Good day, everyone. Welcome to the NBT Bancorp second quarter 2022 financial results conference call. This call is being recorded and has been made accessible to the public in accordance with the SEC's Regulation FD. Corresponding presentation slides can be found on the company's website at nbtbancorp.com. Before the call begins, NBT's management would like to remind listeners that, as noted on slide two, today's presentation may contain forward-looking statements as defined by the Securities and Exchange Commission. Actual results may differ from those projected. In addition, certain non-GAAP measures will be discussed. Reconciliations for these numbers are contained within the appendix of today's presentation. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session. Instructions will follow at that time. As a reminder, this call is being recorded. I would now like to turn the conference over to NBT Bancorp President and CEO, John H. Watt Jr. for his opening remarks. Mr. Watt, please begin. Thank you, Josh, and good morning, everyone. Thank you for participating in this earnings call covering NBT Bancorp's second quarter 2022 results. Joining me today are NBT's Chief Financial Officer, Scott Kingsley, and our Chief Accounting Officer, Annette Burns. We are extremely pleased with our results for the second quarter of 2022, including earnings per share of $0.88, ROA of 1.28%, and a ROATCE of 17%. I'd like to take a moment here to highlight activity in our businesses. Loan growth continued to be strong. Our commercial business generated $310 million in loan originations, an increase of 24% over the last quarter. You know, it's clear to us that our commercial and small business customers continue to successfully navigate the challenging operating environment in the face of supply chain issues and inflation, and NBT is there to support them. The second quarter performance of our Sungage Residential Solar Partnership is also notable. Originations were strong in the quarter and credit quality continues to be pristine. Our fee-based businesses continued their strong performance with total non-interest income at nearly 33% of total revenue for the second quarter. Although we are very mindful that the forward environment is likely to be volatile, through six months, we observe a very strong consumer. Balances in personal checking accounts grew in the second quarter and credit quality in consumer loan portfolios is very healthy. Delinquency across all consumer loan categories is below pre-pandemic levels. I'm happy this morning to report that at a meeting yesterday, our board of directors approved a 7% increase in the dividend, or $0.02 a share to $0.30, making this our 10th consecutive year of annual dividend increases. As we head into the back half of the year and the potential for increased levels of uncertainty and volatility, we are well-positioned with strong liquidity and capital levels, a diversified business mix, a highly effective risk management practice, and a team of experienced professionals. With that said, Scott, I'm gonna turn it over to you to talk in greater detail with respect to our financial performance. Following Scott's remarks, we're happy to take your questions. Thank you, John, and good morning, everyone. Turning to the results overview on page 4 of our earnings presentation, our second quarter earnings per share was $0.88, which was down from $0.92 a share reported in the second quarter of 2021 and $0.02 a share lower than the first quarter of 2022. These results were achieved despite a $3.4 million decline or $0.06 a share in PPP income recognition compared to the second quarter of last year, and a $700,000 decline in PPP income from the first quarter of 2022. The improvement in net interest income over the two comparative quarters was the result of solid organic loan growth, productive incremental deployment of a portion of our excess liquidity into investment securities, increases in the Federal Reserve's targeted Federal Funds Rate, and the continuation of historically low funding costs. We recorded a loan loss provision expense of $4.4 million in the second quarter, compared to a provision benefit of $5.2 million in the second quarter of 2021, or a $0.17 per share swing, and a provision expense of $600,000 in the first quarter of 2022. Net charge-offs in the second quarter were $800,000 or 4 basis points of loans, compared to 7 basis points of loans in the second quarter of 2021 and 14 basis points of net charge-offs in the linked first quarter. Our reserve coverage increased slightly to 1.21% of loans from 1.18% at the end of March. The next slide, page five, shows trends in outstanding loans. On a core basis, excluding PPP, loans were up $162 million for the quarter and included growth in both our consumer and commercial portfolios. Our total PPP balances as of June thirtieth were down to just over $17 million. With forgiveness almost complete for both the 2020 and 2021 vintage loans, we recognized $1.3 million of interest and fees associated with PPP lending during the quarter, and we have just $400,000 in unamortized fees remaining. Excluding PPP recognition, loan yields were 16 basis points up from the first quarter of 2022, reflective of higher yields on our variable- rate portfolios, as well as higher new volume rates. Moving to the slide on deposits. We were down $433 million from the end of the first quarter, which was a result of a $100 million brokered deposit maturity within the quarter, as well as seasonal declines in municipal deposits. The matured brokered deposit was the last of our wholesale funding, which we secured in the early and uncertain days of the pandemic. Our quarterly cost of deposits remained flat at 7 basis points, and we continued to add new accounts. The next slide looks at the detailed changes in our net interest income and margin. Net interest income increased $8.4 million as compared to the second quarter of last year, and up $7.2 million from the first quarter of 2022, reflective of higher yields on earning assets. Reported second quarter net interest margin was 3.21%, up 26 basis points from the first quarter of 2022, and up 21 basis points from the second quarter of 2021. Looking forward, with interest rates rising, the yields on our variable- rate earning assets are expected to continue to move higher. We also expect to reinvest our loan and securities portfolio cash flows at levels above current blended portfolio yields. As such, we would expect to see more opportunities for additional core margin improvement. Although we believe our deposit funding profile is best in class, we would expect some level of deposit beta to be present beginning in the third quarter. Our balance sheet still continues to exhibit a meaningful level of asset sensitivity. Moving to the trends in non-interest income on page eight. Excluding securities gains and losses, our fee income was up 8% from the second quarter of 2021 to $42.2 million, but lower by $600,000 from the linked first quarter. More broadly, non-spread revenue was 33% of our total revenue in the second quarter of 2022 and remains a key strength and value driver for NBT. Our retirement plan administration businesses experienced strong year-over-year growth, driven by higher activity-based revenues and continued organic growth. Wealth management fees were lower than the linked first quarter, as well as the second quarter of 2021, due primarily to market performance. Banking fees improved almost 11% from the second quarter of 2021, driven by both higher card-related income and service charges. As a reminder, the bank is subject to the provisions of the Durbin Amendment to the Dodd-Frank Act beginning in the third quarter, which caps our per transaction compensatory opportunity for debit interchange. We estimate this will reduce quarterly debit card interchange income by approximately $3.7 million or almost $0.07 a share. Turning to non-interest expense, our total operating expenses were $76.1 million for the quarter, which was $4.7 million or 6.6% above the second quarter of 2021. Salaries and employee benefit costs of $46.7 million were up 9.5% over the prior year and included merit-related salary increases, as well as higher performance-based incentive compensation and increased medical expenses. Total operating expenses were also higher than the linked first quarter of 2022, reflective of one additional payroll day, annual merit pay increases, which we process annually in March and higher medical costs. We'd expect core operating expenses to drift modestly upward over the next several quarters as we continue our efforts to fill a higher- than- historical level of open positions in support of our customer engagement and growth objectives. In addition to investing in our people, we expect to continue to invest in technology-related applications and tools in order to advance our customer- facing and processing infrastructure. On the next slide, we provide an overview of key asset quality metrics. A walk forward of our loan loss reserve changes is also available in the appendix to the presentation. As I previously mentioned, net charge- offs were 4 basis points of loans in the second quarter of 2022, compared to 14 basis points in the prior quarter. Both NPLs and NPAs declined again this quarter. We are continuing to benefit from our conservative underwriting, and we have been experiencing higher- than- historical levels of recoveries. As I wrap up prepared remarks, a couple closing thoughts. We started 2022 on strong footing, and we are pleased with the fundamental results achieved in the first half of the year. Improving net interest income, solid results from our recurring fee income lines, and exceptional credit quality outcomes have more than offset higher levels of non-interest expense, which has allowed for productive gains and operating leverage. Our capital accumulation results over the past several quarters continue to put us in an enviable position as we consider growth opportunities for the balance of 2022 and beyond. With that, we're happy to answer any questions you may have at this time. Thank you. Anyone with a question at this time can press star and then one one on your touchtone telephone. Again, that's star, then one one on your touchtone telephone for a question. One moment for our questions. Our first question comes from Alex Twerdahl with PSC. You may proceed with your question. Hey, good morning, guys. Morning. Morning, Alex. First off, I was just hoping you give us a little bit more color on the momentum in the loan portfolio with respect to growth that you saw during the second quarter. Is that momentum strong enough to carry into the third quarter? Maybe give us a little bit of color on sort of which geographies have been the strongest, and where new loan yields are coming on relative to the 4.08% book yield. Sure. Let me talk about where we're seeing the growth, and then Scott will follow up with our view of loan yield and where we can go from here. You know, it's been very strong, Alex. As you know, in the first Q, we experienced growth in excess of what we would normally experience in the markets we serve. You know, that's a post-pandemic impact that is positive for us and positive for the economy. We see it across the board. It's in New England. We see it in our core markets. We see it in Northeastern Pennsylvania. It's a good mix of C&I business and CRE as well. You know, I think we would observe that developers are slightly more cautious as they think about multifamily projects going forward here. We have several that are in process now and will continue to build out over the next 12 months. The demand there continues to be high in those markets. On the C&I side, we see business owners expanding their plant capacity, buying equipment, becoming more efficient, all the kinds of things that a community bank like NBT knows how to support and is very good at doing. You know, no doubt it's a very competitive market, but I think I've been saying that for 37 years in these markets, that it's always competitive in the commercial business. It's the quality of what we have to deliver that distinguishes us and that explains the high production levels in second Q. You know, slight moderation, I would suspect, towards the back half of the year driven by higher rates. The pipelines are still active, and moving towards closing through third Q and towards the end of the year. Scott, why don't you talk about yields a little bit? Sure. Alex, let's take this sort of in two chunks. You know, during the quarter, especially the early parts of the second quarter, we were certainly still adding new assets that had interest rates in the low 4s, because we were making, you know, pipeline commitments that, you know, were out there prior to that. As the quarter came to an end, very few of our assets were not getting locked at 5%. You know, so probably still closing some assets in June in the high 4s. But generally speaking, you know, the pipeline commitments have now moved out to where, you know, most assets that are attractive for us are in the 5% level. Great. That's really helpful. You know, with respect to credit, you guys did put a little bit more into the ACL this quarter. Can you just talk through kind of the thought process there? It doesn't seem like anything you're saying would suggest that that was warranted, but obviously, there's a lot of uncertainty on the horizon for the back half of the year. You know, maybe just kind of what drove that, specifically drove that ACL increase, for you guys. Yeah. Alex, again, excellent point, you know, from a timing standpoint. I would call our approach from a reserving standpoint in the second quarter as prudent. You answered your question within the construct that you just asked, which is the level of uncertainties, you know, probably has us thinking that the weighting of downside versus the weighting of a baseline forecast are probably pretty close to each other at the current point in time. Again, kind of think about what we did is we provided enough provision to cover the minimal level of charge-offs we had, and then we provided enough to fund the growth that the portfolio experienced, and then a little bit more because the macroeconomic conditions ever so slightly had modest deterioration during the quarter. Okay. Just a final question from me, just with respect to M&A. You know, we've talked a lot in the past about kind of the desire to do a deal, you know, now that you guys are over $10 billion. Obviously, you guys have been very, you know, I guess, cautious on approaching a transaction. I'm just curious with the rapid change in interest rates and all the volatility in the markets, if a transaction today is something that you could pursue. Great question, Alex. Our strategy hasn't changed as expressed in the last four quarters. Yes, well, you're right. We are very selective in terms of ensuring that we have the right partner to drive our strategic growth. There are a lot of conversations with potential partners that continue. I guess Scott and I would observe that there was a slight pause in second Q while those partners considered the impact of a shock in rates on their balance sheet in the context of an acquisition and on their valuation. You know, that makes sense to us. I think they're working through what a higher-rate environment means, and there'll be some adjustments in understanding of what they're able to achieve. I think based on what we have been able to continue to have dialogues around, it's still active and again what do we think about when we're approaching one of those opportunities? How does it accelerate our otherwise established strategy? You know, what kind of partner from an integration perspective will we be able to do a deal with? We wanna make sure that in the end all of those things align and that we're doing the right thing by our existing shareholders when we do it. Again, a short answer no change in strategy, just slight pause, because everybody is trying to figure out what this rate environment means to them. Alex, I'll follow that up with this, is that to John's point, by any sort of ALCO junkie's perspective, 225 basis points in four months is a shock, right? That's a shock to the rate structure. What does that mean? For purposes of our consideration of potential partners, we've had to look at the impact on beginning regulatory capital of impacts of AOCI reductions and potential interest- rate marks on loan portfolios. Certainly doesn't mean we think less of the operating characteristics of a business we might be interested in. We at least need to be cautious and understand what does that do to opening equity? What does that do to opening capital ratio levels? We need to be responsible with that. You know, I think there's a little bit more clarity now as to where we are probably going to stand relative to long-term rates. That's probably helpful in, you know, sort of rekindling some of the dialogue that we were having earlier in the quarter. Great. Thanks for taking my questions. Thanks, Alex. Thank you. Thank you. One moment for questions. Our next question comes from Chris O'Connell with KBW. You may proceed. Hi, good morning. All right, guys. Why don't you start off on the expense guide? I know it came in, you know, a little higher this quarter on some of the seasonal factors you mentioned, and, you know, to modestly drift higher from here. Was just hoping to get a little bit of color into maybe like the longer term trends, because if I'm reading it right, you know, relative to, you know, kind of the $73 million-$74 million guide last quarter, you know, this would put you guys kind of toward the upper- single-digit for growth in 2022 versus, you know, more, you know, low- to mid-single-digit previously. Does that mean that you're making more hires this year and that, you know, the pace kind of moderates in 2023? Does it not really change the long-term outlook? Thank you. Thanks, Chris. Appreciate the question. So let me start to frame that. You know, coming out of the first quarter where our operating expense rate was closer to $72 million. A couple sort of probably optically astute observers would be around the first quarter, we were not still fully engaged. There was still enough sort of COVID uncertainty out there in the early stages of the first quarter, where some of our things like marketing initiatives and group gatherings and full engagement from a customer perspective, we're not able to get through some of those. Second quarter, different story. Just the pure sort of transactional and activity- level expenses were higher in the second quarter because it's stuff we didn't do in the first quarter. Kind of add to that, an additional payroll day off the first quarter. You know, we're performing very well relative to some of our incentive objectives. For us, incentive compensation is a higher proportional value of our expense run rate in 2022 than it certainly was in previous years. That probably continues for the balance of the year, you know, given some of the success we're having. Your question relative to how do we think about that going forward and modest uptick in expenses. Another payroll day in the third quarter, but even amounts of payroll days in the fourth quarter with the second quarter, just the way the calendar falls. We still have a, you know, sort of, 50-60 open position outcome in our company today. Would we like to add those folks? We sure would. Are they available for us to do on a recurring basis? It's been difficult. I think you kind of look at it this way and say $76 million is not a bad run rate. It's probably a little higher on the incentives than we would have said historically. From there, I would say if we could hire a few more people to help us with our customer-facing objectives that we have from a growth standpoint, we'd be happy to bring those aboard. I still think you don't get meaningfully above sort of that $76 million run rate going forward. Okay, that's helpful. As far as the deposit moves this quarter, you know, I hear you on the $100 million of brokered CDs. How are you seeing, you know? I guess, what if you could quantify the muni seasonal magnitude, that'd be great. Maybe how much of that you think would be coming back in. How are you thinking about kind of just deposit flows and what you're seeing from customers going forward on overall deposit growth? Excellent point, and thanks for asking the question, Chris. To your point, what we had was a pool of brokered money market funds that matured in the second quarter that we actually secured at the early stages of the pandemic from a liquidity standpoint. Clearly, we didn't end up needing that, you know, but obviously, in those particular cases, you just run those to maturity. On the other $300 million-ish drop in deposits for the quarter, seasonal outflows on the municipal side, you know, represented the lion's share of that. What we also saw is that within our, whether it's a municipal or non-for-profit portfolio, there's a meaningful amount of deposits with some rural healthcare enterprises. They spent some of their money in the second quarter. A lot of that was either pandemic-related support, you know, or other government assistance programs, you know, that they all either applied for or were granted, you know, as part of the pandemic, you know, some of the incremental costs they incurred in the last couple of years. There was actually drawdown of some of those funds. Just on our healthcare entities alone, that was close to $75 million in the quarter. Don't think we think that piece is coming back in the near term. The third quarter is typically a net positive for us on municipal deposit flows. You know, the states we're in, people collect school taxes in the month of September. Normally we have an uptick there. I will observe this too, though at the same point in time to talk about customer deposit flows. What's happened since we've had such rapid changes in rates, you know, over the last four months, is that the money market aggregators are back in business. Those people that did not participate in the market relative to other options for some of our customers, those firms are getting the band back together, and they're doing it in short order, you know, because of the level of volatility. There are offerings out there with some of the aggregators that are meaningfully above where our core rates are relative to money market opportunities. Do we think some of our larger institutional and municipal customers may avail themselves of some of that higher rate before we'll get them to that higher rate? Probably. Do we think it's a meaningful piece of our $10 billion deposit portfolio? We don't. I think that's how we're thinking about it, Chris. The beauty of us is we're still adding net new units from a depository standpoint, and that's the important thing. Adding new accounts on a net basis is always, you know, the point of reference for us. Account balances can change over time, but as long as you're adding new accounts, you're probably progressing. Okay. Got it. That, that's helpful. Then, kind of just piggybacking there, you know, I hear you that deposit costs, you know, start to move up, in the third quarter. Just trying to see if there's any more color there or, you know, any way to frame that. Obviously, you guys have had, you know, low betas in the past, and we're expecting to, you know, be running below, you know, the market, at least initially here. You know, just given this, the magnitude of the moves and the speed, you know, any color as to, you know, the magnitude of what you guys are thinking would be helpful. Sure. I would probably do a little bit of bifurcation within our deposit portfolio and tell you that we have in the neighborhood of $7 billion worth of DDA checking and savings deposits that we don't see the rate movements there being very substantial, at least for the next six months. What are we managing? We're managing that other $3 billion in deposits where the customers are a little more interest rate sensitive. In fairness, would expect to be having some discussions with some portion of that part of the deposit base about Fed Funds rates being up 225 basis points, I think, as of tomorrow. Geez, we should maybe get some modest piece of that. We'll be very deliberate about that, Chris. To your point, we love our starting point. You know, base costs at 7 basis points with going into the quarter of $300 million of net liquidity. We have the affordability to take obvious, you know, very, you know, thought out, thoughtful ways to go back to customers and say, you know, "What's the definition of excess liquidity, and what's the definition of core accounts? If I could follow on that, Chris. Yeah. If I could follow on that. Yeah. Absolutely. It's in the DNA of this company to be very thoughtful about how we manage the deposit book in an uprate environment, and we've had great success with that in the past. It's an integrated approach on the front line in every branch, in every commercial lending office, in the business banking sector of our businesses, and a lot of collaboration on the finance side with those folks to make sure that these customers that we've been serving for many, many years have their needs met. Also, we continue with our long history of being very careful on how that beta moves quarter to quarter to quarter. We feel good about all the tools we have in place to do it, and we would expect that we'll replicate our practices in the past and we'll see what the outcome there is, but we feel good about how we're gonna move forward in the short to medium term. Great. Yep, I hear you. On the fee side of the business, was just hoping to get, you know, an updated outlook as to, you know, how you're seeing, you know, the retirement plan business, you know, wealth and kind of the insurance segments, you know, given some of the market impacts going into those in the third quarter. Then, if you could quantify the, you know, contribution, if significant, from the H.A. Rogers announcement. Chris, take a shot at that. First and foremost, we like all three of those businesses. We continue to think all three of those businesses are investable in terms of their organic growth objectives as well as, you know, the potential for bolt-on acquisitions as we've done, especially in the retirement plan space over the last several years. You know, to your point, you're right. You know, equity market performance does have an impact on their revenues. It's not all of their revenues, but it's some of their revenues, and it matters. Did we get the full impact of some of the market declines in the second quarter? There might be still a little bit more hangover to come into the third quarter, you know, presuming the market is still, you know, kind of at the level of valuation it sits at today. Underlying attributes, we like the organic growth that we're experiencing in all those lines of business. You know, we're soliciting and securing the right kind of new business. You know, we're also doing things from a technical infrastructure standpoint in all of those businesses to try to expand our services, to try to expand our product base, you know, while we're adding to a wider group of customers. One thing we've talked about, you know, at some detail internally is we really haven't, you know, transported a lot of those attributes, especially on the wealth management side, into our new markets in New England, and that's an opportunity. Now, that means finding good people, but those people are out there and we're having chats with those people. We would love to round out our services, you know, in some of those markets we've been successful at from a commercial lending standpoint, you know, with the full scope of NBT products. Great. Appreciate you taking my questions. Thanks. The small insurance agency that we acquired in northern New York is just that. It's small, but it fits us very well. You know, we have common customers on the banking side. You know, the principal of this business has been an NBT customer and an NBT advocate for many, many years. You know, we're just happy to be able to expand that outcome. We think that's a great opportunity to fold in. In fairness, if we could find a few more of these, we'd be happy to do them. Thank you. As a reminder, to ask a question, you will need to press star one one on your telephone. Our next question comes from Matthew Breese with Stephens. You may proceed. Good morning. Morning, Matt. First one for me, just, you know, in the appendix of the presentation, you show that the overall loan portfolio is 62% fixed and 38% adjustable/floating. How much of that is pure floating and true floors? And then I was hoping for a bit of color around duration on the fixed side and then the adjustable side. All right. Let's take a shot at the easy one first, and then we'll work on the duration question, Matt. We think there's about $2 billion worth of pure variable. So when the Fed funds changes and that presumably moves through prime rate changes or LIBOR or SOFR changes, you know, we get the benefit later that day. Now, do we experience that benefit from our customers immediately? There's probably a one-month lag just based on where the customer is in their billing cycle. In some cases that, you know, you don't get that adjustment until, you know, the next billing cycle. But I think what we're using that is essentially that $2 billion number. You know, to kind of lead into your follow-up to that would be, you know, clearly the Fed funds changes that have happened from March to June. We have not yet experienced the full benefit of those, which we will in the third quarter, as well as, you know, the rhetoric around whether we're getting 75 or 100 tomorrow. So that'd be the start point. I think generally, I'll say this about from a duration standpoint, you know, generally we have a lot of five-year repricing- type instruments in our commercial loan book. You know, we may be offering terms that go out seven to 10 years on a fixed side in certain cases. Usually, the duration of those instruments don't last that long anyways. Right. Usually the customer is back in front of us with another initiative or another opportunity long before we get to that point. You know, cash flows are meaningful. I think we've said this before, you know. You know, cash flows off our loan portfolio in terms of natural amortization and maturities, you know, are in the neighborhood of $2 billion a year. You know, we will have that opportunity, obviously, to reprice at higher new volume rates as rates continue to move up. Understood. Okay. This leads into my second question. You know, Scott, in your opening remarks, you kind of led us to believe that you expect NIM expansion, at least in the near term. You'd mentioned you haven't gotten the full benefit of the rate hikes. We're about to get another. At least it seems to be consensus that we get another at least 75 basis points this week, plus perhaps another 50 to 75 basis points later in the year. Is it possible that we see kind of repeat performance on the NIM expansion this quarter in the third quarter? Or could you give us some idea, frame for us better what you anticipate on the NIM for the duration of the year? Let me, again, break that into a couple different buckets. Part of this, the second quarter's net interest margin expansion came from the fact that we had a meaningful drop in cash equivalents. We don't have that same drop in cash equivalents coming in the third quarter. To your point, we will get the full quarter impact of some of those changes in Fed funds rates. The sheer impact, as I said, was in and around 15 or 16 basis points on loan yields. I think we could see that happen again, you know, in the third quarter. You know, I think that would be our expectation. I think what's also gonna happen, and maybe it's not a third quarter outcome, but we're gonna get some level of response necessary on the deposit beta side. That's probably more in the fourth quarter. You know, we're a third of the way through the third quarter, and we can probably tell you, haven't had to do much yet. That's coming, and we need to have productive conversations with some part of our or our customer base that addresses that, and that's coming. Do I think 21 basis points? Would be happy to book that today, or 26 basis points. Probably not all of that, but I think a decent portion of it. Okay. I noticed that you, the loan portfolio breakout is a little bit different this quarter. You know, specialty lending is now broken into resi solar and looks like other consumer caught the balance. Beyond just the resi solar piece, if I think about that legacy specialty lending book, what else was in there? What made up the delta? Just give us the numbers and the yields and the historical kind of loss content there. Yeah. You're right. We did do that. During the quarter, we had some productive conversations with investors, you know, folks like you and potential investors that were looking for a little bit more clarity because we've obviously have had some real success with residential solar. We really like the platform that we're partnered with, you know, our friends at Sungage, and that's been highly productive for us. You know, we continue to look at that and say that's opportunistic. What's left in the pool? We still have some assets from the Springstone relationship that we've had historically. To your point, they have had higher than our blended book yields historically, but we've also experienced a little higher level of net charge-off in that portfolio. Those were, you know, dental and other healthcare- related, consumer unsecured credit, outcomes. They've performed very well historically. It's been a net net positive for us historically. You know, what's also in there now is, you know, that since Springstone was acquired by LendingClub, to the extent that we were still participating on their platform, we're really not today. I would argue that portfolio is in a runoff status, which we're fine with. We're fine with reallocating some of those outstandings into other portions of our portfolio. Recall there, Matt, once LendingClub acquired Radius Bank, they had a charter that enabled them to originate directly. We no longer were in front of them originating that category of loans for them. Okay. As we think about those two buckets, you know, one is growing, the Sungage piece. Could you frame for us what you expect for loan growth there? The other piece sounds like it's in runoff. Could you give us some idea of the pace of runoff? Yeah. Pace of runoff on that portfolio is probably like a you know two to three-year duration. Maybe that speeds up because you're not generating anything new. On the Sungage side, you know, really productive growth has been experienced, you know, in the residential solar world. Remember, that's a national platform. You know, we've really geared up to be able to, you know, quote, take more of that. It meets our credit attributes in terms of our credit box. You know, we dictate those outcomes, so we're very happy with the credits that we're putting in there. As a reminder, Matt, I think you know this, but that's a better- than- average customer with a better- than- average FICO score. You know, somebody who makes a decision to do a $25,000 or $30,000 investment in their own property, for a solar array, you know, is not just run-of-the-mill from a customer standpoint. We like the attributes of that. Could that grow, you know, again, at the pace that we've experienced over the last four or five quarters for another couple of quarters? There's a potential for that. I think it'll be really interesting to see what happens in that market with higher demanded yields, 'cause that's where we are today. You know, you know, the yields that are necessary in order to stay, you know, productive in that portfolio are moving up. Does that change how the customer base views that opportunity relative to their net utility savings? Does that change how installers view those opportunities? I think the jury is still out on that. If we could get the desired yields that we think are appropriate today, we're certainly willing to grow that portfolio. Got it. Okay. Then my last one, you know, I asked another upstate New York bank the same question, but you know, the winters in your neck of the woods tend to be longer and harsher than a lot of the country. Fuel costs per the CPI, you know, year-over-year are up nearly 100%. How do you feel about the health of your customer base, your consumer customer base heading into the winter months? Do you feel like there's any potential for deterioration in credit quality on the back of it? I think I said in my comments upfront, Matt, that we have not observed through the end of second quarter any deterioration in the consumer's behavior or in the consumer credit portfolios. We saw growth in consumer checking accounts. With that said, you know, we're very aware that the proportion of the weekly paycheck allocated towards gas and heating is gonna go up, and we're watching that closely. We think the consumer has a nice cushion going into it. The other visibility we have here are several large integrated commercial home heating oil, propane fuel distributors who we're close to, who obviously are also watching that same behavior. Between us, we share information about how the consumer is behaving. There's a degree of caution there, but no panic and no observation of inability to pay. We'll watch it. You know, I think Scott said it earlier, consumer credit from a past due, not performing, and charge-off perspective can't get any better than it is today. Will there be an eventual reversion to the mean, the traditional levels of performance of those portfolios over time? Sure, I would expect that would happen. I don't see it happening in one quarter or two quarters. It's gonna take some time for that to occur. Got it. That's all I had. I appreciate you taking my questions. Thank you. Thank you, Matt. Thanks, Matt. Thank you. One moment for questions. Our next question comes from Alex Twerdahl with PSC. You may proceed. Hey, just one quick, sort of nitpicky follow-up question, you know, with respect to Durbin kicking in the third quarter. That, ATM and debit card line has kind of bounced around a little bit over the last couple of quarters. Is the $3.7 million reduction, should we be using $9.75 million from this quarter as the starting point from that? Or is that, does that number include something that maybe is not gonna recur? Alex, within that line item, it is also true sort of ATM utilization, you know, fees, you know, that we get when, you know, our non-customers that aren't ours end up hitting some of our ATM sources. I think when we look at that $3.7, that's probably a number that we've looked at and said, you know, what were our run rate for the first half of the year? You know, I think we think somewhere between $7.4 million and $7.5 million is likely to be the outcome in the back half of the year. Hopefully that helps you from a solving of that. But there is other stuff in there than just pure debit interchange. Okay. Some of that other stuff maybe hit a little bit harder in the second quarter relative to prior quarters. Yes. It's pure activity. The first quarter is always a down utilization outcome for some of those other activity-based fees. The second, third, and fourth quarter tend to look a lot alike, you know, before you experience sort of that, you know, the winter misery of people not showing up and, you know, going to the ATM. Got it. All right. Thanks for taking my follow-up. Thanks, Alex. Thank you. I'm not showing any further questions. I will now turn the call back to John H. Watt Jr. for his closing remarks. Thank you, Josh. Again, thank you all for joining this call. We're very excited about our performance in the second quarter and the prospects looking forward, and we appreciate your interest in that story. Look forward to catching up with all of you at the end of the next quarter. Thank you. Thank you, Mr. Watt. This concludes our program. You may disconnect. Have a great day.