NBTB - NASDAQ

Good day, everyone. Welcome to the conference call covering NBT's Bancorp's Fourth Quarter and Full Year 2025 Financial Results. This call is being recorded and has been made accessible to the public in accordance with SEC Regulation FD. Corresponding presentation slides can be found on the company's website at nbtbancorp.com. Before the call begins, NBT's management would like to remind listeners that, as noted on Slide 2, today's presentation may contain forward-looking statements as defined by the Securities and Exchange Commission. Actual results may differ from those projected. In addition, certain non-GAAP measures will be discussed. Reconciliations for these numbers are contained within the appendix of today's presentation. [Operator Instructions] As a reminder, this call is being recorded. I will now turn the call over to NBT Bancorp President and CEO, Scott Kingsley for opening remarks. Mr. Kingsley, please begin.

Thank you, Sania. Good morning, and thank you for joining us for this earnings call covering NBT Bancorp's Fourth Quarter and Full Year 2025 results. With me today are Annette Burns, NBT's Chief Financial Officer; Joe Stagliano, President of NBT Bank; and Joe Ondesko, our Treasurer. Our operating performance for the fourth quarter continued to reflect the positive attributes of productive fixed rate asset repricing trends the diversification of our revenue streams, prudent balance sheet growth and the additive impact of our merger with Evans Bancorp completed in the second quarter. Operating return on assets was 1.37% for the second consecutive quarter with a return on tangible equity of 17.02%. These metrics demonstrate continued improvement over the prior year quarters and importantly, reflect the generation of positive operating leverage. Our tangible book value per share of $26.54 at year-end was 11% higher than a year ago. The continued remix of earning assets, diligent management of funding costs and the addition of the Evans balance sheet resulted in a 36 basis point improvement in net interest margin year-over-year. Growth in noninterest income continues to be a highlight with each of our nonbanking businesses achieving record results in both revenue and earnings generation for 2025. In the third quarter, we were pleased to announce to shareholders a year-over-year improvement of 8.8% to our dividend, marking our 13th consecutive year of annual increases. This is reflective of our strong capital position and our generation of consistent and improving operating earnings. Our capital utilization priorities focus on supporting NBT's organic growth strategies, as well as improving our dividend each year. In addition, our strong capital levels continue to allow us to evaluate a variety of M&A opportunities. Finally, returning capital to shareholders through opportunistic share repurchases is also a component of our capital planning. And as such, we repurchased 250,000 of our own shares in the fourth quarter. Our transition and integration activities over the past 8 months with the team members who joined us from Evans Bank have been highly successful and have reaffirmed our belief that we have added a customer and community-focused group of talented professionals to our ranks. We remain excited about our opportunities in the Western region of New York. Activities have continued to progress across Upstate New York semiconductor chip corridor in the fourth quarter, including the official groundbreaking of Micron's planned complex outside of Syracuse. Site development and construction of the first fabrication facility is expected to commence immediately with completed targeted in 2030. I will now turn the meeting over to Annette to review our fourth quarter results with you in detail. Annette?

Thank you, Scott, and good morning. Turning to the results overview page of our earnings presentation. For the fourth quarter, we reported net income of $55.5 million or $1.06 per diluted common share. On a core operating basis, which excludes acquisition-related expenses and securities gains, our operating earnings were $1.05 per share, consistent with the prior quarter. Revenue generation remained favorable and consistent with the prior quarter and grew 25% from the fourth quarter of the prior year, driven by improvements in both net interest income and noninterest income, including the impact of the Evans merger. The next page shows trends in outstanding loans. Including acquired loans from Evans, total loans were up $1.63 billion or 16.3% for the year. During 2025, commercial production remained strong, but we did experience a higher level of commercial real estate payoffs. We have captured quality C&I opportunities across our markets, which have provided growth in core deposits, consistent with our focus on holistic relationships. Our total loan portfolio of $11.6 billion remains very well diversified and is comprised of 56% commercial relationships and 44% consumer loans. On Page 6, total deposits were up $2 billion from December 2024, including deposits from Evans. We experienced a favorable change in our mix of deposits out of higher cost time deposits and into checking, savings and money market products. 58% or $7.8 billion of our deposit portfolio consists of no and low-cost checking and savings accounts at a cost of 80 basis points. The next slide highlights the detailed changes in our net interest income and margin. Our net interest margin for the fourth quarter decreased 1 basis point to 3.65% compared with the prior quarter, as lower earning asset yields were largely offset by a reduction in funding costs. In addition, a higher level of lower-yielding short-term interest-bearing balances in the fourth quarter reduced NIM by 1 basis point compared to the third quarter. Net interest income for the fourth quarter was $135.4 million, an increase of $1 million above the prior quarter and $29 million above the fourth quarter of 2024. The increase in net interest income from the prior quarter was driven by the decrease in interest expense more than offsetting the decrease in interest income, as the decline in short-term interest rates impacted both earning asset yields and funding costs. As a reminder, approximately $3 billion of earning assets repriced almost immediately with changes in the federal funds rate, while approximately $6 billion of our deposits, principally money market and CD accounts remain price-sensitive. The opportunity for further upward movement and earning asset yields will depend on the shape of the yield curve and how we reinvest loan and investment portfolio cash flows. The trends in noninterest income are outlined on Page 8. Excluding securities gains, our fee income was $49.6 million, a decrease of $1.8 million compared to the seasonally high third quarter and increased 17.4% from the fourth quarter of 2024. Our combined revenues from the retirement plan services, wealth management and insurance services exceeded $30 million in quarterly revenues. Consistent with historical trends, the fourth quarter is typically our lowest quarter in revenue generation for these businesses, while the third quarter is seasonally higher. Noninterest income represented 27% of total revenues in the fourth quarter and reflects the strength of our diversified revenue base. Total operating expenses, excluding acquisition expenses, were $112 million for the quarter, a 1.5% increase from the prior quarter, including higher technology, year-end charitable contribution and marketing costs. The effective tax rate for the fourth quarter was lower than the prior quarter at 20.3%, primarily due to the finalization of the assessment of the deductibility of merger-related expenses and the associated impact on the full year effective tax rate of 23%. The Slide 10 provides an overview of key asset quality metrics. Provision expense for the 3 months ended December 31, 2025, was $3.8 million compared to $3.1 million for the third quarter of 2025. The increase in the provision for loan losses was primarily due to a slightly higher level of net charge-offs in the fourth quarter of 2025. Reserves were 1.19% of total loans and covered 2.5x the level of nonperforming loans. In closing, the current level of net interest income and fee-based revenues have produced solid results with meaningful positive operating leverage, supported by disciplined balance sheet management as we've navigated three federal funds rate cuts in late in 2025. Asset quality remains stable. And with our strong capital position, we are well positioned to pursue growth opportunities across all our markets. Thank you for your continued support. At this time, we welcome any questions you may have.

[Operator Instructions] Our first question will be coming from Feddie Strickland of Hovde Group.

Just -- and you mentioned in your opening comments, higher CRE payoffs for part of the slower loan growth. I mean, do you expect any larger payoffs on the commercial side in the next couple of quarters? And then broadly, how does that factor in to overall loan growth keeping in mind the run-off portfolios?

Thanks, Feddie. And yes, we have officially hurdled the 100-inch snow mark in Central New York. So I appreciate the sentiments on that. So your question is a good one. So in 2025, we probably had $150 million to $175 million of unscheduled commercial real estate payoffs. And where do they go? Agency money and in certain of our markets, private equity or private funding, maybe the private funding more closely aligned with some of the more larger urban areas, Southern Hudson Valley and maybe some things in New England, closer to Boston, but meaningful. So I think we think that, that's an outsized number, but we're planning for -- that could be a risk for our growth attributes going forward this year as well, understanding that there's other people out there just looking for yield. And as rates have started to come down a little bit more, I think some of our sponsors are getting offers from agency, structures and other places that are too good to turn down.

Got you. And along those same lines, I mean, can you just update us on what you're seeing in terms of loan pipelines, opportunity in terms of tight geography I'm particularly curious about Rochester and Buffalo since you've mentioned them in your opening comments.

Yes. Thank you. So across the franchise, from Buffalo to Portland, Maine from Louisbourg, Pennsylvania to Burlington, demand is good. Pipelines are strong, stronger than they were at this point last year. And we feel pretty good about the opportunities we're getting to see. We have a -- as you know, we tend to focus on things that are more holistic from a relationship standpoint. So CRE-only outcomes for us are not as attractive as something where there's real estate involved, but we get a full operating relationship with the sponsor or through C&I relationships. So no reason appears to have a real gap in demand. I think certainly given the cost of building compared to maybe early or mid-2024, there's not as many projects underway on the multifamily housing side, which is where we tend to have a concentration. But those that are out there are good opportunities. I think the pipeline is good in Western New York in Rochester and Buffalo, I think the team is really energized. We've added a couple of really talented people to the group. And I think on a going-forward basis, we're pretty bullish on opportunities we'll see in Western New York.

And I guess just to drill down on that. I mean, is kind of the mid- to lower single-digit growth rate a good number for '26?

I think it is. And reminding people that we still continue to have our just south of $800 million, older loan portfolio that's in runoff. And we use last year as a marker for that that's moving downwards about $100 million a year. So we're seeing good activity around C&I, and we're seeing good opportunities on the CRE side in most of our marketplaces. And again, we can exercise selectivity as to which ones we put our best foot forward for. And in fairness, starting in the fourth quarter, we saw better consumer lending activity, especially on the mortgage side. So upbeat that customers potentially who were thinking about moving for the last 2 or 3 years, can deal with a low 6% mortgage rate and given the dynamic of what most people have as equity in their home decide to do something else.

And our next question will be coming from Mark Fitzgibbon of Piper Sandler.

First question I had, it looked like, Scott, you had boosted your reserve against the solar book this quarter by a decent amount. I was curious if anything had fundamentally changed there?

No fundamental change there. I think we were trying to kind of rightsize our coverage allowance, given that it is a runoff portfolio. So really, what you saw this quarter is kind of recalibration of that coverage ratio, but no trends or negative concerns as it relates to that book.

Okay. And then secondly, I was curious how, if at all, the tensions between the U.S. and Canada is impacting sort of the economy in the northernmost markets of your footprint?

Yes, a really good question. And I think I may have said this before, Mark, but we love the Canadians. We grew up with those people. And we have a lot of -- our customers have a lot of business that are cross-border, whether that's out in Western New York and Buffalo or whether that's up in Northern New York closer to Plattsburgh, it's a real issue. I think that the Canadian customers are just frustrated, whether that means they come into the Adirondack for seasonal housing or just straight commerce. I think the unpredictability of where we've been with tariff rates and what things were going to be accessible to that point. And I think, if I was kind of going through the underlying comments, what I have heard from people that I've talked to, is a sense of can we trust you still? And so I think that's caused hesitation and future investments. or an existing investment moving forward. So problematic for us because those are not the highest areas of long-term growth anyways. So it's really important to have that connection to the Canadian base for some of our customers to do the things they want to do.

Okay. Great. And then I guess changing gears a little bit. As you think about M&A, I'm curious, are the hurdle rates of return that you're looking for higher today than in the past, given that the market really hasn't been at -- enamored of many acquisitions in recent quarters and obviously, your own frustration with your stock price post-Evans.

So a couple of things on bundler, but thank you for that. And yes, we think that -- if think about it, a combination of the Evans transaction and us improving our net interest margin, 35 or almost 40 basis points last year, has shifted the plateau of our earnings capacity from somewhere close to $0.80 a quarter to $1. And we think that's pretty noticeable. Worked hard to get to that point. But at the same point in time, the construct around people worried about either the execution risk associated with M&A or the dilution of your attention to other strategic objectives. Not an issue for us. The Evans transaction went as good as we could have hoped for. Their folks are really engaged. We've had to put them through some changes to some of our systems, but they've really been good at bringing that alive. And I think that from a practical standpoint, they're looking forward going forward. Your question on hurdle rate is a good one. We're a $16 billion bank now. So it's not so much what transaction is large enough for us to be interested in is that do we put our folks, our organization through an M&A opportunity that can't at least generate or 5% accretion? So if we're running kind of off a base of $4 a share, does something have to be north of $0.20 a share for us to really take a hard run at that. Now you can look at a bunch of different things, and you can accomplish that in a bunch of different ways. But for us, it's generally been a modest extension of the franchise geographically or really productive fill-in opportunity where our concentration hasn't been as high as we'd like it to be. So still having lots of conversations. There's a lot of high-quality, like-minded smaller community banks across our seven states. So the opportunities are there. And that's how we kind of think about it from a capital deployment mark.

And our next question will be coming from Thomas Reed of Raymond James.

This is Thomas on for Steve. Just wanted to start off, maybe as you guys are looking -- or as you look to deepen your presence in select markets to support growth, can you talk about maybe any planned hiring initiatives that you may have and whether those investments are already reflected in that expense guidance?

Yes. And I might even ask Joe to help me a little bit on this one. So I think we believe that all of our geographies are investable today. So I'll just use an example. We've added a couple of really high-quality folks to the team up in Maine. We have a really nice base of customers in Maine, but we never fully extended our reach from the standpoint of full holistic banking, and we're doing more of that. So the folks that we brought on board have C&I backgrounds. We've committed to a branch site off the wharf in Portland, our first true retail branch site, and we're about to make a commitment for another one up there. Joe?

Yes. Sure, Scott. Branch site, just off the wharf, we call it Bayside. It's a marginal way. We've also signed a letter of intent down in Scarborough. So building out our main presence are really important to us. And why is that? We have good quality bankers up there and adding good quality bankers to the team, which Scott just alluded to. Now over in Western New York, the same thing, really good quality hires across all parts of the bank. Including insurance and mortgage. Scott mentioned our mortgage results the last quarter. So we're seeing some really nice pipelines across our entire footprint. So where are our focus areas? Definitely, New England, Maine, we mentioned, but also New Hampshire, the Greater Manchester market, a really important market for us, where we're looking for some growth opportunities with some new branches, as well as in Rochester, already looking at sites in Rochester. We have a lot of intent that we've signed in the city and planning on moving a financial center there in downtown Rochester, as well as across other parts of the Western region. So still in targets, as well as some of our newer markets. We're excited about the prospects that they're going to bring to us.

[Operator Instructions] Our next question comes from David Konrad of KBW.

Just had a question on the NIM outlook next year, it feels like maybe stability might be the key phrase. I'm not sure. But, the great news is your deposit costs are down to 2%. The bad news is your deposit costs are down to 2%. It might be challenging to reprice. And your commercial book, now the portfolio seems to be pretty close to new originations. So maybe talk about the NIM outlook over the next few quarters?

Sure. I'll start on that one. So you're right. We have our net interest margin 3.65% is a very strong NIM. We can really throw off some nice core earnings with a NIM like that. We are neutrally positioned, so we've been actively managing through federal funds rate cuts over the last few months. So when we think about our margin expansion, it's probably in that 2 or 3 basis points a quarter. Some of the factors that will influence our ability to reprice our book if you think about the lending side, probably our largest opportunity is in the residential mortgage book where we probably have somewhere in the 125 to 130 basis points of room there. Our other books are probably pretty close to market rates at this point. Another area where there's some opportunity is in our investment securities book, still have some repricing opportunity there, probably throws somewhere around $25 million in cash flows a month. You're spot on. We have very low funding costs. We talked about having right around $6 billion in deposits that we can actively reprice with market sensitivity. Probably the biggest opportunity there is in our CD book, probably 77% of that reprices in the next 2 quarters. So I think there is some room, but probably not to the extent that we've seen in 2025, it's probably limited to a few basis points. Net interest income improvement is probably going to be more focused on our earning asset growth and the opportunities that we have there.

Yes. And then I'll just follow up with that. A good observation, Dave, on the commercial crossover where for the quarter, new activity or new loans at a rate that was not terribly different than portfolio yields. Some of that was yield curve base during 2025. Remember that the 2- to 5-year point of the curve, kind of came down 60 to 75 basis points during the year. when you started the year and said, "Hey, listen, I still got a gap between new production and portfolio yields", some of that got taken away with just natural market activity. In a couple of our markets, we're seeing a little bit of pressure on spread. They typically are the best assets, and so needless to say, whether we're defending or seeing something new, we're very interested in those types of credits. But holding to a north of 200 or 225 spread above SOFR has been more difficult in recent months. And maybe that's just a function of market demand right now. There was a little bit of a -- a little bit of slowdown in the second half of the year. And then made the comment about our opportunity in -- on the CD book. CD duration today for everybody, not just us, is dam short, 5- to 7- to 9-month instruments and whether we start to see some elongation from us or from others on that, so people can lock in some yields as it looks like the rate structure is more moving in a direction of down, not up. And lastly, I'll remind everybody that the customer used to getting the yield for the last 3 years. So if you're a customer with significant liquidity, whether you kept it on a bank balance sheet or moved it off, you're used to getting a yield. After going 13 or 14 years with no yield, you now know what that looks like. So I think people utilize the tools that we give them from a treasury management standpoint, and they're very smart with how they do funds management.

And our next question will be coming from Daniel Cardenas of Janney Montgomery Scott.

So maybe just a quick question on competitive factors throughout your footprint on the lending side, would you say competition is fairly rational? Or are you beginning to see perhaps a pickup in pressure as people are looking for growth?

Yes. I would say a little bit as people are looking for growth, and if nothing else, a lot of defense when people have really solid customers where they're the incumbent, where they're defending. I don't think we've seen anything irrational from a structural standpoint. And those have seemed to make sense for us. I mentioned before, some of our payoffs came from agency-based funding sources where, in fairness, both structure and rate is something that are better normally for the customer than what our standards actually allow for that way. But I don't think it's pervasive and we have so many different markets to be participating in that I wouldn't make a general construct out of that just today. But I will say this, if you're a highly rated company and you're doing well and you have a history of doing well, you've been able to demand a lower spread if you're interested in new money this year.

Good. And then on the deposits front, are there any markets that are better able to absorb a decrease in rates, as rates come down, are you going to be able to push down deposit costs in any markets better than others?

I would kind of frame it this way, and Annette, if you have something else, let me know. But we have such good market share in so many of our legacy markets that we've been able to do rational things as rates decline in those markets pretty uniformly. In some of our other markets where we don't enjoy that kind of a share, maybe we've had to keep rates a little higher for a little bit longer or we've got some concentration characteristics that haven't forced down the rates as fast as the Fed has moved. But generally speaking, the fourth quarter was pretty indicative of that. $3 billion of our assets reprice immediately upon a Fed's fund decline, and it takes us a little bit longer. There's a little lag there to get the funding cost down. Maybe we're a month or 6 weeks behind, but so far, we've been pretty diligent at getting it to that point.

Great. And then just last question for me on the credit quality front. Any areas that you guys are perhaps tapping the brakes on? I mean, your credit metrics are good. Just wondering if maybe you're approaching any particular area with the -- a little bit more caution than maybe you were 2 or 3 quarters ago.

Not necessarily anything new. We have a pretty diversified book. So we pay attention to concentrations. We're probably a little less excited about hospitality or the office space, but that's not new. So I don't think we have anything that's specific emerging trend from something that we're going to shy away with continuing to just monitor as maturities come due and make sure we understand what our customers' position is and their ability to refi when that maturity happens. But also pretty well balanced as far as what our maturity, no large maturity walls or anything like that. So just navigating customers and paying attention to our industry composition, but really no emerging industry or anything we're avoiding at this point.

Our next question will be coming from Matthew Breese of Stephens.

I wanted to touch on charge-offs a little bit. For a while there, meaning for the years kind of proceeding COVID, charge-offs at NBTB could be anywhere from 30 to 35 basis points per quarter routinely. And with the consumer balances and wind down and coming down, should we reframe charge-off expectations here to something lower? And how would you kind of characterize normal with the makeup of the current book?

Yes, Matt, that's a good question. I -- back in maybe 5 or 6 years ago, our charge-off rates were probably somewhere in that 25 to 30 basis points. We had a fairly large unsecured consumer book with our LendingClub and Springstone portfolio, as well as our residential solar book, which is has much less of an impact. So those were throwing up a little bit higher charge-off rates. As those books wind down, we would expect to see more lower levels of charge-offs and kind of where we've been running at somewhere in the 20 basis points range, 15 to 20 basis points range is probably kind of more normalized as those books become smaller and smaller. Just -- I think residential solar is somewhere in the 90% to 95% charge-off rate basis point charge-off rate -- versus probably somewhere closer to 8% to 10% with that prior book. So really, I think that that's kind of where we are in 2025 is kind of probably that new normalized rate.

And I think, Matt, if you think about it, that we've done such a good job in indirect auto lending and our losses historically. Have kind of been between 20 to 35 basis points. So despite the cars being way more expensive in 2026, than the last time that Matt Breese bought a car, we've held in very well on that, and the customers have performed quite well on that side. Someone read to me the other day, a statistic that our combined mortgage losses from 2020 to 2025 were $31,000. So we continue to lead with that product. It's really, really important in our core marketplaces. And so many other opportunities present themselves once you're the core lender on the mortgage side. So I don't see us taking our focus away from that line of business either.

Yes, not the greatest auto customer here. Annette, while you were discussing the reserve on solar, has the appetite to sell that book changed at all? And maybe I'm connecting the wrong dots, but one of my thoughts as you were discussing the recalibration there was whether or not you've been listening to bids or rethought kind of what the mark should be on that book?

I'll start with that one, Matt, and then have Annette jump in as well. The dilemma we have is so much of our production was sort of in the 2020 to early 2023 time frame where we experienced really productive, but substantial growth in that portfolio. And I think we all knew what the rate structures look like in the world then. So from a marketability of that portfolio, which we would move out of, if we could find something that made sense for us. But right now, it's really just a rate question. I think the assets are performing much better than most other solar portfolios in terms of loss rates and customer performance. but the rates are low. And so for us to do that, would be a substantial outcome. And much like investment portfolio restructuring, we're kind of curious. If we can't find something that's got a terminal value above zero, we don't like to do it. So I think for us, we're hanging in there, waiting for the customer to pay us back and redeploy those proceeds and other things.

Understood. And then last one is just on share repurchases. This quarter's level is a bit higher than I was expecting. What are some of the catalysts or triggers for you to repurchase stock? And is what we saw this quarter something we might see in early '26?

Yes. Great question, Matt. I said this last quarter, I thought I was going to get to go my whole career, and not buy shares. But truthfully, the opportunity presented itself. And to your point, two things. Value price, because somebody pointed out earlier, we think our valuation does not fully reflect the improvements we've had from an operating earnings standpoint. And number two is capacity, right? So with our change of earnings capacity, essentially, those share repurchases that we did in the fourth quarter, a little over $10 million worth. We self-funded in the quarter and didn't change any of our capital ratios. So I think it presents an opportunity for us to follow that pattern like we did in the fourth quarter. Going into the future, and we probably have more capacity than that. But I'm saying we think we can self-fund the level that we bought in the fourth quarter every quarter.

[Operator Instructions] Our next question will come from Feddie Strickland from Hovde Group.

I had a couple of quick follow-ups. First on the margin. I did notice secretion income picked up some there. Just to clarify, the margin still increased in the first quarter even if that normalizes back down.

So accretion, usually, there are a handful of accelerated payoffs or affecting accretion during the quarter, which are very hard to predict. We think working through some of the federal fund rate cuts that happened in December, the margin will probably be fairly stable, if not, maybe affected by a basis point or 2 barring any changes that are normalized accretion. So that's kind of how we're thinking about margin for the first quarter.

Okay. Got it. And then just on fees, I saw there was some seasonal activity-based fees in the wealth line. Do you have a sense for how much of the linked quarter growth was seasonal?

So probably somewhere around 300,000 to 400,000 was seasonal related on the wealth side. So just some activity-based fees. But all in all, a very strong quarter with organic growth, and our market helped a little bit with that. On fee income in general, there's probably somewhere around $1 million to $1.5 million of BOLI gains and other securities gains that are a little harder to predict the activity there. I think, BOLI, on a normal run rate basis is somewhere around $2.4 million.

Yes. And I even follow that up. And I think now that as we've gone to be a larger enterprise, the seasonality is a bit less noticeable for us. But -- kind of as a quick reminder, the insurance business tends to thrive in the first and the third quarter based on renewal time frames with a little lower activity in the second and the fourth benefits administration, the retirement plan administration business, usually solid first, second, third, with a little less activity fees in their fourth quarter. Your observation is astute. Wealth had a really, really strong year and a really strong finish to the year, and some of that was a bit seasonal, but generally speaking, we're in a really good lift off point on all of those businesses. I think the other thing, I think Annette has reminded people from time to time is that in our first quarter, we tend to have $0.04 or $0.05 of operating costs that are not usually reflected in some of the other quarters. Some of that is seasonality. It's just more expensive to plow and heat than it is to mow and air condition. So that's a basic one. But we also have higher payroll costs in the first quarter of the year and usually higher stock-based compensation expense just based on the protocol, the timing of how we grant new awards. So I think we always kind of think about this $0.04 to $0.05 carry that the first quarter has on the OpEx side that usually the other quarters don't have to work through.

And I would now like to turn the call back to Scott Kingsley for his closing remarks.

In closing, I want to thank everyone on the call for participating with us today, and we appreciate your interest in NBT. Stay warm. See you next time.