Luke Wyse - SVP of Finance and IR Aaron Graft - CEO Bryce Fowler - EVP, CFO & Treasurer Dan Karas - Chief Lending Officer

Timur Braziler - Well Fargo Nick Grant - KBW Brett Rabatin - Piper Jaffray Steve Moss - FBR Gary Tenner - D.A. Davidson Matt Olney - Stephens Inc

Good afternoon, and welcome to the Triumph Bancorp Incorporated Third Quarter Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Mr. Luke Wyse, Senior Vice President of Finance and Investor Relations. Please go ahead.

Good morning. Welcome to the Triumph Bancorp conference call to discuss our third quarter 2017 financial results. Before we get started, I would like to remind that this presentation may include forward-looking statements. Those statements are subject to risks and uncertainties that could cause actual and anticipated results to differ. The Company undertakes no obligation to publicly revise any forward-looking statements. If you are logged into our webcast, please refer to the slide presentation available online including our Safe Harbor statement on Slide 2. For those joining by phone, please note that the Safe Harbor statement and presentation are available on our website at www.triumphbancorp.com. All comments made during today's call are subject to that Safe Harbor statement. I am joined this morning by Triumph’s Vice-Chairman and CEO, Aaron Graft, our Chief Financial Officer, Bryce Fowler and Dan Karas, our Chief Lending Officer After the presentation, we’ll be happy to address any questions you may have. At this time, I would like to turn the call over to Aaron. Aaron?

Thank you Luke. We have been busy since the end of the second quarter and I am very pleased with what our team has accomplished. We completed a successful public offering of our common stock raising $65.5 million of capital. We completed our acquisition and conversion of nine Independent Bank Colorado branches on October 6 adding to our core deposit base in our Western Division and we are progressing as expected towards our fourth quarter closing on our pending acquisition of Valley Bancorp. Despite all this activity, we continued to generate solid core earnings, strong loan growth and improved asset quality in the third quarter. Our total loan portfolio grew organically by $130 million or 6% in Q3. This growth continues to be well diversified across many lending products. Our commercial finance portfolio which includes our ABL equipment finance and premium finance lending in addition to our factored receivables comprised the majority of the increase. This portfolio is now at $887 million, an increase of $85 million or 11% for the quarter and comprised 37% of our overall loan portfolio. We also experienced solid growth in CRE and real estate lending of over $42 million. Triumph business capital, our factoring subsidiary contributed approximately $47 million of loan growth for the quarter. TBC again achieved record highs in the number of invoices purchased, the dollar value of invoices purchased and the number of clients served in the third quarter. Specifically, TBC purchased 476,000 invoices or a dollar value of 732.4 million and added 235 net new clients in the third quarter to reach 2,925 clients at September 30. Average net funds employed were 260 million during the third quarter and the average invoice size purchased this quarter increased to $1537 versus $1433 in the prior quarter. The dollar value of invoices purchased this quarter over the same quarter last year are up 50%. These team members deserve a hearty congratulations for their continuing exceptional performance. I am pleased to see that the investment we have made in this business is producing above market return for our shareholders. We are also excited about the prospects of TriumphPay, our technology driven reserve factoring platform. While TriumphPay does not contribute to our earnings currently, early marketed option has exceeded our expectations and we believe we are building a technology and a platform that could have great promise for the future. With respect to asset quality, our third quarter metrics continue to reflect improvements. In the third quarter, we recorded a provision for loan loss of only $572,000 primarily to provide for the quarter’s loan growth. Net charge-offs were negligible at only $2000, which was aided by 1.2 million of recoveries in the quarter. Our past due non-performing loan and non-performing asset ratios all experienced improvements during the third quarter. Over a year ago, I stated on an earnings call that our goal was to achieve a 50% per share run rate by the end of 2017, which was approximately a 100% improvement over our current run rate at that time. We achieved that goal ahead of schedule last quarter. But for the issuance of additional shares to support our announced acquisitions we would have achieved it again this quarter. More importantly with our core loan growth and the closing of our previously announced acquisitions, I expect we will continue to meet and exceed that mark into the future as our operating leverage improves. I point this out to investors and potential investors to illustrate to them what our management and board have believed all along, that we had front loaded the expense of building a platform that could take us to the next level. We are not done building yet, not even close, but with our current core return on average assets running around 1.3% I think we have proven the business case for our strategy. At this point, I’d like to turn the call over to Bryce to provide some additional color on our financial performance for the third quarter. Bryce?

Thank you, Aaron. For the third quarter we earned net income to common stock holders of $9.6 million or $0.47 per diluted share. Earnings per share for the quarter were impacted by our public offering of 2,530,000 shares on August 1. All things being equal the increased share count was a reduction of approximately $0.04 per share. Net interest income for the third quarter increased $955,000 or 2.5% over the prior quarter. This increase was driven primarily by the $160 million in average balance of loans outstanding over the prior quarter. The GAAP yield on total loans including loan discount accretion decreased 35 basis points from the prior quarter to 7.44%. GAAP net interest margin decreased 26 basis points to 5.90%. Excluding the impact of purchase loan discount accretion, the adjusted yield on loans was only down 5 basis points at 7.2% for the third quarter and our adjusted net interest margin decreased to only one basis point to 5.69%. The third quarter included $1.4 million of loan discount accretion, a decrease of $1.5 million. The prior quarter included accelerated accretion associated with the pre payment of certain loans which contributed to a higher GAAP loan yield and net interest margin. As of September 30, we had $10.8 million of remaining loan purchased discount of which we currently expect $9.4 million to accrete into income for the remaining lives of their acquired loans. Of this accretable amount, approximately $1 million is expected to accrete by the end of 2017. Total deposits for the quarter were down $60 million from the prior quarter, primarily to our intentional plan to reduce public funds. Due to the nature of our asset portfolio being primarily in loans rather than securities and continuing strong loan demand, the pledging requirements associated with public funds make many of these accounts non-economical for us to continue. Our loan to deposit ratio was 121% as of September 30. Our use of federal home loan bank advances to fund most of our mortgage warehouse portfolio and place this ratio about 10%. We would also like to note that our third quarter results do not yet incorporate the $162 million in deposits and net liquidity provided by the independent branch acquisition or the $296 million of deposits and net liquidity we expect to acquire in the pending Valley Bank Acquisition. On a static basis, these two acquisitions will reduce the loan deposit ratio of about 10%. We remain confident in our ability to continue funding profitable loan growth given our ability to pay competitive deposit rates as our loan portfolio yield remains above 7%. Non-interest income decreased $1 million from the second quarter to $4.2 million. As discussed in our last earnings call, the primary drop of this decrease is due to $990,000 of earnings we realized in the prior quarter on our investment in our CLO warehouse which was repaid to us in late June. Non-interest expenses in the second quarter were $28.2 million, which is in line with our expectation of approximately $28 million we communicated during last quarter’s call. Total non-interest expense increased about $900,000 over the prior quarter, most of this was attributable to increased bonus and incentive compensation as our core and earnings performance continues to improve since the first quarter of this year. Our FTEs were up only about five positions from the prior quarter to 711 as of September 30. With that, I’d like to turn the call back to Aaron.

Thank you, Bryce. A couple of final things to mention regarding expenses and future plans before we turn the call over to the operator for questions. First, investors should expect to see expense growth in Q4 beyond our normal growth due to the completion of our acquisition of the nine branches from Independent Bank and our acquisition of Valley Banking Trust. We estimate that the cumulative impact of these transactions will increase our expense run rate in Q4 to approximately $30.5 million. Q4 will include the Independent Bank branches for nearly the full three months and Valley Banking Trust for one month. As most of you know TBK has been a bank headquartered in Dallas but not really a full service Dallas bank since the current management group led the recapitalization of the bank in 2010. We expect this will change in 2018. Our board and senior management have deep roots in North Texas. As a result we have built a significant loan book in our local market. Many of our borrowers have expressed an interest in moving their entire relationship to TBK but have been unwilling to do for lack of a full service branch. We expect to open a full service branch in Dallas in 2018. And like most things TBK does, we won’t do it quite like other banks. More details on this to come, but know that we are excited about building a true commercial full service presence in North Texas. We view this as a very strategic investment into the future growth of our company. As part of this, we are scoping a significant upgrade to systems such as our treasury management solutions. We expect to deliver significant deposit and loan growth through the presence of this branch and these upgraded solutions. With that, I’d like to turn the call over to the operator for any questions.

[Operator Instructions] Our first question will come from Jared Shaw of Wells Fargo Securities. Please go ahead.

Hi, good morning. This is actually Timur Braziler filling in for Jared. I guess my first question is on the deposit side. Can we talk a little bit about what you saw there for trends this quarter, how much of that length quarter decline was driven solely by the pending acquisitions or is there some sort of strategic shift taking place?

Hey this is Bryce. I’ll take – got to take that one. I think that as far as the change overall we saw a decline in our public fund deposits of about $100 million during the quarter, that was a result of a conscious decision on our part to kind of rejigger our funding mix and we are eliminating those overtime to its overall. So, otherwise I would say that our – we were anticipating the closing of the branch acquisitions, their close as well as Valleys so we were running at a little lean and probably not pushing on liquidity and probably not pushing as hard on deposit growth knowing that those two transactions were on the way.

Okay, thank you for that. And then just maybe looking at the Colorado franchise, I know many of those deals were down for the deposit aspects but what have you seen on the lending side thus far, and then once you roll in these two deals that are one closed and ones expecting to close on the fourth quarter, how will that landscape potentially change or what’s your expectation there?

Hey good morning, it’s Dan Karas. We’re pretty excited about the opportunities in Colorado. We pick up or have picked up in the branch acquisition about $100 million in loans, about $75 million to that is ag. So we are pretty comfortable with the people and the types of businesses that we serve in those markets. In the Valley acquisition, that’s about $170 million in loans, mostly commercial a little bit of ag mixed in, but that’s primarily commercial. We don’t look as we said before in our community bank franchise for the same growth level that we expect in commercial finance, so it were in the 3% to 5% range organically we are pretty comfortable with that and then let commercial finance continue to drive the overall growth in...

Okay and then maybe just one more from me. There has been a lot of deal activity recently, what’s the deal appetite currently and from just a back office standpoint when are you guys able to kind of get back in the market and then look for incremental M&A opportunities?

Well this is Aaron. So the Valley Bank Acquisition legal day one is scheduled for December 8 and of course that involves the merger and conversion as you would expect there’s an integration process that has already begun but really picks up at that time. Of course as you also might expect there’s a few of us at the organization who spend our time not only helping with that but looking out towards what the next opportunities that is. And I don’t think it’s a surprise to anyone if you step back and just look at Triumph holistically and you think about how do we do M&A that creates value for our shareholders not just asset growth, that M&A is going to be focused on the opportunity to grow or capture core deposits. And so there are many of those dialogues going on right now from branch deals to full bank deals, end markets were and adjacent to markets we are in, and so I mean I would be hopeful much like we did in 2017 where we were able to announce and close multiple deals that we could do the same in 2018, but you won’t hear anything from us as far as an announcement goes until after the first of the year just because of where we are in the process with Valley. And as far as you know what we are capable of doing in our back office and we are so much better than we were a year ago. We have a lot of things we still want to get better at, I mentioned those in the call, we want to improve technology related to treasury management and many other things, but huge upgrade behind the scenes have been made and there are more to go, but we certainly are better equipped to do multiple deals in 2018 than we were even in 2017, so we expect M&A to be part of our future.

Okay, great. And then just I guess lastly was the expectation of North Texas becoming a bigger component of the overall bank, is it safe to assume that we can see the potential for either the branch transactions or whole bank M&A to be centered around that area or is it still more broadly looking than that.

I think it’s more broadly looking than that. I don’t think – nothing in North Texas you know what we just to be clear what we wanted to tell everyone we are doing is establishing a branch in North Texas and of course that physical branch will already have pre wired around it a lot of loans and a lot of deposit potential just because if you look at our board of directors and our management and our relationships here, we just needed to create a physical location where we can direct all this potential traffic to. So it’s going to grow far faster than any just if we were to already have five branches here, just be adding a sixth. You are going to push a lot of volume there, so excited about that. As far as on the M&A in North Texas, should an opportunity present itself, we certainly will look at it but I would not put that at the top of the list of at least sitting here today where I expect we would do M&A in 2018.

Great. Thank you for that color.

Our next question will come from Nick Grant of KBW. Please go ahead.

Hey good morning guys.

Good morning, Nick.

[Indiscernible] right. So you had another really clean quarter from a credit perspective, are there any pockets that concerns it all right now, or is it pretty clean across the board and was any of the provision related to you know like hurricane Harvey or anything like that you can note on.

Hey good morning Nick, it’s Dan. Let me start with the hurricanes’ first and we are pleased that both the people and our clients overall have been relatively likely impacted. We have made a few equipment finance extensions but really nothing significant as it relates to that our largest exposure was the mortgage warehouse and I’m happy to say that that exposure has all but been repurchased at this point, so really there’s no impact that the hurricane had on us institutionally. As I think about – as I think about trends in asset quality nothing really stands out at this point, we had one equipment finance issue in Q3 that we are done with. On the charge-off side and the recovery side, we had two legacy loans that we are able to work through and fortunately have recoveries where we have one health care credit that we took a charge on in the first quarter; we’ve had a small recovery on it. So as I look at it today really no meaningful negative trends for us.

And Nick, just to add on to that. I would say where we are sitting now the bulk of our non-performing assets are concentrated in a few large relationships that have been around you know for some acquired, some made it. You know we continue to progress further onto resolution unknowable whether that will happen in Q4 or Q1, but you know when you get to a point where they could complete resolution could lower our non-performing asset ratio to something that’s extremely miniscule that’s exciting to us.

Okay great, thanks. Then can you kind of touch on the decrease in commercial finance loan yields. I mean, I realize this is coming off of a very high level but it is primarily driven by more premium finance kind of lowering that or is there something else going on we should think by moving forward.

This is Bryce. I think there is a mix of things happening there. Some of it is a little bit of change in the mix of the portfolio but you know really that outplays the driver quarter over quarter as much as we did have kind of a not a – I wouldn’t call it unusual, we had a within the range of normal we had the higher level of fee income in the prior quarter versus this quarter and that drove a big piece of that, I think the growth in the premium finance is probably a little bit of drag in that quarter over quarter but even their portfolio yields are improving for us overall, so I mean we really are not seeing yield compression in the commercial finance portfolio kind of on the trend basis. Yes, we charter [Ph] from quarter to quarter as being even as the things happen.

Okay, great. And then one last one from me, can you guys just touch on your outlook for loan growth , are there any segments you expect to pull back and as a sustainable pace going forward on a core basis I hear you’ll be growing up for larger base, but how do you see on the future?

You know as we talked about Q2 was an anomaly we are happy to have that level of success in Q1 of this summer or Q3 rather the summer was a bit slow for us but really picked up substantially post labor day, so overall we were happy with that mix of commercial finance and commercial real estate growth. The outlook at this point looks similar for Q4; I think we’ll see a mix of commercial finance driven in large part by Triumph’s business capital whereas we’ve got some real estate projects in the works and I think we are close or- perhaps a similar Q4 quarter.

And Nick as I look out just beyond Q4 into the future, one of the things that excites me for TBK is first of all it’s not lost on us, what is going on in the economy and that we’ve got some tailwinds there but when we look at the pipeline, I mean yes, Triumph business capital has exceeded expectations. Invoice sizes continue to grow even after this quarter ended which just is going to go straight to the bottom line, that’s great. TriumphPay could be tremendous opportunity, but it’s not just a forward-looking pipeline of factoring or commercial finance growth. I see what we are doing in our CRE business; you know we have a 175% concentration in CRE. We’ve purposely been judicious in how we wanted to grow there, so we are excited about the opportunity there with some larger projects, lower loan to value projects with good sponsors because we have the balance sheet room and ability to do that but are becoming overly concentrated. So and commercial finance as a whole in our ABL and equipment finance group I think there’s growth opportunities, and not to mention just in our traditional community bank platform which is now a bigger platform. So I think we are pretty optimistic maintaining a loan growth percentage relative to where we were certainly this quarter and excited really about the diversification within that loan growth pipeline for the future.

Great. Thanks for taking my questions.

Our next question will come from Brett Rabatin with Piper Jaffray. Please go ahead.

Hey good morning everyone.

Good morning, Brett.

Wanted to ask, first Aaron, can you I know you are talking about – you know wait for the details but this development in Dallas and you are going to do it differently, does that mean we are going to look at 2018 and see you know a much higher spending rate on a commercial, physical bank build out and can you talk maybe about how much you might be spending on technology and the treasury management new platform?

Yes, I’m not prepared right now to give you specific numbers. Look, it’s a branch, right. So on the whole of our entire expense base, I don’t think it’s not going to be a game changer, I mean directionally it will certainly be increased expenditure but we think that will pretty quickly because like I said as a pent up demand the pre marketing we will have done pay off. As far on the treasury management we are not building, this is not something like try and pay for example where there has been millions of dollars spent overtime in developing that technology. When we do that that will be the capital line of the shelf product from our current provider. So it’s an incremental expense rate. So I mean, I think the story is you should expect to see absolute expense growth in 2018 as we make these investments, but I don’t think it’s a sudden leg up, I mean, you’ll see it start to come in the earnings and it will – to the expense run rate and it probably you won’t see much of it in Q1 it will grow as the year goes on.

Okay, so this isn’t the next -- step, the next growth phase of your company so to speak.

Yes, sir.

Okay. And then the other thing, just on the margin you know it seems like if you have some continued mix shift change so it’s the commercial finance your margin could actually move higher and rates maybe could help, but then you know I guess everyone’s focussed on deposit betas and I guess I’m curious as you are thinking about your funding over the next few quarters, just I’m curious on your thoughts on the margin and how you see it playing out?

I’ll let – I’ll answer generally and then let Bryce correct or explain anything I get wrong. But, look our incremental cost of funding right now is certainly higher like everybody I’m sure than what our average cost is today. We could absolutely go out and turn on the deposit engine and bring in a lot of deposits in 90 days or 180 days. Our sensitivity is we don’t think doing that is and repricing our entire existing deposit customer base is good for the long term value creation for our investors. So we’ve instead chosen to be judicious, if there are markets where we can maintain time deposit rates that are at a discount to more you know especially in rural markets to more urban markets than we think that’s what we are supposed to do, that’s the smart way to grow rather than just blast out a nationwide CD rate that just makes people lined up at the front of your banks. We can certainly do that. So, I mean as I sit here and look at things today, I expect and I don’t have a crystal ball and I’m not an economist but in 2018, we certainly expect our cost of funds is going to go up, I’d – would be shocked if it didn’t. We think we’ll generate core deposit growth undoubtedly through what we talked about in Dallas through better marketing, better technology we certainly would be surprised if we were able to do that at the rate at which we grow assets. That’s just the nature of our business. So M&A will help, again, we have a very specific focus when we do M&A about what we are after so that can certainly help but just the trend lines overall to support the continued growth of our organization our cost of funds should go up. As far as where we are on assets, you know as you look it seems fairly stable and certainly to the extent that we have tailwinds and factoring which by a large margin is our highest yielding loan product then that would hopefully offset that and continue to maintain sort of the similar NIM profile that we’ve had the last few quarters.

I might just clarify – if you don’t mind on deposit to say that, I mean just [Indiscernible] in our retail brand system we’ve not had to and we have not adjusted our rates in response to market or competitive pressure. So the rise you are seeing in deposit cost this quarter really a mix shift in the growth that we are creating net net as we turn the portfolio underneath and reprice it on more of the national pricing scale.

Okay, great. I appreciate all the color.

Our next question will come from Steve Moss of FBR. Please go ahead.

Good morning. You guys had really a good growth here in our commercial portfolio, but I was a bit surprised that the loan loss reserve actually went down two basis points quarter over quarter. I was kind of wondering if you could help that some of the underlying dynamics and how we should think about the reserve ratio going forward?

Sure I mean, I think clearly we’ve pointed out I think on the call that this quarter in particular that we had net charge-offs of basically zero that was aided a little bit by some nice recoveries in year net net in there, so that was a benefit for this particular quarter. And as I’ve discussed play with the math on provision expense going forward on future loan growth of course it will be depended on mix of that but it’s probably going to be on average something like 80 to 90 basis points that we would be providing on net loan growth, and currently we have thing [ph] calibrated today on the provision.

Okay, that’s helpful. And then with regard to factored receivables, good growth this quarter, I’m assuming some of the growth may have been due to higher gas prices in part of the quarter; I was just kind of wondering you know how should we think about fourth quarter growth and trends there?

So there are lot of things going on in transportation and the market moves fast I certainly think you are correct that diesel prices have had some effect, although our analysis is just demand in the spot market it’s been driven to some very high levels. If we sit here today and look at where our average invoice purchase price is today versus what’s reported for this past quarter it is again significantly higher. So we see a lot of tailwinds in that business because as you know I mean the invoice size doesn’t create any more or less work for us and so it’s incredibly profitable incremental growth when those invoice sizes stay high which it feels like to us and if you read the literature in the industry is going to happen. Something I’d point out to you that we do control that FX growth in that line of business. In Q3 of 2017 we added 235 net new clients, that’s more net new clients than we added the entire period of Q1 to Q3 of 2016. And we think that is a result of all the investments we’ve made in that business of superior technology, superior marketing, name recognition because as long as we are generating net new client growth than we are going to have I mean it’s just academic, we’ll have exposure to more invoices, and if you are operating that on the frameworks, the infrastructure we’ve build out there. So, all those things considered I would expect another pretty outstanding quarter from Triumph Business Capital in Q4 and I think it could certainly continue for the foreseeable future.

All right. Thank you very much.

Our next question will come from Gary Tenner with D.A. Davidson. Please go ahead.

Thanks, good morning guys.

Good morning.

Had a couple more questions on the factoring business. The yield in that business in the third quarter came down a bit, is there any – is that just a function of timing reflecting on the invoices or anything structure on terms of maybe penetrating into some larger clients that maybe the discounts are a little bit skinnier on the...

I think it’s both of them, but there clearly we’ve I think picked up more fleet clients which you know you are going to pick up more invoices per client at slightly lower rates.

Okay, great. And then you’ve alluded to this a bit but certainly the pick up in average invoice price up over $1500 this quarter. I imagine that September number was quite a bit higher jut given the spot rate impacts post hurricane, is that fair?

I think we are running, I think months-to date right now we are running around 1650, so yes significantly.

Great. And just wondering if you have any sort of updated thoughts on what the impact of ELD coming you know at the end of the year would do to average invoice prices or just to your overall portfolio ex any additional growth?

We still it’s the same thing I’ve said before. We just don’t know, I mean I know there is a big push right now to get the implementation of ELD delayed for a year. I have no idea whether that will gain traction or not. I know that President Trump spoke to a bunch of truckers and I enjoyed reading the hash tag, its ELD or me as the independent truckers pointed out. Rightfully so, I happened to think how the hours of service rule is a negative for them. So look, all we know is that the day after this gets implemented freight’s still going to have to move. And if you look at, take for example Warren Buffet’s investment in Flying J, right? We don’t know what, autonomous trucking we don’t know about battery powered trucks, we don’t’ know about ELDs but what we do know is a lot of freight has to get from the coasts to all across the United States and the only way I know it moves is through truckers. And I don’t see that, and I think that actually increases in 2018 and so we think it’s well equipped as anybody to participate in that market. Whatever volatility comes from ELD or not we still think it’s – the future’s pretty bright for us.

Great. Thanks guys.

Thank you.

[Operator Instructions] Our next question will come from Matt Olney with Stephens Inc. Please go ahead.

Hey thanks, good morning guys.

Good morning, Matt.

You’ve already addressed all my questions on the factoring, so appreciate that. But I want to circle back on commercial real estate and it sounds like there are some nice opportunities there. Can you just kind of speak to the pricing, the terms you are seeing right now within CRE and then by geography is this growth going to be in footprint and if so which markets do you think a lot of CRE growth will come from?

Hey good morning Matt, it’s Dan. Most of the growth is coming in two pockets. It’s either of the higher quality, lower LTV. I think of that as 60%, 65% a bit lower yielding, multi family or office out of our Dallas office. Most of that is in this geography. The other component of real estate growth is construction of development and we are seeing that growth in the mid-West market. Those terms likewise are similar, relatively modest LTVs were in that 70%, 75% range. Yields are pretty consistent across the board. We are going to see as we saw in Q3 more draws under existing CND facilities not necessarily new commitments in that process. So those are really the two areas where we have seen growth over the last quarter.

Okay, that’s helpful Dan. And on the expenses and the prepared remarks I believe you mentioned the fourth quarter outlook also operating expenses at 30.5 million, did I get that correct and is there anything non-operating in that number or is that the clean run rate kind of a core number going forward.

Right. That’s right. You got the number, $30.5 million and I mean that’s our estimate of kind of a clean run rate number for that net quarter. Okay, but that also includes again like Valley not being in there for the fourth quarter as a reminder.

Understood, okay. Thank you guys, appreciate it.

Thank you Matt, take care.

And ladies and gentlemen, this will conclude our question and answer session. I would like to turn the conference back over to Mr. Aaron Graft for any closing remarks.

Thank you all for joining us today. We look forward to seeing you down the road.

The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect your lines.