Old National Bancorp (ONB) 2004 Q1 法說會逐字稿

Good day, everyone, and welcome to the Old National Bancorp first-quarter 2004 financial results conference call. This call is being recorded and has been made accessible to the public in accordance with the SEC's Regulation FD. The call will be archived for twelve months on the shareholder relations page at www.OldNational.com. A replay of the call will also be available beginning at 12;30 PM central time today through 12;00 midnight on May 7. To access the replay dial 1-888-203-1112. Your confirmation code will be 712744. Those participating today will be analysts and members of the financial community. (OPERATOR INSTRUCTIONS).

Over the course of this conference call, the Company will make certain forward-looking statements in an effort to assist you in understanding its financial results and competitive outlook, including a discussion of the Company's future plans. These and other statements in this conference call that are not statements of current or historical facts constitute forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause the actual results of the Company to be materially different from the historical results or from any future results expressed or implied by any forward-looking statements. In addition the Company may disclose financial data based on operating earnings that is intended to provide comparable data between periods.

With us today is Old National Bancorp's Interim Chairman of the Board, Larry Dunigan; President and Chief Operating Officer, Mike Hinton, Chief Financial Officer, John Poelker, and Chief Credit Officer Daryl Moore. At this time, the call will be turned over to Mr. Dunigan for some opening remarks. Please go ahead, sir.

Good morning, and thank you for joining us for our quarterly conference call. I am Larry Dunigan, Interim Chairman, and I am pleased to serve as your host this morning. Joining me this morning, again, are Mike Hinton, President and Chief Operating Officer, Tom Clayton, Executive Vice President of Administration; Daryl Moore, our Chief Credit Officer; and from New York, John Poelker, our CFO.

Before we begin, let me give you a quick introduction to myself and my long association with Old National. I have been a customer of the bank since 1975, a shareholder since 1977 and a director since 1982. We will follow our usual agenda this morning with John Poelker giving you an overview of our results for the first quarter and Mike Hinton providing some details and insights into our Ascend project. As I presume you've already read, we announced our preliminary estimate of the benefits of the program in our press release and Mike will discuss some of those details. We will then follow with Mike's comments and a question-and-answer session.

Before I turn it over to John, let me say that we are really pleased to have met consensus earnings estimates for the first quarter. We realize we've still got a long way to go before we get back to the level of earnings that our shareholders expect. We are very excited about the contribution that the Ascend program will make to that effort and I'm looking forward to participating in my first conference call with you. And now John will provide an overview of the key factors in our first quarter results.

Good morning, everyone. First of all, to allay any suspicions about what the heck I'm doing in New York, I am here for my son's wedding tomorrow. So that's the reason I am not able to be with my associates in Evansville. As Larry said, we are quite pleased with our first-quarter results in terms of clearly the turnaround from the disappointing results of the fourth quarter and meeting the consensus estimates of 29 cents a share. As you folks know quite well, the big factor in terms of the turnaround from the fourth-quarter results clearly, a significant reduction in our provision for loan losses from $26 million last quarter to -- back to a fairly normal level, as we indicated earlier in the year, of 7.5 million for this first quarter. And then the other big swing factor was the $10 million litigation charge that we made in the fourth quarter of last year.

At $19 million or 29 cents a share, we clearly recognize that we're still operating significantly below the very high levels of earnings that we experienced during the first two quarters of last year. Obviously, the continuing shrinkage of our net interest income occasioned by lack of meaningful commercial loan growth, obviously, the impact of lower levels of rates on our margin -- and those two impacts on revenue being more than offset by increases in operating expenses. It's really that sort of broad dynamic that convinced us as last year was unfolding that the Ascend project that Mike will tell you a lot more about in a minute, is really a critical component of our longer-term strategy.

There were a lot of moving parts during the quarter. And I will try to highlight those as I go through the sort of line by line analysis of the quarter's results. Looking at the balance sheet, we continue to have fairly soft commercial loan demand reflecting -- I think as you know and you've seen in other banks in this part of the country -- a continued pretty soft economy, particularly as it affects the manufacturing sector. Our commercial loan portfolio was actually down another $20 million from the end of last year and essentially unchanged since the beginning of 2003. We are very pleased that -- I mean close to offsetting that reduction in commercial loans is the very strong continued growth of our consumer loan portfolio, up another $12 million this quarter and probably more significantly compared to where we were March 31 of last year. Consumer loans are up over 12 percent. So we continue to experience good success with our marketing and sales efforts relative to our consumer lending business.

We did see a reduction in core deposits compared to where they stood at the end of the year, down about $90 million. But essentially that change in deposit structure is pretty consistent with both our expectations and probably more significantly, consistent with some of the things we've been trying to do over the over the last 12 months or so in terms of changing the mix of that deposit portfolio. Our transaction accounts -- all core deposits excluding CDs are up very significantly over last year and we have continued to let that CD portfolio run off, as we have continued to tighten up our pricing, really in response to the lack of growth in our earning asset portfolio. We've done a much better job, we think, over the last couple of quarters in sort of controlling deposit pricing on an enterprise-wide basis. And we are delighted this quarter to see that CD rates were down about 14 basis points compared to the fourth quarter and overall deposit costs were down another 9 basis points. And that really has been a very significant contributor to our ability to stabilize the net interest margin over the last two to three quarters, despite the fact that we continue to have a fairly dramatic shift in the mix of our earning assets away from higher-yielding commercial loans into investment-portfolio assets, in terms of the mix of that portfolio. So we are very quite pleased, as a matter of fact, with what's going on on the deposit side.

For the first time in quite a few quarters, Daryl is actually not going to give a speech this morning. Credit quality for the quarter actually came in quite satisfactorily, the lowest level of charge-offs we have had in about eight quarters since the second quarter of 2002 -- 3.5 million. And our total non-performing assets are actually down from the end of the year by almost $4 million with a slight increase in non-accruals offset by a $6.3 million reduction in 90 days past due and foreclosed properties. We did, despite that lower level of charge-offs, make a provision for loan losses of 7.5 and that brings our reserve now to $108.6 million, slightly higher now than our total non-accrual loans.

On the fee income side, it was sort of a mixed bag this quarter. Like most banks, we saw a significant reduction in the revenue from our mortgage banking operations as mortgage originations continued to slow compared to last year's record rates and even from the reduced levels in the fourth quarter. Our total originations in the quarter were 145 million compared to 185 million in the fourth quarter. Also, as you've seen throughout the industry, the low levels of rates through most of the quarter resulted in a reduction in the value of our mortgage servicing rights and during the quarter, we had a net write-down of mortgage servicing rights of 1.4 million. So revenue from mortgage was actually a negative number this quarter of about $300,000.

Insurance revenues were up very struggling, basically more than offsetting that reduction. On an annual basis, insurance agencies get loss experience adjustment commissions from the underwriting companies. And we had in excess of $2 million of loss experience commission adjustments that we got during the first quarter; that's obviously sort of non-recurring. But we continue to be very gratified with the contribution that insurance agency business is making to our revenue growth.

We had a couple of other nonrecurring gains during the quarter, the sale of some surplus real estate and a couple of other adjustments that added about $1.5 million to that other income line within Other Income. So that helped also to offset somewhat the reduction in mortgage revenue.

If you try to sort of normalize first-quarter other income, we reported 43.6 million. I think we're probably at the 41.5 to $42 million level on a normalized basis, assuming that we get some recovery of mortgage revenue over the next few quarters as we see this uptick in rates will hopefully offset or allow us to offset that mortgage impairment adjustment in the first quarter.

Looking at expenses, other expenses for the quarter were $80.5 million, an elevated level of expenses from the standpoint of kind of an ongoing run rate. There were two fairly significant nonrecurring expenses that we incurred during the quarter, most significant of which was $2.9 million in severance payments for three executives that left the company. Obviously, Jim Risinger constitutes the biggest chunk of that severance payment. We are not going to talk about the details of that agreement. But we will be including in the 10-Q, the complete details of the severance agreement with Jim. In addition, during the quarter, we had about $1.5 million of write-downs of some of our OREO properties. So it looks to us like the sort of ongoing run rate with regard to operating expenses is probably in the range right now of 76 to $77 million.

So the quarter was right on our expectations, right on the expectations of the analysts in the audience. And as Larry indicated, we clearly recognize that this level of earnings of 29 cents a share, return on assets, 84 basis points, just barely over 10 percent return on equity, is clearly not up to our own expectations and clearly not the expectations of our shareholders and investors. But as we look out to the rest of this year and into '05, we are guardedly optimistic about our prospects. We think we see the beginnings of some positive signs in the economy in the Midwest, particularly with regard to the job situation, although we all recognize how fragile that job situation can be. But I would think that both from an information point of view and anecdotally, we are probably about as optimistic as we have been with regard to the economy for the last 18 to 24 months.

Our interest rate risk position continues to be fairly balanced. But if we've got a slight leaning one way or the other, it's slightly liability -- rather, asset sensitive, which suggests now that as rates begin to increase through the rest of the year, it should have a positive impact on our net interest margin. And if we start to see some loan growth accompanying this economic reversal, clearly that should translate into some increases in net interest income.

Mortgage revenue continues to be a fairly sizable uncertainty. Clearly, if we get a strong kick-up in rates, that has the impact of dampening the levels of refinancing, although clearly, if it accompanies an improvement in the economy, it should lead to increased housing starts and perhaps an increase in purchase financing.

Mike is going to share with you a lot of the details on the Ascend project which we announced this morning on a preliminary basis. We do fully anticipate that there will be a second-quarter special charge in connection with the implementation of Ascend. As we mentioned in our release this morning, we plan on providing the investment community and the public a much more comprehensive estimate and details of the Ascend project in late May or early June. We are currently working at finalizing the implementation plan and putting the details around the program, in terms of benefits, timing, implementation costs and the like. So that data will -- information -- will be provided to you later this quarter. With that overview of the finances, I will turn the program over to Mike Hinton, who will bring you up-to-date on the details of the Ascend project.

Thanks, a lot John. As we previously announced, we contracted with EHS Partners late last year to undertake what we have termed the Ascend project at Old National. You all, I'm sure, recognize EHS as a global advisory firm with an excellent track record and similar previous engagements for realizing the results that are projected. And we have just wrapped up four to five months of a process of idea generation, evaluation and fine costing, during which over 3,000 ideas for profit improvement were considered. Of those, a little over 800 have survived to this point. And those 800-plus ideas have a total annualized pretax earnings impact of 55 to $60 million. This is a figure which fully meets the expectations which we had when we embarked upon the Ascend process. Of the total 55 to $60 million, we expect approximately two-thirds of that benefit will be realized from cost reduction initiatives. The remaining one-third is being derived from a variety of revenue enhancements initiatives, including adjustment to pricing, better capturability and collection rates, and also some new service and product initiatives. To accomplish the cost reduction and efficiency savings, there will be an impact upon our employment. We have a net figure of approximately 300 positions from our current workforce which will be impacted. That accounts for less than 10 percent of our employees.

With that idea phase coming to a close, we are now entering an intense implementation stage for those ideas. A core group of our very, very capable employees who served on a full-time challenge team have enthusiastically agreed to another tour of duty as full-time implementation team and they will be serving anywhere from six to 18 months, full-time, on the implementation phase of the Ascend project. That group is working right now to develop a detailed implementation schedule for all 800 ideas and a specific tracking system for each of those.

The goals which we have accepted as executive management, along with that implementation team is 100 percent implementation of those ideas and 100 percent financial benefit realization and on-time implementation for those. While the majority of the ideas will actually be implemented in '04, I would hasten to add that we will get most of the benefit in succeeding years. We expect that there will be very significant -- significantly recognizable impact from our Ascend implementation in '05 and that we should fully realize the total benefits for '06.

As John said, we expect to be back with you with more of the details and timing for this in late May. So with that, Larry, I will turn it back to you.

Well, I think that puts us in a position that we are now ready for the question-and-answer section.

(OPERATOR INSTRUCTIONS). Scott Siefers, Sandler O'Neill.

Just a couple separate questions -- first on the credit side, the first-quarter credit costs, I guess given pretty much where you guys were or in the game from a run rate standpoint -- but having said that, it sounds -- or it kind of felt like they came in more on the optimistic side or the low end of where you might have anticipated. I guess just kind of structurally, what has changed in the last few months? And is that kind of $30 million, which would be expect kind of more optimistic run rate for credit costs for '04? Is that still something that you guys are comfortable with?

This is Daryl. We are. I think that -- you know we had a very good first quarter with regard to charge-offs. We are not yet ready to say that that is what we expect for the balance of the year. We are still pretty confident that in terms of charge-offs, they will not exceed that $30 million rate that we have put on the table with you before. And we're as confident as we were when we made that statement to you late last year, early last year that that's still a representative number.

Okay, and then the provision obviously exceeded the charge-off number pretty comfortably. How would you see that then playing out going forward, especially now that I think your reserve does exceed the amount -- accrual number?

As we talked about before, we operate within a range. And we're -- at the end of the first quarter, about midway in that range. Management has decided until we're all very comfortable that the economy is chugging along and very strong that we want to push our reserve up to the upper end of that range. So I think that you could see that over the next couple of quarters that if our charge-offs remain low, we don't have, at this point in time, given what we know, any intention of probably pulling that provision down in any near-term until we get to the upper end of that reserve range.

Okay, thank you. And then just a couple separate questions on the Ascend project. One, is it possible to provide any more details at this point of kind of where some of the efficiencies will come from? I know you alluded to some of the top-level ones, but things like branch closings, for example? And then again, you sort of alluded on a high-level to when we should be hitting run rates. But I'm looking to drill down just a little more, you know, should we expect kind of 50 percent of that, 55 to 60 million run rate in '05? Is it 75? Just a little more color there? And it sounds like basically 100 percent by 2006. But just a little more detail if possible?

Let me see what I can tell you. And I am not sure I'm going to be prepared to go into the specifics of the ideas that are in there. But certainly, I could tell you that the bulk of the cost savings are expected to come in our banking operations -- about half of what we expect to get in cost savings would be as a result of some pruning in branch system, and just better processes within how we run our retail operations, as well as credit processes. What I could also tell you is that, yes, you know, if you want to think about -- John, step in if you think I'm wrong here, but 50 percent or more of that improvement in '05 would seem to be realistic.

Yes, I think that's fair. But Scott, the fact of the matter is that we really are not going to be providing a lot more detail, any more detail, frankly, until late May or early June because we recognize that you guys are trying to get a handle on when these benefits start to show up. And frankly at this point in time, it's still pretty much intuition that suggests to us that knowing that this is an 18-month implementation time frame that we do fully expect to realize a fairly significant portion of these benefits through '05. But our intent would be to provide you with a lot more detail in May. And we are just going to have to ask you to sort of hold off in trying to put this thing into specific quarters until that time.

Troy Ward, A.G. Edwards.

I'd like to take up a few questions about the mortgage line. You indicated 145 million of originations in Q1. What did the pipeline look at at the end of the quarter?

I'm not sure I can give you that pipeline number. I apologize. I'd be happy to provide you that following the call.

Okay. And if we look at the MSR, do you happen to have -- would the capitalized servicing rights -- how is that growing as well as the amortization for the MSR in the quarter?

Well, I can take a stab at that, Troy. Well, the volume in the mortgage business, as I said, through -- just in terms of mortgage originations closed during the quarter was down pretty significantly. I don't have the components of that right at my fingertips. But the biggest percentage, why don't we put it this way, probably about half of the mortgage revenue comes from the capitalization of new servicing rights and the rest from sort of gain on originations fees, etc. Suffice it to say that what we had this quarter with a million 4 of impairment charges, that that outstripped the run rate of ordinary revenue. You know, comparatively speaking, in the first quarter of last year, we had a $2.4 million impairment charge and still reported $4.4 million of net revenue. So you know what you got is a combination of servicing income and originations fees, etc. in the first quarter of last year of about 6 million compared to essentially less than 2 million this quarter. Our mortgage guys indicated, Mike -- I think it's fair to say that they saw some pick-up in originations in March, and indicated that the pipeline had increased. But I don't have those specific numbers.

We will get the specifics on that. But in the general direction, that's right. Applications are now up at budgeted levels at the end of March. And we -- obviously, we don't get paid till we close. So we're hopeful that that does portend an improvement in closings coming in April and May and some, therefore, improvement in our origination revenues.

Right. And that makes sense. But as the prepayments will also be up in Q2 -- what I'm trying to get a feel for is, I think with your 1.4 impairment -- additional impairment -- to the MSR, I think it takes you up to about 2.5, 2.5 total valuation allowance in the MSR.

Yes, exactly right.

Do you have a feeling that in Q2, obviously based on what rates have done, you should probably see a recovery. Do you have a feeling that could push that mortgage line back into positive territory?

Yes. I think that's very comfortable to say that. That's exactly what we expect.

Okay, great. Could you give us an update on the executive search by the Board? How is that going? What stage is it in?

This is Larry. I will take that one. Right now, the executive search firm, Heidrick & Struggles, are in the midst of the search. We understand that the candidates applicable are doing well. By May the 10, they plan to have 15 candidates available. They will start a process at that point, cutting that list down from 15 to eight. And then, our search firm, search committee rather, here at the bank gets involved and they will work that list from eight down to three. At that point, the Governance and Nominating Committee gets involved with the search people, and we will have interviews socially and business-wise with those three final candidates. We are still hoping to have a candidate named by sometime in July. Certainly, sometime in August of this year.

And can you give us any kind of color from your perspective, from the Board perspective, on whether or not this search is more focused on an external hire?

That's not really true. We have two very viable candidates inside the organization. They are still candidates. And it would be equally possible that we end up with an internal and/or an external.

You would put that at 50-50?

I would.

All right. Thank you, very much.

Fred Cummings, KeyBank Capital Markets.

Mike, with respect to the Ascend project, I just want to make sure I understand the targeted savings from a high-level. Specifically on the expense side, assuming the high-end at 70 percent, 42 million in aggregate, would that be an absolute number, relative to -- your run rate right now is 308 million of expenses, at 77 million a quarter. And so should we be thinking about when you use the words "annualize," $42 million absolute out of the 308 million? And I know you have some baseline growth for other; maybe your insurance business will be growing. But is that how we should be thinking about that number on an absolute basis like that?

Yes, I think that's the way we are envisioning this, Fred.

This is John. Maybe implicit in your question is you know are there offsets to that implementation cost etc. Those numbers -- that 55 to $60 million should be considered to be net improvements. And so, yes, your $42 million, all other things being equal, would come right out of that $300 million operating expense line.

Okay. And I know you now -- without a CEO in place now, and I'm just curious as to how do you look at your baseline growth in expenses? X this Ascend project, what type of growth -- is it inflation?

Fred, we've got an internal forecast and sort of a budgeting process, obviously, in place that we look at as we move forward. There will still be a slight impact in '04 of some of those insurance acquisitions that happened sort of around the middle of last year. But we now believe that the sort of baseline core growth in operating expenses should be a number reasonably close to inflation, depending on what inflation is. But it seems to me that as we look out over the next seven quarters, excluding the impact of Ascend, that annualized rates of growth and operating expenses should be in that 4 to 5 percent sort of a range, accounting for some incremental investments. We are continuing to grow our branch network in Indianapolis. We are adding to our LPO operation in Louisville. And so you know those sort of things on the margin will inch the expense growth line up a little bit over inflation. But my sense of it is a 4 to 5 percent run rate is acceptable. Keep in mind the observation I made earlier is I think the current run rate is probably a number you know sort of closer to 76 to 77 million than it is 80.

Right.

Just two other quick questions. One on the dividend, is the dividend -- can you see any scenario where you guys might consider cutting the dividend?

No.

So that's clearly off the table. Lastly, the -- Daryl, on credit, any thoughts about being -- selling any of the -- trying to sell some of your larger non-accrual loans? Or you're just going to kind of work these out -- work them out? Or might you consider trying to sell some of the larger credits?

The commercial credits, Fred?

Yes.

You know, we are always looking at that. And we don't have any present plans to do that. But we do have a list of commercial credits that we evaluate on a monthly basis and run the economics on them in terms of what we think the cost to carry and cost to sell. So at the current time, we don't have a specific list of loans or plans to do that. But that's always on the table.

Karen Lamark, Merrill Lynch.

A couple more questions about Ascend. The revenue enhancements that you expect to receive, I understand you can't give us a lot of details. But you must be comfortable enough to expect to gain those revenue enhancements. So can you give us a little more color on what your expectations are and where you might get it?

Yes, I think we do have to refer you to May. I think the most I can say is what I told you earlier. A significant portion of that is just in fee adjustments that we can feel very comfortable about and in just capturing increased collections, which I think give us a great deal of comfort. And beyond that, I think we can be more specific in May but not at this point.

Okay. And then a couple more questions. Your efficiency ratio, you don't specifically call that out as a target. But are you still targeting the high 50 percent range, maybe the mid '50s, is that fair?

Absolutely.

Terrific. And also, on the jobs that you are planning -- have you announced those job cuts already, can (multiple speakers)?

What we have announced is the 300 or so net positions which we think will be impacted. We have notified our total employee base that it will be late May before we have specifics about which jobs are impacted and we have given them that timetable that we will be back to them with the details.

Do you have any concerns about potentially losing some revenue opportunities or lending opportunities with those job cuts?

Everything that we think is a risk in terms of revenue loss has been calculated into our assessment of the benefit of this project. And I would tell you that we expect that to be minimal. But if there is then it's already accounted for and we are talking to you about a net benefit of 55 to 60 million.

Okay. And then separately, your net interest margin, can you give us any kind of guidance for the next quarter or so?

This is John. As I indicated, right now, we really believe that we are 337. It's pretty tough to be accurate on the margin down to the last basis point. But 335 to 340 with a bias toward the upper end of that range looks to us to be certainly doable over the next couple quarters.

Great. Thank you.

Troy Ward.

Sorry to come back at you like this. Can you give us an update on your expansion plans, specifically related to St. Louis and Louisville?

Sure, let me try to address that a little bit. We have got Jerry Gassen in the room with us who actually heads up banking for us who might comment on that also. What I would tell you is that we have gained a great deal of traction we think in Louisville. We now have nine people on our team, including commercial lenders, private bankers. We have just signed for a location for our main office in Louisville. And we have built about $100 million pipeline in loans in that community already. We have had much slower traction in St. Louis. We do have a producer over there today. And we've gotten you know a few deals. But clearly, we have not yet in St. Louis, met the success that we found in Indianapolis and in Louisville. Jerry, is that fair?

We will continue -- our expansion in Indianapolis is on our target range for number of offices. And those offices are meeting our budgeted projections. And we will evaluate Louisville much like we did Indianapolis and determine the plan for how many offices we would expect in the future and set up budget expectations; and those will be included in our future budgeted performance.

Let me just say this, in terms of perhaps a little caveat to that whole discussion. And I would tell you that we still consider that market expansion strategy into MSAs to be very, very important to our improvement in terms of performance and growth. But I think we recognize at the same time that a misstep in that is not something we can afford. So we have placed a real premium on making sure that we hire the right people in those markets before we proceed. And we have just been unwilling to go in without a very, very proven set of bankers to build a team around in any of those new markets. So what that should suggest to you, as we comfortably did it in Indy, we are very, very comfortable with the group in Louisville, and we have not yet been able to assemble the team that we feel is capable of us committing a lot of capital and energy to in St. Louis.

Okay. And specifically, a little bit more on the St. Louis market. I know you have the insurance acquisitions here. And has your appetite, potential appetite, for bank acquisition, decreased? And is that a function of the marketplace? Or like you just said, is it strictly a function of just finding the right team?

Yes, I don't -- I would say that our appetite for the right acquisition in a market like St. Louis or other metropolitan markets that would fit our strategy has not diminished. What I would say is that the timing on our expectation of taking on acquisitions is probably set back a little bit by our attention to our own internal operation, implementation of Ascend and making sure that we get very identifiable benefits from those processes.

Okay. And one follow-up on the Ascend project, could we get some type of feel for what a potential Q2 charge would look like at this point? Should we -- is there any way to base that on the 55 to 60 million in savings? Is that how that's going to be restructured?

John, do you want to give your speech?

The answer is you cannot. We're just -- we're heavily involved in actually determining what the amount of that charge is going to be. And we're just not in a position to speculate or give you any ranges or anything else, Troy. So, you know, for the purposes of what you guys are trying to do, we know it's a bit frustrating. I guess our -- when we actually consider the alternative, not talking about the Ascend project at all until we're ready to fully reveal all the details -- but felt like it was appropriate to talk about the sort of macro numbers. But we're not in a position to give you any guidance whatsoever on what that second-quarter charge is going to be.

All right, fair enough. Thanks.

And gentlemen, at this time, there are no further questions. Mr. Dunigan, we'll turn the conference back over to you for any additional or closing remarks.

Thank you, very much, for your time and interest in our bank. And we will look forward to talking with you again at the end of next quarter. Thank you.

Thank you, gentlemen. This concludes Old National's call. Once again, a replay will be available for 12 months on the Shareholder Relations page of Old National's Website, at www.OldNational.com. A replay of the call will also be available by dialing 1-888-203-1112, confirmation code 712744. This replay will be available until 12;00 midnight on May 7. If anyone has additional questions, please contact Lynell Walton in the Investor Relations area at area code 812-464-1366. Thank you for your participation in today's conference call.