Question-and-Answer Session
Operator
(Operator Instructions). Your first question comes from the line of Scott Siefers with Sandler O'Neill.
Bob Jones
Scott, you are on a trend here. I think you have the first question this quarter, the last three quarters.
Scott Siefers - Sandler O'Neill
Good morning. That's a quick trigger finger, I guess.
Bob Jones
Good morning.
Scott Siefers - Sandler O'Neill
Let's see, Daryl, I guess, this one is for you. I need a [revise] of the fourth quarter charge-off number, which was elevated by a few different items. I would just like to, I guess, we would back out of the loan sales. The charge-off number was substantially higher than what you have been doing, and also above what you guys are anticipating for the full year '08. So I guess I am curious to hear what metrics allow the '08 number to be so much better than the fourth quarter's core number?
Daryl Moore
Well, you hit it on the head. We have had some loan sales that were included in there. We also took a pretty aggressive approach in the fourth quarter and looking at some of the loans that we had on our books that we needed to be written down. As with many banks, we've leaned towards the conservative side to get those to more realistic values at the end of the year. If you go back and look at the first three quarters, I really do believe that 2008, barring some significant economic downturns, is going to give us something a little closer to that, as Bob talked about the 25 to 35 basis points. Scott, it is so difficult to really convince you now that that is going to be the case, because you have specific loans that come up during the quarter. That’s what happened in the fourth quarter of 2007 and we really do feel like we can get back down to that 30, 35 basis-point range.
Chris Wolking
Scott, I just might add, as you look at the granularity of the portfolio, as we look at it today, and as Daryl said, they are non accruals. The size of those credits has come down. We also don’t see the loan sale market being very active in 2008, which again, it contributed to some of those. But I think it really goes down to all of the hard work in understanding what Daryl and his team have of the portfolio.
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