Greetings, everyone, and welcome to the QCR Holdings, Inc. earnings conference call for the first quarter of 2022. Yesterday, after market close, the company distributed its first quarter earnings press release. If there's anyone on the call who has not received a copy, you may access it on the company's website, www.qcrh.com. With us today from management are Larry Helling, CEO, and Todd Gipple, President, COO, and CFO. Management will provide a brief summary of the financial results and then open the call to questions from analysts. Before we begin, I'd like to remind everyone that some of the information management will be providing today falls under the guidelines of forward-looking statements as defined by the Securities and Exchange Commission. As part of these guidelines, any statements made during this call concerning the company's hopes, beliefs, expectations, and predictions of the future are forward-looking statements, and actual results could differ materially from those projected. Additional information on these factors is included in the company's SEC filings, which are available on the company's website. Additionally, management may refer to non-GAAP measures, which are intended to supplement, but not substitute, for the most directly comparable GAAP measures. The press release available on the website contains the financial and other quantitative information to be discussed today, as well as the reconciliation of the GAAP to non-GAAP measures. As a reminder, this conference call is recorded and will be available for replay through May fourth, twenty twenty-two, starting this afternoon, approximately one hour after completion of this call. It will be accessible on the company's website. At this time, I'd like to turn the floor over to Mr. Larry Helling at QCR Holdings. Sir, you may begin. Thank you, operator. Welcome, ladies and gentlemen, and thank you for taking the time to join us today. I will start the call with a brief discussion regarding our first quarter performance. Todd will follow with additional details on our financial results for the quarter. Before I discuss the quarter, I want to welcome any new shareholders that are on the call today as a result of our successful acquisition of Guaranty Federal Bancshares shares, which closed on April first. We have merged Guaranty Bank into SFC Bank, our charter in Southwest Missouri, and the integration process is going very well. We have retained the Guaranty Bank brand due to its more extensive branch network and strong name recognition in the market. We're eager to continue our growth in the vibrant Southwest Missouri region. Turning to quarterly results, which are highlighted by exceptional loan growth and expanded net interest margin, carefully managed expenses, and continued excellent credit quality. We continue to experience healthy demand from our client base and grew loans by 14.6% on an annualized basis, excluding PPP. Our accelerated loan growth in the first quarter was driven by strength in our traditional commercial banking, leasing, and specialty finance businesses. We are capitalizing on improved economic conditions in our markets and continue to gain market share across our charters. Our clients value our relationship-based community banking model, emphasizing the importance of strong relationships and customized service. Our loan pipelines remain healthy and our near-term outlook for loan growth remains positive. Therefore, we are increasing our targeted loan growth to between 10% and 12% for the full year. While core deposits decreased modestly during the quarter, mainly due to expected seasonality with our commercial client base, we saw the mix of our deposits continue to improve with further rotation from time deposits to interest-bearing demand deposits. In addition, Guaranty Bank brings excess liquidity and a strong core deposit client base to our balance sheet, which will support our ability to continue to fund our expected loan growth. We expanded our net interest margin in the first quarter, which was up 1 basis point on an adjusted basis and up four basis points excluding the impact of PPP fees. This expansion was supported by a favorable change in our asset mix, lower deposit costs, and stable loan yields. Given our asset-sensitive balance sheet, we are very well positioned for the current rising rate environment and expect to see meaningful NIM expansion in the second quarter. Todd will go into more details in his remarks. With respect to our non-interest income, we experienced a decline in Capital Markets revenue from swap fees due to project delays, which are caused by ongoing supply chain disruptions and inflationary pressures. The majority of our swap business is generated by Low-Income Housing Tax Credit projects. Over the years, we have grown and diversified our client base, which has helped our outsized growth, and as a result, our pipeline remains robust. The gap between the demand and the availability of affordable housing is widening, and we believe that the long-term fundamentals for this business have actually strengthened despite the short-term challenges. Our asset quality and credit metrics remain extremely strong. Non-performing assets improved again and represent a record low of four basis points of total assets. Additionally, our criticized loans and classified loans to total loans and leases decreased during the quarter. We continue to have negligible net charge-offs, and we feel very good about our current reserve level at 1.55% of total loans and leases. Our excellent credit quality is a function of our disciplined and consistent underwriting, along with vibrant economic conditions across our markets. With that, I will now turn the call over to Todd to provide further information about our first quarter results. Thank you, Larry. Good morning, everyone. Thanks for joining us today. I'll start with net interest income. Our adjusted net interest income for the quarter was $48.5 million, down 1.4% from our record amount set in the fourth quarter. However, the decline was entirely due to the significant linked quarter decrease in PPP loan forgiveness fees, which was expected as our PPP loan program nears its end. With our strong loan growth using our excess liquidity from the prior quarter, our balance sheet efficiency improved, helping to expand margin in the first quarter. We funded our loan and lease growth during the quarter with a combination of excess liquidity and overnight advances. Our non-maturity deposits typically experience a seasonal decline in the first quarter, as many of our commercial clients are using funds to make bonus and tax payments during this period. We continue to improve the mix of our deposit base, intentionally rotating out of higher cost CD balances as they mature. The cost of our total interest-bearing liabilities further improved by one basis point from the fourth quarter. We utilized our overnight borrowing capacity during the quarter to temporarily fund some of our loan growth, and we subsequently repaid the majority of these advances after quarter end with Guaranty Bank's excess liquidity. Our adjusted NIM improved by 1 basis point for the quarter. However, after excluding the impact of lower PPP income that I mentioned earlier, our core NIM expanded by four basis points, significantly outperforming our guidance of a slight decline of two-four basis points. We've been very pleased with our NIM performance over the last several quarters as we've been successful in maintaining earning asset yields while driving down our cost of funds. As we are now entering a rising rate environment, our asset-sensitive balance sheet will lead to significant further NIM expansion. Our asset sensitivity is driven by the strong growth in our floating rate loan portfolio over the past three years. During that same period, the success we've had in growing core deposits has reduced our reliance on deposits tied to an index and higher cost wholesale funds. Looking ahead, as we benefit from a full quarter of the March rate hike and factoring in another rate hike of 50 basis points in early May, combined with the addition of the Guaranty Bank balance sheet, we project further NIM expansion of 9-11 basis points in the second quarter. Given the addition of Guaranty Bank in the second quarter, we are also providing additional guidance on net interest income for Q2. Excluding PPP and acquisition-related accretion, we expect net interest income for the second quarter in the range of $56 million-$58 million. Now turning to our non-interest income of $15.6 million for the quarter, which was lower than the $23 million we generated in the fourth quarter. As Larry mentioned, we produced capital markets revenue from swap fees of $6.4 million in Q1. While this result was below the lower end of our typical guidance range of $14 million, it is very consistent with our past Q1 LIHTC production, which has averaged $6.8 million the past four years. Capital markets revenue from LIHTC swap fees has averaged $15 million per quarter since the first quarter of 2020, which gives us continued confidence in the sustainability of this important source of fee income. During the same nine-quarter period, capital markets revenue from LIHTC swap fees has ranged from a low of $4.5 million-$25.2 million. Given our solid pipeline of transactions, but recognizing the project delays caused by ongoing supply chain disruptions and inflationary pressures that Larry mentioned previously, we are expecting this source of fee income to be in a range of $13 million-$15 million per quarter for the remainder of 2022. Excluding swap fees and non-core items, non-interest income for the first quarter totaled $8.3 million. With the addition of Guaranty Bank in the second quarter, we are also providing additional non-interest income guidance. We expect non-interest income, excluding capital markets revenue, to be in the range of $9 million-$11 million for the second quarter. This guidance reflects the addition of Guaranty Bank's strong retail and commercial banking fee income while adjusting for the headwinds of rising rates on our mortgage business. Now turning to our expenses. Non-interest expense for the first quarter totaled $38.3 million, compared to $39.4 million for the fourth quarter. After adjusting for acquisition expenses and lower performance-based compensation expense related to Capital Markets revenue, non-interest expenses were $39 million and at the low end of our guidance range of $39-$41 million. Our non-interest expense run rate remains very well controlled. Looking ahead to the second quarter and factoring in the addition of Guaranty Bank, we anticipate that our level of non-interest expense will be in the range of $46-$48 million. This guidance includes the incremental expenses from Guaranty Bank but excludes remaining integration costs. In addition, we do not anticipate that the full cost savings from the Guaranty Bank acquisition will be recognized until 2023. Our overall asset quality continues to be quite strong. Non-performing assets remain very low at $2.7 million and as Larry mentioned, represent only four basis points of total assets, 21 basis points lower than one year ago. Additionally, we recorded a $2.9 million negative provision for credit losses in the first quarter, primarily due to continued strong asset quality and a corresponding reduction in the qualitative factor related to the pandemic. Our allowance for credit losses remains quite strong at 1.55% of total loans and leases, down 13 basis points from the end of 2021. This allowance represents over 27 times our non-performing assets. With respect to capital, our capital levels remain strong. Our tangible common equity to tangible assets ratio modestly declined to 9.60% at quarter end, compared to 9.87% at the end of December. This was largely the result of a decline in our AOCI, the resumption of our share repurchase program during the quarter, and strong organic loan growth. While AOCI and the share repurchases did reduce the company's tangible common equity, our strong earnings helped to offset this impact, which led to a net decline of only 1.2% in tangible book value. Finally, our effective tax rate for the quarter was 9%, down significantly from 18.9% in the fourth quarter. The rate was lower on a linked quarter basis due to an increased benefit from a tax strategy we implemented in 2021, combined with the book tax expense benefits from our stock compensation plans, which are typically higher in the first quarter, as well as a lower ratio of taxable earnings to tax-exempt revenue in the first quarter. We expect the effective tax rate to normalize back to a range of 18%-20%, including the addition of Guaranty Bank. With that added context on our first quarter financial results, let's open up the call for your questions. Operator, we are ready for our first question. Ladies and gentlemen, at this time, we will begin the question-and-answer session. To ask a question, you may press star and then one. If you are using a speakerphone, we do ask you please pick up the handset prior to pressing the numbers to ensure the best sound quality. To withdraw your questions, you may press star and two. Once again, that is star and then one to join the question queue. Our first question today comes from Nathan Race from Piper Sandler. Please go ahead with your question. Yep. Hi, guys. Good morning. Morning, Nate. Morning, Nate. Maybe a question on the swap capital markets revenue outlook. You know, I appreciate the updated guidance. I guess I'm just curious if you guys could kind of update us just in terms of how the swap revenue pricing may be impacted in future quarters, just based on what rates have done recently. Yeah, Nate, I'll start and let Todd any additional comments if you think it's appropriate. The interest rate is really having just a modest impact on the pricing, compared to the other factors that we talked about. It's really the impact on the future swap revenue, which we've guided to a slightly different number than historic, is really because of the inflationary pressures and the supply chain disruptions that are causing the delays in the project. Our pipeline of activity is really consistent with a year ago. It's really just a matter of getting those projects to fruition. You know, certainly a little impact from interest rates, but we do expect the vast majority of these projects to come to fruition at maybe slightly less pricing power than we would have had, you know, during the pandemic. Probably pricing pressure maybe decrease those fees maybe 10%-15%. Got it. Yeah, Nate. Sorry, go ahead, Todd. Well, Nate, I would just point out Larry's spot on in terms of the impact of the rates. It's really a drop of about 10% in terms of our average fee on each deal, so fairly modest impact due to rate. Understood. Maybe switching gears and kind of think about deposit trends in the quarter and the outlook. I appreciate, you know, some of the sequential declining core deposits and somewhat seasonal nature. I know with Guaranty, you guys are picking up some excess liquidity. Just trying to think about, you know, core deposit growth expectations going forward. I know you guys have some deposits off balance sheet that are maybe more rate sensitive that you may want to keep there. I'm just curious if you guys expect, you know, deposit growth to run commensurate to kind of the loan growth expectations that you guys are guiding to in that 10%-12% range for this year. Sure, Nate. Yeah, we do continue to have a fair amount of what we would call just-in-time inventory off balance sheet with the correspondent bank team. That actually ended at roughly $1.4 billion in excess balance accounts at the Fed. So a fair amount of liquidity available to us there. We love the core deposit franchise we acquired with Guaranty Bank and added to our legacy bank here in Southwest Missouri. We do expect the loan to deposit ratio to settle back down a bit here in Q2. It elevated, as we talked, we used some overnight funds to really supplement our loan growth funding, in the first quarter because we knew that Guaranty Bank balance sheet was, coming on April first, and that really paid off for us in terms of taking advantage of that here in the second quarter. While loan growth is very robust, we expect to keep pace with deposit growth and not have to rely on, wholesale funding. Dave, I would add that, you know, you're on an interesting question because of the excess liquidity, because of all the government programs in the last year and a half, some of that excess liquidity will flow out over time, and I think we saw some of that happen in the first quarter. We're trying to figure out what the new normal is in that space and what new liquidity levels are gonna be for our clients, both on the retail and the commercial side. What I would tell you is our new account opening activity during the past month of March was really strong. While balances are moving around, we're continuing to add clients at a really steady pace. Okay, great. Maybe just along those lines, thinking about the margin outlook going forward, would love to get an update just in terms of kind of the interest rate sensitivity position of the balance sheet at the end of the quarter and how you guys see the margin trending over the next couple quarters, assuming the Fed you know raises by you know I think half a percent or so in both May and June. Sure, Nate. As we said in our opening comments, we're guiding for margin expansion of between 9 and 11 basis points here in the second quarter. It might help you better plan for future quarters if you know really the mix of that improvement. We talked during the Q4 call about a 4-5 basis point improvement in margin for each 25 basis point hike. With the full impact of the March hike here in the second quarter, that's 4-5 basis points of that increased margin. We are expecting, as we indicated in our opening comments, a 50 basis point hike by the Fed here in first part of May. That would also do 4-5 basis points per 25 there, but of course, it's only about half the quarter. That nets down to a net 4-5 for Q2. While that's in a range of 8-10, we're adding another basis point of margin expansion expectation due to the blending in of the Guaranty Bank balance sheet. Their legacy NIM was 3.15% in the first quarter. Solid, but less than our legacy NIM run rate. Between the excess liquidity that they brought to the balance sheet, some of the bond restructuring that was accomplished post-closing, their balance sheet is actually slightly more rate sensitive than our legacy balance sheet. All of that has us pivoting to a slightly accreted NIM from the acquisition, and we're adding another basis point there here in the second quarter. That's really the buildup of the 9-11. In terms of subsequent quarters, we certainly expect our asset sensitive balance sheet to continue to provide upward trajectory on margin. We're very pleased to be in this position from a balance sheet perspective. Okay, great. If I could just ask one more housekeeping question. Todd, do you have the amount of PPP revenue that was recognized in the quarter and what's remaining? Yeah. We have very little remaining as you would guess and, you know, consistent with our comments. In the fourth quarter, total PPP impact on NII was $1.4 million. Dropped pretty significantly in the fourth quarter to about $530 thousand. That $800 thousand or so drop was really the cause for NII dollars to be down on a linked quarter basis. It was entirely PPP. We only have $119 thousand of remaining PPP fees and only about $6 million in remaining loan balances. We're really at the end of that program. Okay, perfect. I appreciate all the color. I will step back. Thanks, guys. Thanks. Thanks. Our next question comes from Jeffrey Rulis from D.A. Davidson. Please go ahead with your question. Thanks. Good morning, Larry and Todd. Morning, Jeff. Hello, Jeff. Wanted to check in on Guaranty a little bit. I just wanted to, you know, as of the first of the month, what that loan balance you brought over, you know, kind of basically what was growth in the first quarter, and then, you know, still assuming a couple million shares, on the transaction. Yeah. So the shares issued were slightly over 2 million. Really didn't end up very close to the 80/20 stock cash split that was announced based on the elections of the GFED shareholders. Issued about $27 million in cash to go along with the 2 million and the 2 million shares. Their average earning assets for GFED was $1.15 billion. I think, Jeff, that's probably the important number for you in terms of run rate on earning assets that came across. Very strong performance in the first quarter out of Guaranty Bank. Really pleased with the balance sheet and the people and the clients that they brought along with the transaction. Todd, the conversion expectation timing on that? Sure. We had a lot of folks working really hard to make sure that our all of our collaboration tools were implemented right at closing on April first. Teams and telephony and all the communication aspects are fully integrated right away. The conversion onto a single platform right now is scheduled for early October. During this time, one of the things that helps us through transitions like this is our multi-charter structure. Our group operations teams are used to dealing with divergent cores at times. We're able to operate on the two separate cores here very effectively during this period. We actually have some very powerful software that's rolling data and financials and other things up on a combined basis. We are able to look at one Guaranty Bank. Gotcha. Another check in Todd, just what was the core margin? You said up 4 basis points linked-quarter. What, just wanted to kind of back into that. Core margin for? I'm sorry. For the overall. On a consolidated basis with them folded in, with Guaranty Bank folded in? Yeah. Yeah. First, yeah for Yeah. QCR. Legacy QCR was at 3.50% on a tax equivalent basis. When we're giving this 9-11 guidance going forward, that can either be layered on top of TEY or stripping out tax equivalent and just getting to the core margin of 3.30%. Those would be our legacy numbers carrying into the second quarter. The adjusted Guaranty Bank balance sheet would be accretive to that by 1 basis point in each case. Right. Just getting back to, you know, you sort of stated linked quarter is a one basis point increase. Again, you talked about core of four basis point linked quarter. I'm trying to, you know, kind of equate those two. Gotcha. The difference would be the decrease in PPP revenue would give you that delta of those three basis points. Okay. I'll calculate. I just thought you had core margin linked quarter. The last one would be on the buyback. Just in that it sounded from shareholder approval of Guaranty shareholders, I guess in like the third week of March, you mentioned that amount of activity. Was that the amount of time between Guaranty shareholder approval and the end of the quarter? Or was that to date effectively kind of a month's timeframe into today, you know, today or yesterday of a full month? Or was that just the kind of small piece remaining in the first quarter? Yeah, Jeff, that was just through quarter end, 3/31. Got it. I guess the broader question for both you and Larry is just the appetite there and you know knowing that you had a moderate amount remaining under authorization, what's the appetite for future and discussions with the board in terms of upping that authorization? Yeah, I'll take first crack there, Jeff. Your timing's good. At our next board meeting in a few weeks, we're certainly gonna discuss our overall capital plan and revisit the facts and decide if it's the appropriate time to reset our repurchase program, you know, in just a couple of weeks. Right, right about the same time as our shareholder meeting. Okay. Is there any remaining authorization given the pullback in bank stocks just as of today until that, I guess, till that meeting? Yes, we do still have some available. Certainly at this price point we feel like we're undervalued and that there's an opportunity for us. Perfect. Okay. Thank you. Hey, Jeff. I feel badly that maybe I wasn't quite on top of understanding your linked quarter question. What I'm wondering is, are you looking for the adjusted NIM where we talked about the four basis point delta and what that core number is on a linked quarter basis? Yeah, just, you know, it was on a, you know, TEY is adjusted as 3.49%-3.50%. The stated is 3.29%-3.30%. You guys are talking about a four basis point linked-quarter increase. Just trying to look at what is the other margin that you're referencing on core? Sure. Yeah. That's why I wanted to get back to your question. That gets down to taking the TEY about 3.50% compared to last quarter at 3.49%. There is the one basis point where we're talking about pretty consistently. Then when we strip out the impact of PPP, we get that down to a 3.43% in Q4 and a 3.47% in Q1. It's really the stripping out of that PPP impact that gets us to that four basis points. Got it. Thank you. Yeah. Thanks, Joe. Our next question comes from Damon DelMonte from KBW. Please go ahead with your question. Hey, good morning, guys. Hope everybody's doing well today. Morning, Damon. Not to belabor the discussion on the margin, but just to kind of close the loop on this. That 347 core that you just described to Jeff's question, from there, you would layer on 9-11 basis points. Is that correct? Correct. Correct. Okay. Yep. All right. Great. Okay. Thank you. I guess, you know, with regards to the swap fees, you know, you gave a good description as to why they came in lower this quarter and provided some commentary with the outlook. Do you expect you know, we've seen this in previous quarters where you have like a soft quarter for one reason or another, you kind of have a snap back in the following quarter. Would you expect something similar to occur here in the second quarter where you could, you know, get to that high end of that range or even exceed it, but then it kind of blends in for the remainder of the year to average that $13 million-$15 million per quarter? Yeah. I think because we got off to a little bit of a slow start, you know, we think the total for the year will be in the $45-$50 million range, given what we know today. While the supply chain things are, you know, our clients are figuring out ways to work through those, it could still slow roll the, you know, the execution on these projects. I think we really still believe the $13-$15 million per quarter is our best estimate for today on a quarterly basis throughout the rest of the year. I think it was in the third quarter of last year where you spoke on the July call and you had said, oh, we already had, you know, 3 deals priced in the beginning of July. That's not the case this go around. Yeah. It's a little slower because of this, you know, supply chain inflationary pressures making them reset the capital stacks for deals. You know, we all wish this business was a little more consistent, but the pipeline is still there. Is it possible, you know, what you're describing happens in the second or third quarter? It's possible, but I don't wanna. It's probably premature to give that kind of guidance yet. Got it. Okay. In the previous quarter, you guys had commented that you were exploring the opportunity or potential opportunity to securitize some of the SFG loans and sell them off. Is there any update on where that stands and any color around that? Yeah. It's still something that we would expect to do at some point in the future, you know, possibly late in the year. Because the growth slowed a little bit there, we're not in a big rush to execute on a securitization, but it's still something we want available to us later in the year. We plan to be very transparent when we get closer to doing a securitization and let you know exactly how it's gonna work and the economics of the transaction when we do that. It's a couple quarters possibly down the road yet. We'll give you a preview when we get there. I would tell you that the loan growth number that we guided you to would be net of any securitization if that happens later this year. Got it. Okay. That's all that I had. Thank you very much for the commentary this quarter. Thanks, Damon. Thanks, Damon. Our next question comes from Brian Martin from Janney Montgomery. Please go ahead with your question. Hey, good morning, guys. Morning, Brian. Morning, Brian. Hey, Todd, I appreciate all the added color this quarter on the margin and particularly with Guaranty. Just, as it relates to the margin, just big picture, I think when you look at the variable rate loans and in the past, you've typically given some thought on the rate sensitive assets and liabilities just kind of combined. I guess if we think about your guidance or just kind of your outlook for second quarter on the margin, if we think about additional rate increase, I'm just kind of wondering what those repricing assets and liabilities are and just maybe what betas you've got assumed in there so we can think about additional hikes and just kinda how to think that through. I don't know the best way for you to answer that, but, you know, that's kind of the path of what I'm kinda asking. Sure. No, Brian, I think it's fair to give you a little more insight on RSA, RSL. We ended the quarter, and this is on a combined basis, so this is pro forma with GFED at 3/31. We have just shy of $1 billion in net RSAs. So about $2.6 billion RSAs. RSLs about $1.6 billion. Roughly $1 billion net positive RSAs. In terms of deposit betas, one of the significant pivots we've made in our balance sheet, I think all of you that have covered us for a while understand that, we have a much more effective right side of the balance sheet now. As a result, only about 25% of our funding is in rate sensitive liabilities that would have high betas. That roughly $1.3 billion would be most of that $1.6 billion that I just mentioned. In that $1.6 billion, we've had betas in a range of 60-100 here, just starting off with some of the rate increases. Some of those are truly indexed, so they are gonna perform like a 100 beta. Some of those are very rate sensitive, but they're more negotiated rates, and we can hold back a bit, and the beta's not quite as strong. 75% of our deposits have exhibited zero beta thus far. I mean, we think that we still got some runway to hold on to deposit rates before they need to increase. We're very optimistic, not just having the $1 billion of net RSAs, but in the characteristics of the underlying, rate sensitive liabilities. We feel very good about ongoing betas. That is what's leading us to give this very strong guidance for the second quarter. As the Fed continues to hike rates, we think that we will stay fairly static with respect to the uptick in margin as a result of those 25 basis point increases. But I will tell you, we'll probably have more guidance for you in July with Q2, and be a little more precise about the rest of 2022. Does that help? Got it. Yeah, that helps. I guess, so just bottom line, as your second, if you got another 50 basis point hike after the May one, the benefit should be less than what you're guiding to this quarter, based on the 50 hike in May. Is that accurate? You'll just give more detail later? I don't know that we yet have enough insight once we get past this next 50 in May, if we're gonna see diminished returns on rate hikes. I think it's a little too early for us to capitulate there and say that that's gonna narrow. We're optimistic based on what we're seeing, Brian, that we will continue to see a nice upward trend. We'll have more guidance in July, but I don't know that we're ready to yet say we're gonna start getting diminished returns. Of course, we all know it's subject to market factors on deposit and loan pricing, and that's why I think we'll have a little more insight in July. Gotcha. Okay. No, I appreciate all the color, Todd. That's helpful. Maybe just one or two others just on with the transaction, the accretion, Todd, the purchase accounting accretion. Can you give any color on how to think about that as you just get into second quarter? Sure. We right now looking at what we announced in November for the transaction and, what we're seeing here, being through closing and integration. The numbers are holding up very consistent with our initial thoughts back at announcement, so not seeing much in the way of variation there. We talked about a initial credit mark on non-PCD of around $10.5 million, and actually disclosed in our deck that we had a negative interest rate mark of just shy of $3 million factored into the model. That's roughly $13.5 million that would get accreted back over the 3 years. That'll give you a little bit of insight as to what early expectations would be for loan accretion heading to Q2 and beyond. Gotcha. Okay, that's helpful. Just the last one. Just the loan growth this quarter, can you give just update on where the specialty finance balances are today relative to year-end? Was there much of a change there or is that kind of spread equally among the, you know, the buckets there, the traditional leasing and specialty? Yeah, Brian, it was really fairly evenly distributed, where our traditional leasing and lending business was up and probably represented 60%-70% of our growth in the first quarter. The specialty group, because of the supply chain disruptions that we talked about, in the LIHTC business, grew, but you know, more slowly than it had. As we get into the year, we expect that pace to pick up. Gotcha. Okay. Thank you, Larry. I appreciate it. Thanks for taking the questions, guys. I appreciate it. Thanks, Brian. Thanks, Brian. Our next question comes from Daniel Tamayo from Raymond James. Please go ahead with your question. Hey, good morning, guys. Good morning, Daniel. Daniel. Maybe just a quick follow-up on the swaps. You know, someone asked earlier about pricing. Can you just go into a little more detail on what the swaps pricing is based on and kind of your thoughts on if it could potentially tighten further as rates rise the rest of the year? Thanks. Yeah, certainly the swap pricing is determined by things going on in the yield curve and the duration of the swap that we're doing. As we talk, you know, there's been some marginal pricing pressure on that, you know, maybe 10% off the top end of our historic performance. As rates are starting to move, I don't think that's gonna continue to impact pricing. The marketplace seems to have kinda started to adjust to that now. While it'll continue to be compressed, you know, compared to a year ago, probably a little bit. Pricing is really not the issue here. It's really people getting projects to the point where they're comfortable executing and moving forward because of the other inflationary pressures and supply chain issues. Okay, that's helpful. Within the fee income guidance that you gave, just curious what your assumptions are around the gain on sale of the mortgage banking piece, including with Guaranty Federal? Sure, Danny. Yeah. The additional guidance we provided, ex swaps was really to help everyone understand what we thought the combined, post-closing run rate might be. When you look back at that other non-interest income, we had about $8.3 million of that, legacy QCRH. GFED, Guaranty Bank had about $2.2 million in the first quarter. That gets you at 10.5. We gave a range of 9-11. We have certainly seen a significant impact on run rate on mortgage. The good news is, Guaranty Bank has a very strong standing in the community and mortgage. We have very strong team coming over from Legacy SFC. We think on a combined basis, they're gonna be able to hold on to their share of the market and perhaps improve it. There's a pretty wide delta there, obviously between 9 and 11. Unfortunately, the net number is not all that material, but our expectation is mortgage is gonna be under pressure, of course, and part of that is rate and part of that is supply. Our assumptions on mortgage would be maybe taking a look at what we did in Q1, and that might be a static number or down slightly further from that. We in the first quarter did not have a whole lot of refi activity for obvious reasons. We are kind of getting down to core purchase activity, which tends to be more stable of course. Our outlook for mortgages is down, but we are expecting that most of the headwinds there have already been faced and we'll start trudging along with purchase mortgage volume going forward. Okay, great. Thank you for that. Finally, just a quick one here. I'm just curious how much impact the decline in swap fees had on expenses. Obviously, we had a big step down, but you know, provided the guidance for that to kind of rebound with here in the second quarter. Just curious how much of that was associated with the decline in swaps. Sure. Daniel, about $2.5 was reduced commission and other salary expense related to that decline. The guidance that we gave has that added back in, if you will. Our guidance on non-interest expense that we just provided would be at the midpoint of that $13-$15 million. $14 million of swap would get back to the guidance that we gave on non-interest expense. It was about a $2.5 million reduction in Q1. All right. That's great. I appreciate it. That's all I had. Thanks for answering my question. Thanks, Danny. Thank you. Our next question is a follow-up from Jeffrey Rulis from D.A. Davidson. Please go ahead with your follow-up. Thanks. I just wanted to check in on the $56-$58 NII guide for next quarter. Is that comparable to the $45.7 GAAP or the adjusted $48.5? Yeah. Great question, Jeff. I'm glad you asked that clarifying comment or clarifying question. That is based on the reported 45.7%, not grossed up for TEY. QCR for Q1, we had the 45.7%. Guaranty Bank had 8.6%, so 54.3% combined, on a pro forma basis for Q1, and then our guidance is 56%-58%. Again, that's non-TEY. I'm glad you asked that clarifying question. Thanks, Todd. Just one other one, and this is a little more squishy. The swap business and the supply chain and inflation pressures. Any sense that that has eased? I mean, was that consistent throughout the quarter? I think Larry mentioned, you know, finding ways to kind of get around that a bit. In other words, is there any kind of hope that maybe those pressures were early in the quarter and now as we're into April, is that easing at all or is it pretty steady state? It's a, you know, each project is its own animal. Thanks. Yeah, you're right. That's a little bit of a squishy one, Jeff. What I would tell you is, I think our clients are starting to find ways to work through the restructuring of their capital stacks for their transactions in order to make things move forward. They're starting to find ways to get materials and material costs figured out so that they can, you know, be comfortable committing going forward on a project. You know, it's certainly not over. I would say, I think they're finding ways to adjust to it, and we're finding ways to adjust to it because we're out probably being more active on a, you know, outbound basis, reaching out to this, people operating this niche, trying to find new transactions. I'd say we're in the middle of it yet, but certainly not over. Okay, fair enough. I figured you'd be doing just as much to help them through as well. I appreciate it. Thank you, guys. Thanks, Jeff. Ladies and gentlemen, with that, we will be concluding today's question-and-answer session. I'd like to turn the floor back over to Larry Helling for any closing remarks. Thank you, Operator. I'd just like to thank everyone for joining us on our call today. We hope everyone remains healthy and safe. Have a great day, and we look forward to speaking with you all again soon. Ladies and gentlemen, with that, we will be concluding today's conference call. We do thank you for joining today's presentation. You may now disconnect your lines.