Jay Brogdon: Yes. I’ll take another shot at that one as well, Brady. So I’d say we outlined some accrual clean-ups again here in the third quarter. So I do think you’ve got to adjust for that from a run rate perspective. I think it’s fair to think that fourth quarter noninterest expense run rate is kind of in that mid-130s range, which significantly exceeds what we had hoped to achieve through the Better Bank Initiative goals that we had outlined earlier in the year. I think as we look into next year run rate, that’s kind of the launching point. However, again, you won’t have any of those sort of incentive run rate adjustments coming into those numbers. And as we continue to say, we’re going to remain very focused on the expense discipline side of things, but we’ll also continue to evaluate some opportunities or investment opportunities we have.
So I think our guide that we’ve given previously is what I’d still stand by today. And we’ll — as we continue to evaluate the opportunities that are out there, there are other goals or initiatives that we want to lay out, we would got them or announce them at a later date.
Brady Gailey: Okay. And finally for me, just on the net interest margin. I know in the fourth quarter, we should have the benefit of the hedge gains starting to flow through, but your NIM is still kind of slipping on a core basis. So you have a positive coming and maybe a little more NIM slippage. So how should we think about the NIM next quarter and into ’24?
Jay Brogdon: Yes. I think you just set it up perfectly. I’ve talked about it historically or in past conversations, kind of underlying NIM, meaning sort of the net interest margin, absent the positive impact of the swap. There will continue to be some pressure there, although I think that we see that pressure moderating for sure. I think we’re experiencing at this point, sort of the natural lag effect at this point with the Fed kind of in the late innings it seems on interest rate hikes. We’ve got some lagging that will occur over the fourth quarter and maybe into the first quarter. A great example of that would just be CD maturities that will take place in the quarter and so in the fourth quarter and in the first quarter. So we’ll have some repricing there.
But again, I think the pressure on the cost side will slow down through the fourth quarter and the first quarter. Bottom line result of all of that is as we move through fourth quarter and first quarter, I think NIM is kind of in a band. What you saw in Q3, we’re probably close to the band of where I think our overall net interest margin will be. I think we’ve probably inflected here in the third and fourth quarter. And then as we move into — move through next year, subject to whatever happens with the Fed or in the market more broadly, we’re going to have a lot more assets repricing than deposits repricing. And that’s how I would think about the margin going forward here.
Brady Gailey: Okay. Great. Thanks for all the color.
Jay Brogdon: Brady.
Operator: Our next question comes from David Feaster with Raymond James. Please go ahead.
David Feaster: Hey, good morning, everybody.
Bob Fehlman: Good morning, David.
Jay Brogdon: Hey, David.
David Feaster: I was hoping maybe we could just touch on some of the trends that you’re seeing on the core funding side. We’re obviously seeing some of the migration in new client utilization of excess cash. But I’m just curious maybe some of the underlying trends that you’re seeing and where are you seeing the most opportunity to drive core deposit growth? How core deposit balances are trending early in the fourth quarter, maybe how new deposit pricing is for both core deposits as well as your CDs?
