about our BSA and AMS program. The last Investor Call we had on November 17th. I told you that we had a very high degree of confidence that the consent order was going to be lifted soon. And I'm proud to say that order was officially lifted on December 14th, less than one-year after we entered into the order.
I want to reinforce how proud I am of our team and our whole company for coming together and working through the consent order record time, not only that did we comply with the order, but we built sustainable program that's positioned to meet our needs, as we continue to grow the Bank. And additionally, we achieved that without losing our focus on our core bank and continued our positive momentum, delivering outstanding financial results.
For the fourth quarter, we recorded operating earnings of $0.63 per share which excludes adjustment of $0.36 attributable of revaluation of deferred tax assets from the lower federal tax rates as well as few small items, merger charges and expenses related to BSA and a loss on a sale of the portion of the mortgage pools. Including these charges, we reported earnings of $9.2 million or $0.24 per share.
For the full year 2017, our operating earnings were $92.3 million compared to $80.6 million in 2016. I really like the way we grew earnings in 2017, managing just a just slight uptick in the margin, steady credit cost and a very small decrease in operating efficiency despite continuing to invest what we have made to continue to grow our company.
We grew earnings the way we anticipated by relying on our growth engine and managing as tight as we could on the operating expenses. This was a challenging year with the margin pressures from the flat yield curve and the normal operating expense pressures on a fast-growing bank basis, but we managed through that and posted impressive operating results and stable to improving operating ratios across the board.
Nicole will talk more about our earnings for the year in the quarter in a moment, so I’ll shift quickly to the other announcements, we have made this morning. First, we are on track with our Atlantic Coast transaction, with the application submitted and being work by the regulatory agencies, I still anticipate that this will close on time near the end of the first quarter of 2018.
Today, we are announcing that we've negotiated by the remainder of U.S. Premium Finance, which we have been operating together with Bill Villari for the past year. The vast majority of lift in earnings per share came when we entered into the joint marketing agreement and this transaction will only slightly impact our earnings per share in 2019, but is increasingly accretive over the coming year with its impressive growth rate. Bill has agreed to continue working with us for an extended period to help us keep building the business, and we are excited to be in this position with him and his outstanding team.
Lastly, we’ve announced this morning the signing of the definitive agreement with Hamilton State Bancshares in Atlanta. This acquisition is important for several reasons. First, the deal will take us over $10 billion at closing and our economics on the deal were strong enough to more than pay for that costs, using our normally conservative estimates and modeling assumptions.
Second, maybe more importantly that this leverages us as one of the best markets in the Southeast. We are already growing at a very respectable pace and this deal in this market assures our investors that our attractive growth rates will continue for the foreseeable future. Dennis will talk more about our vision for Atlanta shortly, but as we put this deal together, I was remembering the success we have had executing our vision for our company’s growth in the past decade, with attractive deals and hard work, and my confidence is really bolstered that this vision for the Atlanta market will be really meaningful for us and our investors as we move forward.
Lastly about the integration, Hamilton State operates the community bank model which fits very nicely with the Ameris Bank model, and we believe will help in a quick and effective integration of their employees and customers. We anticipate that this deal will close sometime in the third quarter of this year after the appropriate regulatory approvals are received and the conversion would be completed soon thereafter.
Nicole, I’ll stop here and turn the call over to you to review the financial results.
Thank you. As Ed mentioned earlier, we are reporting earnings of $0.24 per share and operating earnings of $0.53 per share for the fourth quarter, which excludes the $13.4 million tax expense or $0.36 per share attributable to the deferred tax re-measurement provided to the change in our future tax rate as well as the few small items that are discussed in detail in our press release.
Outside of these charges, we recorded operating net income of approximately $23.6 million or $0.63 per share compared to $22.5 million or $0.63 in the same quarter last year. For the full year, we grew our operating earnings by 25% to $2.48. Our full year-to-date operating earnings exclude the same amount for the quarter and there’s a reconciliation of the early part of press release that you can reference that we’ve detailed out those numbers.
During the fourth quarter, we’ve recorded a reduction in our deferred tax asset or DTA of a $13.4 million or $0.36 a share. That was due to the passing of the Tax Cuts and Jobs Act. We expect that the lower tax rate will increase our EPS by about $0.44 to $0.47 per share in 2018 leaving about a nine month earn back on the drive out. We do expect a slightly lower margin going forward from the impact of our muni loan and security book by approximately 6 basis points and I considered all of this in our EPS adjustments that we're projecting.
During the fourth quarter, we sold approximately a 120 million of purchased loan pools that were yielding around 2.90, expecting to reinvestment that's done in loan products at a current projection yield, which is about 200 basis points higher. The loan sale impacted earnings by about $475,000 during the fourth quarter which is at accelerated amortization, but it gives us summary of underlying to deposit ratio and positions us for a stronger margin and return on assets, once those fund are reinvested which we believe will be about a quarter.
One of the key metrics we were focused on in 2017 is the operating efficiency ratio. Our operating efficiency ratio for the fourth quarter was 60.88% and the ratio for the full year was 60.27%. This is an improvement compared to our 2016 operating ratio of 61.55%. However, we continue to press for a better ratio as a sub-60 level on a consistent wide basis. We believe the additional USPF purchase along with the efficiency we gained from our recently announced acquisitions of Atlantic Coast and Hamilton will get us where we want to be.
Our operating ROA for the year came in at 1.26%, down from the 1.32% that we reported in 2016. The main driver in our slightly lower ROA was mortgages lower overall contributions to earnings given the core bank’s outsized growth during the year. Our return on tangible common equity was 13.91% in the fourth quarter compared to 17.25% for the same period last year. This decline is attributable to our increased capital level, as we have over a $158 million more capital or 24% increase this year over last year.
A part of that increase comes from the capital raise in the first quarter this year and the remainder is due to our earnings stream that went do dividend and paid to shareholders. Our net interest margin exclusive of accretion improved by 5 basis points during 2017 from 3.74% in 2016 to 3.79% in '17, for the year, our yield on loans increased by 13 basis points while our total cost of deposits increased by 15 basis points.
We're going to talk about loan-to-deposit growth in a minute, but I want mention here how important the increase in margin is considering how we grew the balance sheet organically during 2017 in the current interest rate environment. The spread between short and long-term rates continue to tighten, so I am still pleased with our bankers and the efforts that they’ve made to produce these positive results on our margins in this rate environment. Our impact to margin due to incremental asset growth is 4.69, which the exceptional given our high rate environment.
Moving onto non-interest expense, non-interest expense increased $16.1 million during 2017. However, when we remove some of those unusual items like merger charges, Hurricane Irma, and also we have $14 million of expenses in the Premium Finance division in ’17 that we didn’t have fixed in 2016. So, when you exclude those items, our non-interest expense actually increased only 7.5 million or 3.7%. Of that increase, retail mortgage warehouse lending and SBA market business accounted for 41% of that increase.
So excluding those lines of business, our non-interest expense increased only $4.4 million or 2.8%. While I know some of that was technical, my point here is that we were able to spend money where we needed to spend, such as backing up the strength in BSA group and building the infrastructure of the new Equipment Finance division While controlling expenses in other parts of the Bank.
On the balance sheet side, we grew earning asset by a $1 billion to 7.3 billion. We grew core deposit by approximately 665 million as well with a good bid of that growth coming in the fourth quarter. With that, that we handle this many customers and this much growth and still move the fee base of point higher on the market is notable.
Going forward, we expect that the same amount of growth in 2018 except that believe the momentum we’re developing on the deposit side will come closer to fully funding on loan growth. We continue to see a fairly even sort of growth between the lines of business that we operate versus the core bank. We still believe that this is sustainable going into 2018. As far as geography, our strongest and fastest growing markets have been the Atlanta MSA, which supports the amount that we're making today.
For the year, we also have really shown grown in Tallahassee, St. Augustine, Jacksonville, Florida as well as Greenville, Charleston and Columbia in South Carolina. Just a few comments on asset quality, our asset quality remains strong as our annualized net charge-off ratio was 12 basis points of total loans and 13 basis points of non-purchase loans. Our non-performing assets as a percentage of total assets decreased to 68 basis points, and we were able to reduce our non-performing assets by 11.4 million or over 17% during 2017.
With that Dennis, I’ll turn the call over to you for details in our acquisitions and continued strategy.
Great, thank you Nicole. I’m going to be referencing the investor presentation that we filed this morning as an 8-K and can be found at the end on the SEC’s website or in our website at amerisbank.com.
I’ll start with the acquisition of the remainder of U.S. Premium Finance. Our agreement to purchase the business I believe is only a win-win for us and the Company's owners. In total, including the 5% that we’ve purchased at the end of 2017, our purchase price of approximately 77 million equates to about 5.8 times what we expect 2018’s earnings to be from this division.
The -- as Ed mentioned and I’ll second it that we’ve how pleased we’ve been with the division’s growth, the quality of their sales and support staff, the depth of the relationships they have with their insurance agency customers, their consistently showing asset quality, their historical growth rates. Ed mentioned that the additional purchase will not materially affect our go forward EPS since most of the benefit is already in our earnings, but the purchase will move almost all of the management fee out of our expense load and should reduce our efficiency ratio by about 100 basis points and increase our return on assets accordingly.
We’re also announcing the acquisition of Hamilton State Bank today. We’ve been talking to Hamilton for a couple of years all along developing our vision for being a significant player in the Atlanta market. We believe that there is real incremental value that we can build for our shareholders with this vision and the acquisition of Hamilton positioned us to start realizing that quickly. The deal terms are 90% stock and 10% cash, shareholders of handles and will receive 0.16 shares of Ameris stock and about $0.93 per share of cash.
Using our stock price as of last night, the shareholders of Hamilton will save about $9.47 per share, which works out to roughly 2.05 times tangible book. Our economics are pretty attractive. The deal is breakeven to tangible book value and about 3% to 4% accretive to earnings after considering all of the calls and loans revenue for going over $10 billion. Outside of that and on a standalone basis, the deal would have been about 6% to 7% accretive to our 2019 EPS estimate. Our strategies to hit these economics are very realistic and we expect very doable.
Three main assumptions to discuss here. First, we're assuming growth of the acquired balance sheet of 10%. Nicole mentioned how strong our Atlanta Bank is? In Atlanta already, we have an outstanding commercial bank that consistently exceeds all of our growth and production goals. Their growth alone in 2017 would have managed about 75% of the forecasted pro forma growth that we have for this market and this deal.
Secondly, we're assuming call savings of 35%, which can be achieved almost entirely with background consolidation and for which we have a roadmap to achieve. We are modeling and are confident that we can complete the conversion and integration before year-end and 2019 will be a clean year with respect to our operating expense run rate.
Lastly, we are assuming virtually no revenue synergies. This is our strong suites, especially in Atlanta, where we have our mortgage SBA and Premium Finance groups headquarter. There is no doubt in my mind that these groups and our commercial bank will work together well and then our footprint here will afford us the opportunity to move the needle of non-interest income.
Other financial metrics of the deal support our enthusiasm as well. Our pro forma capital levels after the deal, after both deals are about 8.1% TCE, climbing to about 8.6 by the end of the year. The deal was slightly accretive to our net interest margin by few basis points and importantly, it lowers our pro forma loan-to-deposit ratio by about 200 basis points. Once we've done integrating the deal will be accretive like I said to our -- the deal will be accretive to our internal assets our efficient fee ratio and our credit quality.
Lastly, before I turn the call back to the operator, let me talk a little about going over $10 billion and give you some assurances of what that means for Ameris Bank and how prepared we are? First, we have been preparing and planning to over $10 billion for almost two years. Last year's calls on M&A and our intense investment in compliance BSA infrastructure and systems better positions us today for being successful on this new chapter.
So look across the Company, we are modeling about $1.5 million of additional operating expense almost all of that centered in data management and credit analyst roles that would support the DFAST testing and modeling that we are already well underway with. Outside of that, all of the calls going over $10 billion are already baked into our current earn rate.
So with that, I will turn it back over to Stephen for any questions.
Thank you, sir. We will now begin the question-and-answer-session. [Operator Instructions] And our first question comes from Brady Gailey with KBW. Please go ahead.
So maybe let’s start about with talking about the kind of five year vision for a robust community bank in Atlanta that you all talked about in the slides. So you have $1.4 billion in Atlanta deposits right now. Where are you in Atlanta assets? And do you have your goal in mind? You want to be $5 billion, and if some number, here five years out, when you think about the Atlanta market?
Brady, thank you. Right now, in Atlanta we have about $0.5 billion of total assets before this deal and it's almost commercially oriented assets. I think when we say, when we want to be material -- when we look across Atlanta, we want to be material. I don’t -- we want to be material in enough of Atlanta, so that we have a recognizable brand. I think that’s probably is nothing closure to $4 billion to $5 billion of total assets. We think given our growth rate that we can probably get half of that with just organic growth and probably another half of that with M&A opportunities that we think exist in Atlanta.
And then, I think when Hamilton raised some capital, they brought some private equity owners. Can you just remind us how much of Hamilton is private equity owned? And if there is any sort of agreements or lockup with those shareholders?
There about two-thirds of the shareholder base is private equity. As far as lockups, I don’t know that we -- I don’t believe we have -- we do not have any formal lockups. I believe I don’t think we have any formal lockups. We do have -- I know we have had quite few conversations with them and kind of understand their time horizons and have been comfortable with that.
And then just lastly on the capital. With this deal to see will be kind of knock back down into the 8% range. I know you guys accrete capital at a very fast stage just given by your profitability nowadays. But just -- any update on how you are thinking about capital, would you like to have a little more excess capital for future M&A? Or do you think that you'll just let you capital kind of grow organically post-deal close?
We -- I think what we want to do see tangible capital grow back to about 9%. I think the 9% especially given how active we want to be in M&A, I think it's important that we stay upper 8s low 9s on TCE. The deferred tax asset write-off and the final acquisition of U.S. Premium Finance, negatively affected that but both of those, sort of a pre-capital back pretty quickly. I think what we do is probably stand close to path onto dividend and just to create capital all the way back. Again by the end of the year, we think we’re going to be about 860 and so probably early next year, we should see -- excuse me, early next year, we should see -- early next year see us getting back close to about the 9% range.
Our next question comes from Jennifer Demba with SunTrust. Please go ahead.
How long does the Hamilton State acquisition keep you on the M&A sideline, as you integrate this transaction?
Jennifer, typically, the way we look at that is, how long does it take us internally to prepare and then how long does it take to do the data conversion and complete all of that integration. And I think one thing that helps us with Hamilton and I mentioned it in my comments was being very similar likeminded about how we treat customers and how we approach customers, and the community bank model will help expedite the culture transition. So, I would expect as soon as we get the conversion done, we will be mentally prepared to be do it again.
So, that should really answer your question. We would continue to have conversations through the process and hopefully in 2019, we'd be greenlighted -- we will greenlight ourselves to execute on another opportunity.
You’ve got an ambitious goal for Atlanta Bank size. Do you anticipate adding any de novo branches inside -- more inside the city limit or the business centers inside Atlanta?
Well, I appreciate you're saying that, but we don’t think it’s too ambitious from what we’ve done in the past. We think that’s really reasonable and our expectation is, we’ll use the branches that we have in our business bankers. As you probably know Hamilton kind of circles around Atlanta, not a lot of downtown presence what we have now in Atlanta is downtown, midtown rather, not downtown. So, it will complement each other, but I don’t think you’ll see us doing a lot of de novo branching there.
Our next question comes from Will Curtiss with Piper Jaffray. Please go ahead.
Maybe just talk a little bit about the earnings. The other expenses I believe you've mentioned in the release, the increase is related to the Premium Finance. So, curious if there was anything else that may have been a little unusual this quarter in that line? And how you are thinking about that line going forward?
So, in the -- you mean the non-interest expense?
Correct.
So, are you asking about items that were already excluded some of those in the first table, such as the…
Yes.
Merger related charges, and that we have that reconciliation in the press release? May be I am not understanding your question I am sorry?
Sure. I mean I guess when I back those out I've got other expenses that are around a little over 11 million.
So you back out the U.S. Premium Finance as well and then we also have the build out of the Equipment Finance Division that we had in 2017 that we did not have in 2016. And then we also have the strength in the BSA group. So on our financial table where we exclude the BSA charges, we're only excluding the one-time charges to get us out of the consent order of like the look-back expense. We did not exclude the ongoing costs of building out that staff in that group. So that is increased in 17 versus 16.
And then maybe kind of sticking with expenses. Are you guys planning on accelerating in the planned projects or reinvesting any of the tax savings that may add to the expense base outside of the deals that you guys have pending?
As of right now, Will, we don't -- as of right now, we intent to just accrete capital back with that, but for right now, no, outside of the -- you need strategies or infrastructure build, to accommodate the $10 billion cross, no, we don’t.
And then maybe, Nicole, just to clarify the comment kind of around the margins, so you’d mention that the reinvestment will add three basis points and you expect that to be done in the quarter. Is that first quarter or is that second quarter when we will see that?
Probably by the second quarter to see all that flow back in.
And then you have the six basis points negative tax adjustment and so, okay.
That’s right.
[Operator Instructions] And our next question comes from Christopher Marinac from FIG Partners. Please go ahead.
Just want to ask the Durbin crossing should occur for you or the Durbin charge to begin in the third quarter of '19. Is that right?
Yes, that's right.
Okay, that’s what I thought. And then from a strategic standpoint, I know we talked -- that you’re taking in the slides a little bit about the sort of mature versus non-mature, but can you talk a little bit about the loan side? How much in Atlanta are you doing that is closer to the city center, just kind of going a little back Jenny’s question a few minute ago?
How much of our lending right now is in the Atlanta market?
Correct and I guess, if you really refine it closer into where midtown is and also to the sort of main thorough fares around the marketplace?
And almost all of our growth, our Atlanta group focus is really in DeKalb, Fulton and Cobb County, are the vast majority of everything we do is in those markets. Really the further out you go, all of our lenders will probably 2 or 3 miles from our office there is Midtown. The majority of the growth is definitely inside the perimeter. Some of it again I’ll tell you out in the Cobb County area, but the vast majority is there in town.
Okay. So with Hamilton’s footprint and as the math shows in the presentation, does that push the lending further out? Or do you simply use that as a funding mechanism to keep doing what you’re doing with the current lending strategy?
That’s exactly. I think we’ll use -- I think we'll use that primarily as a funding mechanism. I think we anticipate being able to be very aggressive on deposit side with a much large footprint in Atlanta, which we’ve not been able to do. Hamilton does lending kind of in lines of business, sort of similar to what we do on the line of business out around here. We will do lending in some of those markets, but the majority of our lending will continue to be focused the way we have it right now, and we’ll use that footprint or kind of really intense efforts on deposit gathering.
And then just from a timing standpoint, could you remind us on the sort of integration and systems conversions on Atlanta Coast and then how the timing will go with Hamilton?
Sure. So, right now, we have the regulatory approval pending. We have the -- we still believe it will close in the first quarter, late in the first quarter. And we have a data conversion planned for the second quarter. And then Hamilton, we expect to close in the third quarter and then we'll start working on that conversion plan and typically as soon as possible after we go close.
Okay. So, hopefully by year-end, you'll have that one done, so that finishes the year. Okay, got it.
Yes, Chris, historically, we've been able to do those conversions within 90 days. And be in the end of the year, it might be little tricky, but we would expect it to be within 90 days, which is what we've accomplished in every other transaction.
Okay. And there is still capacity to do additional transaction you obviously just timed it different in terms of what you do with something else down the road?
Exactly, it's not quite as easy as it sounds. There is an awful lot of work that goes into mapping and work ahead of time. So, it's very, very detailed and time consuming. But as you know, with the number of deals that we've done, we have the procedure down fairly well and typically don't run at really big problems. So, we'd expect it to be smooth.
[Operator Instructions] And our next question comes from Tyler Stafford with Stephens. Please go ahead.
In terms of Hamilton, can you just talk about the revenue synergy potential here? What could be kind of incremental to the EPS accretion that you guys led out that's not embedded in that?
Several things, one is the SBA we get a good bit of our SBA opportunity from our existing branch network and from our existing partners. So, we think there is a real opportunity there. The big opportunity is mortgage. Hamilton has a pretty successful and pretty profitable reach on residential construction. I mean if you look at across Atlanta, there is several reports that show them number three or four in residential lending. Everybody know by on the call knows what percentage of our residential lending we capture in our mortgage group it's very high.
And so, I think that alone provides a pretty significant lift. If you look at what we do in Savannah, Jacksonville, St. Augustine, really all over South Carolina, we are number one or two in mortgage originations in all of those markets. And that's what we'd expect in Atlanta. I mean although our group is headquartered in Atlanta. We do most of our mortgage production outside of that. So, this is all sort of a de novo opportunity for us. Hamilton does not have a very strong mortgage footprint or mortgage banking activity. And so, we think that alone is pretty profitable.
One more thing, Tyler, if you go back to all the other deals we've done, we've really never modeled in mortgage revenues, we never modeled in SBA revenues, service charge synergy. We get those in virtually every deal. And so, if there was one deal where I think, we could have justify that it probably would have been this one.
Got it, okay, helpful. Thanks Dennis. On the USPF, can you just remind us of the mechanics, now that you owned 100% of that? What the financial impact to Ameris will be that we should see on our side?
The -- right now we pay about -- we pay somewhere between $5.5 and $6 million of management fee, which will be going away in 2018. So, the pretax impact would probably be $5.5 million to $6 million, Nicole is confirming. And then the after tax effect of that, really that’s the only difference, and that’s not in the -- that’s in the other non-interest expense line, I guess, that Will was asking about earlier.
So, that’s how we are seeing, that’s how we are forecasting the decrease in operating efficiency. From a revenue standpoint, there's not going to be a margin or revenue lift. Because again all those revenues are already coming to us, we just are simply -- now that we’re the 100% owner, we are not need to pay the management fee.
Okay, got it. And then all in with ACFC and Hamilton, again, apologize, if you already covered this. As you loan to deposit ratio moving down or I guess stay now, call it in the low 90s?
Yes, our pro forma -- as of the end of the year, our pro-forma loan to deposit ratio with Atlantic Coast was about 93.5. And pro forma with Hamilton, it drops about 200 basis points.
Got it, okay. And then on the loan growth outlook, side of things, the 15% plus loan growth. Can you just talk about the portfolios? I guess the mix of that, that you expect to see this year, what portfolios are going to kind of makeup that 15% plus growth?
Yes, I think we’re going to see -- I'll start with U.S. Premium Finance. I think we would see just as much growth as we saw last year. On that side -- I would say U.S. Premium Finance, U.S. Premium Finance and the Equipment Finance probably will be -- probably about 25% to 30% of the growth.
I think the Bank, the Core bank, what we do kind of commercial -- just our bread and butter, commercial real estate probably in that been half, which is about what was this year. We are a little bit better in consumer than we have been, not that we’re going to develop a lot of momentum there, but consumer and residential lending probably will make up the difference there, probably know there are 15% to 20%.
Okay and then just last within that. Just the mortgage loan pool expectations, could we see more one-off sales? Or will that just kind of naturally cash flow off?
We think of that all naturally cash flow off.
Okay.
Going forward.
And there are no further questions at this time. I’d like to turn the conference back over Dennis Zember for any closing remarks.
All right, thank you again for all that joined us. If you have any question or comments, please feel free to call or email me or Ed or Nicole. Thank you. Have a great day.
The conference is now concluded. Ladies and gentlemen, thank you for attending today’s presentation. You may now disconnect.