Preferred Bank (PFBC) 2008 Q4 法說會逐字稿

Good afternoon, ladies and gentlemen, thank you for standing by, and welcome to the Preferred Bank fourth quarter 2008 earnings conference call. (OPERATOR INSTRUCTIONS.) This conference call is being recorded today, Tuesday, January 27th of 2009.

I would now like to turn the conference over to Lasse Glassen of the Financial Relations Board. Please go ahead, sir.

Thank you. Good day, everyone. And thanks for joining us to discuss Preferred Bank's results for the fourth quarter and full year ended December 31st, 2008.

With us from Management today are Mr. Li Yu, Chairman, President, and Chief Executive Officer, Bob Kosof, Chief Credit Officer, and Ed Czajka, Chief Financial Officer. Management will provide a brief summary of the quarter and then we'll open the call up to your questions.

During the course of this conference call statements made by Management may include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based upon specific assumptions that may or may not prove correct.

Forward-looking statements are also subject to known and unknown risks, uncertainties, and other factors relating to Preferred Bank's operations and business environment, all of which are difficult to predict and many of which are beyond the control of Preferred Bank.

For a detailed description of these risks and uncertainties please refer to the documents the Company files with the Federal Deposit Insurance Corporation, or FDIC.

If any of these uncertainties materializes or any of these assumptions prove incorrect, Preferred Bank's results could differ materially from its expectations as set forth in these statements. Preferred Bank assumes no obligation to update such forward-looking statements.

At this time, I'd now like to turn the call over to Mr. Li Yu. Mr. Yu?

Thank you very much. Thank you, ladies and gentlemen, for attending the earnings conference. Because of our press release which the wire delayed today, and I would like to have Ed Czajka to read off the operation results for the first quarter and year, first, and then I will follow-up with my comments. Ed?

Thank you, Mr. Yu. I'm just going to go ahead and read the first paragraph to kind of give some color on the quarter and also to give everyone a chance to get the press release and digest it here.

Preferred Bank today reported results for the quarter and year ended December 31, 2008. Preferred Bank reported a net loss of $468,000 or $0.05 per diluted share for the quarter and a net loss of $473,000 or $0.05 per diluted share for the year ended December 31, 2008. This compares to net income of $5.8 million or $0.57 per diluted share for the fourth quarter of 2007 and compares to net income of $26.5 million or $2.50 per diluted share for the year ended December 31, 2007.

Results for the quarter were negatively impacted by a charge of $4.5 million for an other-than-temporary impairment charge on investment securities, a provision for loan losses of $6.9 million and a write-down of OREO of $1.2 million.

Also included in this quarter were life insurance proceeds of $1.6 million received in connection with a former executive, as well as a tax benefit of $2.6 million recorded in connection with the OTTI charge that we recorded on Freddie Mac preferred stock in the second and third quarters of 2008.

Okay, ladies and gentlemen, for the time since December I thought Preferred Bank would be reporting a profit for the fourth quarter and full year. What I didn't know is how this OTTI can mushroom on us, starting from less than a million dollars to over a million dollars, to then to be about $2 million, and finally reached $4.5 million.

It seems to me the methodology and the standard has -- that was applicable in the third quarter is no longer adequate for the fourth quarter. And, obviously, that -- well, we have to use 18% as discount rate to measure the cash flow on certain investment securities, that is something that is quite astonishing to me.

But in any event for the full year that we are reporting a $0.05 loss, which I personally am not accustomed to. But having said that, during the full year we are charge off -- we have provided $23 million in loan loss provisions, over $12 million in OTTI, and approximately $2 million in write-down of real estate owned, okay. And all this add up to $37 million, and we reported a $453,000 net loss, which make me feel that we're still comfortable with the earning power of Preferred Bank.

This is especially true when you consider that we also charged our income statement with a $2 million stock option charge, a noncash stock option charge. To me, this is virtual expense that is neither common sense, valuable, nor with economic reality today. But in any event that it was expensed and recorded.

During the fourth quarter we worked very hard in reducing problem loans, and we had some good successes here and there but wasn't for the overwhelming economic events that happened in the fourth quarter and the total meltdown of credit market, we would have report better results in nonperforming loans and nonperforming assets.

Having said that, we have reduced our exposure in the for sale housing related loan for about 11%, another 11%, during the quarter, and we have reduced the overall exposure in construction loans another 13% during the quarter. Going to the new year, our effort will be continuous and consistent.

Now, common wisdom today is that we will be starting to see some weaknesses in the CRE portfolio, or commercial real estate portfolio, and I'd like to report that we have only a limited exposure in some of the higher exposure items, which we think are retail income properties and office properties. In these two areas our exposure is rather limited, and we believe that they are underwritten on a reasonable basis at the origination.

Looking forward, I think 2009 will continue to be tough and challenging for us, but if I have to make a prediction, which I never did, and if I have to make a prediction that's purely a guess, a personal guess, I would say that for Preferred Bank we've seen the worst already.

Thank you very much. That we'll now open for questions.

Thank you, sir. And, ladies and gentlemen, at this time we will begin the question and answer session. (OPERATOR INSTRUCTIONS.)

And our first question comes from the line of Aaron Deer with Sandler O'Neill. Please go ahead.

Hi, good afternoon, Li. Hi, Ed.

How are you, Aaron?

Hello, Aaron.

Good, thanks. Say, I was just wondering, I was hoping you could talk a little bit about your provision in the quarter. I just would have expected that given the continued rise in nonperformers and real estate owned that you might have taken a bigger provision -- what held you back from that?

Well, actually, it's -- we can only take provision based on whatever the prevailing GAAP rule, okay? And surely that condition is kind of challenging during fourth quarter, and, however, that being most of our construction loan property nowadays are in a prime area of Los Angeles, the value of these properties are generally well ahead -- I shouldn't say well ahead, we are comfortably ahead of the loan amount that is outstanding.

Even in cases where you have a disruption of interest payment, still that loan amount is below the value of the property. And sometimes when we are even converting to a basis for, just for measuring sake, it's a problem. What if these things turn into a problem, what is a problem value. With the new appraisal, is updated appraisal, usually taking November, December, all shows our loan is protected. So, therefore, many of the loans that seems to be challenging really does not require provisions.

Okay. And then can you talk a little bit about your, I guess maybe what the real estate trends you are seeing in the market in terms of absorption for your builder borrowers, and as well as what -- kind of talk about the workout process in cases where you're needing to do that?

Yes, fourth quarter is probably the worst time that happened -- later, especially November, December, and in some cases carried to the early part of January. Because a total state of shock is -- was everyone. And whereas previously people have high hopes, I'm talking about the builder borrowers, high hopes about their project and property, their recoverability, shows certain degree of reluctance in their part.

Any many of the builder, the customer of ours, also depend on money partners for continuous interest support, when the interests become due. And the money partners stop advancing interest, notably obviously we all know Lehman Brothers, but there are people supported by CalPERS, CalSTRS, and all kind of financial institutions, private and public and these kind of people, okay?

And it seems to me that generally speaking the mood is getting slightly better, okay, in the early part of January, but there's no proof of the situation yet.

Where the property itself -- we usually work with the customer where the property, itself, can be turning into an income producing property where it underwrites to pay for the loans, that we will work with them and have them convert to an income producing property that conforms to the current underwriting standards.

When there's a shortfall in value in cases, most of our borrower is willing to come up with additional collaterals to secure the properties. So the working effort will be continuing because these, basically these projects are usually in the good areas, okay? So most of them are willing to do that.

Now, I just want to tell you, to give you some example that we had sold three pieces, IEOs, in the months of December, okay? All three pieces are sold for the combined amount is over, even after brokerage expenses, are over the loan amount we have, because they are basically all located in the very affluent area in Los Angeles. You find there are still buyers out there try to get these items when it's well priced.

Okay. Are you having success in cases like that to just, to push your builders to slash prices or do whatever they need to do to to get (inaudible)?

They are slashing prices. Whenever they think they can get out with the loan, they're slashing prices. But the question today is the absorption rate being slow [selling pace] being slow. There's basically transactions in November and December, to me, it's nonexistent.

And, also, with the mortgage restriction that was placed by the mortgage lenders, many brokers found out selling out a project is very difficult.

Most of them wants to conform and sell. Only one or two occasions that you find them, that they are really in trouble, wants to walk away from the project. And the others who are well financed would love to hold onto the building and just turn into rental property and for sale at a future date.

Okay. I'll step back. Thank you.

Okay.

Thank you. Our next question comes form the line of Joe Morford with RBC Capital markets. Please go ahead.

Thanks. Good afternoon, everyone. And, Li, congratulations on getting through 2008.

It takes some doing!

I wondered if you could talk a bit more about the increase in the 30 to 89 day past dues? It sounds like it was mostly related to timing issues. Have the bulk of those since been resolved now here in late January?

Well, 40% of them is the timing issue type of situation is resolved. There's some portion of them is the supporter, I mean the money partners stop to advancing the interest payment and so on and cause, and when the loan is due it would cause the loan to be holding on there.

And a couple cases the loan to value ratio is still below 50%, but the overall reluctance on the marketplace is holding these projects and let it sit in state.

So we're working hard on these things case by case, item by item. And work on these kind of matters is the toughest, and to a certain extent when there's a lot of value in there some of them even also is testing the patience of the bank.

And there are many, many borrowers, some of our borrowers, some of the other banks' borrowers that we know of, they are perfectly capable of coming up with a continuing [fund] to support the project, and their project is very, very well positioned, but they choose to force the bank and try to see the bank's patience, and to see whether the bank will give them a chance to short pay off to gain further advantage on the bank.

Now, it's, you know, the threat is that if you do something about foreclosure we're going to go into bankruptcy and delay the proceeding. And it's become a case by case situation in dealing with these issues.

Yours truly is not going anywhere these days, and stay on the offense, and they are dealing one item at a time, you know?

Right. Okay. Can you also talk about the -- what looks like maybe two new commercial real estate loans in the [NPA] category and, also, a new commercial construction credit, as well? A little more details about those loans?

Oh, commercial construction, I mean loans, and commercial constructions went [through] the [NPA]. It is that particular piece is a office condo, for sale office condo, located in San Diego downtown area, in a very beautiful area, right across from some very major projects. The location is impeccable. Again, builder run out of fund, the [mass] money that was there with the builder, decided not to step-up, okay?

And we are one-quarter of the total loan, which is led by another bank, okay? And at this point in time that preliminary appraisal was made, and we have provided 25% reduction to the value of that particular property based on the appraisal which is done in October.

However, the lead bank has informed us the appraisal that was already done is in flaw, okay? And they have, they're convinced the new appraisal that ordered, which should be concluded sometime in January, should show that the value is pretty much equal to the loan amount, okay? So we are hopeful that good news to happen so we can reverse the provision in January.

And another property, which other property you mentioning about?

Yes, it looks like some increase in commercial real estate nonperformers, too?

Oh, I really have to go down through the list. Would you allow me a couple minutes?

Sure. They went from $8.9 million in September, five properties, to seven properties for $14.3 million.

Joe, I just want to elaborate on -- not to take any of your time, but on Aaron's question regarding the allowance for loan loss and coverage. I did want to point out that the coverage ratio, which I'm sure you've all seen, has gone from 1.27 of total loans to 1.56 on a linked quarter basis. So there certainly was a significant rise in coverage.

Okay, that was -- the majority of that particular (inaudible) is a $7.4 million loan, in the downtown San Diego area is the condo construction. And 14 units, condo, in the affluent downtown San Diego area.

The project is not 100% complete yet. The builder ran out of interest reserve, and was 90 days behind due on interest. The latest report, it takes $50,000 to finish and get a certificate of occupancy, okay?

And we are in the process of getting that, getting that finished and sending the receiver in, getting that finished and hopefully sell the property beginning sometime later, probably the first quarter.

Okay. And then I guess, lastly, just any comment on the status of your TARP application? And just I guess your thoughts in general about taking that capital?

Well, we applied way back in November sometime, and we had had a question asked to us, and information that they want from us, basically the FDIC. And we have replied in two different times that the information for what they want.

The last situation is that it's in the process in being evaluated in San Francisco, perhaps already been sent to Washington, D.C. for evaluation, okay? And so we are not told that the TARP is not available to us.

Having said that, as each quarter went by actually that our loss situation [was a little] less than the doomsday situation that many of us internally or externally projected, we are really also looking at the economic viability, the reality that we should do with this TARP money.

And if we get approved, which we would like to hope that, we would like to think we can get approved, which we get approved, we do not know the exact amount we're going to take in terms of this TARP money.

And, as you know, today's interest rate environment it become awfully expensive. And what is killing the situation, what is more threatening to us is because the low stock prices today, the warrants outstanding would constitute more than 10% of our total outstanding shares, which makes it awfully unattractive to me, barring other restrictions that may be aside on dividends, other things, with that.

So we have really have not finalized yet the amount we're going to be taking if approved, and anything at all.

Okay. That's very helpful. Thanks so much, Li.

By the way, just on the same line of question, I want to tell you that we think we're going to be -- we think we're going to get clearance for the FDIC insured TLGP that senior debt, guaranteed money. We think that we [enroll] on that, it was one of the firm and one of the funds that we will be participating in, that issuing roughly $25 million of FDIC-insured senior debt.

Oh, okay. Great. Thank you.

Thank you.

Thank you. Your next question comes from the line of Julianna Balicka with Keefe, Bruyette & Woods. Please go ahead.

good afternoon.

Hi, Julianna.

Hi, how are you?

I'm fine.

I have several questions, if you don't mind? One, you had in the beginning in March you talked about limited exposure to the income producing office and retail CRE, could you give us some numbers behind that?

Yes, it's in the back of the text. Retail portfolio is $55 million, okay? It's in page number six.

I'm sorry about that, I'm still kind of going through all the numbers.

Okay.

And then --

It's the last paragraph, page number three, it was $55 million retail income property with a weighted average LTV at origination of 59%, okay? And average -- I think a medium origination date sometime in May '06, something like that, okay? And on the office property, excluding the medical office property, is $50 million. Again, was LTV origination of 52%.

Okay. Or your write-down that you had took in this quarter, was that related to a specific property or some overall(inaudible)?

Yes, this is a property in the OREO write-down. It's the second item on the OREO information list. It said $12.2 million, partially completed condo apartment project in western Los Angeles. The amount represents a value of accepted [LI].

Now, I was told the purchaser agreed with the points, the lawyer has cleared that. They are finalizing the purchase and sales agreement now. And the current value of the project is $13.3 million. We're down $1.2 million, it rounded out to be $12.2 million.

Very good. And then --

By the way, events happen, I just might as well add on something. It really is the LI comes in mid January, okay? And that we accepted NOI, (inaudible) January 10th, 11th, and then we, both sides see things eye to eye right around January the 18th or something like that, and we decided we want to be provided the write-down in the month of December.

Okay. And then you were talking about the loan where there's going to be the new appraisal in January, what are going to be the changes within those appraisals that will allow for the value to increase by 25%? I mean what's one appraisal doing different from the other?

Oh, that one, okay. Basically speaking, that was originally -- frankly speaking, okay, that was the one that was told by our lead bank, okay? They said they think they're on a different set of assumptions, and that is on the property there was some kind of based on the for sale condo.

But if you use as a rental units, okay, the value tends to be higher, okay? It was a value based on the basis that is not necessarily sound, okay? And then that's necessarily the course of action.

But we, I'm not fully aware of that, I just have their president who told me that, that that's their information, I mean indication that that is the case.

Okay. Well, that's lucky, I guess.

I will cross my fingers, because I would need $1.1 million, at least part of it.

And, yes, we can all use that! And what's the NIM without the impact of the nonaccrual interest reversal?

Julianna, it probably would have been right around 336 as opposed to the 331 we posted for the quarter. Certainly, not a lot of contraction given what's going on with interest rates. Our asset yields have come down a little bit, but so have our deposit costs, as we've talked about in the past, as CDs start to re-price to this lower rate environment.

And then my final question, and I'll step back, on your FDIC baseline assessment rate, what is that going to be going forward, please?

I didn't quite get your question?

Sorry. My final question, the FDIC insurance baseline assessment rate, initial assessment rate, what's that going to be going forward?

We have not, frankly speaking, I cannot answer that question to you, okay? But at this point in time, because we have not really, how should I say, really dived into the question on that particular part, but we will study and provide the information to you.

Okay. Well, I think that's all the questions I have. Thank you.

Thank you.

Thank you. Your next question comes from the line of Don Worthington with Howe Barnes Hoefer & Arnett. Please go ahead.

Hi, good afternoon, Li and Ed.

Hi, Don.

A couple of minor things. On the -- that [BOLI] gain, is that included in the other noninterest line item?

Yes.

Okay. And then in terms of the OTTI write-downs, what are the remaining balances of the various securities? You know, for example, the CDO trough and then the bonds, and do you have anything left on the Freddie Mac?

Okay. I will let Ed read that to you. We have four pieces of our trust, pooled trust preferred, okay? The two pieces that seem to be not impaired, am I right?

Yes, we have four pools, as Mr. Yu discussed. The two that we have not recorded impairment charges -- as you recall we recorded an impairment charge in Q3 for about $1.1 million, we recorded an impairment charge this quarter for about $3.1 million, those were on two separate pools.

The other two pools we've not recorded any impairment charges, and in looking and analyzing all of the underlying issuing banks there does not seem to be any point into the future where we can determine that there's going to be any principal default on either of those pools. I've done an extensive analysis on the underlying banks utilizing Texas ratio, capital ratios, nonperforming assets, et cetera, as well as earnings, and those look to be okay going forward. Obviously, in terms of their market value there's quite illiquid assets and so they're getting -- from an OCI standpoint they're getting fairly low marks.

But the other two that we own now, the one we took a charge on this quarter, Don, we now own that at $0.22 on the dollar, and the one we took a charge on in Q3 we own at about $0.43 on the dollar. Total book value of all four of those combined is about $3.7 million.

On the corporate notes, we took two charges this quarter on two different corporate notes. The one now we own at -- the book value is $312,000. We own that at $0.24 on the dollar, and the other one we own at $864,000, and that's at $0.43 on the dollar, and those were the current marks as of 12-31-08. All the other securities in the corporate bond portfolio, none of those are other than temporarily impaired, and they are all investment grade.

Terrific, that's what I needed to know. Thank you.

Well, thank you. I knew you were going to ask that question because looking forward that's what worries me, how much more we'll have to write-down ahead of us, since we have --it's no man's land, no rule governing that, the judgments decide everything. And thank heaven we don't have much left, you know?

Okay. Thank you.

Thank you. Your next question comes from the line of Joe Gladue with B. Riley. Please go ahead.

Yes, hi, Li. Hi, Ed.

Hi, Joe.

Hi, Joe.

Just wanted to get a little bit better idea on the net interest margin, I guess, though, I don't think it'll have much effect going forward. But you mentioned putting floors on loans going forward. How much, how many of your loans or what percentage have floors on them now?

Right now, is over 40% of the loans have a floor. We previously have fixed rate loans and other [near-] fixed rate loans in the neighborhood about 13%, so that makes about 53% of our total loans have a floor.

Every renew will require a floor going forward, okay? And every new loan which -- although we're still doing a limited amount of new loans, (inaudible) we hope that will require floor, okay? And all this 40-some percent of the loans who have a floor, that currently (inaudible) operation at the floor, because the lowest floor we have other than one 4.5%, the rest of them are all over 5%.

And on the funding side, what type of a, and how much in the way of CDs or any borrowings might come due in the next -- in the first or second quarter that you might be able to reduce rates on?

We -- I mean do you have the (inaudible)?

Yes, well, I would say on the CD side it's probably about 30% of the CDs within the next quarter or two will be maturing. Probably actually if we're talking about two quarters, we're talking about probably more than half the CD portfolio will be re-pricing.

On the borrowing side the $58 million we have outstanding in FHLB advances, most of those are a little bit longer term. I think we only have one coming due in the first six months of '09.

Okay. All right. Thank you. That's all.

Thank you. (OPERATOR INSTRUCTIONS.)

And our next question comes from the line of John Deysher with Pinnacle. Please go ahead.

Good afternoon.

Hi.

What are you seeing on the C&I portfolio? I mean small businessmen, and what's their sense of the tone going forward?

Well, that's probably the hardest question today, okay? And I have attempted to ask many people, some of the best, bigger than we are, and people much, much smarter than we are. And, of course, I try to ask our credit people. And it seems to be that nobody can come with conclusions about how to have a methodology for evaluating C&I, and because it's so micro in the whole situation. Each loan has its own characteristic, belong to a different industry, belong to a different situation.

Let me just give you a funny example so that to let you know. You would thought as today, where the economy is today, that the shoe importers from China will be in trouble, okay? Well, we have one customer like that, and they are one of the largest shoe importer from China. Even though there's cost increases and everything else, they reported business increased 30% and reported increased earnings, because it's very simple, they said, all their competitor went out of business. She is one of the few people that is still standing there.

So it is almost a case by case situation. And, frankly speaking, the monitoring of a C&I item is one of a constant and never ending job in a bank.

Okay. I mean your nonaccruals are basically flat in that category quarter to quarter?

We base it on historical number, and we also have a -- our nonaccrual is fairly flat, okay? Not spiking up for much. We do have here and there, one or two spiking up here and there, but it's either resolved or written off and so on.

Okay, fair enough. And just -- it wasn't quite clear on that chart of nonaccruals, the commercial real estate, the number of delinquent loans increased by two, and it went from $8.9 million to $14.3 million.

Yes, that's the ones that -- okay, that was one of them is -- one of them is a $4 million, as I indicating. Now it's commercial real estate. Let me see, okay? Then I have to go back to the list, okay?

If you could just clarify specifically what those two loans are and what the amounts are, that would be helpful.

Okay, let me see. I have to really go back in to see which items specifically related to, because they have not been classified item by item during the quarter.

Oh, okay, there's one $3 million item is two single-family used as collateral, okay, for commercial projects, and that was -- went into a noninterest payment state, over 90 days past due, okay?

There's another --

Wait a second. What is that loan? A single family --

Two single family, okay, that was used as a collateral for commercial project.

Okay, those are considered nonaccrual loans?

Yes.

And they're embedded in the commercial real estate category?

That's right.

That doesn't quite make sense, but okay, go ahead?

It makes sense, because it's for the commercial real property to start with, okay?

It was commercial real property to start with?

Yes.

What does that mean?

Well, it was for the purpose of the commercial real estate to start with.

Okay, I'll follow-up with that after that, later. But what's the other loan?

Can't get the detail about it. It may be one other loan. Can't get the detail at this point in time.

All right. Thank you.

Thank you. Your next question comes from the line of [Gus Dorecka], a private investor. Please go ahead.

Yes, hi, good afternoon.

Hello, how are you?

Good, how are you? I have three questions, two kind of big picture and then something a little more detailed.

My first question is regarding the dividend on the common stock, any thoughts, intentions? What are your feelings about that going forward?

We will be having a meeting this afternoon, after this conference, to discuss the dividends issue. So, unfortunately, that without the Board discussion that I would not be able to discuss the issue at this point in time.

Okay. The second question I have is are there currently any plans or efforts, other than the TARP capital, are there any plans or efforts as far as securing additional private capital?

Well, the consensus opinion by many of our professional analysts that covers us is that the Preferred Bank has sufficient capital. And at this current low rate of our discounted value of our capital stock, to get additional stock at current, today's market price would be, how should I say, would be un-advantageous to our current shareholders, in our opinion. We certainly will keep that in mind from time to time, when a need, further need, arises, if they arise.

Okay. And then my final question and I'll step back is regarding the past due loans, 30 to 89 days, would it be possible to put a number, be more specific as far as the reading from the statement, the portion that was related to temporary interest payment disruption and how they related delayed extensions? How much of that was because of --

We don't have the exact information right now, okay? We will maybe be able to get that information. And, frankly speaking, when we get that, we don't know what the value of discussing the matter, because every case is so different.

The one delayed interest payment may or may not come up with additional interest. If they don't, it goes to 90 days, and they will become past due. Or the one delay funding (inaudible) having a funding situation. I mean they may or may not, okay? Or we force them to liquidate, or we sell the note if we can. All these situations is being dealt on an individual basis. To get that has little value to us internally.

Okay. And thank you very much.

Okay.

Thank you. And, Management, there are no further questions. I'll turn it back to you for closing comments.

Okay, well, thank you very much for attending the conference. And let me apologize, again, for the press release hit the wire late, so many of you does not have a chance to really read it more carefully on the situation, which we try to correct the situation in the future. And certainly it is not a promise and we would be able to do that, but I'm crossing my finger, and hopefully next quarter I can have better and more cheerful voice. Thank you very much.

Thank you, sir.

And, ladies and gentlemen, that will conclude today's teleconference. We do thank you, again, for your participation.

If you would like to listen to a replay of today's presentation, you may dial into 303-590-3000 or 1-800-405-2236 and enter the access code of 11125508 followed by the pound sign. We thank you, again, and at this time you may disconnect.