Good day, and welcome to ServisFirst Bancshares First Quarter Earnings Conference Call. All participants will be in listen-only mode. After today’s presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Davis Mange, Investor Relations Manager. Please go ahead.

Thank you, Allie. Good afternoon, and welcome to our first quarter earnings call. We’ll have Tom Broughton, our CEO; Bud Foshee, our CFO; and Henry Abbott, our Chief Credit Officer, covering some highlights from the quarter and then we’ll take your questions. I’ll now cover our forward-looking statements disclosure. Some of the discussion in today’s earnings call may include forward-looking statements. Actual results may differ from any projections shared today due to factors described in our most recent 10-K and 10-Q filings. Forward-looking statements speak only as of the date they are made, and ServisFirst assumes no duty to update them. With that, I’ll turn the call over to Tom.

Davis, thank you, and good afternoon, and welcome everybody to our call. My comments will be a little bit longer than normal, because these are interesting times we’re in today with a pandemic. It seems like the first quarter was a long time ago; so much has happened over the course of the ensuing days. I guess, we talk a little bit about the pandemic. We activated our pandemic plan on March 2. I remember the first time we – the regulators said we need to have a pandemic plan, and I thought it was one of the silliest things I had ever heard. It turns out the FDIC was right and I was wrong. And we all thought that it was just going to be a bad flu season that we could make it through. I’ve always believed that we give all employees a free flu shot and we’re not going to have a flu epidemic. It was sort of my plan, but plans go awry during the pandemic. But what we found is that we had an excellent plan, thanks to our Chief Risk Officer, Mark McVay. Our focus has been on employee safety. Employee and customer safety are number one, with employee safety being the first focus and customer safety second. What we found is that a branch light, technology-heavy business model works very well during a pandemic. Our business model was designed for a pandemic. As one of our regional CEOs said, he said, 'I’m so happy that I’m managing one office instead of the 34 branches at my old bank I used to work with.' So it is much easier to only manage. We have some 22 offices, and in many cases, we’ve obviously gone to drive-in only. We have very limited in-person contact. We are rotating a number of our people; we’re at 50% working from home where possible. We’re all in this conference room, a large conference room that’s larger than normal, so that we can all be socially distanced six feet apart. Also, our second focus has been on serving our clients and our community’s needs. We received very positive feedback from all our clients. I’ll go into a little more detail. When you’re facing an unknown threat, you want to be as conservative as possible, and that’s what we tried to do in every case of how we’ve managed the business since March 2. We’ve tried to be as conservative as possible. Certainly, we don’t change anything we don’t need to change and try to serve our customers’ needs. That has been our total focus: serving employees, keeping employees safe, and serving our clients’ needs. Henry Abbott, who is our Chief Credit Officer, is going to talk in a few minutes a little bit more about our asset quality focus and give you a lot of details on that. We put a deck out this afternoon; I think all the analysts have it. It’s on our website and it’s on the SEC website as well. It’s not a very large deck, as I’m glad to say. I remember when I was a young credit analyst at AmSouth Bank, and I went to an Executive Officer’s office, and he handed me a credit file that was about six inches thick. I still remember it was a department store called City Stores out in New York. Obviously, I don’t remember when it was a Shared National Credit or we had a direct relationship. I stared at that thick credit file and the executive said, 'Tom, you need to understand that the quality of credit is inversely related to the thickness of the credit file.' He said a very good company has a very thin file. So I’m glad to say that we’re a good company and we have a thin deck that we posted out there today with a little bit more information. Henry will go over it in a few minutes. But I want to give a few high-level comments on asset quality. Henry is going to talk about the loan categories that are of interest to investors. We will say that everybody says they underwrite better than other banks; of course, we say that, but everybody says that. We do have minimal consumer exposure, less than 1% of our portfolio is consumer. I know there are areas of interest, like restaurants and hotels, but a recession causes problems with weak players in every industry. It does not matter what industry it is. You’re going to have problems, for example, if you’ve got some large apartments that are not well underwritten and they’ve got a lot of tenants who lose their jobs. So it exposes all weak players in all industries. I don’t know if you can hear anything you want to hear about what economists are saying that’s going to happen to the economy over the next few quarters. I’ve been looking for a list of economists that have gotten rich from making accurate forecasts. If anybody has got a list, I wish somebody would e-mail me it. I don’t know of any. If there’s a list, I’d like to know. I will say that charge-offs, common sense will tell you they’re going to be elevated a bit over the next – I don’t think anytime soon. I remember during the 2008 recession what was created was homebuilders' AD&C. But now we have so many that started creating in 2007. We were ahead of the recession. But I remember, they’d come in and they’d kind of say, 'You need to make us a large unsecured loan or we’re going to throw you the keys.' So we’d say, 'Hand us the keys,' and they’d hand you the keys and walk out. This isn’t like that. It’s been very calm with the customers. Some have asked for loan extensions, and Henry is going to cover that in more detail. I’ve been surprised about who’s asked for the loan extensions; it’s people that are in really strong financial shape. I think a lot of them are very conservative. It’s mainly churches, which are not reliant on the collection plate for their revenue; most of the money is sent by check or by automatic debit. Dentists and other medical professionals, endodontists, dermatologists, those sorts of people have all asked for extensions as well. So I don’t expect any long-term credit issues or repayment issues in those sorts of places. Regarding asset quality, we’re not a deal bank. We’re a relationship bank. We know our customers well. We don’t have deals all over the United States with some random deals. They’re in our footprint for the most part and we feel really good about our customer base. I’m going to talk about deposit growth for a minute. We’ve seen really solid deposit growth in the first quarter. Year-to-date, our liquidity continues to grow. We have not seen a surge in line usage. We don’t have those types of customers that you read about at big banks either, where there’s a lot of credit usage surge. In fact, our line utilization was exactly the same at March 31 as it was at December 31, within like 48.8 versus 48.2. So there’s almost no change there whatsoever. We did see very strong deposit growth during the last recession from customers looking for a strong bank, and we see this shaping up to be much the same. Talking about loan pricing, Bud is going to talk about our margin improvement in a minute. But loan pricing today is much more rational than it was just a few weeks ago. We made the decision to implement minimum pricing in early March. Our minimum pricing has been strengthened significantly. It’s sort of interesting; commercial customers call to say they read the interest rates have dropped and they want to know if we can redo their loan at a lower rate. Well, no, the only borrower whose borrowing cost has dropped is the United States government. In almost everybody else, including most countries in the world, their borrowing costs have gone up. So we straighten them out on that standpoint. I might be surprised; people might go back to doing silly things a little quicker than I think. But I don’t think we’re going to see any margin pressure in the immediate future. I think customers today are more focused on access to credit. The cost is still low, and I think that’s just going to remain the same for at least the balance of the year. I’ll talk for a minute about profitability. We put in our press releases that our first quarter pre-tax pre-provision return on assets was 2.49% in the first quarter, which is obviously one of the best in the industry. Our dividend payout has been in the mid-20% range of earnings. We’ve had a lot of questions in the past about, 'Why don’t you buy your stock back?' So I always answer, well, I read a lot of studies and insiders never know when is the best time to buy stock back because that stock can always get cheaper. So you feel foolish if you purchased it back at a higher price. We’ve gotten questions about what are you going to do with all your excess capital? I always say, 'It might be nice to have one of these days.' We’ve also gotten questions about why we don’t buy – why we haven’t been buying banks with all our excess capital? Our answer has always been that bank stocks might get cheaper at some point. I’m very happy we don’t have to do any goodwill impairment assessments today on any banks we bought. I’m also happy that we don’t have to wonder about the asset quality of the banks we just bought. Our policies have served us well when a pandemic hits. Just going to talk for a minute about the PPP program. Paycheck is a tongue twister for me; I call it the PPP SBA program. We’ve never had a big PPP business; we’ve done SBA loans and certainly, we want to meet our CRA commitment, Community Reinvestment Act commitment to small businesses in our communities, and that’s very important to us. That’s why we do SBA loans, but we’ve never looked at SBA loans as a line of business. I know a lot of banks have made it through the recession by doing a lot of SBA loans and selling off the guaranteed portion for profit, and that’s what kept them alive. I learned pretty early in my career that I didn’t want to be a big SBA lender. Typically, what I’d see when the Democrats were in office, they wanted us to make a lot of SBA loans, and then when the Republicans came into office, they would try to figure out how to avoid the guarantees on the loans we made when the Democrats were in office. I got out of that business pretty quickly; it was not something we wanted to pursue. Despite that, we decided to participate in the program to support our customers and communities that need the support. Paul Schabacker is one of our executive officers here in Birmingham who ramped up our program and did an outstanding job. We made about six months' worth of loans in a two-week period; I think it was a little over 3,300 loans, totaling $914 million that we have closed and funded in the PPP program in Round one. I understand Round two is probably coming over the next few days, possibly. It’s been an interesting time; we have people working 24/7, except for Easter Sunday, trying to get all these loans booked and funded. In very few cases did we have any that we didn’t get done, and it was typically just because our clients didn’t give us all the information. Everybody has all the information they’ve given to us. We might have, I think, just made mistakes on maybe two or three that we didn’t get done. But anyway, I’m very proud of our team. One thing that’s interesting is I think our production staff have a greater appreciation today for our credit and operations people than ever before. It’s truly been a team effort, and I’m proud of what they’ve done to get those loans closed. If we put in our slide deck that we expect the vast bulk of those loans to be forgivable and will be off our books before the end of the second quarter. If we need liquidity, as I mentioned earlier, has been strong. If we need any additional funding, we will go to the Fed. We’ve filled out the paperwork for the PPP loan facility at the Fed if that’s necessary. But I’m not at all sure that we’ll need to do that. Due to high demand, we focused on existing clients, and we attempted to prioritize the smallest clients first, thinking they would need the help. But we just ended up doing it randomly. That’s the only way it worked. Our expenses are quite high. I kind of learned that during a pandemic – everything costs more except all the catering we did. For our employees, we were catering as many as three meals a day for a lot of our employees for a good chunk of time. That’s the only thing we got a good deal on, because the restaurants all needed business. We expect that the program will be profitable in the second quarter, and we think it will make a nice addition to our loan loss reserve in the second quarter with the net profit above. We paid a lot of overtime, and a lot of incentive pay in terms of piece rate. We paid piece rate fees to expedite a lot of this over the course of a 24-hour period. Initially, we only had what we call seats at the SBA. We had three seats when we first started inputting loans. We tried to get as many seats as we could, but we didn't get them approved by the SBA. So I think we ramped up over the course of a few days from three seats to eight seats to 19 seats to 29 seats, and we got it done. All these loans are being closed, funded; they’ve all been signed by DocuSign. We got them all done. At the end of the day, besides our overtime and incentive pay that we’ll pay, it will be a little noisy in the second quarter for the analysts, and we will keep a reserve knowing my thoughts on any issues down the road—we’re going to keep a reserve for any contingencies on those types of loans. I’m going to ask Henry Abbott now to talk a little bit more about asset quality. Henry?

Thank you, Tom. Looking at the ServisFirst footprint, I’m cautiously optimistic as the economy reopens and viewing heat maps and other data points that lay out impacted COVID-19 areas thus far; the majority of our markets are in low impacted areas. We’re not in the Northeast or other heavily concentrated COVID-19 impacted communities. No one is immune to the broader impacts of the pandemic, but we should be well positioned as our markets reopen. We have a well-diversified loan portfolio in both geography and industry classifications. The portfolio is granular, and we don’t have any major concentrations within industry codes. We’ve always prided ourselves on being a well-rounded commercial and industrial, or C&I bank, versus a bank that focuses on CRE transactions or targeted industry calling officers. Greater than 55% of our loan portfolio is to C&I operating companies, and this is through owner-occupied real estate loans, equipment loans, and lines of credit. We have a very low exposure to SNCs, as they represent only $65 million in current balances on a total loan portfolio of $7.5 billion, which is less than 1%. The SNCs we are involved in are because we have a direct relationship with those borrowers. To date, we’ve had no major downgrades within the portfolio as a result of COVID-19. At the end of the quarter, past due decreased by $7 million from year-end and non-performing assets decreased by $3 million from year-end. As Tom mentioned, we have a slide deck on the website, and I’ll cover some of that in more detail. Page four lays out areas of interest to investors. We’re not a large hotel lender, and hotels only constitute roughly 2% of our portfolio; the overwhelming majority of those are flagged hotels, and none are oriented towards conventions or resort-style accommodations. Restaurant exposure is noted at less than 3% of our portfolio. Oil and gas is less than 1% of our portfolio. Retail CRE consists of $267 million in loans, which is 3.5% of our loan portfolio. The CRE loans are to well-established borrowers with longstanding relationships with this bank. The average loan size in this segment is less than $2 million. Our AD&C portfolio to capital is 55%, which is well under the regulatory guidelines of 100%. Our income-producing portfolio, which is non-owner-occupied commercial real estate, is 236% of our capital, which is well under the regulatory guidance of 300%. Within our income-producing commercial real estate portfolio, we don’t have any major market concentrations, the highest one being Alabama, that accounts for just under 10% of our loan portfolio. Given the guidance from regulators and FASB, we’ve agreed to provide COVID-related deferrals to clients who have requested some form of payment relief. We’ve taken a three-month approach to these deferrals, and we’ll assess future deferrals in the coming months. The deferrals requested have, for the vast majority, been principal-only relief, and the borrowers are continuing to make monthly interest payments. On page five of the PowerPoint presentation, we lay out the industries of these deferrals. Given the uncertainty with the financial impact of COVID-19, we’ve chosen to retain our proven incurred loss methodology for calculating our ALLL and delayed CECL implementation. With that, I’ll turn it over to Bud.

Thank you, Henry. Good afternoon. First, our net interest margin. Our margin increased from 3.47% in the fourth quarter to 3.58% in the first quarter. Tom has talked about our strong growth for loans in the first quarter. We grew $307 million, and deposits grew $302 million. Our variable rate loans were $3.1 million at March 31, and $1.2 billion of those loans were at their floor rates, or 40% of our total variable rate loans at the end of March. Based on our March 31 balance sheet, our consolidated margin was 3.64%. Also, our total deposit cost was 0.55 as of March 31. For the future NIM, we expect it to remain north of 3.60% in the second quarter, exclusive of PPP loans. A reminder, we have no accretion income related to acquisitions, and there were no other major items that impacted first quarter earnings. Regarding liquidity, our investment portfolio is 8.5% of our total assets. The portfolio is available for any liquidity needs. We have a very vanilla portfolio: government agency mortgage-backed securities, Alabama munis with an A or better underlying credit rating, treasuries, agencies, and bank senior and subordinated debt, and an average life of the portfolio is 3.4 years. For non-interest income, we added 70 banks in the first quarter through our American Bankers Association credit card referral program. Mortgage banking income was slow in the first two months, and then in March, we had fee income of $525,000, which had to do with the two Fed rate cuts in March. Also, a reminder, we do not sell any government-guaranteed loans to generate non-interest income. For non-interest expense, our ORE expenses increased by $498,000. That was due to updated appraisals on credits. Payroll taxes increased by $380,000, primarily related to incentives that were paid in January, and our 401(k) contribution match increased by $229,000 related to incentives. Net producers had five leave in the first quarter and we added three. As we mentioned in our fourth quarter call, we’ll have a new expense control initiative for 2020. We’ll continue to look at our costs, working with our vendors to control that, which is going to show the impact in 2021 as opposed to 2020. Our loan loss provision: our first-quarter net charge-offs were $4.8 million, $3.7 million of which were loans that were previously impaired, and we continue to be proactive with our problem credits. Capital: our bank Tier 1 leverage ratio was in excess of 10% at March 31. So we have very good ratios. Taxes: our year-to-date tax credit rate for 2020 was 18.8%, 21.3% without the stock option tax credits in the first quarter of $1.1 million. The 2019 year-to-date rate was 19.5% and 21.3% less stock option credits of $772,000. We project the tax rate for the remainder of 2020 to be 22%. And that concludes my comments, and I’ll turn it back over to Tom.

Thank you, Bud. I’ll finish before we take questions by saying that we see a lot of opportunities on the horizon. We see a lot of opportunities with customers that had an unsatisfactory experience at their existing bank, some large banks and some regional banks. You might guess that with some of the people that put caps on how much they were going to do, they had a very unsatisfactory experience with their existing bank. So we are in the process of onboarding some new customers. We see a lot more opportunity down the road. We are mindful of the current economic conditions with any new requests involving credit; we’re stress-testing any new loan requests in light of the current economic conditions. In summary, I really like where we are today. The positives far outweigh the negatives. We have the capacity to bring in many new clients, and we intend to thrive, not survive, through this pandemic. We’ve shown we can adapt to a new environment and do very well. We also got a chart out there on digital banking opportunities; we’re seeing much greater adoption today than ever before of scanners, as well as mobile banking. So our business model is working very well given the current conditions. We’ll now turn it over to Davis to take questions.

We will now begin the question-and-answer session. Our first question will come from Kevin Fitzsimmons with D.A. Davidson.

Hey, good evening, guys.

Hey, Kevin.

Hey, Kevin.

I recognize upfront how fluid this is and all the uncertainty. But can you give us any idea of how you think about further reserve building off of this quarter, as we look forward in the next few quarters? Because I’m interested in how that debate went among you all in terms of should you be aggressive in provisioning. Did you even entertain the thought of using even more of that to be more proactive than you thought based on what you see now?

Hey, that’s an interesting question, Kevin. Obviously, if we thought we needed more money, we would put more money in there. The clear answer is, if we felt it was necessary to do that, we would have done so. We like our customer base. We feel good about our customer base. I mean, obviously, there’s going to be some pain with some of the restaurants, for example—they're going to have some pain. But we listed our existing balances. On watch lists that day, we’ve had no downgrades as a result of COVID-19. It takes time for things to play out.

Okay, great. One quick follow-up. On the subject of loan growth, it was very strong this quarter. I think I remember that traditionally in past years, loan growth has been on the light side early in the year and then it really kicks in during the second half of the year. You mentioned that there wasn’t a surge in people drawing on the lines. Was it mostly just the PPP loans being on the books? Was it just pent-up loan demand from last quarter? Can you attribute that to anything?

We had a couple of bank holding company loans close; they were pretty sizable, solid companies. We had a marine oil and gas customer payoff, and they went permanent in the fall. They came back in with another vessel this quarter, which is the best part of our oil and gas exposure. Again, these few credits distorted the numbers upwards, if that makes any sense.

Our next question comes from Tyler Stafford with Stephens.

Hey, good afternoon, guys.

Hey, Tyler.

Hey, Tyler.

I had a question also to start on the allowance. I saw in the release that you added a new pandemic qualitative factor to the allowance. How much did that new pandemic qualitative factor add to the allowance and reserve build this quarter?

Yes, this is Bud. I don’t know if we have that specific amount in front of us.

Okay.

But other factors also played into it, like GDP growth and the change in prime continuing to decrease; there were other factors that also drove it.

So maybe let me ask it this way. Do you have a good frame of reference we can think about for what the reserve build would have been if you had adopted CECL?

Yes. Early in the quarter, we look at CECL in two or three different ways. But we start from the stance that if you’re going to be as conservative as possible, you don’t change anything that you don’t need to change. We’ve got enough going on, and what we’ve had going on is this SBA PPP program that has kept us extremely busy. We’ve had all requests for people looking for loan extensions because the regulators announced they could gather them. We’ve had a handful, primarily with PPP loans, but we look at it a few different ways. First of all, we don’t change anything we don’t need to change at this time.

Okay. So if you had adopted CECL, the incremental provisioning would have been an additional $8 million?

Yes.

Got it. Thank you. I appreciate the details in the release around the deferrals from COVID-19 and the major industries impacted. Do you have the total amount of loans that were deferred as of 3/31?

Yes, so as of 3/31, the total balances deferred were $574 million. That was about 5% of our customers in terms of units. So $575 million as of the end of the quarter.

And again, this isn’t spread across 80 different industries; I look down the list, and most industries get down to maybe $1 million or $2 million in each industry that’s, I don’t look at those as vulnerable on the credit side for the most part.

Okay. All right, thanks for that. Lastly, did I hear you say that you provided three meals a day for all of your employees?

No, not every day, but in many cases, we did. That’s why I think we got a good deal on the catering. We were running close to 24/7 except for Easter Sunday; we were running the first weekend. We had to roll it out.

Good for you for doing that. That’s pretty great. That’s all my questions. Thanks.

Thank you, Tyler.

Our next question comes from Graham Dick with Piper Sandler.

Hey, guys, good evening. I’m on for Brad Milsaps.

Hi, Graham.

Following up on the portfolios, you guys disclosed in the slide deck. Within restaurants, I know it’s just under 3% of your total loans. Would you mind giving a little info on the composition of that segment? Is it mostly quick service or weighted towards casual dining?

This is Henry. On a true loan balance perspective, $145 million is full service, and the remaining is in more limited service, which represents another $60 million. We’ve also added bars to that category.

Okay, great. That’s very helpful. Following up on the loan growth question, obviously, it’ll be relatively slow until you guys are working through the PPP and COVID continues to pause client activity. But how do you think about loan growth at the other end of this? Is there a light at the end of the tunnel? Do you think you might be able to get close to picking up where you left off, or do you expect it to take some time to ramp back up to that low double-digit rate you guys had in 2019?

We see an abundance of loan opportunities, Graham. Despite the fact that we’ve taken our people all off the road; they are not making calls. Obviously, we took them off the airlines pretty early on compared to others, and we were on the conservative side. We've had a lot of national teams around the company when we told people to get off the road. Once they got off an airline, we said don't come to the office for 14 days. We took a very conservative approach, and yet we see an abundance of loan opportunities out there. We feel like we can strengthen our loan pricing and see better opportunities later in terms of where we are, because there are certainly fewer banks able to make loans today than there were just literally a couple of months ago.

Our next question comes from Kevin Swanson with Hovde Group.

Hey, guys.

Hey, Kevin.

Hey, Kevin.

The multiple in the stock has held up well compared to others. Despite your strength this quarter and the outlook, it looks like some banks won’t come out of this unscathed. Prior to COVID, you guys set up well organically with all the M&A going on in your backyard and some of the hiring you’ve done. Is there any change in thinking around being an acquirer now that the multiple seems to be stronger on a relative basis considering where you guys sit?

We want to get on the other side of the dust storm, Kevin. But it’s much more interesting now than it was just a few weeks ago. The prices are substantially better than I think they would be if people are even – once M&A starts back up—which might be six months. I would guess it would take six months before we see any activity. But certainly, we’d be willing to entertain it at the lower pricing levels we see today.

Okay, thanks. Also, have you guys thought about any changes to credit structure and underwriting policies, given what we’ve learned so far in the impact? Obviously, it changed significantly after the Great Recession, but just curious if this has refreshed any kind of credit process in your mind?

We’re focusing on our existing clients, and that’s what we should focus on today. For any requests, we’re putting an extra step for stress testing. As one of our executives, Greg Bryant, said, that’s what we did during 2008 to 2012 in Florida. We put extra stress tests on any loan request, so it makes perfect sense. We need to make the same loan decision when the stock market is going up 5,000 points or down 5,000 points. We need to be emotionless in making a good sound underwriting decision and it shouldn’t vary at all. So, the same underwriting standards apply and we want to deal with good quality people.

Thanks, guys.

Thank you.

Our next question comes from William Wallace with Raymond James.

Thanks. Good afternoon, guys.

Hi, Wallace.

On CECL real quick: with the decision to delay, were you operating under the assumption that when you do adopt that you’re going to have to go back and restate your results?

Yes, I mean, we know we will have to restate once we implement. If that comes to pass in 2020, we will have to do that.

What kind of expense does it add to go back and do that?

We’re doing parallel; we’re doing incurred loss and CECL. We’ll do that each quarter.

So you have all the results right there. So theoretically, it shouldn’t be too expensive?

Right.

On the expense side, is there any way—there’s a lot of commentary in your preamble, Tom, about the expenses being pretty hard to gauge, and generally being up. Can you help us get a sense of what we might be looking at for the next couple of quarters on a run rate basis, understanding that I guess this quarter will be higher given the PPP activity?

Yes. The expenses, in general, are trending down. We expect to see all our expense initiatives; we expect to see most results in the second half of 2020 and 2021. So we’re certainly— we're glad we put in some expense controls, given the current economic environment. It’s just going to be a little noisy. We’ll have heightened expenses in a number of categories because of the PPP program. Now, having said that, it’s still going to be a profitable program.

That’s a good segue to think about the fees related to PPP. I understand that, when you’ve got a few loans that are bigger in that 1% fee range versus a ton of loans that are smaller in the 5% range, would you suggest that we’d be better off modeling closer to that 1% range, or do you think it’s better to look at a midpoint in the 3% range?

I’ve seen people modeling closer to 4%, but 3.5% to 4% would seem a little high to me.

Okay. On the loan deferrals, I believe you gave the number $574 million at 3/31. Would you be willing to share what that number is today?

Through part of last week, it was $988 million through the first half of April.

Are you continuing to see a pretty high volume of requests coming through?

Yes, I think it slowed down partly because people now have some PPP funds. We were able to accommodate the overwhelming majority of our customers. I think the volume has slowed down, whether that’s related to them getting PPP money or our bankers working on PPP loans at the same time, I can’t tell you, but it is slowing.

Okay. Regarding PPP part two, which looks like it could be a possibility, how many applications do you have that you weren’t able to get through before they ran out of money? In other words, how much do you already have in the pipeline that you could take advantage of should there be part two?

It’s not huge, Wally. We got most of them knocked out, but it’s in the $20 million range, I think, is the loans we had in the pipe when the shutdown happened. We’ve added loans from people that are not our clients; we prioritized our existing clients, but then we added clients from other banks, trying to help those who had a bank that didn’t participate in the program.

Okay. I’ll step out. Appreciate the responses. Thank you.

Thank you, Wallace.

Our next question is a follow-up from Tyler Stafford with Stephens.

Thanks for taking the follow-up. Just one more quick one for me on the margin. I appreciate the two-quarter outlook of relatively stable in the 3/31 total deposit cost. Do you have what the spot loan yield rates were at 3/31 as well?

Let me check, but I want to say it was 460; I’ll e-mail it to you.

Okay.

But we still expect that ex-PPP, we’d be at 360. I’ll e-mail that to you.

Okay. It’ll be impressive if you can hold the margin flat in Q2 after 150 bps of cuts in March.

Thank you.

This will conclude our question-and-answer session, as well as today’s conference call. Thank you for attending today’s presentation. You may now disconnect.