Q3 2021 Sandy Spring Bancorp Inc Earnings Call
Welcome to the Sandy Spring Bancorp incorporated earnings conference call and webcast for the third.
So 2021 my name is Harry and I'll be your coordinator today.
You'd like to ask a question during the presentation you may do so by pressing star followed by one on your telephone keypad.
I'll now hand over to your host Dan tried our president and CEO of Sandy Spring Bancorp incorporated to begin Mr. Schroeder. Please go ahead.
Thank you Harry and good afternoon.
Really appreciate you joining us for our conference call to discuss Sandy spring Bancorp's performance for the third quarter of 2021.
Today, we will also bring you up to date on a response to an impact from the COVID-19 pandemic. This is Dan Schreiter speaking and I'm joined here by my colleagues, Phil Mantua, Chief Financial Officer.
Aaron Kaslow General counsel for Sandy Spring Bancorp.
Today's call is open to all investors analysts and the media there'll be a live webcast of todays call and a replay will be available on our website later today, but before we get started covering highlights from the quarter end and then taking your questions Aaron will give the customary safe Harbor.
Arbor statement.
Thank you Dan Good afternoon, everyone Sandy spring Bancorp will make forward looking statements in this webcast that are subject to risks and uncertainties. These forward looking statements include statements of goals intentions earnings and other expectations estimates of risks and future costs and benefits assessments of.
Expected credit losses assessments of market risk and statements of the ability to achieve financial and other goals. These forward looking statements are subject to significant uncertainties because they are based upon or affected by managements estimates and projections of future interest rates market behavior, other economic conditions future laws and regulations and a variety of other matters.
Including the impact of the COVID-19, pandemic, which by their very nature are subject to significant uncertainties because of these uncertainties Sandy spring bancorp's actual future results may differ materially from those indicated in addition, the companys past results of operations do not necessarily indicate its future results.
Thanks, Aaron and thanks, again to everyone for joining us to discuss our third quarter financials.
Our earnings performance remained strong and we delivered another solid quarter.
Fueled by exceptional deposit growth and a record level of commercial loan production, we continue to grow new and existing client relationships across our lines of business.
In addition, our credit quality margin and efficiency ratios are all in great position and we continue to make great progress on PPP forgiveness.
We do have momentum going into the fourth quarter and a lot of good news to share with you today, So let's jump right into the highlights from the press release and the supplemental information.
Today, we reported net.
Income of $57 million or $1 20 per diluted common share for the quarter ended September 32021.
The current quarter compares to $44 6 million or <unk> 94 per diluted common share for the third quarter of 2020, and net income of $57 3 million or $1 19 per diluted common share for the second quarter.
Year.
Core operating earnings for the third quarter remained stable at $52 million compared to $52 1 million for the prior year quarter and $55 one for the linked quarter.
The provision for credit losses was a credit of $8 2 million compared to a $4 2 million credit for the second quarter of 2021.
<unk> then the credits this year, primarily reflect the improved forecast for the unemployment rate and this quarters provision also included updated metrics for determining the allowance for credit losses.
Shifting to the balance sheet total assets, we're at $13 billion or a 3% increase compared to $12 7 billion at September 30 of 2020.
As cash and cash equivalents grew by $890 million, primarily from the forgiveness of PPP loans.
To that end PPP loans declined $602 million during the same period in further funded by consistent deposit growth over the last 12 months.
Excluding PPP loan portfolio.
Leo remained at $9 3 billion compared to the third quarter of the prior year.
And while residential mortgage and consumer loan runoff totaled $327 million. It was offset by the year over year commercial loan growth of $316 million or 4%.
Year over year gross commercial production increased 102%.
<unk> or $416 million and totaled $823 million for the quarter.
And funded production increased 127% or $298 million.
On a linked quarter basis gross commercial production increased 4% or $32 million in funded production increased 6% or $30 million. So.
All right results in the commercial space.
We're pleased with the sustained and expanded commercial production because we know that when times normalize it will translate to the kind of growth that we're accustomed to.
While we continue to operate in the season of lower commercial line utilization higher runoff and excess liquidity on our balance.
Balance sheet, we're taking actions to accelerate commercial loan growth in the fourth quarter. This includes adding new talent in our commercial line of business looking at larger credits proactively approaching new and prospective clients and pursuing new opportunities across our market.
On the deposit side of things year over year deposits increased 10.
Percent.
This was driven by 15% growth in noninterest bearing deposits and 8% growth in interest bearing deposits. This deposit growth is significant and a good indication of our ability to grow and deepen client relationships.
Noninterest income decreased by 17% or $5 million compared to the prior.
Year quarter.
The decline was a result of the 65% decline in income from mortgage banking activities, which we anticipated as refinances continue to slow.
Looking ahead, we expect our quarterly gain on sale to be roughly in the $4 million to $5 million range as we anticipate a more consistent rate environment and we moved to stabilize.
The runoff from our mortgage portfolio by retaining more of that future production on the balance sheet.
We achieved 21% growth in wealth management income compared to the prior year.
Our 2020 acquisition of Rembert Pendleton Jackson continues to make a positive impact on our results as well as the performance.
In the financial markets and the expansion of the wealth management client base.
Other noninterest income also grew by 113% compared to the prior year quarter, primarily driven by credit related fees and contractual vendor incentives.
The net interest margin improved to $3 57 for the first.
First nine months of the year compared to $3 33 for the prior year excluding the.
Amortization of the fair value marks derived from acquisitions. The net interest margin would've been $3 52 for the current year and $3 21 and 2020.
A significant.
<unk> aspect of success in the year over year improvement in the margin was our ability.
<unk> to manage the cost of our interest bearing liabilities down by 52 basis points through disciplined deposit pricing and the reduction of more costly wholesale based borrowings and subordinated debt.
Our ability to grow average noninterest bearing deposits by 18% over the prior year also contributed to the margin improvement.
Noninterest expenses increased $2 2 million or 4% compared to the third quarter of 2020, while the increase was primarily driven by rising compensation costs and professional fees. It was partially offset by the lack of M&A expenses during the current quarter and a significant reduction in FDIC insurance.
This decline in FDIC insurance expense reflects reduced risk factor factors and the regulatory agencies assessment of the company.
Salary and benefits increased $2 6 million as a result of staffing increases.
And the $1 2 million increase in professional fees is primarily due to the consulting fees associated.
With our various technology investments.
The non-GAAP efficiency ratio for the third quarter of 2021 was $46 67 compared to $45 36 for the second quarter of 2021, the change in non-GAAP efficiency ratio reflects a decrease in noninterest income from mortgage banking activities and the increase in.
Personnel costs and professional fees that we experienced during the quarter.
Shifting to credit quality the positive trend in the level of nonperforming loans continued in this quarter at 80 basis points compared to 93 basis points in the linked quarter.
Nonperforming loans totaled $78 2 million compared.
Third to $94 three in the linked quarter.
Loans placed on nonaccrual during the quarter amounted to $5 7 million compared to 900000 for the prior year quarter and $1 5 million for the linked quarter.
Non accrual loans declined from the prior quarter due primarily to the partial payoffs and eventual charge offs of a few large borrowings in the hospital.
<unk> sector with an aggregate balance of $32 9 million. It's important to note that these borrowings are contained to two relationships within the hotel portfolio that I've commented on in prior quarters.
Charge off amounts of these credits did not exceed their associated individual reserves. So it did not result in any additional impact on the current.
Provision for credit losses.
Loans greater than 90 days or more increased from the prior quarter as a result of maturities of existing portfolio of loans that were in the process of being extended loans amounted amounting to $22 2 million were subsequently settled after September 32021, and no longer and are no longer past.
Current quarter.
The company recorded net charge offs of $7 8 million for the third quarter compared to net charge offs of 200000 for the third quarter 2020, and $2 2 million for the linked quarter again. This increase was primarily the result of the previously mentioned charge offs of non accrual loans.
The allowance.
<unk> credit losses was $107 9 million or 111% of outstanding loans, and 138, 111% of outstanding loans, and 138% of nonperforming loans compared to $124 million or one 3% of outstanding loans and 131% of nonperforming.
<unk> loans at the linked quarter.
Excluding PPP loans, the allowance for credit losses, as a percentage of total loans outstanding was one 7% compared to 134% at the linked quarter overall, our credit quality trends continue to be positive and as youll see in our supplemental materials nearly all loan accommodate.
Commendations have returned.
To making payments.
Tangible common equity increased to $1 1 billion or nine 1% of tangible assets at September 30, compared to $1 billion or 831% at September 30 of 2020 as a result of accumulated earnings over the preceding 12 months.
Excluding the impact of the PPP program from tangible assets at September 30, the tangible common equity ratio would be 944%.
At September 32021, the company had a total risk based capital ratio of 15, 3% a common equity tier one risk based capital ratio of 12 five.
5%.
Tier one risk base ratio at the same 12, 5% and a tier one leverage ratio of nine 2%.
Given our strong capital position and growth during the past year. The company activated its approved stock repurchase program and repurchased over $1 2 million shares of its common stock at an average price of 40.
$33 <unk> per share.
So with that we'll now turn to the supplemental information. We also issued this morning.
If you move to slide two you'll see that the loans with payment accommodations as of September 30.
<unk> totaled $14 million, resulting in well less than.
1% of our loan portfolio remaining in some form of accommodation. This this is great news and an indication of the recovery that's going on not only within the portfolio, but in the local economy.
On slide three we have detailed specific industry information outstanding balances for each segment and the loan and payment accommodations RF.
<unk>.
As of September 30.
And then moving to slides four and five again breaking out where we stand on forgiveness for rounds, one and two of the program. We have also included this quarter. The remaining fees to be earned so that you can see what is expected for the balance of the program.
As of October 4th 97.
7% of all round loan one.
Round, one loans have apply for forgiveness and 99, 5% of applicants submitted to the SBA have received full forgiveness.
And as detailed on slide 565% of round two loans have apply for forgiveness and 100% of those applications submitted have received both.
Forgiveness.
So, we're making really good progress and we expect to be substantially complete on both rounds of forgiveness by the end of the year, So with that I'll turn it over to Phil Mantua, he'll walk through our seasonal slides and capital position.
Thank you Dan Good morning, good afternoon, everyone I'm going to pick up on slide six.
<unk>, where we have a waterfall representation of the movement in our allowance for the third quarter of 2021.
Broken into the components that reflect the key drivers of the change during the quarter.
Change over the course of the current quarter was primarily driven by three main factors the reduction in the projected near term level of the unemployment rate changes.
Change in individual reserves and the update to our model inputs, which is part of our periodic review process.
On slide seven as comparison of our current and more recent economic forecast variables are seesaw methodology continues to use the Moody's baseline forecast that for the third quarter was a version released by Moody's.
On September 20.
This baseline forecast integrates the effect of COVID-19, and portrays an unemployment rate for a local market that is essentially already peaked and ultimately recovers to a level of 3% in the third quarter of 2023.
Additionally, the projected levels of year over year growth in business bankruptcies.
Change in the home price index is presented contribute to the provision credits for the quarter.
A key macroeconomic variables are further outlined on the next slide number eight and for the first quarter. All of these variables have been applied in a consistent manner to those same factors is used in the prior quarters.
Slide nine provides some additional granularity related to a reserve from a portfolio view, where you can see that all major categories of commercial loans with the exception of a D&C reflect a continuing trend of reserve release.
We should note that the 145% of reserve reflected here for commercial business loans includes the PPP loans in the <unk>.
Balance, although as we know there is no reserve required on those loans.
And as illustrated in the footnote at the bottom of the slide when adjusting the balance to exclude PPP loans outstanding.
<unk> on our commercial business segment would be 2.0% to 4% and our total reserve would be one 7% of total lessons.
Finally on slide 10 is the trend of our capital ratios with some brief explanations regarding the treatment of certain items and their impact to the results and ratios.
Included in those comments as the adjusted tangible equity tangible asset ratio to reflect the impact of PPP loans on the current measure.
We've also reach.
<unk> updated our capital stress tests, we have constructed a baseline severe forecast scenario utilizing the same moody's baseline forecast incorporated into our seasonal calculations and.
And the Covid base, thus for economy in the severe case.
Having said that we continue to feel confident about our capital position and therefore during the quarter we.
We redeemed $56 million of outstanding subordinated to bet excuse me subordinated debt $25 million of which was acquired in the Washington first transaction and the other 31 million obtained in Revere acquisition.
And as Dan mentioned earlier in some of his earlier comments, we activated our share repurchase program during the quarter.
And we expect to complete the buyback of the total authorized amount of shares before year end.
Dan back to you.
Thank you Phil before we move to your questions want to let everybody know our return to office plans continued to.
Move forward effective November one in person.
<unk> operations across all of our offices will expand to pre pandemic levels. We've also require that all employees be fully vaccinated by that time November one so that we can do our part to ensure a safe and healthy workplace for our colleagues clients and the communities that we serve so with that I will conclude our general comments for today.
Today, and we'll now move to your questions. So Harry you can.
Take it away.
Thank you Dan.
First question comes from Casey Whitman from Piper Sandler.
Chris Your line will be open now if you would like to proceed with your question.
Yes.
Good afternoon.
Hi, Casey Casey.
Hello.
Dan you mentioned potentially adding new talent, you've talked previously about some of the technology investments and other initiatives.
Maybe help us sort of think about what a reasonable expectation for expense growth in 2022 is going to be or.
Yeah, perhaps easier just to update us on your efficiency ratio targets.
Thanks.
Yeah.
Yeah. Casey this is Phil I think I think we took last we talked about this in terms of looking year over year in.
In terms of core expense base, and we would probably be anticipating.
Roughly about a 4%.
Overall increase in 22 over 21.
And that again takes into consideration the things that you just asking about and also some of the things that occurred during the course of time this year related to home loan Bank advance.
Advanced prepayment fees and things.
That we don't believe will reoccur again next year.
Makes sense. Thank you.
Another question here for you, Phil, but maybe do you want to update us on your kind of core margin outlook I am sure. This quarter, there's more more liquidity that impacted that core margin than maybe you were anticipating but how are you.
Thinking about the core margin over the next several quarters.
Yes, I'd be glad to talk about that too as well Casey so.
I think when you strip away as we did in the in the commentary here first of all on the fair value marks and then add to that.
The impact of what we.
<unk> got back this quarter for PPP forgiveness that that core margin here in the third quarter was probably in the mid 330 range.
And I would anticipate that that core would stay that way.
In the fourth quarter, although the reported margin next quarter, we'll probably something comparable because of our expectations for finishing.
The forgiveness part of the PPP plan or program and then I would think as we move into next year.
And as we work towards trying to redeploy some of the excess liquidity.
We are anticipating trying to keep that margin in that kind of low low to mid 330 range throughout the.
Of course of next year as well.
Okay.
Okay understood and what is your expectation for the timing of the latest round of PDP forgiveness. Do you think that will go through mid 2022, or do you think will be kind of through that earlier.
Yeah, our expectation is substantially complete.
I'm pleased this year, but we might have some fall over into the first quarter just by virtue of can't control exactly what what our clients do but we're working hard to have its substantially behind us.
So that we can go into 'twenty two clean.
Clean from a margin perspective.
Understood.
Thank you.
Thanks, guys Youre welcome.
Thank you Casey. Our next question comes from Erik Zwick from Boenning and Scattergood.
Your line is now open if you'd like to proceed with your question.
Thank you good afternoon guys.
Good afternoon.
Payer.
First I wanted to follow up a little bit on <unk> question about the loans and adding new commercial talent and looking at larger credits.
Maybe in terms of not so much the growth rate, but in terms of the mix over the past year or so that the mix of commercial loans.
Absent the run off of Pvp has gotten larger.
Larger residential mortgage has gotten.
Smaller would you expect that kind of remixing to continue.
Or are you happy with the current mix of the portfolio.
Yes.
Eric Dan.
Part of my comments earlier.
Particularly related to the mortgage business as we are going to look to try.
To stabilize that mortgage portfolio and eliminate the runoff that we've been seeing.
And perhaps might even see a little bit of growth in it.
By virtue of just putting more on portfolio.
In terms of future production, we've already we've already begun that process.
And.
In terms of putting more portfolio on on when we're looking for new talent and growing the commercial production I mean, we're doing that with the intent of being able to enhance our C&I and in connected owner occupied real estate lending.
And the.
The middle market space the Gulf.
Con space.
And so those are really where.
Specific.
Efforts are.
And trying to grow that now CRE, obviously is a significant part of what we do and we're very good at it.
So it's going to take some some time for C&I to take on a bigger role overall from a mix standpoint, but that's.
That's where we're focused.
Yes, and Eric I might follow up to Dan's comments related to talent.
The mortgage side I mean, we've been.
Pretty successful here in recent times, some very recent times of pulling together a handful of individuals.
From some of the other larger organizations like through Etsy.
<unk>.
We continue.
To build that out and we're also looking to Dan's point about building the portfolio is that being one of the means for.
Kind of Sopping up this excess liquidity here by trying to produce more in that area and putting it directly in the portfolio.
That's great color turning to the charge offs in the quarter. Just curious you know what prompted the decision to record the charge offs now and how did you determine the size of the marks you took in there are those two relationships still with the bank at this point.
No.
We've been obviously working to resolve these credits for a number of quarters is as we've mentioned our initial set aside specific reserves are based on our.
The process, we go through the methodology to establish a reserve in assessing value and liquidation costs.
And the like.
And we were.
In those cases in both cases, they were resolved through through those sales.
Got it thanks.
Phil do you happen to know they are the dollar amount there.
Go ahead, I'm, sorry, they're not they're no longer clients to further answer your question.
Understood.
Thanks, Dan.
Do you have the dollar amount of purchase accounting accretion that was all recorded in <unk>.
I don't necessarily have the dollar amount per se, but it's getting to be pretty much.
You know getting to be more and more insignificant as we move move ahead here.
And I think my.
My guidance as it relates to margin next years, not only will it be core.
We'll probably be as reported as well because I think we're pretty well exhausting much left to do that accretive nature.
Okay that sounds consistent with what I've got in my model. So thanks for that.
And then just last one is in the press release, you mentioned in the noninterest income.
On a year over year comparison higher activity based contractual vendor incentives can you just provide a little more color in terms of exactly what that's related to and whether it does that hit every quarter or is there kind of an annual how does that flow.
Flow through.
That's probably more on a one off basis, Eric as it relates to different types of incentive programs, we have with various vendors for hitting certain thresholds or where targets.
Josh it's unlikely for the next time, we might see it would be in <unk> again next year are there multiple oh.
Okay.
In scenario, yes, yes, okay perfect. Thanks for taking my questions today guys.
Thank you.
Thank you Eric and as a reminder, if you would like to ask a question you may do so by pressing star followed by one on your telephone keypad.
And our next question comes from Catherine Mealor from K B W.
Catherine Your line is now open if you would like to proceed with your question.
Thanks, Good afternoon.
Good afternoon, hi back to embrace Kathryn.
Oh.
I don't wanted to thank Seth Tonight is going to be hopefully fine [laughter].
But.
So.
W start with growth and.
Just.
Mrs.
And about five minutes late to the call. So if you already gave a growth guidance I apologize for missing it but how are you thinking about.
Gross moving into next year, what a good loan growth target is and then maybe within that conversation on securities are you are you feeling.
Hum.
Open to putting more of the excess liquidity into.
Securities as well in the next couple of quarters, just given that we're in a better rate environment.
[noise].
Yeah.
Yes, Catherine Dan We did we did not cover that earlier a couple a couple of.
More things.
In response to your questions just thinking about loan growth.
It's a little more challenged you just by virtue of the current liquidity situation that we are sitting with in terms of net netting out.
<unk>.
Netting out asset growth on the loan growth side of things.
Different.
We were looking at the type of production that we are driving in the last few quarters.
Just shy of 800 million $822 million of commercial production this quarter.
We see any return to normal in terms of run off then.
Commercial loan growth in that 8% to 10% should be.
Reality.
And that's all the while trying to.
Redeploy some of this liquidity in some strategies and I don't know if you've heard Phil talk about the mortgage business, but finding some ways to put more on portfolio.
We go then we would customarily by virtue of selling so trying to drive some.
And here in the next couple of quarters, a little more utilization of that excess liquidity. So I would I would say on the commercial space, 8% to 10%, we're looking at and on a go forward basis, and then stabilizing.
Foley that mortgage run off stabilizing that portfolio and then modest.
Low to mid single digit growth in the consumer space.
Yeah, and Catherine as it relates to the investment portfolio.
Currently don't really have any specific plans for increasing it relative to the size of the.
<unk> of the overall balance sheet, we did during the current quarter do some repositioning.
More specifically for <unk>.
Interest rate risk management purposes, and shortening up on the on the duration of some of the.
Asset backed mortgage backed type components of the portfolio.
But I think.
To Dan's comments, we certainly will look to redeploy into mortgage in the mortgage and other elements of the loan portfolio first before.
We would we would think about or consider expanding the size of the investment portfolio.
That's great.
For the margin any way right.
Okay.
Thats all I got thank you so much.
Thanks, guys Youre welcome.
Thank you Kathryn has a final reminder, if you would like to ask a question you may do so by pressing star one on your telephone keypad.
Our next question is from Brody Preston from Stephens incorporated your.
Your line is now open if you'd like to proceed.
Hey, good afternoon, everyone.
Hi, Rhodic I've already.
I guess I just wanted to stick on on the growth I know you talked a lot about it but I actually thought you know this quarter was pretty solid fee on an ex PPP basis, particularly on the C&I.
C&I side, and so I guess I just wanted to ask was there anything specific that drove the strength in our core commercial business portfolio.
The higher line utilization I know that those are still.
Pretty low, but you know what kind of drove the strength that you saw there.
Yes, Brian this is Jay.
Dan.
We are blind Utilizations are hovering right, where they had been in the last three or four quarters. So we're not seeing anything material.
Happening there.
Credit the success with the hustle of our bankers that are you know.
Out on the street developing new relationship.
Ships.
And while it is strong I would tell you that with the degree of production level of production that we are putting out.
Yeah.
The runoff that we've experienced that as a headwind against that.
As atypical and it's.
It is curbing what could be really great.
Really great growth in the in the commercial portfolio, so and those are not that's not losing clients.
Clients that are having successful outcomes, whether the sale of a business or the sale of a large commercial real estate. So.
The other good the other good sign around.
On the production this quarter is.
About 25% of that is in our builder related business and as you might know not very much of those dollars go out the door day, one and so we have over the course of the three quarters built a nice.
Kind of deposit on the future so to speak in terms of future fundings.
In that in that particular book so.
But I think the result as is.
Our efforts of getting out while at the same time some of our competitors may still be a little more inwardly focused and.
We're winning more than our fair share of opportunities in the marketplace.
Got it.
And then just as it relates to fees.
Do you happen to have what the assets under management was for this quarter.
I'll grab that for you.
Just give me.
Second if you have another question.
No actually welcome Dan maybe.
Actually Bob very much Dana go ahead I'm not looking at that let me let me.
Follow back up on part of Eric's question earlier, which was the fair value Mark impact.
So the earnings for the quarter actually in the body of the press release of the income statement review.
It's mentioned that Theres about 800000.
Net overall fair value amortization that was included in the quarter relative to net interest income and the margin.
To clarify.
Go ahead, Barry if you have something else there.
Yeah, Yeah I wanted to just maybe one for you call. It you know just.
Tom.
Liability side.
Are there any more I guess within the CD book are there any more kind of natural maturities that are kind of rolling off here in the fourth quarter and the first quarter of next year and if there are do you happen to know what the what the rates on that on those CBS look like.
I don't know exactly know the specific rate of what's going to roll off the weeks, we continue to have.
Portions of that CD portfolio.
That's certainly at the higher rate levels continue to.
To work their way down.
And in terms of.
Maybe look at it in terms of the impact on that as we go through.
From this year to next it could be.
Probably worth another.
10 to 12 basis points on the cost of time deposits themselves.
Just looking at it as we projected into next year. So there's still some.
Additional room for that to run down and to have some impact to the overall cost of <unk>.
Money into and to the margin but.
That portfolio is getting smaller and smaller as we.
As we speak so.
Got it.
Okay.
Brody.
Go ahead in the quarter through our three wealth groups ended up at.
$5 8 billion at the end of at the end of the quarter.
Okay, great. Thank you very much and then.
My last couple of questions as it relates to capital.
<unk>.
I thought at the bottom of the slide back on the capital position.
So you got about a little over 1 million shares left under.
Under the current authorization that we repurchase I just wanted to get a sense for.
Appetite.
Here.
At the current price just given its moved up.
I'll let.
From the from the $43 four youre buying back this quarter.
Yes, I think.
Appetite.
I think we certainly will continue to evaluate as as we trade and hopefully trade forward here just.
To what degree.
In terms of price that we want to we want to entertain but I think by and large here I think our general thought processes to stay committed to.
Buying everything that is at least authorized at this point.
Through through the end of the year.
And to do so accordingly, so I think the other element of it it will be at the other end of that will be to look to.
Re engage another another.
<unk> plan, just so that we always have something out there in force, which will ultimately give us as much flexibility as we possibly can have in that regard.
Got it.
Alright, Thank you very much for taking my questions.
Sure. Thanks Brody.
Thank you Brady and we currently have no further questions. So I'd like to hand back to our speakers.
Okay. Thank you. Thank you Harry Thanks, everyone for joining us today. If there are no other questions that will conclude our call and we really appreciate you taking the time to participate and have a great afternoon.
Other off.
Thank you to everyone who has joined US. This concludes today's call and you may now disconnect your lines.
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