First Bancshares Inc (Mississippi)
NYSE:FBMS
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First Bancshares Inc (Mississippi)
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Good day, and thank you for standing by. Welcome to the review of first quarter 2023 financial results conference call. [Operator Instructions]
I would like now to hand the conference over to your speaker today, Hoppy Cole, CEO. Please go ahead.
Good morning, everyone, and welcome. I've got several of our team members with us this morning, Dee Dee Lowery, our CFO; George Noonan, our Chief Credit Officer; and JJ Fletcher, our Chief Lending Officer. And I'll start by covering some highlights for the quarter and then turn it over to the rest of the team. So we are so pleased with the outcome of the quarter. It was a great quarter and a strong start for the year.
As noted in the release, we closed our largest acquisition ever. There's a Southeast Bank as of January 1, and we integrated our systems at the 330. So we closed and integrated all in the same quarter, we accumulated bad about 1.6 billion assets in 24 new locations in Atlanta, Coastal Georgia and Jacksonville. So over the last 9 months, our team has done a phenomenal job closing 2 of the largest -- actually, our 2 largest acquisitions ever. And you remember back in July, we closed Beach Bank, which was a little over $600 million acquisition closed July 1 we integrated their system December 3.
And then again, what I just noted about closing here to Southeast bank. So all in all, we've grown $2.2 billion in assets over the last [indiscernible] organic growth that we experienced in the loan portfolio and opened up new markets in Tampa, Jacksonville, Atlanta, Savannah and built a significant density in the Florida [indiscernible]. So we're absolutely just thrilled and appreciate the phenomenal job that our team members have done to make all that come together.
In terms of balance sheet management for the quarter, I thought we did a really nice job of managing our deposit flows, playing the same discipline around deposit pricing and maintaining our liquidity. If you look for the quarter, deposits were down 3.2% overall. But if you adjust for $77 million of broker deposits that we let go deposits were down only 2.1%. Our deposit mix study pre cost, in fact, it improved just a bit. In the net noninterest-bearing deposits were 31% of total deposits at the end of the quarter as compared to about 30% at the end of the fourth quarter.
So we're pleased with the ability to manage our deposit flows, maintaining our relationship management have done a really good job of not only defend what we have. But when we're doing matching around the margin, I can people are asking people to bring new money to us. And so like most people in the industry, we're feeling deposit pricing pressures as well.
However, again, we're probably doing a really good job and remain disciplined in that total cost for posts were only up 20 basis points to 72 basis points, but still well below 1%. And loan growth was a bit muted for the quarter. It was up 1% quarter-over-quarter or 4% annualized, about $37 million, but that was not inconsistent with our guidance from last quarter where we had seen pipelines off about 20%. Dee Dee is going to offer some additional color about where our pipelines are now and what we expect for the second quarter and the back half of the year.
Net interest margin, again, I thought we did another good job of managing our margins. Certainly, the seasonal -- we guided to some margin improvement in the first quarter. Last quarter, we certainly experienced that because of the seasonal deposit flows, but also because of the addition of a heresy Southeast and Beach, both added asset sensitivity to our balance sheet. So our net interest margin was up 32 basis points to 3.63%. So all of this combined are a great quarter in terms of improvement in our core earnings, adding scale of ASPI, the effect of getting all the cost saves and the majority of the cost saves in from tech plus a better-than-expected margins contributed to the core earnings growth of $9.9 million quarter-over-quarter or 58%.
Earnings per share was up 27% quarter-over-quarter to $0.86. So given where we sit today, the construct of our balance sheet, strong liquidity, well diversified, low-cost funding sources, strong capital position, earnings ramp, which is even creating more capital so we can reward our shareholders with a deploy. And we feel like we're in a really good spot to compete the balance of the year. Even if we have significant economic headwinds, we feel like we're in a really good competitive spot.
So with that, I'll turn it over to Dee Dee to give us some more detail on the round of financials.
Great. Thanks,. And as he mentioned, obviously, about the heritage closing, I was going to start by saying we have noise again this quarter, and that seems to be our theme every quarter is the noise in trying to get to what our operating results actually are minus the noise. But we did close heritage on 1/1 and issued 6.9 million shares of our common stock. For the quarter ended March, we reported $16.3 million or $0.52 per diluted share.
But on an operating basis, which excludes acquisition charges, which were net of tax of $2.8 million and then the day 1 initial provision for credit losses for the Heritage loan portfolio, net of tax was $8 million. So when you take those into account, our actual operating earnings were $27.1 million or $0.86. And as Hoppy did mention, that was an increase from previous quarter end of $9.9 million or 58%.
The drivers for this quarter obviously included a full quarter of Heritage Bank as well as cost savings from the Beach Bank. If you remember, we closed 6 locations in relationship to the Beach acquisition, and those were all done in the month of December following the systems conversion of Beach. Our net interest margin, as Hoppy mentioned, did expand 363 2363, that was an increase of 32 basis points, 21 basis points of that was related to the purchase accounting adjustment.
And if you recall from our call last quarter, we did expect net interest margin expansion for the first quarter, mainly due to the closing of heritage. Heritage had a higher net interest margin as a company as a whole compared to ours, and they also have had more floating rate loans as a percentage of their portfolio than we did. So as well as the beach loan portfolio that Hoppy mentioned.
So our core NIM did increase 18 basis points to 3.47%. We are expecting some contraction in the margin going forward. We had indicated that expansion in the first quarter mainly due to the increase of the addition of the Heritage portfolio. So we think we could have 10 to 15 basis points of contraction throughout the year. on the core margin to probably better 330. One point as well, I could bring a heritage on. We do remain asset sous about 1.5. So we had mentioned that as well as before that they would increase our asset sensitivity.
Our yield on earning assets net increased 49 basis points while our cost increased 20 basis points during the quarter. On the topic you did mention, our deposits did decline 3.2%. A part of that was from the payoff of bookers of $77 million. And then the remaining part of that was kind of split $50 million in interest-bearing million between our savings and money market and $76 million in our noninterest-bearing. And then the heritage portfolio as a total was down of $54 million, and that was mainly in the interest-bearing categories, non-CD related. So we feel really good about that.
As I mentioned, we kept our mix with 31% of noninterest-bearing at the end of the quarter. Our cumulative interest-bearing deposit beta was 18%, and that was from a period of quarter end '21 to current. So we feel really good about that, 18% beta. We also, as Hoppy mentioned, our liquidity feel good about our liquidity. We have a strong liquidity position.
Our ratios are well above our limits. Our loan-to-deposit ratio was below 75%. And -- our borrowing capacity is $1.8 billion. And then we have about 41% of our securities portfolio is unpledged. So that's roughly about $850 million. Over the next 4 quarters, about $220 million is expected in cash flow that of our securities portfolio. So we feel really good about our liquidity position. At the end of the year, if you recall, we had $130 million in advances from the home loan bank. Those were paid off in January as well as the $77 million in brokered CDs throughout the quarter.
At the end of March, we still have $27 million in brokered CDs. Those were paid off at the beginning of April. So those are going off our balance sheet. We did participate in the [ bank term ] funding program with the Federal Reserve near the end of March. We felt like that was a good a good way to go ahead and kind of look at our liquidity, look at where we were with some of the deposit runoff and take advantage of that. And we did $250 million at a rate of $469 million. So we were able to use our unpledged securities book and pledge those at the Fed. So we really kind of remained or think our liquidity position to remain the same, with being able to borrow the $250 million. and felt like that was a good prudent decision as far as looking forward to for our liquidity needs.
I just want to highlight a couple of our operating results, our operating net income ratios. Our ROA for the quarter was at $1.36. Our return on average tangible common equity was 20.13. Our efficiency -- operating efficiency ratio was 53%. And as Hoppy mentioned, our capital ratio is our capital is good. Our TCE was $7.2 million -- our common equity was 11.2%. Our leverage was 8.8%, and our total risk base was 14.7%. So all rate capital ratios.
So I think that is all for me. I'm going to turn it to Hoppy.
Good to -- great report. Thanks, Dee Dee, I would you like to dig in to the loan portfolio a little bit?
Yes, sir. Thank you, Hoppy. As Hoppy already reported, the bank achieved modest growth of about $37 million for the quarter. I would note with HSBI close on 1/1, A lot of time and effort was spent lot size HSBI and first legacy trying to get those people up and trained and going into our system. So to take a lot of effort, and we appreciate that everybody's part. Bright spots within the company continue to be our private bank division and also the Tampa market.
After somewhat a slow start for the quarter, overall originations were about $245 million, including HSBI and positive momentum of about $90 million in originations just in March from the first legacy portfolio. As Hoppy also mentioned, in January, we reported pipelines had compressed about 20% from the previous quarter. However, at the end of Q1 in 2023, those numbers were back up to previous levels pretty much on line with the Q3 2022 numbers. And then heritage, of course, excluded there, but they had about $90 million in pipeline at the end of Q1 2030.
On pricing, we remain diligent in repricing opportunities and all renewals and modifying loans and continue to maximize spreads on new production. I think you'll see in the release overall weighted average yield for the new loans in the first quarter was $736 million -- also unfunded commitments and lines continue to augment production in the first quarter. Trailing 12-month unfunded commitments were about $345 million and an 18-month unfunded, about $600 million.
So summary from the loan side is cautiously optimistic as to production and funding going forward based on our current pipeline, unfunded commitments. We have several new lending teams being onboarded currently at this time in different markets and then look forward to the full integration of the HSBI team members into our system. All right. Thank you all.
Thanks, George?
Thank you. Generally, through the first quarter, our credit performance metrics remained very stable with some categories showing some moderate improvement on benefiting from the acquisition of adding their results to our numbers. Delinquencies for the quarter continued to remain very manageable, averaging about 39 basis points through the quarter. Our criticized and classified loans as a percentage of capital plus ACL showed improvement with a decline of 9 basis points in total C&C. And NPAs as a percentage of capital plus ACL improved likely. We saw a decline of just under 2 basis points. So generally, all good metrics from the credit side. If you're looking at the deck, the next comments, if you will, track with the pie chart starting on Page 15. So you can see these comments depicted there.
Our loan portfolio composition continues to remain a very balanced CRE overall, represents 44% of the loan portfolio. But when you divide that between owner occupied at 24 and nonowner-occupied at 20 big balance among the subcategories, onto family run about 19%, 315 and C&D, 14% of our overall loan portfolio. All of the other categories don't really exceed 5% of loan total. So good balance across the whole portfolio. Drilling down to CRE and -- can B, you can see the predominant categories there post HSB acquisition, our retail stand-alone at 27% and hotel, about 21%. -- professional office space, 20 and retail center, 12 are the predominant drivers in CRE. In the C&D category of residential 14 is the largest subcategory with some vision lots at 6 and commercial subdivisions at 12%. So again, no other category exceeds 5% of the undeveloped land and multifamily categories.
Moving on to Page 16, just for reference, with a little more heightened focus on office space, particularly nonowner-occupied office space on a lot of folks' mind, thought we show kind of where we sit as far as nonowner-occupied office -- as a percentage of our total portfolio, we're about 4.1% of total loans. So about $204 million, give or take, in the nonowner-occupied office space that comprises about 43% of our total office lines. So the larger majority is in the owner-occupied office that has been a traditional category for us in non-owner occupied. And by the state, as you might imagine, with the recent acquisitions in both Florida and Georgia, we see that Florida holds about 49% of our nonowner as does Georgia, a little about $20 million.
And our average loan size is probably typical for a community bank more so than a large national bank. Our average loan size on the nonowner-occupied office side, it's $727,000. So we've got a lot of big size on overall portfolio. maturities. Our total loans in nonowner-occupied maturing through the end of '25 comprise just under 20%, and that's a pretty even balance of about 5% to 8% of the subcategory each year over that 3-year run. So a pretty orderly maturity schedule coming up in owner occupied and 51% of the portfolio matures in 2028 and beyond. So we feel like the takeaway there is that gets us through what we hope will be kind of the downward trend in rates as those loans due in 2028 moving forward.
As for credit quality has remained very stable over the last several years. occupancies have continued to remain in our portfolio in acceptable ranges. And as with most of our newer loans in this space of newer credits, we are -- those are [ typified ] by more owner injected equity in the credits to put them in the performance ratios we won't see. Class 5 nonowner-occupied office is running just under 1.6%. So again, continuing to see good credit quality through that portfolio. Just referring you to Pages 17, '18 and '19, if you have any questions on those, we could certainly answer those come, but that generally is a pretty good overview of Credit as we sit through the end of the first quarter.
Thank you, George. Appreciate those comments. That concludes our prepared remarks. And so now we'd open it up for questions.
[Operator Instructions] Our first question will be with Catherine Mealor from KBW.
Dee Dee, your thinking in your NIM guidance, how are you thinking about deposit betas over the course of the rest of the year?
Well, I think we have -- I think that was going to go up a little bit because I feel like we've had -- we're continuing with the pressure with some of our competitors with some products. We've just been matching is Hoppy kind of mentioned in the same thing last quarter, we're just kind of fighting it every day and trying to maintain what we have. And so I just can see that continuing. We try to put a little slide in there that showed the cost, and you can see the increase from February to March to kind of show a little bit of guidance going forward. So it's not like it's [ they lose ] every day, but I mean we have some continuing kind of daily. So I do see that going up some.
We have to be a little more aggressive from here on out because noted pipelines are building. And so we've got the ability to be a little more aggressive or the deposit side but put out in the loan book. So we have to be a little more aggressive.
Yes. I mean, but it's amazing if you look at your cumulative total beta so far is just still so low at only 12%. So is it -- is it your -- what do you think is the driving factor if -- or have you just been able to keep as low of a deposit data as you have been so far? I understand it will increase from here for sure. But still, I mean, I think we'll be below industry averages.
We've got a well-diversified, relatively rural deposit base across the Southeast. And I think if you look at the slide in the deck, it shows that like 80% of our accounts are consumer accounts. So we don't have a lot of concentration in large commercial accounts, which tend to be a little more -- a little less [ sticky ], I guess. So I think that's it. it's highly granular. The average size accounts $23,000. So it's a highly granular older seasoned retail deposit base across the Southeast.
Great. And then on remix, we're seeing across the industry, a big remix from noninterest-bearing into interest-bearing. It's hard to kind of see just because you've got the merger kind of missing the numbers a little bit. But how -- what are you seeing in that mix shift? And what do you expect for the rest of the year? For the last several quarters, Catherine, we've been in that same like our noninterest-bearing, we were 31%. I think at the end of the year, we were here over 30, 3.5%, somewhere in there. And I think September, we were 31.5%. So we've continued to kind of maintain that noninterest-bearing percentage. So I think...
No. I think you're right. We hope to be able to maintain a pretty constant...
Great. And then how about on the expense side, do any outlook on just the expense run rate for the next couple of quarters and the pace at which we'll see cost savings flow through?
Yes, I do, Catherine. I think we should see some more cost savings this next quarter. I'm showing a little under 1%, probably 7.5%, 8%, 7.5% to 81% in this next quarter. And then I think going down to the third quarter, probably another 1.5%, so -- and then kind of constant for the fourth quarter. So I think we'll have, with the Beach acquisition, a lot of those folks that were remaining that were -- that left at the end of January. And then with the heritage that will be the end of May for some of those folks. So I think we'll be able to see even more of that by the third quarter.
And the percentage -- just to be clear that you're giving -- can you specific what exactly you mean?
Yes. So like on our actual expenses for the first quarter without acquisition charges is like $41.8 million. So I'm showing that down to about $41.5 million in it's like 40.8% the next quarter.
Our next question comes from Matthew Olney with Stephens.
I want to go back to the discussion around the core margin. And Dee Dee, I'm curious what that assumes for liquidity deployment. You still have a very low loan-to-deposit ratio, and you mentioned some of the security cash flow expectations. Just curious kind of what the plan is for deploying liquidity this year.
I think as [indiscernible] been saying remixing as we talked about the securities portfolio coming in the 250, we'll be able to deploy that into the loan book, obviously, considering what the deposit runoff might continue to be. Obviously, we've talked about that and being aggressive in keeping those deposits. But I mean, 78% to 80% loan deposit ratio would be really good for us. And so that's kind of what we've been talking about for this year was a big remix opportunity.
Okay. That's helpful, Dee Dee. And then on the loan growth side, I think JJ mentioned a few new lending teams that are hopefully being onboard pretty quickly. pipelines so like they are better now than they were maybe a few months ago. Curious kind of what this means for loan growth expectations for the balance of the year...
I think we're feeling like between mid-single digit, high single digits, given that we've got the new markets in Tampa, Jacksonville and Atlanta and then Pahala really building our pipelines pretty quickly. So somewhere between 5% to 7.5% is kind of what we internally feel like our loan growth will come out for the year, Matt.
Okay. That's helpful. And then just one last one on the on the -- going back, I guess, to the margin, the accretion level, I think, $3.5 million this quarter. What's the expectations for the scheduled accretion from here?
Part of that, Matt, is difficult to predict because the first quarter until [ Heritage ] was on our books, we took a straight-line approach to the accretion for Heritage. During this quarter, those loans will be added on the accretion will be added on, and it will be creating off on a loan-by-loan basis based on the average life of each individual loan. So it could fluctuate. So it's very hard to just kind of predict. I would say I think we have about 8 million, I think, across my head kind of internally budgeting for that for this year, but it's really kind of on basis. And obviously, if one pays off or pays down, you get more of that quarter. So...
And just to clarify, $8 million for the remainder of the year or the full year of which you've already recognized 3.5%?
Well, part of that was not all of that was heritage. So I was really kind of talking about the additional accretion for this year over the last, what was about $8 million for the heritage book. So that -- I think there was a little over $2 million for our heritage. This quarter. We still have some of those other acquisitions still generating some accretion in there.
Our next question will be from Christopher Marinac of Janney Montgomery Scott LLC.
I wanted to talk about credit. And Hoppy, if we look out the next maybe 18 months, I think now that the company has completed the acquisition and integration continues as kind of a steady state. Should we expect to see some just modest normalization of kind of special mention and substandard loans. And I'm just curious kind of how those get resolved now compared to the past. Do you think the credit resolution is the same as it would have been in past cycles? Or will this environment be any different?
That's -- I haven't had much about that would be any different. I think that -- my initial thought, Chris, is, first of all, we're not seeing credit cracks, and we keep looking. You got to believe that the box the interest rates have gone up, that there's going to be some cracks somewhere. Now in terms of resolution, I don't see us taking our -- changing our approach to quick resolution in my career, it's always been the identification and quick resolution of problem credit limits your loss. Your first loss is your likely your smallest loss. So I think we've been very conservative about grading credits. I think our loan reviews and our exams have proved that out. And then we -- I can't remember last time we had any material downgrade from an external auditor. And so we're pretty diligent. We've got a prudent credit culture here. So I would say a quick resolution or our continued quick resolution would be our strategy. George, do you have any thoughts on it?
I agree, Hoppy. And we have beefed up our regional senior credit officer capacity to in each of our regions has an end market regional credit officer that also works with the regional special assets officer. So they're able to identify problems early on and work together total resolution. I don't think our strategy will change [indiscernible], but certainly, the addition of some additional resources from more folks working on that very thing will benefit us over the next 18-month cycle.
Well, you made a great point. And when you said that I thought back and Chris, I think this goes along with your answer. As we've grown, we've never had a special assets to vision up until about 8 months ago time we form we took a very seasoned credit officer and she started our special assets division. So now we have a more formal collection process with the sand department that manages those problem credits in preparation for one being a larger bank. And 2, the economic [ headwinds ] and the fact that it's just a lot a lot larger footprint to manage. So that's a good point, George.
All right. Great. That's helpful. And I guess just more kind of stay in the obvious with the modest growth that you have in the future, it still feels that the [ pretax ] pre-provision base is stable and growing, but that also feeds into credit protection as well.
Our next question comes from Brett Rabatin from the Hovde Group.
Wanted to just talk about the rebuilding of the loan pipeline. And I guess I'm curious just to hear your experience in this market if others pulling back is providing opportunities on credit or if you're just still seeing existing customers may be looking to do things? And if there's a pullback, are you being able to originate new stuff or put up in the pipeline that might be enhanced from a credit perspective with equity, et cetera.
So this is JJ. So I think a couple of things. When the interest rate went up happened late last year, I think we saw a pullback in contraction just from demand. Some of our customers were not sure. And so we knew at the end of the year that was going to be down and it was. And so I think we just got a little more aggressive in rebuilding those 5 months, but I think it's just a combination of our clients getting ready. We are getting some new looks, but George will tell you, we're seeing some things now that I think we weren't looking at in the past that are coming to us that we're not excited about because it feels like everybody is trying to find place the deal. So I do think there's some limitations in the market. But I think our core business remains the same, and we're still looking for quality opportunities. And just in our recent committee meetings, you can fill the pickup of credit and good credit from what we saw at the end of last year.
That's one of the thing that amaze me is we have required essentially more equity in most all projects that we've done since the in the last year in the first session. I looked at the pipeline, I look at the equity going in on the front end and people put it in. So our core customers still have a lot of equity, a lot of liquidity, and we're just requiring more equity because of the rate environment, and they're still doing it.
Okay. That's helpful. And then I wanted to make sure I got the -- you're having to pay more in deposits everybody is and your [ betas ] have been really low. Would you guys have just the spot deposit rate that maybe you paid for CDs, money market type accounts at the end of the quarter?
I believe we -- one of our CD specials, care if I'm wrong, but I think we came out towards the end of the quarter at 4% for 4% for 9 months and 3.75% for 13 months. That was kind of 2 of our specials. Now at the end of the quarter, when we put that in place, we were seeing some 5% numbers from some of our competitors on money markets and some short term, 3, 6 months CDs at 5%. We've been kind of just around that, whether it was on a CD or money market, mostly in the 3% range on our money markets up until probably February, March, really more in March, we went into that 4% range on some of the requests for money markets.
I kind of mentioned a while ago, but in the deck we put out, you can see that increase from February to March, which was really where we -- obviously, with the last rate hike, it hadn't increased our CD specials and then some of our money markets.
So our all-in cost of deposits is 83 basis points system.
For March.
March.
Okay. And then just lastly, the tax rate from here is 22% a good number? Does that move any higher or lower?
It's generally -- it's -- I would say around that, pinion where we are. We were right on top of our accrual for this quarter. So I think we'll be in that range.
Okay. Great. I appreciate all the color and congrats on the quarter.
Our next question comes from Kevin Fitzsimmons from D.A. Davidson.
I just wanted to -- given that the deal is now in the rear view, and you guys have healthy capital levels, but granted it's a bit uncertain in the environment. How are you feeling about buybacks today, Hoppy?
I think it's still part of our capital tool and reward for our shareholders, and these prices certainly attract. And I think we'll use it -- I think to your point, Kevin, we've got plenty of capital, and it's another tool we can use to reward our shareholders.
And what's the -- can you remind me what the current authorization in place is.
I saw $50 billion.
Got it. Okay. And then Hoppy now that you guys -- deals are done, you're over $8 billion in assets, can you remind us or maybe update us how you're thinking about this approach, however long it takes towards $10 billion in terms of whether that -- with the amount left, whether that changes your strategy or attitude on M&A and whether the things that are generally expected or required of being $10 billion, how much of that is already in your expense base? Or is there more to go on that regulatory checklist for being [ write ]? Because I think you've said in the past that they start well in advance of getting ready.
They have. And that continues in both our state examine and our federal the Federal Reserve have been very proactive for us to say, okay, here are our expectation levels in terms of audit compliance management systems, BSA, management information systems. And we actually are having monthly calls with the Federal Reserve just to make sure that we keep pacing at our expectation levels -- and they kind of -- to be honest with they don't out of their way to do it. They've done it like they said, "Hey, look, we want you to be ready because if you're ready to working with us.
So I appreciate that out because I want to be ready. In terms of M&A, right now for -- we're going to digest that, we just completed 2 big acquisitions. So we always remain nimble for opportunities, Kevin, but we are very much focused on integrating these acquisitions. We've added some markets which we think give us above average organic growth opportunities. So we're very much focused on the organic growth piece of it. But we'll remain opportunistic. We've started our 10B committee. We formed an internal management committee that meets quarterly.
We started our GAAP analysis where we have a third-party look at the GAAP between $1 billion to $10 billion to what we have now in terms of our support systems versus what we need at $10 billion. So we've got a good start to go. There's going to be some more expense as we get closer to that $10 billion. And we think we've got good platforms built in terms of software platforms, process and procedure is across the company, but there's going to be more people required as we approach that $10 billion threshold. So I think the closer we get to that, you'll see maybe some increased expenses associated with that.
And I assume that's really compliance folks for the most part?
Compliance, BSA, audit. Those are all areas that really changed materially from being in the community bank space to a regional banking organization.
[Operator Instructions] Please stand by while we can tie the Q&A roster. At this time, I would like to turn it back to Hoppy Cole for closing remarks.
Well, thanks, everyone, for joining us today. Again, we're really thrilled with our quarterly results, and we feel like we're in a really good position to go forward from a competitive set, even given the economic headwinds. So appreciate it by attending, and we look forward to visiting with you next quarter.
Thank you for your participation in today's conference. This does conclude the program. You may now disconnect. You may have a good day.