Question-and-Answer Session
Operator
(Operator instructions) And the first question comes from the line of Barry McCarver with Stephens, Inc. Please go ahead.
Barry McCarver – Stephens, Inc.
Good morning, guys. A couple of questions, I guess first off, probably for Zach, thinking about a little bit more color on the margin. I could see your point to the liabilities, 67 basis point decline in rate there. Does that leave much left for the second quarter? I'm wondering your thoughts – what margin is going to do moving into 2Q here.
Zach Wasson
Barry, as we said in the comments, we still expect our margin to be under pressure. We do have another $550 million of CDs maturing, but the average rate has moved down to between 3.50% and 4%. So, as we have seen the market correct to these new lower levels, during the first quarter, we were anticipating this, and we have moved our rates down to more appropriate levels. Going forward, we are seeing like every other bank that 2.25% funds rate does not leave much further to go to get to zero. So the margin will be under pressure, but we will do what we can to manage that pressure.
Barry McCarver – Stephens, Inc.
Okay. And then, second question I guess for you, Downey, really kind of in two parts surrounding growth. First off, in the press release, you mentioned your size in Dallas now and in Fort Worth with these new branches and getting some critical mass there. Your thoughts on what else you might desire in terms of numbers in that market. And then just overall, you touched on acquisitions and it certainly sounds like you are still looking. You look over the last two or three years, small deals have been coming in for you guys at a pretty good clip. Is that still something you're going to look to for growth, assuming that the pricing qualities there?
Downey Bridgwater
Yes, I will add to the first part of your question first. We do have a critical presence now in Dallas and we entered Fort Worth with this acquisition. I would love to be able to have eight to ten more branches there over time. But, we are going to add the growth and then the capacity on an organic front. We have always tried to take that approach because it's very expensive and a much more lengthy process to get growth out of a de novo. So, we will continue to look to those fill-in opportunities, but that's still going to be a secondary methodology for our expansion.
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