Versabank (VBNK) 2020 Q4 法說會逐字稿

Good morning, ladies and gentlemen. Welcome to VersaBank's Fourth Quarter 2020 Financial Results Conference Call. This morning, VersaBank issued a news release reporting its financial results for the fourth quarter and year ended October 31, 2020. That news release, along with the bank's financial statements and supplemental financial information, are available on the bank's website in the Investor Relations section as well as on SEDAR.

Please note, in addition to the telephone dial-in, VersaBank is webcasting its earnings conference call live over the Internet. The webcast is listen-only. (Operator Instructions) For those participating in today's conference call by telephone, the accompanying slide presentation will be available on the bank's website. Also, today's call will be archived for replay, both by telephone and via the Internet, beginning approximately 1 hour following completion of the call. Details on how to access the replays are available in this morning's news release.

I would now like to remind you, our listeners, that the statements about future events made on this call are forward-looking in nature and are based on certain assumptions and analysis made by VersaBank management. Actual results could differ materially from our expectations due to various material risks and uncertainties associated with VersaBank's businesses. Please refer to VersaBank's forward-looking statement advisory, which is on Slide 3.

I would now like to turn the call over to David Taylor, President and Chief Executive Officer of VersaBank. Please go ahead, Mr. Taylor.

Thank you, Colin. Good morning and thank you, everyone, for joining us today. With me once again via teleconference, as we continue to work remotely, are Shawn Clarke, our Chief Financial Officer; Aly Lalani, Chief Risk Officer; Brent Hodge, General Counsel and Corporate Secretary.

As noted last quarter, as a digital bank, the ability of substantially all the bank's staff to work remotely has meant that various restrictions imposed as a result of the pandemic have had virtually no impact on our operational efficiency. In fact, the bank is thriving in this particular environment. The past few months have given us even greater confidence in our growth prospects for 2021 and, as I will discuss later, the profitability and new growth opportunities created by our acquisition of Digital Boundary Group only amplify this further.

As expected, the fourth quarter of 2020 benefited from our continuing redeployment of cash into interest-earning loans across our lending business, following our decision during the second quarter of this year to temporarily increase our cash balance early in the COVID-19 pandemic out of an abundance of caution. As a result, we achieved strong quarter-over-quarter improvements in all key financial and operational metrics, driven by our continued success and leveraging our proprietary technology to offer innovative solutions that address unmet needs in the banking sector.

Net interest margin for Q4 was 2.82%, down from 3.04% in Q3 last year but a 29 basis point increase over Q3 and moving solidly back toward the prepandemic levels. The decrease compared to Q4 last year is, of course, the higher cash balances in Q4 of this year. Even after these dampened levels, we continue to lead the Canadian banking sector in net interest margin while maintaining a very low-risk loan profile as was once again evidenced by our provision for credit losses, which I will discuss in a moment.

As I did last quarter, I will provide the perspective that if we had maintained our cash balances at our historical levels, net interest would have been higher by approximately 25 basis points or around 315 basis points, which is reflective of the underlying strength of our model. For the year, net interest margin was 290 basis points, down slightly from 300 in 2019.

Net income for Q4 was $4.7 million or $0.20 per share, again up from $4.4 million or $0.18 per share in Q3 but down from $5.4 million or $0.20 in Q4 last year. Core cash earnings or CCE improved to $6.5 million or $0.31 per share compared to $6 million or $0.29 per share in the previous quarter but down from $7.4 million or $0.36 per share for the same quarter last year.

Looking at profitability for the entire year period. Both net income and core cash earnings for 2020 were down just 4% compared to 2019. And I'll note that all our earnings measures for both the fourth quarter and the year were impacted by higher staff expenses, including costs related to full-time employees to support our growth initiatives and higher vacation expense accruals, resulting principally from employees taking less vacation time as a result of the pandemic.

Looking at our overall performance. We view this as a very favorable result, given the uncertainty with which we viewed the outlook for the remainder of 2020 back in March and April. We always act with prudence and focus on keeping risk low. It is in our DNA. And you will recall that early on, out of an abundance of caution, we made the conscious decision to increase our cash position amidst this uncertain outlook.

It turns out that this was not only good for the bank's health in isolation, but in doing so, we have emerged much stronger than many of our competitors. And that has significantly strengthened the competitive position of our lending business, creating more opportunity at greater terms and positioning us for even better 2021 than we would have envisioned prepandemic.

You can see here on our balance sheet that we ended 2020 with total assets of $1.94 billion, up 9% compared to $1.79 billion at the end of 2019. Cash at the end of the fourth quarter was $258 million, down significantly from $354 million at the end of Q3 and from $340 million at the end of Q2, with a peak of more than $400 million, including securities in Q3. That number sits still lower today as we continue to deploy cash across both our point-of-sale and commercial loan portfolios. Book value per share increased 7% to $10.7, and each of our CET1 leverage ratios also increased year-over-year.

The credit quality of our loan portfolio remains very strong with a significant recovery of credit losses during the quarter as the low-risk nature of our business model once again proved itself out. For Q4, we recorded a recovery of credit losses of nearly $600,000, taking the bank's provision for credit losses as a proportion of average loans for the fourth quarter down to negative 0.14%. This continues to compare very favorably with our Canadian big bank peers, further underscoring our ability to generate superior net interest margins with mitigated risk.

We are in the midst of one of the most challenging, and perhaps the most challenging, economic environment for many parts of the economy in recent memory since the Great Depression. And we'll still have no loan losses and just a single request for a deferral. This is both of the risk mitigation built into our business results such as our cash holdbacks in our point-of-sale business, which continue to be at around 4x, what we view to be the intrinsic risk associated with the portfolio; and also the benefit of the ultra-low cost of funds, which allows us to achieve higher net interest margins with lower-risk loans.

I just mentioned the critical role that our ultra-low cost of funds plays in our ability to generate superior net interest margins with a low risk. And I am pleased to report, we saw yet another quarter of decline in our cost of funds, both year-on-year and sequentially, to 1.51%, our lowest result in the last 6 years. The decline both sequentially and year-on-year was again driven by the further expansion of our very low interest-paying Insolvency Professional deposits still at 0%, which increased 14% year-over-year. This is especially noteworthy given that bankruptcies in Canada saw a precipitous decline in the back half of 2020 due to government COVID relief. Even with the steady decline throughout 2020, we continue to expect to see our cost of funds further decline over the quarters to come as we continue to expand the size of the Insolvency Professional deposit base.

Turning to the lending side of the business. The composition of the lending portfolio has shifted significantly since the end of Q3. As noted earlier, our cash balance at the end of Q4 was down significantly, with the difference having been redeployed to our point-of-sale and commercial banking loan portfolio. That resulted in an increase our total loan portfolio from Q3, up 7% to $1.65 billion. Our point-of-sale portfolio increased to $981 million from Q3, primarily the result of the initial financing for our new partner, Simply Green Financial (sic) [Simply Group Financial.] But we also saw continued robust consumer spending activity in certain sectors in Q4, driving increased point-of-sale origination activity, and momentum in that origination activity has continued into Q1. At $981 million, point-of-sale finished the year just 1.4 -- down just 1.4% from the end of 2019, a very satisfying outcome given that the economy has been through in 2020.

In our commercial banking portfolio, we saw a continuation of the renewed activity around residential construction in communities outside the GTA that I mentioned last quarter. That drove expansion of the commercial banking portfolio to $669 million from $634 million at the end of Q3 and $595 million at the end of 2019. That momentum has accelerated in the first part of Q1 as we take advantage of our strengthened competitive position as some of our competitors for these loans have had to retrench due to financial challenges. You will recall that last year at this time, we began slowing down our lending in this part of our portfolio out of a concern that the market was getting a little overheated. I subscribe to the theory that bad loans are made in good times. We avoided that pitfall and are now reaping the rewards.

2020 was a very good year for VersaBank. We easily navigated a very challenging economic environment as a result of our prudence, our risk mitigation built into our model. We chose to forgo some earnings in the short term to ensure the short-term health of our business while positioning the bank for a return to outsized growth in 2021 and a stronger future outlook for years to come. 2020 was a significant year in this regard.

We added multiple new ultra-low-cost deposit partners and expanded business with existing partners to continue to drive our cost of funding lower and generate superior net interest margins with mitigated risk. And we added a major new partner in our point-of-sale business in Simply Group Financial. And we reengaged our public sector finance lending channel.

We also launched a third lending channel, Instant Mortgage, to leverage our point-of-sale technology in pursuit of the $200 billion-plus Canadian home financing market. We hired an industry veteran in Jim Gardiner as product champion to drive its success. And we are well down the road with beta testing with multiple groups, with the potential to start taking on loans as early as this calendar year.

And as of this morning, 2021 looks even more exciting for the bank and its shareholders with the announcement of DRT Cyber's acquisition of Digital Boundary Group. We formed DRT Cyber back in 2019 to crystallize the value inherent in our technological capabilities that we develop within the bank on an ongoing basis to support our own IT security needs. We are leaders in the Canadian banking industry in this regard. We launched our first DRT offering, VersaVault, a couple of years ago. VersaVault is designed to keep all manners of digital assets safe, including cryptocurrency keys, securities and highly sensitive documents.

From inception, I have viewed DRT as a platform not only to mitigate the bank's cybersecurity risk exposure but also enables us to provide a comprehensive suite of innovative cybersecurity solutions that address high-demand, underserved segments of this rapidly growing market, a market that is estimated to grow in excess of $130 billion in the next few years. The acquisition of Digital Boundary Group significantly advances our strategy for DRT Cyber. DBG is one of North America's premier IT security assurance services firms, providing a suite of services to corporate and government clients that include some of Canada's largest retailers and financial service providers to Canadian and U.S. police services organizations, SCADA system reliant energy, public utilities, infrastructure firms. And importantly, DBG is growing rapidly and profitably so that when completed, the acquisition will be immediately accretive to VersaBank's earnings in the range of approximately $0.08 per share annually, based on the last 12 months' performance for which the purchase price has been established as approximately $10 million in cash. The founding management team that has driven the success of DBG will remain on board.

So what does this mean for the future of DRT? To start, DBG in and of itself has significant growth prospects in its current business. The acquisition is attractive based on the opportunity alone, but the real power of the acquisition is in the revenue synergies as DRT launches complementary offerings and capitalizes on revenue synergy opportunities.

And with that, I'd like to open the call to questions. Colin?

(Operator Instructions) So your first question comes from Stephen Boland from Raymond James.

Two questions. Dave, maybe you could just talk about commercial banking. We've seen decline in the portfolio over the last couple of quarters. So what changed in terms of the growth again? Was it -- is it just pent-up COVID demand? Was it some competitors leaving the square or just favorable pricing? Maybe you could just talk about the conditions.

Certainly. Yes, Steve, as you know, leading into the pandemic, we were quite concerned about the major centers. Market has been somewhat overheated. So for about 2 years, we were backing off on lending in those markets. And what was driving it was a lot of competition, low pricing. Some of our competitors weren't asking for this type of security that we thought was appropriate. It was the typical overheated market. So we were backing off, and you saw the portfolio continuously decline quarter-over-quarter.

Now coming out of the pandemic, what we're seeing is a lot less competition. Those aggressive competitors don't seem to be active anymore. And we can guess why, about what I said earlier about bad loans being made in good times. So a lot less competition than we saw before, which has given us the opportunity to price appropriately and take what we think is the appropriate security.

And there's been a resurgence in the construction of homes in the outlying areas from the major centers, quite a resurgence. So in our neck of the woods here, Kitchener, Waterloo, Cambridge, Guelph, Stratford, Paris, Brantford, I mean, all these places have got home projects underway. And thankfully, we are providing a lot of that financing.

So it's a good time for us in this business. In fact, our lenders would say they've never been busier. Good customers, providing a good product that people are demanding and decent pricing and the appropriate security.

Okay. That's good to know. And maybe just the second question on Digital Boundary Group. And I think you said $0.08 accretive. Did I have that correct, that number?

Yes. Based on their last 12 months' earnings, that's approximately the number that it would translate to. Hopefully, of course, we've got synergies, and the business continues to grow. But just looking back at their last 12 months of earnings, that's the number I came up with.

Okay. So I think maybe I'll just frame this. I'm not sure how you can answer it because it relates to the regulator. I mean many years ago, you formed Discovery Air out of a loan. And I believe at the time that it became somewhat material to the earnings of the bank that the regulator wanted you to get it off the books. Is this business imminently related to the bank business that you're not going to get pressure from the regulator to maybe remove this from the balance sheet of the bank or as a subsidiary? I'm just wondering what your thoughts are there.

Well, certainly, this business is extremely important to the security of the bank in itself. We think any bank could be investing in cybersecurity. I think it behooves any CEO of any bank to want to bolster its cybersecurity. We are operating in a hostile cybersecurity environment. And the investment that we've made in DBG, of course, is very important for the bank's own cybersecurity.

But there is additional capacity, of course, to provide cybersecurity to other banks and to corporations. So first and foremost, it just bolsters our own cybersecurity, but it is producing additional cash flow for the bank.

It's hard to say what individual regulator would say. At that time -- and we've faced a change in guard in the regulatory world. We had one superintendent who was very much in favor of the Discovery Air company that we created. And then afterwards, we had another regulator that didn't like it at all.

This is a lot different. This isn't a Canadian military business. However, Discovery Air was providing aerial dogfighting skills to NATO forces in Canada, which we think was very important for Canadians. But this one is really integral into what a bank needs to have to stay safe in this world. So I wouldn't expect regulators to worry about it. In fact, I think our big bank colleagues are deeply invested in this area too as they should be.

So I don't see it the same way. But if it was, we can do what we've done before, start spinning companies off.

Okay. That's good comment. And sorry, maybe you mentioned VersaVault, but just -- can you just provide a -- maybe you did provide an update. Sorry, if I missed it. Just where they are, customers and revenue, things of that sort.

Well, the customer that we announced some time ago was Chairmans Financial, operating in Europe, and they've utilized the VersaVault to a certain extent. We expect that VersaVault will be used a lot more in North America, particularly in conjunction with the other product offerings that DRT is working on and the DBG acquisition.

It's designed to keep sensitive documents away from prying hands -- prying eyes. And as we know, we're in a world where there's a lot of prying eyes. So it keeps cryptocurrency keys safe, but it also keeps the documents safe and then security documents. So I see a big role for VersaVault.

And I now note that others are coming out with similar offerings. So while we were maybe a little bit of ahead of our time being the first to offer digital vault, now there's others with digital vaults, too. Maybe not quite as good as ours, in my own personal opinion, but at least they're out there. So I think people are getting used to the idea that this is a good place to put your digital assets.

Say, you have, for example, the plans to that -- a new fighter plane, just to use maybe a military example, somewhere in the world. And you really want to keep it away from others. We think our vault is the right place. So I think it's going to be -- as part of a comprehensive product offering for DRT Cyber, I think it's going to be a very important component.

Your next question comes from Greg MacDonald from LodeRock Research.

Can you hear me all right?

Sure can, Greg.

So I want to ask a few questions. First, on the loan growth opportunity as you go into the first part of 2021. And specifically, I want to zero in on point-of-sale growth opportunities. So I think of this business growth opportunities as kind of 3 buckets: one is adding new partners; the second is kind of organic growth for the industry, so what you get from existing partners; and then there's the Instant Mortgage app opportunity.

Can we -- how do we think about those 3 buckets as we go into the early part of 2021? Is 1 or 2 of those going to be driving more than the others? Should we be thinking of them as all kind of representing equal opportunities for growth? Give us a sense of how we think about those buckets.

And then I suspect you don't want us to be thinking of 7% sequential growth opportunities each quarter as being kind of what we should expect. Could you talk a little bit about what your expectations are for overall growth? It was a pretty strong quarter in the 4Q. So how are you thinking about 2021 as we enter the first quarter?

Well, good questions, Greg. Thanks. So with respect to the 3 drivers for growth for the point-of-sale program, adding new partners -- well, we expect we'll add a few more new partners throughout the year. That wouldn't be a significant driver, I think, in the course of 2021. And it takes new partners some time to be integrated into the system and to start providing us with point-of-sale loans.

The Instant Mortgage is in sort of its infant stages. And yes, we're having good discussions with various people about utilizing it. We have one partner in particular that's been working very hard on integrating it into their program. So it'll provide some growth.

But organic growth is, at this point, tremendous. We've seen a huge resurgence in organic growth for our existing partner network. And it's so much, but I hesitate to say what it's going to be going forward. But let's say our guys have never seen that kind of organic growth in our history. So it's -- it may very well be that 7% per quarter is the norm or maybe more.

We are well established in this market and we are -- we worked as best we could with our partners to ensure their viability during this tough time. And I think that's very much appreciated. And we have tons of capacity. So all those things added up kind of make the tick next to organic growth versus the other components that will add to growth, but nothing like organic.

Okay. So maybe a point of clarification there. A lot of us have been wondering when we -- we look at numbers like auto sales as a good leading indicator here. And we wonder how much of the 3Q/4Q, I'm talking calendar year, growth that we've seen in indicators like that was a result of pent-up demand, i.e., people not spending money they would have spent in the 2Q as COVID hit versus what might be more kind of structural changes, i.e., people are moving outside of cities and not wanting to take transit, and therefore, there's some continuation on this.

It sounds to me like you're hearing or seeing evidence that there's no slowdown, i.e., maybe it's not so much a pent-up demand issue. Maybe this is more structural. Is that the right way to think about it?

Yes. And also, our competitors are not sort of frontline and center with our partners now. We spent a lot of time working with our partners to ensure they would stay viable during the tough times, and that's enhanced the relationships. So we're seeing a lot more business, and maybe our competitors are seeing a lot less. That's one of the -- and we have a lot of capacity.

So it may be that the market is showing some pent-up demand. But the reason we are so bullish on our growth is that our existing partners are sending us a lot of deals fast and furious. And I think we're seeing a lot more than our competitors are.

Okay. That's helpful. Second question, on the opportunity for insolvency deposit growth. This is interesting. You noted in your press release that a lot of these companies and face-to-face businesses may be practically insolvent but not technically insolvent due to some of the government funding structures out there. And I'm hearing that as well when I talk to some of these insolvency guys. What are you hearing most recently from some of these partners? And I'm thinking in terms of the number that you put up, 14% year-over-year growth in this deposit base. Is it possible you could see numbers bigger than that? Is that something that you expect from this?

Yes. I expect we'll see way bigger numbers. And the reason being is the 14% growth was just a function of us adding more partners. So in fact, the currency of insolvencies was much, much less with the COVID relief helping retail folks out in the tough time, but a lot are on the edge. And we tend to cater to the retail insolvency. So our software makes it very efficient for insolvency professionals to deal with retail and small retail insolvencies. So as you know, there's been a huge decline in retail insolvencies. But everybody believes this, what the Globe and Mail say, a tsunami of the retail insolvencies coming our way.

So that just bodes well for -- I hate to say it positively, and that it means a lot of suffering for individuals. But it means that our deposits from the insolvency practices due to retail insolvencies will likely increase dramatically.

And are the partners suggesting that's more of a second half 2021 event, just as a result of kind of the profile of government subsidies?

Yes. I would think so. I'm just guessing that our government will try to dampen the effect of the tsunami by helping out maybe a bit more with relief. But it's inevitable. I mean this COVID pandemic has created havoc in our economy. It's put a lot of people in terrible spots. And unfortunately, there'll be a lot more insolvencies, probably deeper into 2021. But you'll see our deposits just keep right on growing. We've -- like I say, we're up 14%, with a decline in insolvencies just by adding partners.

Our software works really well for insolvency practices. And we have partnerships with the 2 leading administrative software packages in the industry. So firstly, access to close to 100% of the insolvency practices operating in Canada. So we're in a very good spot there. And we're pleased that we can provide this efficient software package for these folks. And it makes our life easier. And we're not pleased there's going to be so many insolvencies, and that means a lot of hardship for people. But that we're -- it's just a service we provide, and it'd probably mean a lot more deposits.

Okay. And then just one more quick things, and I'll pass it onto others in the queue. On the DRT acquisition, you mentioned in the past the potential for acquisitions to kind of fill out the product suite of the DRT business that you have in mind. Where do we stand right now? Are there more products that you need? Should we expect more tuck-in-type acquisitions like this? Or does this acquisition largely fill out what you need to really see this business out to fruition?

It largely fills it out. Although there are partnerships we presently have with [neat] businesses that round out the product offering. And maybe there's an acquisition in the cards there, maybe not. But the partnership relationship works very well, too. So presently, from a functional point of view, with DBG added to the mix, we think we have a comprehensive suite to offer to another bank or a corporation to keep them safe.

We'll do the assessment. We'll ensure that we identify any vulnerabilities they might have. We have solutions to cover up those vulnerabilities. And we have capability providing ongoing surveillance so that they can be somewhat comforted to know that Big Brother's keeping an eye on their systems as they involve and change and as the hostile cyber world changes.

So we think we have a first-class offering, and we think it's a hugely growing market. We know, we bank. Banks think about it all day long. So I mean, us being a tiny sort of sample of the banking industry in the world, it's -- if you're not thinking about it, you really should start thinking about it very, very soon.

Right. And just you mentioned that DBG, one of the client bases they have is U.S. police services. A lot of us kind of simpletons in the investment world think of companies like cybersecurity companies having customers like that means that they've gone through quite a fact-checking and process to be able to offer services like that to U.S. governmental organizations. Can we assume that, that's a very positive indicator? That, that means you're kind of greenlit to do business with other U.S. government agencies, et cetera?

Oh, absolutely. Absolutely. You have to be a first-class checked-out to be able to provide those types of services. We were -- when we formed that company, Discovery Air, that Steve Boland referred to, we provided these NATO forces with aerial dogfighting and other training. And we received U.S. state department's approval for that. In fact, I think at one time, I was the CEO of the largest private fleet of jet fighters in the world.

So we're in good stead that way. We've always catered to that industry. And so obviously, with foreign actors, there's a lot of need for first-class cybersecurity.

Great. Congrats on the quarter.

Thank you. Good questions, Greg.

So this question comes from online, actually. Okay. So the question is, "What will be unique about Instant Mortgage that it will be a key selling point of this solution?"

Well, that's a good question. And what we're selling with the Instant Mortgage is ease of operation or ease of acquiring a mortgage. We designed it to be extremely user-friendly and to be available at the point-of-sale. So if -- let's say you're a new Canadian and a bit bewildered about where you go to get a mortgage, you'll find that it's available at the point-of-sale. And the salesperson will help you with the app. They'll press the button. And very quickly, it will come back with an approval so that you can pursue purchasing a home.

So it's all about the ease of access as opposed to going down to your local bank branch and finding out where that might be and making an appointment and all those things. This will be done right at the point-of-sale, just as the other point-of-sale industries that we support. Like, if you want to buy a motorcycle or a hot tub or something for your house or a new car, we provide convenience through our partners to get financing rapidly so you can get on with the purchase process.

Your next question comes from Peter Leacock from CIBC Wood Gundy.

First of all, congratulations on the quarter and, otherwise, a terrific year. I mean I think you were faced with, as everybody has been, with very challenging conditions. But I can't imagine you and your team having done a better job. So congratulations on that.

Well, thank you, Peter.

I just was wondering if you could provide a little more information on the Digital Boundary Group in terms of how that came up on your radar. I see that they also look to be based in London, Ontario. Did you know of them? Or how did the opportunity appear for you?

Well, you have done your homework. Yes, indeed, Digital Boundary Group head office is London, Ontario. And that was very fortunate. I met with John Millar, one of the principals of Digital Boundary Group, some time ago. Well, before COVID, we were able to have proper gentlemanly lunches to discuss the possibility of a partnership with DRT Cyber.

And then as we got to know DBG's capabilities, we're super impressed with the wonderful work that they've been able to do over the last 20 years, at the customer base they've established and how well thought of they are in the industry. So it was a wonderful coincidence that they were located in London.

And despite the challenges of -- that COVID's brought upon us, i.e., not meeting people in person, we were able to bring this deal finally to a conclusion. So yes, it was just happenstance that they're located in London. But once in a while, you get some good fortune come your way.

We have another question that's coming from online. So the question is, "There was discussion of a potential acquisition of another FI in the last few calls. Is that still on the table? Or are your organic growth opportunities more attractive?"

Well, that's a really good question. And we have to work upon a number of potential FIs to acquire. We've done a lot of analysis. And there are some attractive ones out there that we think could be complementary to our business and -- the 1 and 1 would make 3. But we are seeing massive organic growth now, to say the least.

So we have to kind of add those -- weigh those opportunities up in that an acquisition does bring a quantum increase in assets and earnings. But we're growing so rapidly too that we might get there maybe just as fast just from the organic growth.

But we're still not -- we're still pursuing them. We're looking at them. We're analyzing them and we're -- but this is a strange period of time. We're coming out of the COVID pandemic. Our bank, of course, with no loan losses and not even a loan in arrears and lots and lots of capital and super systems, it's kind of in a unique position to grow organically.

There are no further questions at this time. Please proceed.

Well, thank you, Colin. And thank you, everybody, for the really good questions. Should you want to engage me later on individually, I'm here at the VersaBank's Innovation Centre of Excellence almost all by myself. I've got 2 cats that are hanging around that are getting awfully lonely with no staff but -- so I'm available to answer your questions individually. If you want to drop me an e-mail, happy to engage. Thank you again. Over and out.

Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines.