Question-and-Answer Session
Operator
(Operator instructions) Your first question comes from the line of Joe Morford with RBC Capital Markets. Please proceed.
Joe Morford – RBC Capital Markets
Thanks. Good morning, everyone.
Dominic Ng
Good morning.
Joe Morford – RBC Capital Markets
I guess – a couple of questions. First, with the sales you made of residential construction land, NPLs and REO this quarter, what kind of bids did you see versus original loan amount, and how did they compare versus where you’d written them down to?
Dominic Ng
They all vary. We compare to the carrying value rather than the original loan amount simply because we have provide, either charge-off or provide reserve, specific reserve to these loans and that’s the amount that we look at. I think they vary from a pretty wide range, but in average, Irene, you have any kind of average number at this point? 10% to 15%, is it, Tom, or –?
Tom Tolda
Probably, that’s correct.
Dominic Ng
Okay.
Tom Tolda
Roughly 15% to 20% and, of course, it does vary.
Dominic Ng
Yes. Some of them, we actually have par, some of them below, significantly below; and then it all depends on specific assets. What we have, the situation that a borrower that may be in a bankruptcy, they’re a little bit more challenging, then we’re more willing to sort of let it go for a little bit bigger discount because we do not want to take on to that task. Then there are others who seem to be a little bit simpler, we get a pretty good price.
Joe Morford – RBC Capital Markets
Right. Okay. That’s helpful. I guess, the other question was just did interest reversals contribute much to the decrease in the margin this quarter? And in getting to the 320 average you’re projecting for 2009, what kind of progression do you expect throughout the year of this 270 base?
Tom Tolda
Yes, Joe, the interest reversals cost us about 1.5 million if I recall correctly for the quarter. And then, going forward, I think a combination of the loan production, some shortening up on the deposits, higher yields from some of the liquidity that we’ve built up, that we’ve kept in a very liquid form and are now placing into higher-yielding securities, all should contribute to the margin improvement next year. We’re certainly not anticipating any further reduction, so all of that should work out for us.
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