John Allison - Chairman Randy Sims - President and Chief Executive Officer, Home BancShares Dave Zaleski - Regional President Tracy French - President and Chief Executive Officer, Centennial Bank Stephen Tipton - Chief Operating Officer Brian Davis - Chief Financial Officer Jennifer Floyd - Chief Accounting Officer Chris Poulton - President, New York Group Kevin Hester - Chief Lending Officer.

Brady Gaily - KBW Jon Arfstrom - RBC Capital Markets Michael Rose - Raymond James Stephen Scouten - Sandler O'Neill Matt Olney - Stephens Brian Martin - FIG Partners.

Greetings, ladies and gentlemen. Welcome to the Home BancShares Incorporated Third Quarter 2017 Earnings Call. The purpose of this call is to discuss the information and data provided in the quarterly earnings release issued this morning. The company presenters will begin with prepared remarks then entertain questions.

[Operator Instructions] The company participants in this call are John Allison, Chairman; Randy Sims, President and CEO Home BancShares; Tracy French, President and CEO, Centennial Bank; Brian Davis, Chief Financial Officer; Jennifer Floyd, Chief Accounting Officer; Kevin Hester, Chief Lending Officer; and Stephen Tipton, Chief Operating Officer.

The company has asked me to remind everyone to refer to the cautionary note regarding forward-looking statements. You will find this note on Page 3 of their Form 10-K filed with the SEC in February 2017. At this time, all participants are in a listen-only mode and this conference is being recorded.

[Operator Instructions] It is now my pleasure to turn the call over to our first presenter, Mr. Allison..

Thank you, Nita, and welcome everyone to the third quarter 2017 earnings release and conference call for Home BancShares. In the first quarter, we had two of the largest events ever in our company’s history.

Number 1 was Irma, reported to be the most powerful hurricane since Donna in 1960, and the three important acquisition closing of Stonegate, $3.2 billion deal. However of these only one I describe as a pleasant experience and that was certainly Stonegate.

I want to say a special thanks to our Florida team, especially Teresa Condas and Stephanie Scuderi of the Keys. They did a great job keeping us informed. As sketchy as it was, as I said, as bad as it was, Teresa did a great job. Sometimes information was a little sketchy, but it was always solid. I have - well, the humor's there.

I've put a little humor in there so talking to Stephanie Scuderi, and I said, I'm coming. As soon as I am open the airport, I'm coming in, and I'm going to get my boat and I am going to ride down and look at the Atlantic side and see the damage. And she said, "Be careful because there are lots of stuff - debris in the water.

She said like yesterday, as far as this is said in my Dad’s boat basin floated up a king size bed head board and foot board all intact in his boat basin. So it will give you an idea of the damage that went on it. And that was there, wasn’t supposed to quite as bad. After my personal trip I realized the Keys were hit and hit hard.

There was virtually no electricity or communications. Lesson learnt, we all learn from experience, we probably need to look at general additional locations, and I think we will probably do there. The good news is all our people are safe and accounted for and all the branches are up and operating.

The people in the Keys are very resilient they have been here before and dealt with this kind of situation. FEMA along with the state of Florida and the military deserves a special thanks, they will plan C130s in there almost immediately in and out the Florida Keys airport brining food and water and even the complete camp hospital.

As bad as it was, I don’t think anyone went without food and water congrats to them. As of now, branches are up and running in the State of Florida except for one in Naples and Tracy said yes this might be the first.

With the approval and the support of the regulators our branch in Naples got hit pretty hard so it not open and we - Tracy went to the regulators asking for help that we needed to move into the Stonegate branch and they said well you are not part of Stonegate yet and you hadn’t converted.

Anyway I don’t know because they have been done before, but what you have going on in Naples is Centennial and Stonegate working side by side in one branch. I don’t know if it is Centennial on one side, Stonegate on the other. I told someone to get me a picture of that that might be the first. We might never see that again.

Interestingly I know this won’t, probably won’t shock you, but Comcast was supposed to be there on a certain day and they didn’t get there for four days to connect the lines. So our people actually operated with cell phones for four days taking care of our customers. That’s an outstanding effort that we all should be proud of.

So you can kind of put this in perspective this storm. It was like a 100 mile wide E4 tornado with winds to 160 to 200 miles an hour. It's greatly devastating, and that's what it was. As I drove further down the Keys towards Key West I saw extensive damage.

We offered our customers a 90-day deferment with all customers in the Keys and 90-day deferment and about $120 million worth of those customers had accepted that offer. That necessarily mean they got a problem. It just means that they kind of take it if they get a chance to do that.

A lot of landscape in one covered by flood, it had to actually go through the building. So the tools and landscaping had to be picked at. Advance checks or cleanups are coming in and rebuilding historically. Probably said enough about that. I would like to welcome all the Stonegate team to the Home family.

We’re blessed with this addition of Dave Zaleski and his professional team. The team looked professionals along with Home’s team as thus far made this deal the cleanest smoothest transaction ever, and I would say that the cleanest smoothest transaction ever.

And it is our largest, pretty much [indiscernible], but it's really because the fact that Dave and his team had been experienced to acquire us in the past and they know what to do and how to do it. And working with our group who are to experience it has been an absolute pleasure. Tracy French commented to me it is the best one we have ever done.

So congratulations everyone there. Not expecting to close this transaction in six months from the time we announced. Now we've been able to run in 9, 10, 11 months we didn't anticipate that and so we didn't set conversion till February. We would ultimately close in this month.

That has caused us some money, it will cost us some money, but we will get through that. Hopefully by the end of Q1 we should bring out nearly all expenses out and the cost, the carryout the branches that’s closing in some of the real expenses. You know there is no substitution for experience and it is well down by all and congrats.

Randy I think you can claim number 26, you all would claim 25, 26 I think [indiscernible] One record all-time earnings, but it was so good solid quarter and when you pull of the two biggest expenses which was $18 million for merger expenses and $33 million for hurricane reserve it may not have had to go to 33 make sure to go in to 40, I don't know, you don't know.

We just took a guess.

Kevin you are going to talk about how you calculate that reserve?.

Yes..

So Kevin will tell you how we came up with the $32.8 million and it was based on percentage in different areas. [Indiscernible] Anyway income, had we not had those two and we had three other deals. We had our lease, we got out of the panhandle, we worked out, finally worked out and we wrote that off.

We had a lot of [indiscernible] branch and we took the hit on, what else do we have [indiscernible] Central Florida. We took all of that. So anyway had we not done that we would have made $46 million a little over $46 million versus $43 million last year. So, if you are not claiming number 26, I can assure you [indiscernible]..

Just wait until my comment..

Alright. I'm just going to touch on a little bit here and then go back to you, a good solid revenue, asset quality continues to be strong. About $75 million with loan growth, we didn't have fell off little bit at the end due to the hurricane.

Hopefully we will get that this quarter margin hung in there, efficiency was good, good core ROI, great expense control. I think expense control was - expenses dropped at the same as last quarter, total assets exceeded 14 billion, market capital 4.5 billion and stock owner’s equity grew at about 2.2 billion.

We made a major personal announcement during the quarter, Kelly Buchanan was named Director of Corporate Branch Strategies. It is a position responsible for deposit growth and incentive programs for all our branches throughout the Centennial footprint.

Along with the value we are having exploring and is adding new virtual branches kind of playing with that we think it’s got a future.

Kelly has been with the bank 17 years, been in retail banking and business development for 10 [ph] and was also a branch manager for Tracy French before we acquired him, actually we acquired him I guess [indiscernible] and Tracy quoted - quote was that she is the best branch manager you ever had. So congratulations to Kelly and [indiscernible].

Finally, we will be setting the new corporate EPS goal for the company as soon as our brilliant leaders in Washington DC settle something on taxes. Well it is if I live that long. So hopefully we will get that done, if we don't we might by the end of January set the new goals.

I want to watch the combined companies and watch the earnings power of Stonegate coupled with the cost reductions and the efficiencies I think we can get there and anticipate what that’s going to be for a couple of months Randy. I’m going to let you have it Rand and see what you have to say about 26..

Well thank you Johnny. As our Chairman stated there was a lot of noise in our third quarter between the hurricane Irma and the acquisition of Stonegate Bank, which was and I don't mind saying it over and over and over, the largest in the history of our company.

You know it has been said that hurricane season brings a humbling reminder that despite technologies most of nature remains unpredictable, but it is also been said that the one thing Florida knows is how to deal with the aftermath of a hurricane and we are proud of our bankers in Florida as Johnny said, especially in the Keys and their response to their community.

The rebuilding has already started and we will see an infusion of construction and restoration that will present a lot of opportunities for our banks and communities. So, let’ s get to the main subject that you introduced, Johnny. Last quarter we announced 25 quarters of record earnings and we were on pace for 26.

However, during the quarter the Corporation established and accrued 33.4 million of pretax hurricane expenses, including 32.9 million to establish a storm-related provision for loan loss. Plus we had 18.2 million of merger expenses associated with the Stonegate acquisition that closed on September 26.

So have all the noise of the third quarter did we make 26? With so many adjustments to earnings plus just a few days of Stonegate income, it is kind of confusing, but here is what I do know. For the third quarter of 2017, the company recorded a net quarterly profit of 14.8 million, compared to 43.6 million for the same period in 2016.

Now that’s not going to get you record earnings. So when you do take out merger expenses and the special expense for the hurricane or to say in a more professional way after-tax non-fundamental earnings for the third quarter or $46.4 million, an increase of 1.1% from third quarter 2016 after-tax non-fundamental earnings.

And that does get record third-quarter earnings a number 26 in a row. As Johnny said, 46 million beats 43 million all day long.

So yes Johnny, I think we can say with confidence that I am claiming that once again and for the 26th quarter in a row Home BancShares got record earnings on a quarter-over-quarter basis, but with all the expenses and everything I am okay for those who would like to tag the quarter with an asterisk due to all the special events and provisions.

You know they did that in 1961, the Roger Maris when he bit Babe Ruth's home-run record, so we will still be in company even if you put an asterisk on it..

How do you know that?.

Roger Maris was my favorite player growing up..

Okay so you follow that..

Most people like to Mickey Mantle, but I was a Roger Maris fan.

But we may not, one thing to remember and this is real important, we need not let the events of Irma take away from the fact that Home BancShares is once again moving to look forward towards a very successful year and we are excited about the positive effect on income that the Stonegate merger will have in the months to come as we gain new efficiencies and saw this.

And with saying all that what a better way to tell you how the transition with Stonegate is going then to have a surprise addition to our call, our newest regional President Mr.

Dave Zaleski is with us today, Dave, can you give us an update on how things are going?.

Yes thanks Randy we are thrilled to be a part of Home BancShares. This merger really gives us a chance to be a major player in many of the best markets in Florida. We are already seeing some results in the commercial side as a result of the combination.

Over the next two quarters we will continue to integrate both organizations, while evaluating revenue and growth opportunities, specifically we will look to expand our treasury management services and association services throughout the state.

The larger balance sheet of Home will also allow us to expand certain Key Stonegate Bank lending relationships. And finally we feel there is some room for some targeted acquisitions to complete the Florida franchise.

We are looking forward to adding to the continued success of Home BancShares and continuing to have fun and growing the franchise and adding to shareholders. Thanks..

Thank you Dave and welcome to the Home BancShares family. We are certainly excited about 3.2 billion coming into our numbers. Okay. So let’s get to some of the numbers. Diluted earnings per share for the third quarter of 2017 was $0.10 per share compared to $0.31 per share for 2016 when compared to the same quarter in the prior year.

Excluding merger and hurricane expenses diluted earnings per share for the third quarter of 2017 were at $0.32 per share. Our return on average assets for the third quarter was 0.54, as compared to 1.81 for the third quarter of 2016.

Take out the merger expenses special hurricane provision and other non-fundamental expenses and our return on assets was 1.70. Our return on average assets, excluding intangible amortization was 0.59%.

Our core return on average assets, excluding intangible amortization provision for loan losses, merger expenses, and income taxes was 2.94%, and our return on average TCE excluding intangible amortization for the quarter was 5.8%. So as of September 30, the Corporation and I’m proud to say that this is fitting and almost 14.3 billion.

Now that is a world record. The process ended at 10.4 billion as compared to 6.94 billion at 12/31/2016, which is reflective of the addition of Stonegate.

We’ve got a great management team on hand to talk more about the results of the third quarter, and I will now turn in over to Centennial’s CEO, Tracy French to give us additional color and his comments on our performance..

Thank you, Randy. I’ve said for 5067 days of working for Home BancShares and Centennial Bank is an adventure every day..

At 5000, how many day?.

5067..

Wonderful days..

Absolutely wonderful days. This past quarter we added another chapter for the book. Our teams of bankers met a hurricane head on named Irma while joining forces with the great company in Stonegate.

As we certainly prefer one over the other, I officially would like to welcome Dave Zaleski and the Stonegate Group of bankers and we hope we never meet a hurricane like Irma ever again. While the Florida Keys were blessed it is fair to say the southern part of Florida was affected along in some ways all parts of Florida with the hurricane.

We're pleased to share as others have said before that everyone associated with our company is safe today. Teresa Condas and our regional banking staff did and are doing great job in managing our banks that were affected back with being in service.

Only one is still closed today that’s our Naples office that was mentioned and we one in the Florida Keys that is open part of the day every day.

In fact the team work with Centennial Bank and Stonegate as Johnny mentioned earlier is already paying dividends, while converging is still a few months away the Stonegate branch and the Centennial branches are working now in the same building. This may be a first and we may be onto something here for cost savings in the future..

How did you get the [indiscernible]..

It is a lot of hard work Johnny. It is a lot of hard work. Our company went over the $10 billion mark and asked us in the first quarter and it is now over 14 billion in assets with the addition of our latest acquisition.

I would like to take our hat off to all the Centennial Bank, Stonegate Bank to Home BancShares staff for making this happen in less than six months. They are talented and it shows when you can announce, get regulatory approval, shareholder approval and close the deal within the timeline while also jumping over the $10 billion mark.

With all the friction factors in this quarter, our region and market leaders continue to focus on revenue and expenses to maximize the results for our shareholders. Revenue was up in the first three quarters compared to last year, even while the month of September was really at standstill in some of the areas that the hurricane was affected.

Our non-interest expenses were steady, and when you take out all the friction factors mentioned. And our non-performing assets continue to make improvement with currently strong numbers. We’re proud to report to a very strong and solid first nine months and begin the simple math person I am at the table, I see the bank's revenue is the most ever.

Core ROA at 3.36 for the bank and our efficiency ratio for the bank at 34.61%. The entire Corporation staff is what makes this happen. So Randy, now I guess it is off to the next chapter..

Thank you Tracy, and well said. Especially the friction factors, I have never heard that. All these merger expenses and exceptions that may be a term that is coined, who knows. Friction factors, I like it. [Indiscernible] Okay.

So, let’s get back to total number of active Centennial branches is 172 versus 147 in the second quarter, of course that’s with Stonegate so let’s look at it, 76 in Arkansas, 89 in Florida. Florida is now larger than Arkansas, six along the Alabama coast line, and of course one in New York.

I would now like to turn it over to Stephen Tipton our Chief Operating Officer, who is going to fill us in on some of our income efforts, efficiencies, and other operational matters..

Thanks Randy. As everyone has mentioned, the third quarter 2017 was a bit busy and a bit noisy. But we are proud to have closed on the largest acquisition in history of our company in such a short period of time.

We want to welcome the 24 branches, hundreds of employees, and thousands of Stonegate Bank customers to the Home BancShares and Centennial Bank family. Our project and implementation teams are now fully focused on the Stonegate conversion and working daily with their peers in South Florida towards that February date mentioned.

As you will hear, we posted a core net interest margin of 4.07 for the third quarter of 2017. Our team is constantly monitoring loan yields and funding costs and I am pleased to say that the legacy bank footprint have $370 million in loan production for the quarter at an average rate of 5.29%, our highest yield today.

Switching to funding, we continue to see our plan of asking for deposits materialize. In Q3, we saw over $150 million in organic deposit growth with much of that coming in the back half of the quarter.

You will continue to see us focus on the core deposit relationships as Johnny mentioned and want to welcome Kelly Buchanan into her new role with the company as Director of Branch Strategies. On to efficiency, I’m pleased to report a solid core efficiency ratio of 39.12% in Q3.

Although a bit noisy as we mentioned, we are proud of the solid expense control during the quarter from the legacy bank. Integration efforts are already underway with Dave Zaleski and his team of bankers and we have decided to begin seeing those results. With that said, I’ll turn it back over to you Randy..

Thanks Stephen. Here to break down more of the quarter and report on our net interest income, margin, non-interest expense and other highlights is our CFO, Brian Davis. After that Brian will pass it to Jennifer Floyd, our Chief Accounting Officer to give us more information on capital and book value members.

Brian?.

Thanks Randy. There is a lot of noise this quarter for our company as a result of the completion of the Stonegate merger and hurricane Irma. For the third quarter of 2017 we had a quarterly profit of 14.8 million or $0.10 diluted earnings per share.

The impact of hurricane, and the merger expenses associated with the Stonegate acquisition third quarter earnings were $46.4 million or $0.32 diluted earnings per share. The impact of hurricane Irma, was $0.14 for Q3, while the impact of the Stonegate merger were $0.08 for Q3.

Accretion income for the fair value adjustment for quarter and purchase accounting was 7.2 million during Q3, compared to 8.5 million during Q2 for a decrease of 1.2 million.

The decrease of recognized accretion income when compared to the second quarter of 2017 is primarily due payoff accretion decreasing from 2.6 million to 1.7 million plus the normal expected decline in accretion.

Excluding the accretion income and the associated loan discounts, the company's net interest margin for Q3 2017 was 4.07% on a non-GAAP basis, compared to 4.11% in Q2. Excluding accretion during Q3, Stonegate produced about 1 million of net interest income.

However, net interest income decreased 583,000 to 106.8 million in Q3 versus 107.4 million in Q2. This decrease is primarily the result of the 1.3 million decline in accretion income. Non-interest income was down $3 million in Q3, compared to Q2 2017. There are several items worth noting.

First, we had 2.3 million in total lower gains and losses in Q3 versus Q2 for SBA, OREO, branches and investment securities. In the third quarter we disposed three of our vacant properties for a total loss of 1.3 million.

Secondly, other income was down in Q3 because in Q2 we had 1 million of additional other income for items which had been previously charged off. Excluding merger expenses and hurricane Irma damage expense non-interest expense was up 1.8 million in Q3 2017, compared to Q2 2017.

The increase is related to the increase in cost associated with one additional day of salary expense four days of Stonegate and $160,000 write-down of an OREO property. With that said, I will turn the call over to Jennifer..

Thank you, Brian. And now for our third quarter capital results. As of September 30, 2017 we ended the quarter with $2.2 billion of capital and $51 million of cash as a parent company.

During the third quarter of 2017, we paid our shareholder dividends of $15.7 million and additionally during the third quarter we utilized a portion of our approved stock repurchase program and repurchased 380,000 shares of common stock at a weighted average price of $24.36 per share.

For the third quarter 2017, our common equity tier 1 capital was $1.23 billion, total tier 1 capital was 1.3 billion, total risk based capital was 1.71 billion, and risk-related assets were approximately $11.4 billion. As a result, our common equity tier 1 capital was 10.9% compared to 11.8% at June 30.

Our leverage ratio was 13.2%, compared to 10.5% at June 30. Tier 1 capital was 11.5%, compared to 12.5% at June 30 and our total risk based capital was 15.1%, compared to 16.8% at June 30. Additional third quarter capital ratios include book value per common share which was $12.71, compared to $10.32 at June 30.

Tangible book value for common share was $7.06 compared to $7.23 at June 30. Excluding the hurricane reserve common stock repurchases and dividends paid in excess of net income, tangible book value per common share would have remained flat. And finally our tangible common equity ratio was 9.2%, compared to 9.9% at June 30.

Excluding the hurricane reserve and common stock repurchases tangible common equity for the third quarter would have been 21 basis points higher.

Randy?.

Thank you, Jennifer. Now normally we switch to our Chief Lender, Kevin Hester at this point, but as another surprise addition to our group today we have the President of our New York Group Mr. Chris Poulton who will give us an update.

How is it going in New York Chris?.

Thanks Randy good afternoon. While it has not quite been the 5000 days that Tracy mentioned. It has been 2.5 years or by my count about 1000 days since I and the team in New York joined Home BancShares..

Wonderful days right?.

Yes, exactly wonderful days. We have brought along with us our portfolio of $300 million of commercial real estate loans. Since that time we’ve expanded the platform, converted to a branch, opened a West Coast loan production office in LA, and have originated over $2 billion in new loans.

What’s been constant over that period is that we have maintained our discipline both online leverage and pricing. Just as when we joined our portfolio today has a weighted average LTV of 43% and yields just under 7%. Now for the third quarter, we grew the portfolio by $74 million to just over $1.2 billion.

This represents a 6% quarter-over-quarter growth or 20% annualized growth rate. And our pipeline for the fourth quarter shaping up nicely and we expect that we will continue to see solid growth as we look to close of the year.

With the support of Tracy and Johnny and the whole Home BancShares team we continue to build the CCFG portfolio, one loan at a time and we couldn't be more pleased with the results..

Thank you, Chris. Okay. So now let’s switch to our Chief Lender, Kevin Hester who will give us more details and color on loans..

Thanks Randy. As was noted in the earnings release, we experienced organic loan growth about $73 million in the third quarter, all of which was provided by CCFG. Payoffs are still substantial. We’re down about $90 million in Q3, compared to the last two quarters. Legacy production was solid in Q3, particularly in north and Central Florida.

Our asset quality ratios remained very strong with the nonperforming loan and non-performing asset ratios at 62 basis point and 60 basis points, respectively, which is virtually the same as last quarter. The ALLL coverage of non-performing loans improved slightly from 171% to 174.5%.

Past dues increased 20 basis points to 0.89% and this number has been very consistent at 1% or below the last few quarters. Lastly, the allowance loan losses as a percentage of non-covered loans increased 7 basis points to 1.09%.

We’ve been working on the resolution of two nonperforming credits in excess of $6 million each that we had hoped will be completed by quarter end that both led into the fourth quarter. In fact, one of those was resolved just after quarter end at a gain and the other will pay off in full later this week.

The two subsequent events will give us a great start to the fourth quarter as it relates to asset quality.

Even with the negative effect in hurricane Irma on September activity as it relates to our mortgage group we are still ahead of 2016 in both closings and locks and we have on boarded all of the Stonegate MLOs, which should provide a significant boost production given their access to our expanded product offering.

Speaking of Stonegate, I want to also take the opportunity to welcome their employees, our team. We are implementing changes to our work processes and those four regions that should be good for both our customers and our lenders and we look forward to working with them going forward.

Johnny mentioned the allocation related to hurricane Irma and that computation is as follows on the 2.5 billion in loans that we have in the disaster area.

It was 5% on the loans in the Florida Key balances, 5% on the two large Orange Grove loans that we had that were on the mainland and in the path of the hurricane, and then 0.7% on balances in the remaining counties within the theme of designated disaster area. And that is 33.9 [ph] million has been previously discussed.

And with that Randy, I’ll turn it back over to you..

Thank you, Kevin. Okay just to recap real quick, another good quarter, despite the friction factors of hurricane Irma and our merger expenses. We featured the closing of the largest acquisition in Home BancShares history. And actually I would like to quote something out of the press release that I think sums up this quarter the best.

That the actions of the company has demonstrated so far this year, especially surrounding the recent hurricane reflect the critical elements of our mission statement and community banking philosophy, a strong sense of community, exceptional customer service, shareholder focus, and high performing growth. I like that.

And with that, I would like to say to you stay tuned 90 days from now as we get a full quarter of earnings with our new partners at Stonegate Bank. And as we go for number 27, I will now turn it back over to our Chairman Mr. Allison..

Thanks Randy. It looks like we're getting geared up for closing out 2017 and a great 2018. I don't - anybody else have any comments? Nita are you still with us? I think we're ready for Q&A..

I am still here. [Operator Instructions] The first question comes from Brady Gaily with KBW. Please go ahead..

Hi, good afternoon guys..

Hi Brad..

Good afternoon Brad..

So when you strip out Stonegate and the loans that were acquired, I think your core loan growth was around 3% to 4% linked quarter annualized which is a little, I guess a little under your target.

I think I heard you guys say the payoffs lightened up a little bit this quarter, but can you just give us some commentary on loan growth and kind of how you are looking at loan growth on a core basis in 2018?.

Yes, this is Kevin. From a legacy perspective I think this quarter is looking similar to last quarter I think Dave or John can talk about Stonegate and Chris could talk about New York as well..

Yes with Stonegate I think we are going to see $15million to $20 million of loan growth. I think the thing that is most significant with us is now with Home’s bigger balance sheet that we can go back to existing customers and increase the relationship. We prescreened three or four deals over the last couple of weeks for existing customers.

If they get approved and we think they will get approve and to customers take that could be additional $70 million in production that as of Stonegate we would not have had.

So we’re pretty optimistic that with the bigger balance sheet of Home BancShares and the ability to do larger deals that we are going to go back to our existing customers and also to some bigger clients that we wouldn't normally do..

Chris..

Yes, this is Chris in New York. With regard to our pipeline, right now it looks pretty similar to last quarter, maybe a little bit better.

You know the challenge for us is always, we might get a surprise pay down or pay off during the quarter, but what we're seeing right now with regard to just pure originations and then funding of our existing commitments those seem right on track for us and I think we continue to see good opportunities in the market and as we’ve always said, we don't really have a growth target, but we will take a look at what the market is giving us and right now the market has given us good loans..

And Chris when I look at CCFG’s kind of year-to-date loan growth, I think you guys at least on a end of period basis have grown loans about 140 million, so maybe that kind of 50 million a quarter pace, does that feel like the right level going forward as the portfolio matures a little bit here?.

Yes, I think that’s right. You know we always sort of think about it somewhere between 50 to 75 million.

You know, our year to date numbers are a little bit skewed we had, the first quarter we had a little bit of decline off of one particular loan that we wrote that paid us off earlier than anticipated, but if you strip that out then, we have been pretty consistent in that sort of $50 million to $75 million number each quarter really for the last year or so.

As the portfolio gets larger, we generally assume about a third of our loans will pay off in any given year, which would make sense and to just under 36 month average duration. So we say about third will pay off each year and then we will replace those..

Alright.

And then finally for me, probably for either Johnny or Tracy, you guys have Stonegate in the books, are you out chasing the next deal?.

Well [indiscernible] Stephen Tipton has a deal, Tracy has got a deal, I have got a deal, and Dave has got three or four queued us. So we are all active and busy and looking for the next stride for Home BancShares when it make sense we are going to be - we got the [indiscernible] Florida near as good as Dave and his organization was.

So we will be paying those - process we will pay for that one, but we would have been disappointed had that will become part of our family.

From the legacy - on the loan side, on the legacy footprint we already have as many loans in the pipeline as we had in the last quarter as we generated and we still got [indiscernible] Stephen Tipton you are going to comment on that?.

Yes, I think you mentioned that payoffs were down a little bit for Q3. I think you maybe start to see New York's volume kind of normalize a little bit, if they are [indiscernible] the first quarter this year we are a little elevated there at $70, $80, $90 million per quarter for [indiscernible] is normal going forward.

I think what you saw here was the legacy portfolio, the community bank footprint slow down a little bit. So whether that is something we could see running forward will remains to be seen, I think so..

The good news is that the addition of Stonegate with New York being about 15% of our book it opens, it is a great opportunity for Chris to double his size over the next one, two, three year whenever we get to that point. So, they get the [indiscernible] as he continues to grow that and you see his profitability that could be.

I think for 2018 as we are positioned right now with - the bad news is Florida had hurricane. The good news is, there is going to be rebuilding in the State of Florida and lots of economic activity.

So I think that’s powerful and the addition of Stonegate and then you bring in Chris' ability to double, and you can see that I think we are teeing up for 2018, for a great year..

The only thing I could add there is like over the last quarter Brady, I think I have been five to five of our regions had an increase and what the loan balances was compared to North Florida and [indiscernible] group down there making some loans in those areas..

Thanks for the color..

You bet. Thank you..

The next question comes from Jon Arfstrom with RBC Capital Markets. Please go ahead..

Thanks. Good afternoon..

Good afternoon..

Hi John..

I had a whole bunch of questions, but I have follow-ups on Brady's now. I'm going to follow up.

In terms of some of the payoffs, how would you characterize where those loans are going? Are they going to other banks, meaning it's getting a bit more competitive? Or is it other things like business sales or private equity takeouts, things like that?.

It is, may be 2% or 3%, maybe 2% or 3% going to other banks that’s not where it is going, it is a real business. It is real activity.

A lot of those Florida guys, I don't know if you have heard me say that, it generally can create so much equity in the property as we will continue to land in 8, 9, 10 and 11 and the value of those properties have really accelerated and the question is, we will loan in the bank. We will loan into that and have acceleration.

Some people are doing that, I learned a lesson you may not remember this as Florida Keys years ago when I loaned into that - I know you do, but we are just not going to do that again that - one of my favorite stories is the hotel in Key West we are in at $200,000 a key or $250,000 a key and recognize it and read us the whole tale and ask us at the end, how much we owned at a million dollars of fee.

And we passed on the million dollars a key. So you are seeing that happen and you have to remain extremely disciplined to not loan back into that at those levels.

We were about 60 days ago prior, about 30 days prior of the hurricane, one of my guest house people said, Johnny I can hit x number of dollars because I am 100% full and my room rates have the highest room rate in town.

And I can make all this money and I need you to loan this, I have got it sold, I need you to loan even about 70% of the money on this deal. Well, we're sitting at that guesthouse today at probably $0.25 on $1.20 we like our position and for us to go back in at that higher price is just not something that we are building right now.

So maybe we’re just too conservative because there is no such super experience in that. I told somebody, maybe we are getting - maybe I am getting too conservative, but I think it is a good place to be right now with some of these pricing, get out, is too high. I think it is time for us, we are not going to play.

We don't mind playing, we will play at $0.50 or $0.60 down on the deal. We will play in the deal, we're just not playing at $0.75 or $0.80 on the dollar in these as these practice.

And what I told the hotelier that I wish I hadn't said it, but it is so true, he said I am a 100% full and I said yes you want hurricane away from being zero too, and it turned out that’s what’s happened. So, here we will cover, don't get me wrong, it will cover if the sale did not go through or has not gone through.

That’s what I am looking at John, just being real careful eight years or six years in, seven years in, this [indiscernible] it just gets your attention when - another example with liberty we had a car wash guy accumulate in car washes, mostly I have heard less store too and he [indiscernible] into another company, UK company we get involved with UK company, a lot of money on that trade.

We thought that was okay. They just sold it again. That was the $60 million payoff this quarter. We chose not to go back in the third time because the process just - it just wouldn't - we didn't think it as reasonable. So we chose not to go. That’s more that you wanted to know, but you got to get a feel on what we're thinking..

No, that helps and that cleans up other questions just in terms of the overall attitude on lending. I guess one of the other follow-up was for Chris. Johnny, you talked about his ability to double the size.

And I guess Chris, the question for you is do you feel like you could do that now with the bigger balance sheet? The question really is, is the quality demand there right now? It's just a matter of picking and choosing..

I think there's a lot of opportunities there. I'm not in a hurry to do it. So if you're sitting now, meaning in the next quarter or so, I would say that’s probably a bad idea, but over the next x period of time, which we would say over the next year or two, yes, I think so. We continue to see good opportunities there.

But just because we have more room to lend doesn't necessarily mean we're going to sit down and do transactions that we wouldn’t have otherwise done. We never really felt like we didn't have the opportunity to do so already. And so I think we like the ones we like.

And as such, we looked at 5 or 6 deals yesterday and we certainly - in our pipeline and we certainly didn't sit there saying, well, I got to do one of these which one of these 5 do we like. Instead, we sit there and take a look at them and see if they fit. We like knowing that if we like them all, we probably have room to do them all.

As it turned out, we don't like any of them. So, I think we would probably will end up passing on either all or all but one. So, I don't know the fact that we could double makes us do it any faster. I think it's nice to know that we have the capacity and I certainly think we can fill that over time..

Okay that helps. Okay. Thank you..

Thanks Jon..

Thanks Jon..

The next question comes from Michael Rose with Raymond James. Please go ahead..

Hi guys how are you?.

Well Michael how are you?.

Good. I was talking to Tracy and he said his favorite baseball player was actually Barry Bonds, so I hope you are not using his assets for this [indiscernible]..

He doesn't know Barry Bonds is. [Indiscernible].

I just want to make sure you are not using your earnings down there, okay. [Indiscernible] We are not talking about that asterisk, we are talking about the Roger Mari asterisk it was totally unfair. .

I just got a little confused given my conversation with Tracy earlier. [Indiscernible] It is like going around in a circle right? Just one or two quick questions for you guys.

So you guys have a fair amount of authorization on the buyback, you know capital levels are pretty high here after the Stonegate close, any thoughts on accelerating the buyback given where the stock is and where it is on year-to-date?.

Well we have been in there for most of the year. We couldn't be in, we are in the hard [ph] the last 45 days which I didn’t think was fair, because we couldn’t buy, we couldn't do anything.

The rest of the world could mess with, manipulate our stock price and we couldn’t do anything, but that - we will be back in and I mean we will continue to buy the stock when Home BancShares is on sale.

But we see an opportunity to buy - we will buy, I mean we bought, average $24 and change, Jennifer, during the third quarter till we got shut down, we would continue to buy particularly when you have got down in the 22.

I told somebody as to we would have bought, we would have accelerated that buyback in the 22, I can promise you that and the 23s, but we paid, I mean our average price was 24 and that was something that when it got down there, but that was also some 25 to 26..

Yeah just in terms of total risk base, little over 15% here you are going to build, why wouldn't you try to utilize more of it is just my thought process, but ….

That is a good point. We got lots of levers to pull their, you know got to be looking at what your capital is for the next deal.

You got to be looking at where you are real and what they want you to be, so you have to keep all that in mind or if you didn’t have to keep that in mind, you could take those levels lay down, you probably buyback it may seem we were low today..

Plus we have to keep the capital for our CRE ratios too..

Yes that’s correct, capital for CRE ratios..

Fair enough. Just switching back to the hurricane provision quarter, I appreciate the color on how you guys came up with the estimates, but as we have seen storms like this cloud over time it seems like after the immediate impact there is a lot of a dollars that flow in, insurance payouts, things like that.

So I mean would you characterize just the magnitude of the provision as being conservative, and maybe from here you have some cushion to may be book a lower provision as we move forward, should things play out if they have historically in past terms?.

Well, I am the guy that kick that up after going to the Florida Keys. I felt like we needed more, some more devastation then I anticipate. If you think about our history we are a company that fixes it.

We don't fix it one time and we don't milk the cow every quarter and we don't go back to the way, we are known as the company that fixes it and fixes it one time. So, I think could I have been, could I have been a little high, I will tell you in a year, you know the real truth is the year from that.

What I did see in Key West, which concern me during my trip was nobody was there. I mean all of those - that market is dependent on tourists and I went to Hogs Breath Saloon and Sloppy Joe's. It just happens they are up in there, by the way.

Just looking at the traffic and there weren’t 10 people in Hogs Breath, and 5 were with me and the same at Sloppy Joe’s. Now we got fantasy fairs coming up. And hopefully, they'll lead back, just start rolling back in, I have been asked the question if the country club last night, Johnny I’m going to Key Wes.

In November, I am okay and as you are fine, [indiscernible] fine. So it wasn’t the damage that Key Wes it is just the fact a lot of cancellations happened as a result of that. So it will be back, it has in the past it will be back.

So my concern really is the cash flow, not to damage there [indiscernible] my markers say 15 to my marker 37.38 it’s pretty bad. However, where there something bad or something good, burned off some of our great customers down there in the Keys is just, it had a generator and it got water turn back own and it is amazing, his business.

We stopped and add a part on a highway. That is how much customer base he had going there and I am really proud for him.

He was very excited, his revenue was up, how much, Kevin it was strong isn’t it?.

Yes, he is right now probably 200% of what he normally does. So there is a lot of people who aren’t doing anything..

There are a lot of people not doing anything and our operator in Florida and overseas [indiscernible] he is just, he is up, he is running and all those people in there, primarily there were locals at Boondocks, and they're coming in to have a beer and I guess, you know we think about it. [Indiscernible]. So some of those places are really doing good..

Maybe one more from me for Brian, with Stonegate coming on, do you have a sense for maybe if you could provide us with what the scheduled accretion and expectations are for the next couple of quarters?.

Hi there. We booked, I am trying to give you a little color on what we have booked on the loans. We have booked 96.6 million in total mark on the loans and of that is 73.3 million that will ultimately be accretable discount.

Probably for the quarter of 2004 we are looking at about in addition at a minimum of about [indiscernible] that is really excluding any payoff accretion.

We normally take up a lot of this payoff accretion because we immediately load the loans on the loan level, but we are not going to convert until February, so we won’t be low in the accretion on the loan level until February.

But based on that it would be a little over $10 million for next quarter, and I will kind of reserve back that accretion will continue on through 2018 on a quarterly basis..

Got it. That’s very helpful. Thanks for taking my question guys..

Thanks..

The next question comes from Stephen Scouten with Sandler O'Neill. Please go ahead..

Hi everyone good afternoon..

Hi Stephen. Welcome..

Thank you. Thank you. So, I wanted to follow-up on kind of what you guys are thinking about Florida and the hurricane impacted areas like as it goes in 2018, Johnny mentioned, you mentioned you feel like you are tied up pretty well for growth in 2018.

So, I mean from your experience and maybe Dave's commentary and he has been in Florida is, what does that turn time look like to where you really start seeing development increase again that rebuild activity and when you would expect loan growth to pick back up in those areas?.

I will take this and I will flip it to Dave, but I will tell what people need to buy Home Depot stop because when I was in Marathon, when I was stopped Marathon went to with Home Depot, I've never seen that activity at Home Depot like I saw the activity in Home Depot.

So it was, I mean that event has started, what you are seeing right now is basically clean up money coming in and enter those claims of fall that we haven’t seen with Central Florida we started seeing a little money coming in, more money coming in, But I thought that Teresa Condas yesterday I ask questions about what she is seeing on the deposit side and she said the small checks are coming in now, but you are going to see, you are seeing economic activities starting as of right now.

Now that because a lot of those people lost their homes or the homes were damaged. So that economic activity has started and it will probably continue particularly on the modular side I would suspect in Florida for the next period of time 12, 24 might depend on that there might be a capacity problem on that - on getting modular’s in there.

By the way those modular’s that were on [indiscernible]. So that was pretty interesting, I think you will see those coming back.

Dave do you have any, you guys planning to add?.

Yes, I mean it depends on which markets were impacted. I mean some markets weren't really impacted at all. So the pipelines remain very strong and there really wasn’t much of an interruption maybe a week or two.

So we’re not seeing any real decline in pipelines and like I said earlier, I honestly believe with the larger balance sheet of home and we had very little attrition in terms of employees throughout this whole process. So most of our business development and lending staff is in place and plus with the additional people from Centennial.

I think we really have got an opportunity to grow. I’m pretty bullish on where we are today and I think the hurricane obviously is a big impact to the Keys and some areas in Southwest Florida, but I think overall we’ve got a great opportunity here. We just got to get out there and execute at this point..

Okay.

That’s really helpful and on the deposit side, I mean Johnny you mentioned some of that starting to come in now on the small end, I mean do you think that will be meaningful enough to where that can help abate some of this pressure you guys are seeing on interest-bearing deposit cost? I mean I know there were 5 basis points this quarter give or take, and so I mean is that something where or may be - I am looking at [indiscernible] is that somewhere you think that will drive deposit growth high enough to keep deposit cost more in line moving forward?.

Well there is a possibility. There is going to lots of money coming in at that point in time and [indiscernible] going to back out, but it will be temporary, you are talking temporarily. I’m sure Stephen and when I think you will see that as it comes in, and what is that six months, eight months that we see that.

Meantime in Florida news our deposits Kelly Buchanan you will see us taking some creative problems on the deposit side over the next period of time. We think deposits are important.

We have been able to find or are saying by just asking for deposits and with that doing anything really silly, we are not letting money leave like we did let money leave so that has raised the cost [indiscernible] little bit. We are letting all that money rollout and we decided to hold on to a little bit.

Steve, we were up hundred and how much?.

150 million. You may be commenting on that we got a - we do have a customer in such report that is in the interest business and just over the last 3 to 5 weeks or so, we have seen 70, 80, 90 million roll into that one customer that, you know as I said we will roll back at some point. It can provide some short-term benefit I think..

Oh sorry.

And then just kind of thinking about how that can affect your code name, I mean the codename I think was down a few basis points again this quarter, which I know in the last quarter's call you were thinking it might be able to directionally move higher, so I mean how do you think that will continue to shake out with where you are seeing new loan yields and some of these deposit inflows and what it might cost to drive some of this deposit growth moving forward?.

I think that might have been a little anomaly last quarter and I will let Steven speak that he had, I ask you what happened. Because I thought we are doing brilliant, so he has got a pretty good estimate..

Cost deposits were up about 6 basis points from prior quarter. I think I mentioned when we were here 90 days ago or so.

We have got the counts that are probably the [indiscernible] and you saw some of that kind of build up and reset in July absent a rate increase over the next few months and I don't think it is reasonable to see that, you know kind of flat and back down.

As Johnny said we have been proactive in retaining the core business that we have, but we haven't had to modify any of our existing rates yet. On the loan side, I think I mentioned our remarks we did, with the legacy bank with 370 million in production that 529 that is probably 12 or 15 basis points higher than what we have seen previously.

Every month we watch renewals and modifications that we do.

We are seeing those increase anywhere from 7 to 15 basis points every month, you are talking $100 million a month a so there, so - and I think obviously with Stonegate will reset a little lower, but their codename was lower, but I think we will - I think we kind of receive that reset down and then take back off from there..

Okay.

That’s great and then maybe just one last follow-up on the M&A discussion I know, you mentioned, deals coming from all angles out there to look out and I know the Florida stuff is largely filling but on the non-Florida deal as you might be looking at, can you give us an idea of may be kind of size that you would be targeting at this point in your life cycle and also if you are kind of leaning more towards the dent and scratch deals that you have historically liked or something cleaner..

All the above. You know I love the dent and scratch, you know that. I am looking for a dent and scratch that is one out there, I don't know if we will ever get it or not, we have been only up some time, but it has got to come some point in time. It is a pretty good size dent and scratch for us.

So looking at that, we looked at one that is pretty deposit rich recently but it made some sense that maybe for the deposit side. Outside our footprint, we probably wouldn't do, I don't know we do anything in this 3 billion or 5 billion. I think, I would rather be in the billion dollar range.

However there is one out there that I'd really lack, it is in the $8 billion or $9 billion range that I really, really like, but you kind of bet the farm with the company not betting the farm with a billion.

So dent and scratch would be my favorite and that’s deposit for our franchise would be a plus, but it all depends on where it is geographically, you know if it is - if it were in North Carolina or South Carolina or Texas or Missouri, we don't have a base there. So we are not going to get the kind of cost saves that we don't get our Stonegate.

And we understand that, but in [indiscernible]. Take a while, but you will bail on it, so I mean, we still like Texas and at some point in time we will probably end up in Texas. I think the strong Texas with Florida, good Alabama, our CCFG operation and the back office operating in Arkansas makes it pretty powerful franchise..

Okay. That’s really helpful color. Appreciate it guys..

Thank you..

The next question comes from Matt Olney with Stephens. Please go ahead..

Hi guys..

Hi Matt..

Hi.

Most of my questions have been addressed, but just one clarification on the credits, it looks like the loans past due 9 days picked that this quarter, was that from the hurricanes that you mentioned previously as you offer some deferrals on some of the professional borrowers or was this from the two loans that Kevin mentioned that you were trying to get resolution on before the quarter by flipping the 4Q?.

No, it didn't have anything to do with the hurricane referrals. I think most likely it was Stonegate acquisition from the - just the percentage that they had to our percentage..

Those Stonegate loans, if they had loans that were on non-accrual they don't come over as non-accrual. They go into pools and all those pools have accretion and so they are technically creating some income so by definition they are not non-accrual loans, so they would land in the 90 days plus bucket..

Okay.

That’s helpful and Kevin the loans that you have mentioned that you are trying to give resolution on before the end of the quarter remind me of the dollar amount of the loans that you mentioned?.

They were both between 6 and 7 million each..

Okay. That's all from me. Thanks guys..

Thanks Matt..

The next question comes from Brian Martin with FIG Partners. Please go ahead..

Hi guys..

Hi Brian..

Just a couple of things, just going back to those two loans you just mentioned Kevin, is there I guess an impact on the provision of the reserve or is it just a, I guess on how the remarks goes it is just an impact in non-performings being reduced in the fourth quarter?.

Should you see any impact in nonperforming, should improve those..

Fair enough. Okay thanks.

And then just one for Steve, on the core margin, I guess just in thinking about it going forward with the potential rate increase in December, I guess is it fair to say that kind of based on your commentary may be the core margin is down a bit in the fourth quarter and with the addition of Stonegate, and then it trends higher in first quarter and looking out even, I guess potentially with a rate increase in there as well?.

That’s fair. Obviously, Stonegate I think ran in the 370 to 380 range on a [indiscernible] so we will reset with a full quarter with them somewhere in the 390 range give or take their mix of variable rate loans is greater than ours. I think Dave was around 60, 40 or so adjustable and variable.

So, yes, I think you see a great increase potentially in December. I think you will see the benefit of that maybe more so than what we did for Stonegate..

I will add a little color to that.

If you adjust pro forma of the two companies together and let every left everything equal it was going to be about 15 basis points decline in the margin, but when we pick up this 3.6, 3.7 million of accretion income that will kind of neutralize the playing field and bring their GAAP margin more in line with our margin, just on a pro forma basis..

Okay, I got you. Okay Brian. Thanks Brian.

And then just maybe one for you Brian, that step-up you talked about the 36 or 37, you said it increases a bit more as you look into next year once the conversion is done, any sense as far as how much - how we should think about that additional pickup may be in the back half for the remaining quarters of?.

I mean without a crystal ball it is hard to tell.

From an accounting standpoint we're going to ask kind of put a band-aid on it until we get those - so we can get that conversion because there is just kind of a manual process on calculating accretion until we get it on our system, which won’t happen until February, but it will just be a function of payouts, I mean we don't have a crystal ball and who walks and pays us up here.

So that should be on the low end going forward at least for 2018..

Okay.

The 37 is being on the low end?.

Right..

Okay. All right.

And then just from a, with regard to the M&A potential, I mean I guess is there, given some of the activity in Florida it sounds like it’s going to pick up as a result of the hurricane, I guess is it, is it - there seems like there is more of a focus on non-organic in the short term a, maybe pricing being up and the activity that you are going to see in Florida plus what you are getting out at Chris, which seems pretty positive or as is M&A still that much of, I guess a priority and has the priority of M&A changed at all with the opportunities it could present themselves in Florida now?.

We take M&A as it comes, Brian. We don't chase them and take. We take it as it comes.

So we are starting to look for organic loan growth and we are probably more rigid on the what [ph] that doing still a step, but wanting more organic loan growth, we are probably looking for that and I think that is possible, but the M&A deal, it is just when they come up, you know you feel [indiscernible] footprints where we need to fill out where we are not and I mean these deals kind of came to Dave and Steven still kind of came to him, Tracy’s team to him, demand kind of came to me.

So it is kind of how - people know we are all acquisitive entrepreneurial kind of company and they just come at us with these opportunities and some work some don’t. They work they don't work.

Dave you got any color on that?.

I mean I think there is still going to be a lot of consolidation, there aren’t as many banks in Florida, but there is going to be opportunities to pick up banks that could fill in the rest of the franchise. I mean we have a nice franchise now, but there are a few areas where we would like to expand and M&A if it makes sense we will do it.

If it doesn't we will just take the long haul and do organically..

Okay.

That’s helpful and just last one Johnny, I guess it sounds as though I mean the other markets outside of Florida, I guess it sounds like if you go there or look at opportunities there it has got to have enough scale, but it is $1 billion enough scale to enter a new market in your mind or do you need something more like for instance if you went to a Texas or pick a different market, does it need to be bigger than 1 billion or was the billion enough to get going.

I know you mentioned a couple of larger ones, but just in general how to think about if you left, if you go to a new market?.

Well you know there is also [indiscernible] great and so the grade is you can go to $8 billion deal - you might get yourself in trouble.

So you do a smaller transaction, you get your feet wet and we are a pretty conservative company and maybe it doesn't give us enough scale and maybe go out from there and then do a $8 billion deal after that if we get comfortable in the market. So it’s just caution, we now lack the $8 billion a lot.

Like the people in the $8 billion deal and I think I like just being that we are dealing that [indiscernible]. So what we do both know, probably wouldn't do both, but it just kind of - this kind of progress forwards here and see how it evolves. Kind of just, you remember when you met your wife you start dating, that’s what we’re doing we’re dating.

And we [indiscernible]..

All right. I appreciate the colors. Thanks guys..

This concludes our question-and-answer session. I would now like to turn the conference back over to Mr. Allison for any closing remarks..

Nita thank you. It has been a pleasure working with you today. Look forward to working with you in the future. I would like the company is well-positioned. I like 2017, as we are about to put to bed now. And I am looking forward to 2018. I wish we would get our conversion done quicker.

So we could really see the impact of the Stonegate transaction in the first quarter, but with, I think I have said it earlier with the ability of our New York operation to grow. They have got a lot of runway out in front of them. Dave joining our team and our great Florida team now, I think we can continue to grow Florida.

I think we will do some smaller target acquisitions. We will certainly be working on those. I think Florida, particularly South Florida is in economic - going to be a you an economic 9, 10 year and I am pretty excited about that.

So overall, I think if our loan loss reserve is more than it needed to be then that will pay dividends, just our money just in different parts and I think it is prudent to do that. I think people that didn't make the reserve properly, I don't think that’s prudent to them or the shareholders.

As I have said, we are known as the root that takes it one time and gets it behind you. So that is what we have done here. We thank and hope for that. And a year from now, we will know the answer to that. Thanks everybody for the support and hopefully we will be back together in 90 days talking about another maybe 27 Randy. Thank you..

27..

Thank you..

This conference has now concluded. Thank you for attending today's presentation. You may now disconnect..