Stifel Financial Corp (SF) 2007 Q1 法說會逐字稿

Good afternoon. My name is Wesley, and I will be your conference operator today. At this time, I would like to welcome everyone to the Stifel Financial first-quarter earnings call for 2007. (Operator Instructions).

Thank you. I would now like to turn the conference over to Mr. James Zemlyak, Chief Financial Officer. Please go ahead, sir.

Good afternoon, everyone. This is Jim Zemlyak, CFO of Stifel Financial Corp. On behalf of the Company, I would like to welcome everyone to our conference call to discuss the first-quarter results of 2007 fiscal year. Please note that this conference call is being recorded.

If you would like a copy of today's presentation and press release, you make obtain them from our website at, www.Stifel.com.

Before we begin today's call, I would like to remind listeners that this presentation may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are not statements of fact or guarantees of performance. They are subject to risks, uncertainties, and other factors that may cause actual future results to differ materially from those discussed in the statements.

Supplement our financial statements presented in accordance with GAAP, we use certain non-GAAP measures of financial performance and liquidity. These non-GAAP measures are in addition to results prepared by the Company in accordance with GAAP and should only be considered together with the Company's GAAP results. For a discussion of these risks and uncertainties, please see the "Business Factors Affecting the Company in the Financial Services Industry" in the Company's Annual Report on Form 10-K and "Management's Discussion and Analysis Results" in the Company's quarterly reports on Form 10-Q.

With that, I would like to turn the call over to the Chairman and CEO and President of Stifel Financial, Mr. Ron Kruszewski.

Welcome everyone to our first-quarter conference call. We will start with updating you on the performance. If you -- our press release and these slides are available at, www.Stifel.com under our Investor Presentation section.

Our Company delivered outstanding results for the first quarter, which was underscored by record revenue and record core earnings. We are in the midst of integrating our recent merger with Ryan Beck. And to date, the progress in that integration has exceeded our expectations. Looking forward, we are well-positioned to continue our growth and add value for our clients while creating value for our shareholders.

In terms of our highlights, as I said, we had record quarterly revenue of 162.5 million, which was a 43% increase over the prior year first quarter. We also had record core earnings. Jim will talk about that in a moment.

Our private client group and equity capital markets segment each achieved both record revenue and profits for the quarter. Commission and principal transactions were up 26%. We had a stellar quarter in investment banking with those revenues increasing 174%. I will talk more about that in a moment also.

Our asset management business increased 44% over the prior first quarter of 2006. For the three months, we utilized in core earnings, our pretax margin was 14% and our annualized return on average equity totaled 21%.

During the quarter, we closed on our acquisition of Ryan Beck & Company from BankAtlantic Bancorp. We closed that transaction on February 28, 2007, adding approximately 400 financial advisers and 38 offices, which significantly increased our presence in the mid-Atlantic region. Today, with our independent contractors, we have approximately 1150 financial advisers.

We also received approval from the Federal Reserve Board to become a bank holding company and a financial holding company in connection with our acquisition of First Service Financial Company and its bank subsidiary, First Service Bank. We actually closed that transaction on April 2. So it's a second-quarter transaction but I think it's noteworthy for this call. We remained the bank Stifel Bank & Trust, and we are well into the integration of that bank into our platform.

And finally, in the quarter, we completed a private placement of $35 million of cumulative trust preferred securities. We swapped the rate for five years at a rate of 6.79%. And you might -- I will also say that if you look in our Q -- the 10-Q, you'll see that we have a letter of intent on an additional $35 million. And we have indicated that we may in fact call our 9% trust preferred. That's callable June 30 and I just think people should be aware of that. Again, that's in our Q.

Turning to slides here, what I thought I would do before I hand it all over to Jim was talk a little bit about the growth that has occurred in the Company. We've been quite busy in terms of growing the Company, adding to our platform and capabilities. And the slide that is in front of you shows our revenue going back to 2002. In 2002, our revenue was $194 million. And you can see we've had great growth through last year's revenue of 471 million. In fact, we've had record revenue on an annual basis for 11 consecutive years.

What I did want to show though was the annualized run rate of the firm today. And I think it's a big takeaway from this call is that if you look at both Stifel and Ryan Beck, both for the three months -- we only have one month of Ryan Beck results in our quarterly numbers that we just released. But just give a sense of the run rate of the Company if you annualize the quarter for both companies, you can see that our revenue is in the $800 million range give or take. I don't mean that to be any kind of guidance. What I do mean it to do is to show the scope of the Company today and the size of the Company as it will be once we complete our integration with Ryan Beck.

Speaking of Ryan Beck, I would like to say that we have successfully completed our first conversion. We are converting our branches in waves. We are doing it over six conversions if you will -- started last week. I'm being told five conversions. We started last week a very successful conversion; it's up and running.

The technology and operational integration is going very well and on track. We expect to be complete with this integration from bringing them into the Stifel platform by September 1. We have already integrated the Ryan Beck research into Stifel, covering over 700 names today. I'm also pleased we had some very nice results in the StarMine that was just released.

Our research platform is doing very well. We have most of the investment banking team integrated into Stifel today. And as previously disclosed, Ryan Beck completed the People's Bank transaction. That was done in the second quarter, but it was a very significant transaction for our firm. And it will help our second quarter of 2007.

So, that will give you an update on Ryan Beck. I'll be glad to take any questions at the end of the call if you have any.

With that, I would like to turn over the detailed numbers to Jim.

Today, we reported unaudited quarterly net income of 8.8 million or $0.58 per diluted share on record revenue of 163 million and record net revenue of 157 million for the quarter ended March 31, '07. For the comparable quarter of '06, net income was 476,000 or $0.04 per diluted share on revenue of 113.6 million.

This chart represents the GAAP to our core analysis, which after adjusting for acquisition-related charges, principally compensation expense recorded for stock-based awards offered to key associates of Legg Mason Capital Markets, and an increase in the value of the warrants to be issued in connection with the Ryan Beck acquisition, non-GAAP net income and non-GAAP earnings per diluted share. Our core earnings were 13.2 million and $0.86 per share for the first quarter of '07 compared to '06 first-quarter core earnings of 11.1 million and $0.83 per share.

Included in the '06 core earnings was $2.1 million after tax or $0.16 per diluted share for the gain on the Company's New York Stock Exchange membership seats. Excluding the gain, core earnings per diluted share increased 28% to $0.86 per share.

The next slide here graphically shows our quarterly net revenues, 157 million, which again Ron noted is a record, up 43% from Q1 of '06. I would like to talk a little bit about the details behind that. Commission and principal transaction revenue increased 26% to 87.9 million from 69.8 million in the same period last year, with increases of 33%, 11%, and 17% in private client equity capital markets and fixed income capital markets.

Investment banking, which Ron will review later, their revenues increased 174% to 43.1 million from 15.7 million from the same period last year. Capital raising revenue was 27.3 million, up 423% over the prior year. Asset management and service fee year-to-date increased 44% to 19.4 million from 13.5 million in the prior year as a result of a 29% increase in the number of our managed accounts and a 44% increase in the value of assets under those managed accounts.

Net interest revenue increased 65% to 5.2 million from 3.1 million in the same period last year, due principally to increased revenue from stock borrow activity and increased interest earned on fixed income inventory held for sale to customers, offset by increased costs to carry higher level of firm inventory and increased rates charged for bank borrowing and stock loans to finance customer borrowings.

Our next chart shows a record core net income of 13.2 million. As Ron noted before, our pretax margin was 14% and annualized return on average equity was 21%.

The next slide depicts core diluted earnings per share. As I noted earlier, our GAAP earnings per share was $0.58 for '07. The red on the slide depicts the New York Stock Exchange gain in '06. Excluding the gain from the previous quarter results, our core EPS increased 28%.

Ron, would you take us through the segments (multiple speakers)?

Well, yes, I will make a quick comment, take a breath and I will hand it right back to you. Our segments again, as Jim has indicated, the numbers have -- the results have just been outstanding. The markets of course have been as we like to say the wind has been at our back. The markets at least for us have been quite favorable and we don't want to discount that. But we've had just tremendous results led by both our private client and equity capital markets group, which both posted record revenue and contribution.

Our fixed income capital markets group had an acceptable quarter in what has continued to be a difficult market with an inverted yield curve. I was commenting yesterday that I was wondering if we're reaching a record in the amount of time -- I'm sure we're not but it sure seems like it -- the amount of time that the yield curve has been inverted.

But, with that, I will just ask Jim to walk you through each of the segments. Jim?

Private client net revenue for the first quarter of '07 were 85.5 million, an increase of 54% from the first quarter of '06, principally due to increased commissions and principal transactions, sales credits from investment banking and increased asset management service fees. Sales credits from investment banking increased due to increased underwriting activity, principally corporate finance.

PCG net revenue increased 34% from the fourth quarter of '06. PCG recorded an operating contribution of 18.1 million, up 40% for the first quarter of '06 and a 28% increase from the fourth quarter of '06. Ryan Beck contributed 14.3 million in net revenues and 2.2 million in operating contributions to PCG during the current quarter.

Next slide is equity capital markets, which recorded a record net revenue of 52.5 million, an increase of 55% from the same quarter last year, principally due to increased commission and principal transaction and increased investment banking revenue. Investment banking fees increased principally due to advisory fees of 15.7 million, up 51% over last year's first quarter and equity financing revenue of 11.8 million, up 1000% compared to the first quarter of '06.

ECM net revenue increased 19% for the fourth quarter of '06. ECM's operating contribution totaled 13.4 million, an 89% increase from the first quarter of '06 and a 76% increase from the fourth quarter of '06. Ryan Beck contributed 1.5 million in net revenue and a small operating loss in the operating contribution during the current quarter.

Ron will now comment on investment banking (multiple speakers) --

Yes, I would first of all -- would just want to underscore that both again private client and equity capital markets had a tremendous quarter and just reflects the value of the team that we're putting together. As we have talked about in the past, this next slide shows investment banking -- and I won't go over it too much -- but we're very pleased with our progress on the investment banking side. And as Jim indicated, both capital raising and advisory fees are up all-time records on -- both for an all-time record quarterly revenue for total investment banking.

And if we look at the next slide, you will see graphically the improvement in investment banking on the capital raising side. As I indicated actually in each of the conference calls going back to last year starting in the first quarter of 2006, one of our disappointments in the integration of our merger with Legg Mason Capital Markets was that we felt that we were hurt during the lag if you will between announcement and getting everything integrated on the capital raising side.

And you will see that our revenue was only at 5.2 million and we were disappointed at that time and at that time also said that it would improve. And as you can see, it has sequentially improved 5.2 to 6.5 to 10.4, started get going in the fourth quarter 22 million and then this quarter 27.3 million -- so a very good investment banking quarter for the firm.

Fixed income capital markets, Jim, if you'd just do those numbers?

Yes, they posted net revenue of 14.6 million, an increase of 23% from the prior year first quarter, principally due to increased commission and principal transactions and investment banking revenue. Fixed income capital markets net revenue decreased 17% from the previous quarter. During '07 the first quarter, they recorded an operating contribution of 1.9 million and an increase of 13% from the prior year first quarter and a decrease of 60% from the previous quarter. Ryan Beck contributed 1.1 million in net revenue and 82,000 in operating contribution to fixed income capital markets during the quarter.

Even though we don't have a slide on our other segment, I would like to make some comments. The other segment includes acquisition charges relating to the Legg Mason Capital Markets and Ryan Beck acquisition. They posted net revenue of 4.3 million, a decrease of 48% from the prior year first quarter, principally as the result of a decrease in gains on investments relating to the 5.1 million gain posted in the first quarter of '06 for the Company's ownership of its New York Stock Exchange seat.

During the first quarter, the other segment recorded an operating loss of 18.6 million, which consisted of 11.3 million from other operations, 6.2 related to the charges from Legg Mason Capital Markets acquisition primarily stock-based compensation and 1.1 million relating to the charges associated with the Ryan Beck acquisition. Compared to the prior year quarter, operating loss of 20.9 million, which consist of 3.1 million from other operations and 17.8 million from the Legg Mason acquisition.

Thank you, Jim. Take a breath. That was a lot of numbers. And I will take it from here.

We -- the next slide just shows other data. The Company continues to grow its balance sheet; although, our balance sheet remains very liquid, about 1.4 billion in assets. I have a slide on that in a moment, equity an all-time record. Equity totals today 342 million. And on top of that, we have approximately in excess today of $100 million in trust preferred. So we're very well capitalized as a firm.

Financial advisers, I have already said. We're very pleased with our recent merger with Ryan Beck, which puts our full-service investment advisers if you will at approximately 950 but 1150 total financial advisers with independent contractors. We have nearly 3000 associates and 178 locations. The client assets at 3/31 is actually about -- you can see on this slide, the number says 36 billion but it's actually 55 billion -- or 56 billion. The 36 million depicted on this slide is Stifel Nicolaus alone; it doesn't include Ryan Beck. But again, just a lot of growth.

To quickly turn to our non-core expense analysis, as we've done every quarter now going back to the first quarter of last year, we need to look at the stock-based -- primarily stock-based compensation that is flowing through our numbers. And as I've said, this is -- we debit expense if you will and we credit equity for a lot of these expenses. And in fact, I will address that in a moment.

But, in addition to that, we also had a couple of items for Ryan Beck. First, we had to record a non-cash charge of about 1.1 million relating to the warrants that we're going to issue. We have not yet issued; we will issue in the second quarter to BankAtlantic. But because of the way the accounting rules work, we had to take a charge for the increase in our stock price. So, in total, you'll see that there was a $0.29 if you will impact, $7.3 million, that we have accounted for in our non-core segment.

The estimated -- what I do want to talk about -- there's been some noise. We've done a lot of transactions. As we've said, we've acquired Legg Mason. We acquired the private client group of Miller Johnson. We've acquired a bank and we acquired Ryan Beck. And we've had a number of items that we have had to look at. One of which I just want to point out is that we are evaluating a charge which would result from conforming Ryan Beck's deferred compensation plans to our compensation plans. We would look at amending their service requirements, having them sign our agreements, change or look at the distribution requirements on vested balances.

If you look at our Form 10-Q, the result of all of that would be if we do this and we get Board approval, the effect of that would be as we say in the Q, approximately 17 to $20 million, again a non-cash charge. It will -- we would take the charge as a merger-related-type charge. And the effect of it is to accelerate that expense as we conform it to our plans.

So, I would want to point that the next chart just shows the annual statement impact of this. We have said in previous calls that Legg Mason amortization of stock-based comp was going to cost about $25 million for both '07 and '08. It will be gone in '09. And then you'll see what we're looking at with the Ryan Beck. Even with these charges with Ryan Beck, the purchase price that we paid for Ryan Beck is a very attractive acquisition for us.

Quickly looking at the balance sheet. Our assets have grown from 2002 400 million to 1.4 billion. The next chart will show that our equity back in 2002 was 80 million. Our equity today stands at 343 million. And I thought we would just show you a little bit of a roll forward of our equity. We started the year -- the next slide will just walk you through it. We started the year with $220 million of equity. On a GAAP basis, we earned $8.8 million. And then, you have to start looking at these things that impact our equity.

One is the stock-based compensation I referred to earlier as a credit to equity of about 12.3 million. We issued $102 million for Ryan Beck and we purchased about 1.3 million in treasury. So if you roll all that forward, that will show how we went from 220 million of equity at the end of the year to $342 million of equity at the end of the first quarter. That results -- as you can see, we have had an impressive growth in our book value per share, increasing from 886 in 2002 to a record $23.16 for the quarter just ended.

So, with that, a lot of numbers. I would just summarize that I could not be more pleased with the progress that we have made at Stifel Financial, transforming our Company from what a few years ago was a small regional player into what is becoming a major player, major regional firm in the country. We are excited about our growth. Our prospects for growth have never been greater. So I'm very pleased with all that has been going on and of course thankful for the favorable markets which have aided our results.

So, with that, Operator, I will take any questions that anyone may have.

(Operator Instructions). Goldman Sachs.

It's [Derek Palecki]. I have a couple of questions about the Ryan Beck transaction. Was any aspect of Ryan Beck's book value illiquid or were they all a liquid security?

No, of their book value, there were certainly -- as in any brokerage firm, there were some illiquid assets for sure. Furniture and equipment I think is illiquid. But I don't think that -- they didn't really have any intangibles on their books if that's your question.

Right. Or there weren't any large deferred tax assets or anything unusual from (multiple speakers)?

Well, they did have some deferred tax assets. As a lot of brokerage firms do, the deferred compensation will result in a deferred tax asset.

Okay, on the slides that you presented when you made the Ryan Beck acquisition, it showed that the contribution margin in their brokerage operation was pretty substantial. And I know in your brokerage operation, it's over 20%. But, Ryan Beck overall was breakeven. How long do you think it will take to get rid of the unprofitable segments of the Ryan Beck business or bring them up to at least breakeven?

Well, I think the -- first of all, I will reiterate that the private client business at Ryan Beck is profitable. It was the Ryan Beck for the first month was about a breakeven. But, you have to remember that it was publicly disclosed for Ryan Beck. Their pretax loss was in the neighborhood of some $25 million for the year ended '06.

I think the management there has done a great job of getting -- our goal was to get the company by the end of our first quarter to breakeven. And that's exactly where we got. As we integrate and I think I said on the call -- it's going to take most of this year to get the branches over to do it right. I've said that we are willing to accept some expense -- additional expenses to bring the clients in and the financial consultants over right. And, that's exactly what we're doing. So, I have said and I will reiterate that the integration both financially, technology and in terms of people is exceeding our expectation.

Great. And then, could you just talk about the general environment for attracting brokers to your platform? I know it was robust last year. Has it continued into the new year? Are brokers still leading the big command and control brokerage operations to get to regional players?

You mean like Goldman? No, I'm kidding. The big firms have their place just as we do. And as I've said, we have 900 to 1000 financial consultants. And for people that are looking for our platform out of the vast majority of financial consultants out there, our -- the people that want to join our platform is as robust as ever.

I must tell you though that I have put the brakes on some of our recruiting. Because from our perspective, we're recruiting 400 financial consultants from Ryan Beck. Our number one priority is to make that as smooth as a transition as it possibly can be. So, while we're continuing our recruiting, we have become a lot more selective in what we're doing.

Because last year, I think we hired 150 new financial consultants. And with everything that's going on today, we are not running at that pace. Once this deal is done, I expect our recruiting activities to not only get back to where they were but to exceed where they were.

Last question, could you remind me what the $11.3 million expense in the other segment is?

Are you looking at the press release?

Yes, there's the amortization of the Legg Mason Capital Markets and then the Ryan Beck warrants and then there's an other line that is about $11.3 -- 3 million of expense.

Well, the way we report -- the way we report our segment is that we do not allocate overhead, such as operations and accounting. And we report our segments on a contribution basis before home office overhead.

And so if you're looking at that number, which I'm seeing is 11.2 million for the quarter, up from 3.1 million, the proper run rate is about 11 million. Last year, that segment had the New York Stock Exchange gain. So that is why you're seeing the increase.

But in our other segment, absent the acquisition-related charges, is the overhead that is not allocated to the revenue-producing segments of the firm. That is just how we look at it. We've watched that number very closely to make sure that our overhead is not getting out of line with respect to our operating segments.

Cooper Investments.

I know you are working really hard. After the -- after you're done rolling all the Ryan Beck branches into the Stifel organization, are you going to drop the Ryan Beck name or will you continue to operate under that name?

We're going to convert the Ryan Beck branches to Stifel Nicolaus. So, on a technical -- technically or legally when we convert these branches, the Stifel Nicolaus name goes up because we are a New York Stock Exchange member firm and these branches are coming under the Stifel Nicolaus banner.

With that said, we have a lot of respect for the Ryan Beck name. And it will be used as people see fit, either as a division of or formerly whatever -- however people want to use it. The Ryan Beck has a long legacy. But ultimately -- and by the way, a lot of name recognition in the Northeast. So we don't want to lose that. We want to use it as appropriate. But legally, it will be Stifel Nicolaus.

And is there -- I can't think of the guy's name. But is there any chance you're going to hire back that Ryan Beck strategist that used to be on TV all the time, the real big guy?

He's still with us. Joe Battipaglia?

Yes, that's it. I never see him on TV anymore.

You don't? I see him all the time. So you'll have to tune that TV in again. He is there and Joe is -- he focuses a lot more on -- he has an investment firm called Washington Advisor Crossings -- Washington Crossing Advisors -- excuse me. No, Joe is a part of Ryan Beck and is going to be part of Stifel. I will tell him you said hello.

My last question, is there any thoughts down the road about getting into the asset management business?

As I've always said, we are opportunistic. And if the right opportunity came along, similar to Legg Mason Capital Markets or the bank or Ryan Beck and it was an asset management firm, we would look at it. But we're not going to chase or overpay in any situation to meet a strategic goal of being in the investment advisory business.

And in fact, we do -- a part of our culture is that we offer the best of breed if you will investment advisory and we wouldn't want to say that ours was the best. I think there's been a trend towards separating the brokerage and investment advisory firms. But if the right opportunity came along, we would certainly look at it.

(Operator Instructions). Fontana Capital.

Forrest Fontana. I've got a couple of questions; just bear with me. I was working through the press release and the slides. I haven't seen any other filing, like did you mention the Q has been filed? Because as of right now, I don't see anything hitting the EDGAR.

Yes, the Q should be out there.

The only thing there is an updated proxy that has hit today and then so forth. But I will take another look at it.

The Q should be right there.

I checked your website and the EDGAR; I will check again. But if we go through Ryan Beck, so if I just understand the strategy then bringing them onboard, the financial consultants will basically offer the full product and service suite of Stifel going forward, correct?

Yes. And also, we are bringing their product people along too.

Right, from a product standpoint, one of their main products is sort of the mutual convergence and the People's transaction. Can you talk a little bit more about sort of that pipeline and what the outlook is for that sort of unique segment of the marketplace?

The Ryan Beck has made I think its name in a lot of ways in the mutual to stock conversions, especially the second step, mutual holding company conversions. We have a very strong team. I know that they are out -- the pipeline is strong.

I want to -- I always had to be careful relative since the transactions like People's or Hudson don't occur obviously every quarter. But, the Ryan Beck I think is a leader in that business. And we expect to get our fair share of those transactions when they occur. The full team is onboard and is fully engaged. And we have transactions currently in the pipeline.

You talked about sort of annualized revenues going through core earnings. I'm trying to look at -- what I'm trying to get a sense of is exactly -- and you've tried to break it out a bit of what is like non-recurring and what is considered non-operating. But if we start with the annualized revenues of 800 million, that is -- can you just define that to me again what you are defining, how you frame that out that sort of current prospects adjusted to seasonality looking out just in terms of current earnings power I can draw from?

Well, no. I mean I can tell you -- I apologize if I wasn't clear on it. What I was trying to do was give a sense of what our revenue would have looked like had Ryan Beck been part of Stifel for the full quarter. We only had one month of Ryan Beck in our numbers.

Correct. Yes, you only had one month.

So, what I really did was took their three months and our three months and annualized it and approximated it. As I was saying, I'm not --

So you're basically adding say 44 million -- 200 for the first quarter times 4 gets you an 800 million run rate.

Fair enough.

Now, so if I look at sort of -- if I try to adjust really what sort of net margins can be because if I look at comp by segment, some has been up; some has been down sort of prior sequentially, annual. I mean at 8.5 -- what's a good margin that I should be thinking about in terms of how much more additional expenses that you are absorbing that you really can't break out and call it non-core but really is over time going to get absorbed or go away, so I get a real sense of the true earnings power here.

Hard question to answer. We are absorbing expenses into our core earnings, other than what we have disclosed, which is really the stock-based comp and the warrant of some of the things we're doing that are truly onetime.

The only thing I can say is if you go back to previous calls and you look at our previous numbers, we like to think that depending on market conditions, pretax margins in the 15%. We've been as high as 19%. But you can go backwards and look -- and you can look at how other well-managed regional firms do. I think if you go back and look at our numbers and look at that pretax margin number, I think it can give you a sense of what you're trying to do.

Lastly and then I will let somebody else jump in. But if I look at my share count -- and I know we've got the Ryan Beck shares and that's going to come up one-third, one-third, one-third over the next couple of years -- but how should I think about the fully diluted share count growth playing out to the rest of the year? What's the right number I should be putting in my model?

Well, I can tell you this. I'm not sure that I have that number going forward. But, the Ryan Beck shares that are in our fully diluted number, I will say was effectively one-third of the shares. Because they were only -- we closed the transaction the beginning of March.

So, the -- we issued about 2.5 million shares. And then, we account for the warrant like under the treasury method like options. So, I think you can do the math based on that.

As it relates to the other shares, those as we have disclosed in the past, we amortize those shares in as they are earned. So, if you go back to our filings, I think you can -- the proxy that was just filed will give you some of those numbers.

Excellent. Thank you. Keep up the good work.

(Operator Instructions). Sir, there are no further questions at this time.

Thank you very much. I will conclude by saying that again, we are -- we think that the results were outstanding for the quarter. Looking forward, we see good things to come with our growth. I look forward to updating everyone on our next conference call for the second quarter. And with that, we will sign off. Thank you very much.

Thank you again for joining today's Stifel Financial first-quarter earnings conference call. You may now disconnect.