Matthew Breese: Okay. And then maybe going back to the NII guide, which suggests in the fourth quarter, there’s a pretty decent step down in terms of quarterly NII. Obviously, that’s short term. As we think about 2024, do you expect that trend of NII being down on a quarterly basis to kind of sync up with your NIM outlook, which stabilizes in, call it, mid-2024? Is that a decent way to think about this?
Mark McCollom: Yes, I think that’s fair, Matt.
Matthew Breese: Okay. And do you have any idea where you think the NIM or NII might stabilize at that point without any additional rate movement?
Mark McCollom: We haven’t given guidance yet for 2023. I mean I’m comfortable given that – given that broad guidance or ESR for 2024. But when we come out next quarter for 2024, we’ll obviously be giving guidance for the full year at that time.
Matthew Breese: Okay. With some of the better-than-expected deposit results this quarter, could you provide some updated thoughts around expectations around terminal deposit beta as we get into 2024 and perhaps at the end of this cycle?
Mark McCollom: Yes. We’re not really moving off our prior numbers for terminal beta because, again, for our terminal beta, I mean, we view it as kind of two quarters after the Fed stops raising rates. So we still feel like we’re going to be around that high 30s to 40s level that we had communicated in prior quarters. And hopefully, we do end up a little bit better than that. But I think our results this quarter, we still want to take a guarded look on that and understand what customer behaviors are going to be like six months from now. We’re just not ready to move off that number yet.
Matthew Breese: Okay. Last one for me is, broadly speaking, it looked like credit trends were benign, very solid. We’ve been getting more questions around syndicated loans and portfolios. I’m just curious, what kind of exposure do you have, if any, to syndicated loans? And what is the size of that portfolio? And how has performance been?
Curtis Myers: Yes, Matt, our shared national credit portfolio balance is about $325 million right now, so less than 2%. It’s – customers we know well, and performance has been steady. We don’t have any metrics in that portfolio that are different than other portfolios. They are larger accounts. So when you have an item there, it’s a little more visible, which I think you see, but it’s a pretty limited portfolio and activity for us.
Matthew Breese: Any subindustries within it that have more of the pie than others?
Curtis Myers: No, not really. It’s pretty evenly split CRE and C&I. And we have five, six different categories. So it’s pretty diversified within the C&I categories as well.
Matthew Breese: Okay. I will – I will leave it there. I appreciate you taking all my questions. Thank you.
Operator: Please stand by for the next question. The next question comes from Frank Schiraldi with Piper Sandler. Your line is open.
Frank Schiraldi: Good morning. Just in terms of – to ask the expense question another way. Any thoughts of more normalized efficiency ratio or broad efficiency ratio targets as we kind of keep a careful eye on the expense side and see where revenues flush out for next year?
Curtis Myers: Yes, Frank, I appreciate the question, and we’re really focused on the efficiency ratio and absolute expenses around expenses to assets. We have not been public with the target. We are looking to drive them incrementally. And as we move forward in this environment, we may be in a position to put a target out there in 2024. We’re just not positioned to do it right now, but we’re very focused on it, and we do want to make incremental change and then potentially even more significant change as we move forward.
Frank Schiraldi: Okay. And then on noninterest-bearing balances, Mark, you talked about where you anticipate those balances ending the year as a percentage of total deposits. If we’re in sort of higher for longer rate scenario, obviously, bottoms up somewhere. Do you see it kind of continuing to be a slow bleed from those levels? Or do you think it’s close to bottoming out here based on the – where rates are currently?
Mark McCollom: We’re still forecasting there to be some rundown in 2024. But Frank, we anticipate that, that pace of shift will continue to decline. So maybe you’re down a couple of percentage points in 2024, but certainly nothing like what we saw in 2023.
Frank Schiraldi: Got you. Okay. I appreciate it. Thank you.
Operator: Please stand by for our next question. The next question comes from Daniel Tamayo with Raymond James. Your line is open. Daniel, your line is now open. Daniel, your line is now open. Please standby for the next question. The next question comes from Manuel Navas with D.A. Davidson. Your line is open.
Manuel Navas: Yes, I just wanted to hop back on to kind of ask about those new branches. Can you just talk about the regions you’re kind of adding branches in? And is that like a similar cadence you might see in other quarters? And is that kind of where you’re seeing the most regional opportunity?
Curtis Myers: Yes. So right now, we have 205 financial centers. We’re consistently managing that network, consolidating or reducing offices that aren’t performing or can be consolidated while then investing in new locations that are strategic for us. We’ve been predominantly focused on the Philadelphia, Baltimore, Richmond corridor. In D.C., we opened a loan production office in the second quarter. So that kind of metro corridor is where we’ve been focused with most of our new financial centers. 3-in-1 quarter is just – it’s a timing thing on the development. So that’s not a specific pickup in that activity. It’s more just the timing of those branches all coming online at the same time. But you’ll see a steady management of that network. So some closures, consolidations and some new investments.
Manuel Navas: Okay, I appreciate that. Thank you. Welcome.
Operator: I show no further questions at this time. I would now like to turn the call back to Curt Myers for closing remarks.
Curtis Myers: Well, thank you again for joining us today. We hope you’ll be able to be with us when we discuss the fourth quarter results in January. Thank you all.
Operator: This concludes today’s conference call. Thank you for participating. You may now disconnect.
