Northpointe Bancshares Inc (NPB) 2025 Q2 法說會逐字稿

Greetings. Welcome to Northpointe Bancshares Inc., Q2 2025 earnings conference call. (Operator Instructions) please note this conference is been recorded. I will now turn the conference over to Brad Howes, Chief Financial Officer. Thank you. You may begin.

Thank you, Darryl. Good morning. Welcome to North Point 2nd quarter 2025 earnings call. My name is Brad House, and I'm the Chief Financial Officer. With me today are Chuck Williams, our Chairman and CEO, and Kevin Combs, our President.

Additional earnings materials, including the presentation slides that we will refer to on today's call, are available on North Point's investor relations website at I.Northpoint.com.

As a reminder, during today's call, we may make forward-looking statements which are subject to risk and uncertainties and are intended to be covered by the safe harbor provisions of federal securities law.

For a list of factors that may cause actual results to differ materially from expectations, please refer to the disclosures contained within our SEC filings.

We will also reference non-gap financial measures and encourage you to review the non-gap reconciliations provided in both our earnings release and presentation slides.

The agenda for today's call will include prepared remarks, qualify a question and answer sessions, and then closing remarks. With that, I'll turn the call over to Chuck.

Thank you, Greg. Good morning, everyone, and thanks for joining. Before I begin, I'd like to thank our North Point team for their incredible dedication to our bank and their unwavering commitment to our clients and customers.

This is now our 2nd quarter end since the IPO in January, and I'm very pleased with the momentum we've gained and how we have continued to execute on our strategic plan.

Before I turn the call over to Kevin and Brad to dive into the details, I'd like to take a moment and share some highlights from our financial and operating performance.

On side four, we lay out our performance for the 2nd quarter of 2025. For the quarter, we earned $18 million or $0.51 per demoted shares. As you can see, all of our performance ratios improved from the first quarter level, highlighted by a 1.34% return on assets and a 14.49% return on average common equity.

We also increased tangible book value per share by over 14% annualized, which reflects the strong financial performance and organic capital we generated during the quarter.

Let me start with an update on the mortgageur program or NPP, which is our distinctive alternative to the traditional warehouse lending model.

We saw another quarter of exceptional performance in the NPP business with period ending balanced growth of $423 million and average balanced growth of $759 million for the prior quarter. We funded over $9 billion in loans through the channel in the second quarter, which is the highest quarterly level ever for North Point.

Overall, we're very pleased with the success and growth trajectory of the MPP business.

Through two quarters, we are slightly ahead of the balance sheet growth we outlined during the IPO and have also outpaced our initial projections in terms of facility commitment, which positions us well nicely for continued success.

Totals were $2.9 billion as of June 30, 2025. With the recent success and commitment growth, I've just outlined, we believe we're in good position to exceed our original growth forecast. Brad would provide additional guidance during his remarks.

Our personal home equity loan business, which is tied seamlessly to a demand sweep through our proprietary technology, continued to grow as well.

For the quarter, these loans increased by just shy of $20 million. This is a 12% annualized growth rate. Our retail lending channel closed over $665 million in residential mortgages during the quarter, which was in line with our forecast. Our retail origination staff continues to excel, even in the current rate environment, which has remained within a tightly or relatively tightly banned during 2025.

Regardless of what happens to rates going forward, we will continue to take our share of the industry mortgage business.

And we are well positioned to quickly capitalize on mortgage volumes should rates decline.

Lastly, we recently completed an agreement to bring in approximately $250 million in new custodial deposits, which is expected to occur during the third quarter of 2025. This is an important part of our overall funding strategy as these types of agreements help bolster our core deposits and reduce the reliance on wholesale funding.

During the IPO, we said that we would look for ways to grow our non-brer deposits with the mortgage verticals we operate in. This transaction helps that, and we'll continue to explore similar types of relationships and opportunities to add core deposits. With that, I'd like to now turn it over to Kevin. And talk about our business lines. Kevin.

Thanks, Chuck. Good morning, everyone. On slide 5, we highlight our NPT business, which is our version of mortgage warehouse lending. We utilize our proprietary state of the art technology stack to offer a purchase program to mortgage bankers nationwide.

As Chuck highlighted, we built up the success in the first quarter and carried that momentum into the second quarter. Period and balances increased by $423 million, or 69% annualized. Let me break that growth down a little further for you. First, we increased facility status for five existing clients which totaled [$250 million] in additional capacity.

Second, there were 3s, new clients brought in which totaled $500 million in additional capacity. And third, we saw a slight increase in the overall utilization of our existing clients. During the second quarter, we had average NCC participation of $8 million. Participations remain an important component of our overall strategy as they help expand that interest margin and manage the balance sheet within our capital framework.

On a year to day basis, and MPP balances have increased by $1.2 billion, which is slightly above our plan.

Average balances will vary a bit more due to the timing of fundings and payoffs, but are largely in line with expectations.

We continue to generate strong returns on the business, with average yields of 7.07% during the quarter. If you include ee, these yields increase to 7.23%. This quarter, we funded the majority of that growth with brokered CDs. Average funding costs have remained in the mid-4s, given us a fee adjusted spread of close to 2.75%. I'd expect this trend to continue or improve slightly for the remainder of 2025.

Now turning to retail banking on slide 6, I'd like to highlight the results of the three main businesses within that segment.

Starting with residential lending, which includes both our traditional retail and our consumer direct channels, we continue to perform well and take our share of industry volume.

We originated $665.5 million in mortgages during the second quarter, of which we sold $589.6 million. This represents approximately 89% of the total production in the quarter, which is similar to last quarter.

Of that, 78% was in our traditional retail channel and 22% was in Consumer direct.

In the second quarter, we sold approximately 80% of our saleable mortgages service released, which is consistent with the prior quarter percentage. Additionally, 72% of our overall production was purchased business in the 2nd quarter, flat from the first quarter level.

Within our help for investment portfolio, we continue to originate and retain the first lien home equity lines tied seamlessly to demand depositsweep accounts, including what we commonly refer to as AIO loans.

For the quarter, we earned $19.6 million in net gain on sales loans. That amount includes fair value increases on the health or investment loan portfolio and the lender risk account, which will cover in more detail.

We continue to look for opportunities to create additional efficiencies using technology and hire new talented lenders within the channel. In the 2nd quarter, we hired 3 new mortgage urging professionals to help us continue our growth within the retail lending channel.

In the middle of slide 6, we highlight our digital deposit banking channel where we feature our direct success platform and competitive product suite.

Our funding strategy and deposit franchise are much different than those of a typical community bank.

We believe our strategy is quite simple but very effective.

We ended the second quarter of 2025 with $4.5 billion in total deposits. The breakdown of these deposits is detailed in the appendix on slide 12.

The majority of our deposit growth compared to the prior quarter was from brokered CDs, which used to fund the strong growth in MPT.

The remainder of our deposit products were down slightly from the prior quarter.

Not that sparing demand deposits complete custodial deposits and deposit balances from our MPP clients.

On the custodial side, there tends to be a little more variability in the quarter end deposit balances which drove the length quarter decrease.

His total deposits remain a critical piece of our funding strategy and a key benefit of our servicing business.

As Chuck mentioned, we'll be bringing over $250 million of deposits during the third quarter of 2025.

A portion of these balances have already come over in July.

We do not anticipate any significant changes to the overall cost of funds, but these deposits will help lower our wholesale funding ratio in the 3rd quarter and beyond.

On the right side of slide 6, we highlight our specially mortgaged servicing channel where we focus on servicing firstly home equity lines tied seamlessly to demand deposit sweep accounts, including what we commonly refer to as AIO loans.

On the last quarterly earnings call, I highlighted our strategy to private label outsource the non-specialized mortgage servicing to a scale subservicr. That work has been completed and we are now realizing those cost savings.

Excluding the 300,000 negative adjustment on the change of fair value MSR, we earned $1.8 million loan servicing fees for Q2, which is up slightly over the prior quarter level. Including loans, we outsourced to a subservice, we service 12,700 loans for others with a total UPB $4.0 billion as compared to second quarter, 2025.

We also started servicing for two additional new investors, the first in home equity lines seamlessly demand deposit, sweep account type of products during the quarter. Turning lastly to asset quality and slide 7, which remains one of the largest risks for any bank and one we continue to monitor very closely.

Similar to what you're likely hearing from peers, our aspect quality metrics remain solid. We are not seeing any systemic credit quality of borrower issues with the small amount of charge offs we are taking coming from isolated circumstances.

Last quarter, I discussed the increase in delinquent loans which were partially attributable to the transfer of loans to a scaled self-service during the quarter. The majority of these have since been made current, paid off, or converted to permanent financing andso, which helped drive the decrease in non-performing assets and loans past due 31 to 89 days from the prior quarter.

Now provide some additional details on our asset quality. We have a very sophisticated and granular allowance for credit loss process, and we spend a great deal of time analyzing the various risks. Our allowance for credit losses was $12.4 million in the second quarter of 2025, which reflects our discipline underwriting, diligent risk controls, and low levels of loss history.

As you can see at the bottom of slat 7, our net charge offs remained historically low. For the second quarter of 2025, our net charge-offs were $488,000 or 4 basis points of average loans for investment.

Virtually all of the known portfolio is backed by residential real estate, which typically carries much lower average loss rates than other asset classes. At June 30, 2025, MPC represented 49.6% of all loans, and we've continued to experience pristine credit quality in that portfolio.

Our residential mortgage portfolio is also high quality, seasoned, and geographically diverse. At June 30, 2025, our average FICO was 751 and our average LTV when you factor in mortgage insurance was 72%.

I'd now like to turn the call over to Brad to cover the financials. All right.

Thank you, Kevin. As I go through today's five presentations, I'll be incorporating full year 2025 guidance into my commentary.

Let's begin on slide 8. We reported 2nd quarter of 2025 net income of $18 million for $0.51 per diluted share. This is up from $15 million in the first quarter of 2025 and $11.4 million in the second quarter of 2024.

Our performance ratios all improved for the second straight quarter with a 134 ROA, a [1449] return on average tangible equity, and a 53.8% efficiency ratio. As a reminder, our non-gap reconciliation on slide 14 provides the details of the calculations and a reconciliation to the comparable GAAP measure for all our non-gap metrics.

Net interest income increased by $6.1 million over the prior quarter level. This reflected a significant growth in MDP average balances, along with the nine basis point improvement in net interest margin of the prior quarter.

Our yield on interest earning assets benefited from the continued improvement in the mix of loans within the health or investment portfolio. We continue to experience strong growth at NPP and AIO loans, both of which carry higher average yields and the remainder of the loan portfolio. Our cost of funds also decreased by 3 basis points from the prior quarter.

This improvement reflects lower costs on our money market, savings and retail CDs, partially offset by the lower average balance of non-interest bearing deposits that Kevin highlighted. That interest margin was 2.44% for the second quarter. I expect us to stay in the 245% to 255% range -- 2.45% to 2.55% range for the full year of 2025, but likely at the lower end of the range.

My guidance is predicated on some recent trends that we were seeing, including slightly lower MPP yields, slightly higher broken CD costs, and lower balances of non-interest bearing deposits. I would expect some of these trends will improve over the remainder of 2025, but if they do not, we would likely fall in the lower range of my margin guidance.

Average interest rate assets increased by $766 million from the prior quarter, given the strong growth in NDP loans and continued runoff of the residential mortgage and construction loan portfolios.

With all the positive momentum in that business that Chuck outlined, we're increasing our overall NPP guidance for 2025. I'd expect our NPP loan balances to increase to between $3.1 billion and $3.3 billion for Q3 2025.

And that increased to between [$3.3 billion and $3.5 billion] for Q4 2025. I would also expect a similar growth rate for average balances. We're not making any changes to our AIO loan guidance for the year end of 2025. Which I'd expect to increase by between 7% and 11% of the June 30th, 2025 level.

Excluding NPT and AIO loans, I'd expect the rest of the loan portfolio to continue to decrease by between 5% and 8% from their June 30, 2025 level. We had a provision for credit losses of $583,000 in the second quarter of 2025, which is down from $1.3 billion in the prior quarter. Let me break that down for you. The largest driver was the decrease in total delinquent and non-performing loans Kevin discussed.

We also saw the continued runoff of residential mortgage and construction loans, both of which carry higher average loss rates than MPP or AIO loans, which is where all our new growth is coming from.

These improvements were partially offset by a worsening of the network on the forecasts, including the impact of tariffs, home prices, unemployment, and interest rates.

We continue to experience a relatively low level of charge-offs, and I'd expect that trend to continue with any additional provisions being driven by loan growth, credit migration trends, and changes in the economic forecast.

Our non-interest income decreased by $435,000 from the prior quarter, which was driven primarily by a lower level of fair value gains and a decrease in other income reflecting the gain of $2 million on the extinguishment of FHOB borrowings in the first quarter of 25.

We've added a new chart to the appendix on slide 13, which breaks out three of our fair value assets and their associated quarterly increases or decreases. These assets tend to move up or down with interest rates and are not part of my revenue guidance each quarter.

That gain on the sale of loans was $19.4 million for the second quarter of 2025, and it includes capitalization of new MSRs, changes in fair value loans, and gains on the sale of those loans. For the second quarter, this included a $1.3 million increase in the fair value of loans over investment and a $497,000 increase in the fair value of our lender risk account with the Federal Home loan bank.

The change in fair value of loans out for investment included an increase of $1.4 million which is related to the agreement to sell $40.3 million of non-annual home equity loans during the quarters. Excluding all these items, net gain on the sale of bones would have been $17.5 million which is up from $14.9 million on a comparable basis in the first quarter of 2025.

Remainder of the fair value changes within the net gain on sale of old line item relate to regular hedging and capital markets activities within our mortgage banking business, including any changes in fair value of the lock pipeline. For 2025, they are forecasting total sale of mortgage originations of $2.1 billion to $2.3 billion. This estimate assumes no significant movement in mortgage rates over the remainder of the year.

Based on the volume terms we're seeing today, I'd expect that we would be towards the lower end of the sale of mortgage origination range.

Consistent with last quarter's call, I'd expect to earn an all-in margin of 2.75% to 3.25% on those salable mortgages. This guidance is a blend of our traditional retail and consumer direct channels, as well as loans sold servicing, released or servicing retained.

It also includes the benefit of any new lender risk account receivable created by selling loans to the Federal Home Loan Bank. It does not, however, include any fair value changes on our loans self or investment portfolio or any fair value changes on the FHOB lender risk account.

For the second quarter, our data on sale margin exceeded the 2.75% to 3.25% range, and I'd expect our full year margin will come in towards the upper end of that range. MPP fees increased by $214,000 from the prior quarter, driven by the strong level of purchases. As if any change in our participation balances, I'd expect MPP fees to continue to increase from their current run rate and range to the level of between $5 million to $6 million for the year.

Servicing fees were $1.5 million for the second quarter of 2025 and included a fair value decrease of $302,000 on the MSR asset. Excluding that decrease, loan servicing fees were $1.8 million for the quarter. I'd expect that quarterly run rate to increase slightly over the remainder of 2025 as we continue to modestly increase the size of the servicing portfolio.

Non interest expense was up $2.4 million from the prior quarter, driven primarily by higher salaries and benefits and professional fees. Salaries and benefits expense increased $1.9 million over the prior quarter, driven primarily by the $1.7 million increase in variable mortgage compensation, which was consistent with the quarter increase in mortgage production.

Professional fees increased by $565,000 on a week quarter basis, driven primarily by higher public company compliance costs. 2025, I'd expect total annual non-interest expense in the range of $128 million to $132 million.

This increase from my prior guidance reflects higher variable NPP compensation, which is related to the stronger respected performance in that business, along with higher expected salaries and benefits and professional fees from being a public company.

Our effective tax rate was flat at 23.67% for the second quarter of 2025, which I would expect to be consistent for the remainder of the year. Returning to the balance sheet on slide 9, our total assets increased to $6.4 billion for the second quarter of 2025. This was driven primarily by the increase in NPP and AIL loans and a higher level of cash and loans held for sale, partially offset by runoff from the remainder of the loans for investment portfolio.

Kevin provided details on our funding and deposits this quarter. The wholesale funding ratio was 70.7% at June 30, 2025, up from the prior quarter level. Looking forward, we'd expect to continue to fund MPP loan growth through a combination of brokered CDs, retail deposits, and other sources of non-brokerd deposits where possible.

Lastly, on slide 10, we outline our regulatory capital ratios, which are estimates pending completion of regulatory reports. Our capital levels remain strong both at the bank and the consolidated entity level. I'd expect that existing capital plus the additional capital we organically generate through earnings will continue to be sufficient to support the forecasted growth we have in our plan.

With that, we're happy to now take any questions. Darryl, can you please open the line with the Q&A.

Thank you. We will now be conducting the question-and-answer session.(Operator Instructions)

Crispin Love, Piper Sandler.

Thank you. Good morning. First, can you just discuss some of the drivers of the MPP growth in the quarter, how you were able to do as much as you did? Was that partly due to some of the capital from the IPO, or did that not have an impact in the second quarter and then just on what type of capacity you have to fund on a quarterly basis for MVP going forward?

Yeah, so I can.

I can take that and Brad and Kevin can follow.

Up. So it, it's, we brought.

A fair amount in the first quarter after the IPO with the additional capital, we brought. As indicated in the IPO, approximately [2 to 400 million] that we were participating out, so that was added to the balance sheet, along with some pent up demand that was really the driver, of the IPO last fall.

So. We were able to execute, on those new commitments. So there was some demand, like I said, dating back to last fall, there was some outstanding balances that we brought back. All of this, again, was covered, during the presentations in the IPO.

And, frankly, we just had tremendous success, developing some new accounts, our, Yeah, our managers have done a great job, not only increasing our existing clients, but also adding, a lot, a fair amount of, new clients that that he did not, even anticipate. So, and we're looking for that growth to, continue to.

In the 3rd quarter and beyond for the balance of the year.

So does that answer your question?

Yes, it does. Appreciate that, Chuck. And then, second question for me, just on the nip trajectory, Brad, I heard that you reiterated the [245 to 255] margin guide, but likely be near the lower end of that halfway through the year you're slightly below that level. As we look at the second half, can you just discuss the cadence a little bit? Are you expecting sequentially higher margins through the rest of the year in the third quarter and 4th quarter, and could those levels even be in excess of that [250, 255] level in order to get to the full year level of around [245 to 250] if that makes sense?

Yeah, that's, Kristen, and you're right, in order to achieve in that range, we would have to average, 10 to 20 basis points higher than we are right now, and higher than our full year guidance, projected. And I think, what I'd say about the margin guidance is that, we were a little off of where we thought we were going to be for the reasons I kind of outlined that, NDP, deals coming in a little bit lighter.

The brokered TV market, picked up a little bit in the 2nd quarter more than we thought, 5 basis points or so, and then our not interest bearing deposits, we saw a decrease which was, timing related, so I suspect that, Hopefully all of those go back in our original favor. We're already seeing some, favorable trends in the brokered CD, our yields on NPP were, stronger towards the second half of the quarter. So I've got some good, visibility and, a decent level of confidence that we will fall within our original projection, of the guidance range, but, if those things don't materialize like we think. I just wanted to be, conservative and give you guys an indication that we would fall towards the lower end of the range and, the biggest driver I'd say of what's going to change in our margin as you look forward is that we continue to increase the percentage of MPP and AIO loans, both of which carry, very strong yields relative to our residential mortgage portfolio, which has, average yields of, 4% to 5% typically. So as we replace and improve the mix of the overall margin, that drives an improvement in that margin in the 34 quarters.

Perfect, thank you.

And if I can just Put squeeze one more in on the AIO loan product. Can you just share a little bit of color on recent trends there? How has the demand been in the AIO loan product? I know there wasn't any change in the guide, but just curious on trends and and and what you expect in the current environment.

Yes, this is Kevin. So I, I'll answer it two ways, I guess. So with our own book, continuing to see strong demand there, that is the product we're putting in our HI book. Brad provided the guidance there so we would still continue to see a net increase in AIO throughout the rest of the year. Also, and then from our specialized servicing sub-servicing business unit, the product in general is also continuing to increase, in this particular environment. So still strong demand across the board.

If I could just add one thing to think about these loans, they advertise quicker than a typical mortgage. So you do have, some pretty good pay downs during the quarter. We've been able to outrun those and still grow balances, which is. A testament, I think, to the strong book Kevin was talking about.

Perfect. Thank you. I appreciate you all take my questions.

Hey, thanks.

Thank you. Damon DelMonte, KBW.

Hey, good morning, guys. Thanks for taking my question. Just looking to get a little bit more color on the, custodial, account agreement for the $250 million. Could you just kind of give a little bit of color, I guess, kind of behind the process there of getting those on and the prospect. For adding more of those types of, relationships. And then also kind of how does the funding work on that? I think the commentary was that, it's not going to be materially lower than the wholesale funding, with the brokered CDs. So just kind of curious about some of those dynamics. Thanks.

Sure, this is Kevin. I can start. So, yeah, negotiate directly with the holders of those.

Custodial funds is the way we do it.

The way the strategy out, during the IPO process. Also that this would be a way we TRY and diversify a little bit away from our our typical just wholesale funding sources.

So we're able to ment with counter party, their agency. So we have those here for various relationships we have from a perspective slightly better than the deposit rates we did negotiate with our strategy. This is twofold. One reduces our overall wholesale funding concentrations, and second, less FDIC insurance premiums are required on balances that are non-brokered funding. So a trio of benefits coming through this, and we are working with other counterparties, similar, I'd say smaller types of custodial funds to bring in in the future.

Got it. Okay, I appreciate that color. And then on the capital front, just kind of, the comment I think was made earlier that you feel adequate with your capital levels, kind of given the growth. Just, do you have any targets on capital ratios as to where you feel comfortable going down to? Or do you feel that, just given the growing profitability and the internal capital generation plus the excess capital just puts you in a favorable position to kind of keep stride and not have to take the pedal off the gas at all.

Yeah, I think the short answer is yes to your question, David. We have, a capital plan and we've got, minimum capital ratios that we're required to maintain internally. Our plan does not have us go. Any below those, we still maintain a buffer to all those capital ratios. We look across all eight capital ratios as well as our TTE ratio, we forecast out the balanced growth. I think our guidance was that MPs to grow, an additional $100 million to $200 million over the original plan. You have the capital to support that still.

And this the capital that we have, when you think about it, it's self-serving because we generate retained earnings, which also increase our capital, we pay a nominal dividend, but all of that capital we generate goes towards growth. So as we perform well and we have, good, expectations about the remainder of the year and in the next year we can generate organically the capital we need to continue to grow that business within our capital framework.

Great, okay, so, and, as I mentioned, part of the prepared remarks, we also would leverage our participation program further if we're overly successful, beyond what we projected from NTP perspective.

Got it. Okay, great. Well, thank you very much for taking my questions.

Thank you, David.

Thank you. Christopher Marin, Jenny Montgomery Scott.

Hey, thanks. Good morning. Chuck, I wanted to ask you about the big picture and as NPP grows, do you see anything in terms of other players who are either pulling back or perhaps the macro is not as popular that allows you to kind of position yourself now where if rates changed on the road, you've kind of made more, even more inroads.

Hey, thanks for your question, Christopher. I'm a little confused by it.

So if you look at the macro in terms of the as you're growing your NTP program, do you see changes externally in terms of players exiting the business that allows you to continue to to accelerate there?

Do you see other consolidation impacts that it can drive the business further than what you've done.

Here, in this, last two quarters?

Okay. Are you talking about our competitors in the warehouse space or our mortgage, company partners? So it's really, it's competition.

Yeah, the competition. We haven't seen the consolidation, like we did last year. So really our organic, growth or the, I should say the, additional facilities, that we've gained have, been, quite frankly, because of the, sales team that we have, the tech stack that we operate under the ease, and frankly, we focus on it as one of our primary business lines is, I think our competition, is, certainly worthy, but I'm not sure that anybody focuses on it like we do.

And, I think it's again, a combination of factors that, puts us in a great position to not only get to share that we want from our existing clients and just regular, new business, but I think the word, continues to go around, like I said, the ease of our tech stack and some other competitive things that, kind of go, I think that you can't really put it on paper and that, we listen to our clients and so I think that's, there, there's some of these intangibles again, that you can't just read, on financials that puts us in a great position, not only for the growth that we We put together so far in the first half, but, we're we're going to continue that momentum in the second half of the year.

So Yeah.

So I guess to kind of sum it up, no matter what our competition, does that, we have a program that I think is second to none, and I think it's going to continue to shine, that we, now that we have the strong capital base, that we've developed with the IPO and, I think the continued success is, there for the taking for us, so.

Great, that's very helpful, thank you. And then I just had a quick, question on, how the fair value marks, could play out in the next couple of quarters. Is there a, one rate that we should be watching to just kind of gauge how that moves quarter to quarter?

Yeah, cause I'd say generally, you kind of watch, your two indices that I would look at would be the 10 year. The better indices would probably be to look at, some kind of mortgage rate index, whether it's, I think Sanny has a kind of conventional 30 year, index, and if you follow along with what happens with mortgage rates, that'll give you a good indication of, the change of the increase or decrease in fair value that, we have each quarter on those three assets.

Great, that's all. Thank you very much.

Yeah, thank you, Chris. Thank you. This now concludes our question and answer session. I would now like to turn the floor back over to Chuck Williams, Chief Executive Officer for closing comments.

Great. I want to thank all of you for joining today's call. In closing, I'm very proud leading an outstanding North Point team, and I'm pleased with our success so far this year.

Our momentum remains strong as we continue to be nimble, opportunistic, and meet with an entrepreneurial spirit.

We'll continue to deliver on our strategic plan for the remainder of 2025 and beyond. We're excited to share more with you in the upcoming quarters and look forward to seeing many of you at some upcoming investor conferences that we have in 2025. With that, again, thank you all and have a great rest of your week.

Thank you ladies and gentlemen for your participation. This does conclude today's teleconference. Please just connect your lines at this time and enjoy the rest of your day.