Good morning, and welcome to the Provident Financial Services second quarter earnings conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key, followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may do so by pressing star then one on your telephone keypad. Please note, this event is being recorded. I would now like to turn the conference over to John Kuntz, Chief Administrative Officer. Please go ahead, sir. Thank you, Chad. Good morning, ladies and gentlemen, and thank you for joining us for our second quarter earnings call. Today's presenters are Chairman and CEO, Chris Martin, President and Chief Operating Officer, Tony Labozzetta, and Senior Executive Vice President and Chief Financial Officer, Tom Lyons. Before beginning their review of our financial results, we ask that you please take note of our standard caution as to any forward-looking statements which may be made during the course of today's call. Our full disclaimer is contained in this morning's earnings release, which has been posted to the investor relations page on our website, provident.bank. Now it's my pleasure to introduce Chris Martin, who will offer his perspective on our second quarter. Chris? Thank you, John, and good morning, everybody. We hope that you and your families are healthy. Our second quarter results were solid and the trends remain generally positive. Operating earnings were strong with net interest income the highest it has ever been for Provident. In spite of strong loan originations, loan portfolio growth was challenged in the quarter as payoffs continued to exceed our forecasts. The loan pipeline, however, is the largest we have ever had, and we anticipate stronger originations in the second half of the year. The economic outlook is promising, assuming continued success against COVID-19, and our business clients are optimistic for the future. Long-term loan growth is highly correlated to economic growth, and we believe economic conditions in our markets continue to improve and support an expansionary trajectory. Also, a positive is the consumer and their personal savings position, which will continue to support solid consumer spending in the future. As businesses see demand increasing, it is anticipated that credit line usage, which is currently on the low side, will increase. However, risks remain as interest rates have been volatile, and the recent downward shift in rates is putting pressure on net interest income and margin. Deposit growth continued to be strong, with substantial increases in non-interest-bearing deposits. The growth in deposits improves our capacity to fund loan growth in the second half of 2021. We are executing a disciplined approach to leveraging the excess liquidity on our balance sheet, initially in the investment portfolio to produce better returns and augment our margin. The net interest margin reflected lower earning asset yields given the low rate environment and spread pressures from lending competition, although improved funding mix and better deposit pricing are helping to mitigate these factors. Asset quality continued to improve during the quarter, and loan payment deferrals are negligible. All of our credit ratios and indicators are positive this quarter. Our primary non-interest revenue sources, namely Beacon Trust and SB One Insurance, will continue to provide meaningful impact to lessen the pressure being experienced in our spread business. We expect most fee revenue categories to grow modestly for the remainder of 2021. We will continue our methodical approach to managing operating costs. Our focus will be holding the line on expenses and creating operating efficiencies without sacrificing our commitment to technology enhancements to improve the customer experience and our competitive position. We believe we can further improve our returns to stockholders through a combination of balance sheet growth, active management of our margin, continuing to rationalize our branch network, and further leveraging operational efficiencies gained with the SB One acquisition, accompanied by continued execution on our regulatory risk and control framework. With that, I will ask Tony to add some more color. Thanks, Chris, and good morning, everyone. Chris has given some highlights of our strong second quarter performance, and Tom will give further details later in the presentation. I would like to take a few moments and share some thoughts with you on market conditions, business line performance, and the areas of focus. Based on the tenor of our conversations with customers, increased activity in our key business lines and improved non-performing assets, and a reduction to an immaterial amount in COVID-related loan deferrals, we believe the economic outlook for the second half of 2021 is promising. This supports improved growth and continued strong profitability for the remainder of the calendar year. Excluding PPP loans, our commercial lending group has paced at or better than planned with regard to production. In the second quarter, we closed over $460 million of new loans, an increase of 57% from the prior quarter. This solid production was offset in part by a decline in line of credit utilization of approximately $161 million over the average for fiscal 2020. In addition, there is significant excess liquidity in the market. As a result, the competition has been persistently more aggressive on pricing and structure. We remain committed to maintaining our credit culture and not sacrificing structure or quality for volume, which contributed to an increased level of prepayments. Consequently, we saw a net decrease in our commercial loan portfolio of about $49 million for the quarter. Despite the competition, we are seeing good activity within our lending teams. At quarter end, our pipeline remains strong at approximately $1.7 billion. However, we are seeing a decline in the average interest rate in the pipeline, which can add pressure to our net interest margin. We expect a good pull-through rate in our pipeline, and if our prepayments normalize, we should experience solid growth for the remainder of the year. Like many banks, we have seen strong growth in our deposits. Nevertheless, I'd like to point out that the largest percentage of our growth is in non-interest-bearing demand deposits, which grew at an annualized rate of 17% and presently comprise 24% of our deposits. Our total cost of those deposits is about 26 basis points and is amongst the best in our peer group. We continue to grow our fee revenue, largely through Beacon Trust and SB One Insurance. SB One Insurance had a strong second quarter with new business that resulted in a 60% increase from the same quarter last year. Beacon Trust also had a very good quarter, with assets under management increasing approximately 24% annualized and revenue being up 32% over the same quarter last year. They integrate well with the other business lines in our organization. Looking forward, our focus is to responsibly deploy our excess liquidity, predominantly into our commercial lending book, continue to build our fee-based businesses, enhance the experience of our employee and customers, and maintain operational efficiency. This will improve our earnings and total return to our shareholders. With that, I'll turn the call over to Tom for his comments on our financial performance. Tom? Thank you, Tony. Good morning, everyone. Our net income for the quarter was $44.8 million, or $0.58 per diluted share, compared with $48.6 million or $0.63 per diluted share for the trailing quarter. Earnings for the current quarter benefited from $8.7 million of net negative provisions for credit losses on loans and off-balance-sheet credit exposures, while the trailing quarter reflected negative provisions of $15.9 million. Pre-tax, pre-provision earnings were $51.4 million, or an annualized 1.56% of average assets. This is an improvement from $48.9 million or 1.52% of average assets in the trailing quarter, as revenue increased to a quarterly record $112 million and operating expenses declined by $2 million. Our net interest margin compressed six basis points versus the trailing quarter. Excess liquidity increased despite an increase in average investments as average loans decreased and average deposits grew. Loan repayments remained elevated and included increased PPP loan forgiveness. We expect to deploy much of this excess liquidity into loans and securities in the near term to improve the earning asset yield and increase interest income. We were able to reduce the cost of interest-bearing liabilities by 5 basis points versus the trailing quarter through reductions in deposit costs. Including non-interest-bearing deposits, our total cost of deposits fell to 26 basis points this quarter from 30 basis points in the trailing quarter. Average non-interest-bearing deposits increased from $100 million or an annualized 17% to $2.48 billion or 24% of total average deposits for the quarter. Average borrowing levels decreased to $146 million as we shifted funding to lower-costing brokered demand deposits. We expect to maintain a relatively stable net interest margin as we continue to deploy excess liquidity into loans and securities while managing funding costs and emphasizing non-interest-bearing deposit growth. The pull-through adjusted loan pipeline at June 30th increased to $150 million from the trailing quarter to a record $1.1 billion. The pipeline rate decreased 35 basis points since last quarter to 3.28%, reflecting the current competitive rate environment. Our provision for credit losses on loans was a benefit of $10.7 million for the current quarter compared with a benefit of $15 million in the trailing quarter. The current quarter benefit was attributable to $6 million of net recoveries on previously charged-off loans, improved asset quality, a favorable economic forecast, and a decrease in loans outstanding. Asset quality metrics, including COVID-19-related deferrals, non-performing loan levels, early-stage and total delinquencies, criticized and classified loans, and all related ratios improved versus the trailing quarter. We had annualized net recoveries as a percentage of average loans of 25 basis points this quarter compared with net charge-offs of 4 basis points for the trailing quarter. Non-performing assets decreased to 62 basis points of total assets from 65 basis points at March 31st. Including PPP loans, the allowance represented 88 basis points of loans compared with 92 basis points in the trailing quarter. Loans granted short-term COVID-19-related payment deferrals have declined from their peak of $1.3 billion to just over $7 million. This compares with $132 million at December 31st. All commercial loans in deferral are paying interest. Non-interest income was stable versus the trailing quarter at $21 million, as increased loan prepayment fees and growth in wealth management insurance agency income were offset by decreased bank-owned life insurance income and reductions in net profits on loan-level swaps and gains on loan sales. Excluding provisions for credit losses on commitments to extend credit, operating expenses were an annualized 1.84% of average assets for the current quarter compared with 1.95% in the trailing quarter and 1.86% for the second quarter of 2020. The efficiency ratio improved to 54.12% for the second quarter of 2021 from 56.19% in the trailing quarter and 57.35% for the second quarter of 2020. Our effective tax rate was 25.4% versus 25.1% for the trailing quarter, and we are currently projecting an effective tax rate of approximately 25% for the remainder of 2021. That concludes our prepared remarks. We'd be happy to respond to questions. We will now begin the Q&A session. To ask a question, you may press star then one on your touch-tone phone. If you're using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then two. At this time, we will pause momentarily to assemble our roster. The first question will be from Michael Perito with KBW. Please go ahead. Hey, good morning, guys. Thanks for taking my questions. Good morning. Good morning. I wanted to start, I think the point you guys made in the prepared remarks on having the fee growth in the tough margin environment is a really good one. I wanted to kind of drill down on that for a second here. I think the last time we spoke, there was some good optimism around the wealth and insurance kind of growth trajectory. Obviously a strong quarter in the first half of the year. I was just curious if you could maybe get a bit more specific on the outlook there. It seems like the market continues to help on the wealth side with some organic growth behind it, then, Tony, you mentioned some of the insurance organic growth. Just do you think that there's still some room for growth on those items off of the kind of elevated Q2 revenue run rates, or just any more specific thoughts there? Yes. I'll start with the insurance. I think, as we mentioned on prior calls that we're expecting that 18%-20%. George just continues to outpace. We're seeing a lot of good synergies between the bank and insurance. The commercial lending team has embraced a lot of the value add that they bring to the customers. You're seeing a lot more referrals going in. George is still doing the things with his group. Obviously, George runs the insurance. They're doing a lot of organic growth on their own around the bank. My expectation is that he can maintain pace. He will at a minimum, we'll achieve that growth number that we talk about, that 18%-20%. Seeing the dynamics, I expect them to outpace that number, and it might be material. I think the challenge for us there will lie more on continuing to have the resources for George to keep pace with all the activity. I'm pretty upbeat on that. Same thing we're seeing on Beacon. We're seeing some organic growth. We're seeing some good synergies between Beacon and the business lines. They got a really good integrated approach to the business. Obviously market conditions not collapsing, I expect it to do well there as well. I don't know, Tom, if you want to add. Yes, I can add a little bit to that, but I think particularly noteworthy in the insurance business that the second quarter is typically a little bit softer because of the contingency income we see flow through in Q1. New business origination was very strong. You saw the level of revenue there was maintained and it significantly increased from last year. Granted, last year it was part of SB One. It was pre-acquisition. If you're looking at the trajectory of the business overall, it's showing nice growth. On the Beacon Trust side of things, obviously, yeah, we did benefit from market appreciation. AUM's up to about $4.1 billion. The fee rate is maintaining at about 78 basis points. We did have a net 13 new clients for the quarter, 44 new clients year-over-year. The average AUM per client's up to $4.1 million. We're seeing good organic growth there, as Tony noted. Seeing more crossover among the disciplines that are within the bank. Exactly. Back to the last point on the insurance, which is a good indicator for me, is that it's how the business is growing. We're seeing new business to the bank, new customers, new business, and the retention levels are quite high. They're in that 95% range, which is pretty extraordinary for an insurance company like that, right? Usually in the 85%-90% is a good indicator. That bodes well for the business we produced in prior years, and now we're getting a larger lion's share of the commission. Hopefully that answers your question. Yeah, it does. It's a great color. Thanks. I guess just to kind of close the loop on the non-interest income side, it doesn't sound like you guys expect much of a step back from kind of the run rate we saw in the first half of the year as we move into the latter half? Yeah. The only hit is we do have Durbin taking effect on July 1. Right. No, No, that's a good reminder. I actually have that in here. Yeah, correct. All right. We had about $4.1 million in card kind of revenue in the first half of the year. We're going to see that drop to about $1.9 million in the second half. The full year 2021 will be about $6 million. I guess the good news is we saw activity step up quite a lot, that's still pretty consistent with 2020 at $6.3 million. The expectation for full year 2022 is it'll drop to about $3.8 million. Got it. Durbin hit, I guess. Okay. In short, will take us from about $6 million in 2021 to $3.8 million in 2022 is what we expect to see. Got it. On the balance sheet side, just curious, Tom, maybe a question for you. Can you help us with kind of the near-term size of the earning asset base? It looked like the cash balances at the end of the quarter were pretty high. Obviously the loan pipeline's strong, but my guess is the investment book could have some continued room for growth. As I look at the average earning asset size of about $12 billion, a little over $12 billion today. Do you expect that to kind of hold near-term? Maybe with some of that cash going into loans and securities, or do you think there's room for that to compress? No, I think we will deploy that liquidity. I'd say there's probably between $200 million-$225 million of excess liquidity in interest-bearing cash right now. We expect to deploy that into the loan pipeline, which is quite strong at this point, with any remainder going to fund some additional growth into deposits and then hopefully remix that to more loans over time. We pick up about 105 basis points just going into the kind of investments that we've been taking on lately versus the cash balance. There's room for some pickup. Just my last question. Thanks, Tom, for that. On that point, you guys mentioned the pipeline. How should we think about net growth in the back half of the year, though? It sounds like based on what you're saying and some of your peers in the market, that payoffs are still potentially pretty high. C&I activity a little slow. Any more specific thoughts? Is 4% or 5% annualized basis doable in the ballpark? Or do you think it could be a little lower than that, given a more base case assumption around payoffs? Or any thoughts there? Yeah, you're pretty much right on with what we're thinking. Ex PPP forgiveness for the second half of the year, we're looking at about 4.6% annualized growth in the second half at current estimate. Okay. Perfect, guys. Well, thank you for taking my questions. I appreciate it. Thank you. Thank you. The next question will be from Mark Fitzgibbon with Piper Sandler. Please go ahead. Hey, guys. Thanks for taking my question. Morning, Mark. Chris, one of your main competitors was just bought. Can you talk about some of the ways that you kind of plan to capitalize on that? Well, certainly Investors moving on and becoming maybe part of Citizens when that happens. We already discussed that. We obviously have a deep respect for Investors. We compete with them in a very civil fashion, I would say, and we've done some participations with them as we split out risk. We see that obviously during any of these type of opportunities, there may be a couple people that aren't going to stick around or maybe don't want to be with the larger bank. We might have opportunity there. Obviously, as they're putting things together, we will see that disruption probably work to our benefit. Again, we don't wish anything bad. We just want to operate. We still see it as a net positive because of the approach that we do to the business, and they've always been a very good competitor, so that might make it a little easier for us and others as we go forward not having maybe one less term sheet. Okay, thanks. I think you mentioned somewhere either in the release or in your comments that you look to sort of consolidate more branches over time. I think you've got just south of 100. How many realistically do you think you could operate with over some period? How many branches might you consolidate? I'll start, and then Tony can dive in. I think we have a couple on the slate already for consolidations as digital and our approach to the customer is a lot more handled through online and the like. There probably is another, I think, probably 8-10 over the next couple of years. We obviously look at everything, and we've been rationalizing the network for the last 15 years. Certainly COVID and doing remote has accelerated that likely. Tony, you want to give some more context there? Mark, I think Chris has given some good guidance there. I think we're looking at optimizing the network and getting a greater span with the technology that we're putting in place. A good aim for us is to look at about $150 million per branch, that's kind of how we look at it. Consolidating around that to get to that endpoint is sort of our strategic viewpoint. That doesn't mean that we won't look at other dynamics in that picture as well. Certainly it's not going to be to grow the network, it's going to be to shrink the network. Yeah. Mark, I would just offer, we do continuously monitor profitability at the branch level, they're all contributing significantly. If they're not, as customer preferences change or demographics change within a region or opportunity for consolidation provides a chance to get more profitability without losing the customer base, we'll certainly take advantage of that. Yep. The other thing you might see, Mark, is shrinking the larger branches and going to a smaller, more compact, cost-effective. I think that's part of our thought process as well. Okay. A couple of questions around the fee-based businesses. We haven't seen sort of an insurance or wealth management deal from you guys in a little while. Is that because the pricing on those transactions just not competitive or you're growing fast enough organically that you don't feel like you need deals? I'd just be curious of some comments on that. Chris, you want to go first? Sure. I will take that first part. Mark, as you know, the RIA space has gotten very, very lofty levels. There's a lot of money and a lot of the aggregators adding things that even though they may make some sense from a market and/or synergistic business perspective, the earn back and the cost is just way too high and the IRR is too low for us to be involved. It's not like we have not been looking at a lot of opportunities, just the fact that most of them do not hit even the minimum of our hurdles. We continue to look and continue to operate as if we can in that space. Tony, you want to talk about the insurance space? Sure. Mark, I think in both of those areas, we didn't move away from the space. I think we're actively looking. Insurance, which historically M&A hadn't played a key role, I think now we'll look at M&A to expand in the footprint, which is much larger than the legacy. I think that has opportunities for us there as well, and to attract and gain more talent to help support that business. Even though they haven't been done, it's not for not looking. Okay. Tom, just a couple clarifications. When you said you expected the margin to be stable, are you referring to the reported margin or the core margin? They're both kind of tracking at about the same pace, Mark. They're both in about 6 basis points this quarter. If I had to project, I'd say they'd probably stay stable to, at a maximum, I think 6 basis points of decline over the next 12 months. Three to six maybe you see in terms of pressure over the course of the next year. Okay. It looked like deposit costs came down 4 or 5 basis points this quarter. Are we getting close to the bottom, do you think, on a lot of these buckets? We've been saying we're close to the bottom for a long time, but we always find a way to get a little bit more. There were some cuts that were put in place on July 1st that'll give us about $3 million in savings annualized. Some of the borrowing portfolio is maturing that was at somewhat higher rates as well. I think in total, I have $949 million of maturing CDs and borrowings over the next year at a current rate of about 109 blended. That on a new rate basis, would be about 36 basis points. There's still some room there on the liability side as well. I agree. Thank you. Thank you. The next question is from Russell Gunther with D.A. Davidson. Please go ahead. Hey. Good morning, guys. I just wanted to add more. Good morning, guys. Just on the expense side of things, you guys have kept it in a pretty tight range the last couple of quarters. You mentioned some pending branch consolidation near term with longer term plans. Tom, I was wondering if you could give us a sense for how the back half of the year is shaping up. Longer term, as you start thinking about 2022 and those additional branch consolidations, what type of core expense rate you're anticipating and ability to achieve positive operating leverage. I think the run rate for the back half of the year is going to stay pretty consistent, excluding the provisions for credit losses on off-balance sheet commitments, about $60 million-$61 million a quarter. Actually going forward, I don't know that we'd see a dramatic decrease because I think we're going to take those expense savings and invest them internally in processes that give us a greater ability to pull through more revenue. I think that money will get spent regardless. Hopefully we get positive operating leverage through revenue generation by investing that wisely. Understood. Very helpful. Just last kind of big picture question. Appreciate your comments on M&A within the fee verticals. Can you just give us a sense for your remaining appetite for depository M&A today and what's of particular interest from a business model and geographic perspective? Chris, you want to take that first? I'll start. Sure. Well, again, Russell, as you know, no stone left unturned. We certainly look at all opportunities if they make sense. I think it is the diligence and the level of confidence in what we can do with a franchise, whether it be contiguous or within market. There's not as many as there used to be, that's for sure. I think we're very disciplined in how we look at those and make sure that they meet the hurdles and a really good use of our capital level and for stockholders. As they are moving fast and furious, and as we've seen, there's a lot of consolidation going on, and we'd like to say that we are a player when it matters. We will continue to look at depository institutions and the structure as long as they meet up with our culture and our business lines and our approach. Thank you, guys. I appreciate your thoughts. That's it for me. Thank you. Thanks. The next question is from Steven Duong with RBC Capital Markets. Please go ahead. Hi. Good morning, guys. Good morning. Good morning. Tom, maybe just on the PPP fees, how much did you realize in the quarter, and how much do you have remaining? In the quarter was $2.9 million. That's down from $4 million in the trailing quarter. The remaining fees on deferral at June 30th were $5.7 million. Okay, great. If we can, just on the $1.7 billion pipeline, can you just give us a sense of where that main growth is coming from or if it's broad based? Sure. Looking through, I'm sorry, Steven, a little bit further. It's about $1.1 million if you adjust it for pull-through expectations. The composition is about $391 in CRE. It's about $500 million in commercial lending. No, $607 million in commercial lending all in. That's the bulk of it. Great. This past quarter, obviously there was a lot of prepayment activity. I guess maybe just for comparison purposes, how does that compare to, say, what you saw last quarter? Prepayments this quarter is up pretty dramatically. You have payoffs of almost $620 million. It was about $390 million last quarter. I think just in the commercial bank, you probably saw a 70% increase just in the commercial. Yeah. Yeah, that is a good number. Have you guys given out your line utilization rate in the past? If you have, just curious what it is this quarter? We have. It's typically been around 40%. I think the 12-month average is down to 29%, but at the end of the period, I think it was 35% at June 30th. Okay. Got it. All right. You mentioned about just on the pricing and structure. Can you just give us some color on what you're seeing in terms of pricing and structure pressures? I think on the pricing side, we're seeing deals, at least the ones that were in our prepayment, but also what we're seeing in the competition, the three handle's been broken quite substantially. We're seeing deals down in the 250 range with longer terms going out 10 years. We're seeing IO deals out there for a very long period of time. On structure, we're basically seeing more leverage than we'd like to. We believe the risk reward is on balance at that point with the leverage going so high. I think that's where we're seeing most on the structure is the high leverage, no PGs, et cetera. The terms are as I defined earlier. Hopefully that answers it. No, that's really helpful. I guess, with all this liquidity in the system and everybody's looking for loan growth, do you get a sense that the pricing and the structure is going to continue and perhaps even get more aggressive? My opinion is, while it's hard to prognosticate that, I see that as my statement is, it's persistent. It might continue. I think we're getting more aggressive on the relationship side. That's why hopefully that $1.7 billion pipeline can get pulled through and have some stickiness. We look at our own portfolio and see how much more of those types of assets that can be prepaid away, and that's slowing down a bit. While it's hard to prognosticate prepayments, our expectation is that they will diminish in the third and fourth quarter, and hopefully that's what'll give us that growth that we projected. Yeah, there's some thoughts, Steven, that maybe some of that activity you saw in the first half was driven by pent-up demand on sellers' parts through the pandemic that we're looking to exit, whether it's a sale of a property or sale of a business. Some of that was able to be realized in the first part of this year, and hopefully that'll abate. Steven, the other part is I should have been clearer on the prepayments. You probably saw at least one third of all those prepayments were what I would call natural, where you're selling the underlying asset. We hope that those customers, the relationship, those funds are sitting in the bank until they make a reinvestment, at which point we'll make another loan to them. Again, that's the only dampening thing that happened in our loan book is the heightened prepayments. No, this is really good color, guys. Just last one from me. Maybe this is for you again, Tony. On the SB One Insurance, you spoke about the 60%, I believe, year-over-year growth that you guys have seen from last year. I guess, just from a comp basis, was the last year period depressed at all from COVID, or was that just a legit comp and you guys are experiencing 6% year-over-year growth? Maybe adding on to that for those that are not familiar in this space, can you give us a sense of the dynamics that's going on in that space and how you guys are achieving this growth? Yeah, the growth in insurance. I would imagine, I don't have empirical evidence, but I would imagine that last year was moderately somewhat affected by COVID. Everything was. They still did quite well last year, I think, if I look at the year before. I would have to go back and look at the data. I'm pretty confident that the growth rate in this quarter was a lot more to do with what they're doing now. If you want to adjust it, cut it somewhat, it's still 60% versus the expectation of 18%-20%, right? I see more of the heightened activity, some new accounts that we brought in that were really high commissions. I attribute it more to that than the delta between last year and this year related to COVID. Got it. Appreciate it. Thank you. Again, if you have a question, please press star then one. The next question will come from Erik Zwick with Boenning and Scattergood. Please go ahead. Good morning, guys. Morning. Morning. First question for me, I guess looking at the allowance for credit losses now standing at about 85 basis points, is it fair to assume that as we think about the loan loss provision going forward, unlikely to see negative provisions, maybe certainly not to the same magnitude that we saw them in the first part of the year? If so, I guess that would mean that provisions would be driven more by loan growth going forward. Given the strong pipeline and then the commentary on the mix in the pipeline, predominantly commercial, at what rate are you reserving for new loan growth today? Yeah, I think that's a reasonable expectation, Erik, and trying to guess where the floor is on this. Obviously we let the CECL model run and see what it looks like in the qualitative adjustments. As a comparison, when we adopted CECL on 1/1/2020, we had 86 basis points of coverage. We're currently at 88 if you exclude the PPP loans. There's about $309 million in PPP loans remaining in portfolio. Thanks, Tom. Any thoughts of just at what rate you're reserving for new loan growth today? I think it would wind up being fairly consistent with the overall coverage. I think it'd be around the 86 basis point level. Perfect. Thanks. Just looking at the capital, it's built nicely again, following the acquisition of SB One. Certainly, with the loan pipeline being strong today, that's the primary use of capital. Just remind us your thoughts around the dividend and an opportunity for share buybacks as well. On the share buyback side of things, we try to stay fairly disciplined on price and earn back the tangible book dilution. Generally speaking, I mean, we have some models that help us in that regard, but generally speaking, 1.2x tangible book sort of sets the level that we're most comfortable at. We can, in extreme circumstances, go higher than that if we think growth opportunities are limited or if we have a view into the future that tells us that's the right thing to do. Generally, 1.2x tangible is about the level we buy back at. In terms of dividend, I think, in terms of the core dividend, we want to get through our strategic planning process and get a little more clarity on the potential impact of the Delta variant and what things look like in the back half of the year before we consider an increase to the regular quarterly cash dividend. Great. Thanks for taking my questions today. The next question is from Jake Civiello with Janney. Please go ahead. Hi, guys. Good morning. Morning. Good morning. Just one question for me. Your loan-to-deposit ratio this quarter down to 90%. Obviously, some of the deposit growth trends are outside of your control, but broadly speaking, do you hope to operate at or near the current level? Do you think over time you gravitate more to a line where you were in the past? Yeah, we'd like to be more loaned out, Jake. I mean, we were back up at, I think, 105%, 106%. I was perfectly comfortable with our liquidity position at those levels. We have very low time deposits in our book. We could certainly raise that if we needed to. Profitability is obviously much better if you're more fully loaned out on the deposit side. We'd love to get there. Okay, great. Thank you. Thank you. Thank you, Jake. Ladies and gentlemen, this concludes our question-and-answer session. I would like to turn the conference back over to Chris Martin for any closing remarks. Well, we thank you for your time today. We look forward to continued positive results, especially the second half of 2021, and thank you for your confidence in PFS. We hope you have a great weekend. Thank you. Thank you, sir. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.