Wintrust Financial Corporation (WTFC) Earnings Call Transcript & Summary

We're live. Okay. Let's go ahead and get started. Welcome, everyone, that's participating today to the 2021 Raymond James Virtual Institutional Investors Conference. This morning, we are excited to chat with Wintrust Financial. Wintrust, ticker WTFC, $4.5 billion market cap is a growth oriented bank headquartered in the Chicago MSA. Wintrust definitely navigated the great financial crisis with asset quality metrics comparison very favorably to its peers, which we believe will prove true once again as we exit the aftermath of the pandemic-driven recession. With plenty of capital, positive momentum coming from new business relationships generated as a result of the PPP program and overall ability to take share in the Chicago market, we believe Wintrust is well positioned for post-pandemic life and believe the bank will be able to produce better than pure organic loan growth for the next couple of years. With that said, let me introduce the Wintrust team with us today, and then we'll get started. With us this morning is Ed Wehmer, CEO; Dave Dykstra, Chief Operating Officer; Tim Crane, President; and Richard Murphy, Chief Credit Officer.

With that, why don't we go ahead and get started. And maybe just starting out, can you guys talk about the health of the Chicago MSA and maybe how the recent shutdowns impacted the local businesses? And maybe a little bit on the commercial side, what is the customer sentiment like right now?

Well, the -- thank you, David. It's always fun to be here, by the way. Wish you were in Florida again, though. It's always good to...

So do I. Next year.

In March to get out of Chicago, go to Florida for a weekend and kind of get the rust off the golf game maybe. And Murph would like to go to Disney World a lot that -- he likes to see Mickey, and Mickey is going to miss him this year. But look forward to getting back and getting back together. It's always a great conference. But Chicago feels okay. I mean you've got -- it's got the backdrop of the city and the state financial situation out of the way. Having President Biden now should be very helpful to them to bail them out a little bit. So I feel a bit better about the health of the city and the state, knowing that the tax increase didn't go through, that Governor Pritzker wanted, where he's going to -- higher taxes if you make more money would have driven even more people out of Illinois. I think there'll be a reconciliation coming up where people are going to have to get serious about Illinois and Chicago's situation as long as the government is printing money and handing it out. Glad we're getting some of that should at least stave off that for a little while. Chicago was a tourist town. Therefore, it's hurt a little bit on the tourism ministry. Hospitality is not going back as quickly as you'd want. But things are coming back to normal. The highway, as mentioned on a previous conference that drove downtown, took the usual 1 hour and 20 minutes as opposed to 30 minutes like it is when there was nobody on the road. Again, no one is on public transportation, but that will come back too. So it seems like we're getting back to normal. [indiscernible] hospitality will be tough for another year for Chicago. They said, hopefully, the ancillary businesses may get out. PPP has certainly helped a lot of the bigger hotels and hotel chains and smaller ones around here. But fortunately, we don't have a large hospitality portfolio. Got a little bit in the ancillary business like guys who make displays and what have you for conventions. But I think that overall, it feels to me, given all the shortages, all the money that's out there, when we give it a go ahead, things are going to roar back. People want to get back to normal. And I think you've got a lot of pent-up demand. Supply chains across the country are totally screwed up, and they get back to the normal because of COVID, some of the weather now in Texas and the South didn't help much, but they can get back to normal. I mean, try to order a washing machine in [indiscernible], you used to have to wait a day, and now you're going to wait 3 weeks or a month to get them. A lot of money out there, a lot of people want to spend it. And when they get free rein, they're just ready to go. My opinion, coming out of this is really going well. Anybody else want to comment on that?

And I think you summed it up well. I think our biggest concern, in the Chicago market in particular, is what Ed said is those are really highly affected businesses that the -- I don't think anybody is really certain as to when movie theaters are going to come back and when the convention space is going to return to normal. So that's -- those are the wildcards out there. But if you talk to our manufacturers and you talk to a lot of the small businesses, they're very optimistic about overall growth for this year. So we'll see.

CECL, although it's a pain in the neck, has helped the banks be prepared. I mean we've got more reserves than I know what to do with right now. And I don't want to get them back as long as I -- as they'll keep them. But we really don't have much say on it anymore. But any losses that come out of this are pretty much already built into the system. And we'll be there. We've got a lot of reserves built up right now, where basically losses that are lessened, we had -- fourth quarter had less losses than fourth quarter of the previous year. I mean -- so we always had a pretty good portfolio, and now it's coming through. And we're well, well reserved. We can handle everything going forward. And I don't want to make it on reserve release. And I just -- I talked we'd rather keep them, but they said I don't have much choice there anymore. In the old days, they used to be able to guide it. Now it guides me. So any committees, well, there's no way to do that, do this. I can't do it anymore. I think why I said that to do this, what is more accurate than the -- anybody -- any of the bets that's been thrown out, but we'll go from there.

Sure. Talking about the reserving and CECL and the reserve releases, the economic forecast continued to at least be steady, if not getting better. At what point do you see Wintrust being able to release those reserves? Or what has to happen in order for that reserve -- excess reserve to come down?

I'll turn it to Dave, but I would like to say what I'd love to see to happen is that the economic forecast changes, a lot of the loan growth just go through a 0 reserve for a couple of years. Do you know what I mean? I'd love to see our growth be covered by the reserve we currently have as the indicators move to a more positive economic outlook. That's what I'd like to see happen. Dave, you'd like to talk about CECL?

Yes. Yes. I mean -- so I -- certainly, a number of factors impact the CECL calculation. The growth in the loan portfolio, as Ed was mentioning, that we are hopeful and confident that we'll achieve. So that adds to the positive. But if you do look at some of the economic forecast, the Moody's forecast, the Blue Chip forecast, et cetera, out there, they are trending better, and the February forecasts are better than they were at the end of last year. And so all else being equal, if the forecast just improves, you would think that your reserve level would be less, which would mean you'd have a negative provision. So the offsets of that would be growth and/or migration in credit quality if you see some deterioration in some of your risk ratings, et cetera. So my gut tells me that if the economic forecasts keep getting better, that you will see, barring growth in the portfolio or deterioration in certain loan categories, then I think the industry will see negative provisions during 2021. Now that could change if we have a different variant come out or there's a relapse of something with the COVID situation. But we're not predicting what our provision is here on this call. But if you follow the economic forecasts, they are getting better, and I think that, that probably means that you will see -- and you saw some of this in the fourth quarter, people having negative provisions. And economic conditions are better. And they were so -- the economic conditions were so bad in the first and second quarters, where people took large provisions. I just think some of that has to reverse if the trends continue to go positive.

Yes. I think, last quarter, I think if you look at our -- the credit portfolio, now we say [indiscernible] from the market viewpoint was actually pretty darn good. Our risk ratings, and we were able to move out lots of credits, 100 -- a couple of hundred million bucks of. They weren't not accrual, but the ones we just saw some issues in roll out, risk rates get better across the board. I mean, that would stay -- we're pretty rough on our risk ratings, and we're pretty rough [indiscernible] but the portfolio itself is getting better. We just had to say we're not going to have onesies or twosies at the end of the day when PPP runs out, that they're going to live happily ever after. They're not. There's going to be a fundamental change in some of the hospitality issues. And we don't have a big portfolio there, but there'll be a fundamental change there that's going to hurt us a little bit. But I think we're extremely well reserved right now. And I don't want to take negative provisions. I would rather hopefully grow through them, and that would be a perfect world for me.

Sure. Talking about the loan growth, I think you've talked about mid- to high single-digit growth this year, excluding the impact that PPP may have. When you're thinking about that, maybe can you give us some color on -- by line item, is it core C&I, is it premium finance, is it franchise finance, is it commercial real estate? Talk about maybe amongst your categories, individually, how do you see this year playing out to get to that mid- to high single-digit growth for the year?

Sure, Rich and Tim, do you want to handle that?

Yes, I can start. I think when we sat down at the end of last year with our teams, we kind of looked at 7.5 percentage increase and said, okay, well, how do we think about your portfolio relative to that for next year and talk to us about how you get there. And it was very interesting. I mean everybody really pretty much had a pretty good sense as to what they thought about 2021. I'll start with probably the most impacted, and that would probably be C&I. C&I, as we talked about last year, the PPP opportunity and our execution with PPP really has put us into a pretty good position in terms of visibility within the Chicago market. We got a number of credit awards tied to our overall product suite, but also with our execution of PPP. And as a result, our -- and I would also couple that with a lot of the dynamics that happened in the Chicago market, Fifth Third taking over MB and the changes of CIBC and just a lot of the changes with the much larger banks. We suddenly have become a -- I would argue, the bank for Chicago right now. As a result, we looked at our credit opportunity in our credit meeting this morning, 4-generation, long-standing company that's been a competitor for years finally just said, we just love the way you guys have positioned yourself as Chicago's bank. We are a Chicago company. We want to bank with you. We are hearing that over and over again. So those businesses take a while to move. We've been talking to these companies here over the course of the back half of last year. And we really view that core C&I book is really having a lot of upside potential here going into this year. As it relates to FIRST Insurance and the premium finance side, the life side had just a really good year last year, I think, fueled by a number of things. But overall, though, it was our top performer, and they are looking at this year also being as a very solid year. And we think that they would kind of be in that guidance range, maybe slightly above that. And the premium finance side on the P&C side, with a hardened market, I mean, the premium -- overall premiums are up pretty dramatically, plus their just core business is growing. So the 2 of those put together have really fueled a lot of growth last year, and we would anticipate that would continue into this year. So all 3 of those, we're highly confident. The leasing group was above guidance last year. They are anticipating that they will be probably at or close to guidance. Where maybe we probably have a little more caution to would be CRE, we would anticipate CRE, which has been a really good contributor over the last 5 years, as being a little bit more muted in terms of its growth. We see a lot of our borrowers right now kind of taking a more cautious approach. They want to see what the fallout is going to be post-pandemic in terms of where vacancy rate is going to be, where lease rate is going to be, what are cap rates going to do. So that, we're probably a little bit more cautious. But we do think those first 4 will be meaningful contributors to our overall growth and kind of keep us right in that guidance range.

Sure. And within marketplace, I know with -- in a virtual world, it may be a little bit more challenging to bring in talent from your competitors, but are there opportunities to bring in veteran bankers that would help be incremental to that growth?

I mean we're talking to bankers all the time in terms of some of the -- I think the MB fallout has probably largely been realized at this point. We've -- a lot of -- we picked up some. Some went to BMO. So they've scattered. I think that, that upside is largely gone. But everybody -- we're winning right now. We've been winning here for a number of years. And I think people are kind of frustrated by the banks that they're at and want to work for us. So generally speaking, when we go out and talk with bankers, it doesn't take a lot of convincing to get them over.

I think We are [indiscernible] either. We're looking for good, solid community bankers, I mean, business bankers and commercial lenders across the board. I mean the -- we're starting to see a pick up a little bit of the inbounds from smaller banks who realize [ we may swallow banks $1 billion ] understand. Maybe they just kind of threw the towel and they kind of had it now. They've hung a real long time, but now [indiscernible] period of time. They're veracious in their appetite for earning assets. It's going to be hard for them to compete [indiscernible] commercial real estate. And they got -- usually, they have a nice core, a little book of business to smaller banks and -- but now they want to get rid of it right away, because somebody else have them. But we're starting -- so recruiting in that area is a good spot. Commercially, it's a good spot. Tim, do you want talk about what's the new cash services business and other businesses we've joined in?

Sure, Ed. David, just as you mentioned, there still are kind of selective niche areas where we can play. One of them that we've started to do some work in is with the money service business. This is a business that one of our competitors exited, and we've been able to acquire some people that know the market well and received a warm reception from clients. And so we'll continue to look for more opportunities like that where we could differentiate and maybe we don't get into the commodity pricing that occurs in other parts of the market. So we feel pretty good about that. And as Rich said, the fallout is probably over from some of the other dislocation, but the bankers that we have acquired are now becoming very successful, and not a lot of that business moves immediately. So our pipeline is still very good, both from the dislocation, the PPP stuff and the new niches that we're entering.

We could [indiscernible] other earning asset, that is true, because as you know, concentrations do kill. And with about 50% of the portfolio out of Illinois, we believe that, that's good for us in terms of the overall geographic concentrations that we have. We've got it because of our premium finance, our leasing, our businesses and other businesses that -- in our core business. On the core side of this, as you called a nexus, we'll do the business. But we won't just to Arizona and pick one up, because a guy -- he doesn't have a nexus to Chicago, have a relationship with us, then we won't do it. But you start to see the -- Chicago is a big building contracts, contractors, engineers, architect sort of business. We're just trying to move out of Chicago too and that move-out, but send their businesses to take and do [indiscernible] in Denver and Texas and other places. We're seeing opportunities there to do business. We have -- of course, it has to have a nexus to Chicago until we make a move to other locations, which is probably going to be in the cards to go the next 5 or 10 years. You'll see us kind of moving our deposit base, which is pretty much all local. They have to get some differentiation there. And you will -- well, we'll talk about acquisitions when you ask the question, yes.

Yes. Okay. And Tim, you mentioned if the PPP program being beneficial, and you guys -- Wintrust has talked about the halo effect. Can you talk about the numbers of clients that you've brought in, maybe prospects, prior to PPP that are now clients? And outside of just the PPP loan and maybe a deposit has -- what has been the conversion rate in selling or bringing in other services to these new PPP relationships?

Sure. So first around the PPP or first 2 rounds, depending how you count it, we did about 12,000 loans and $3.4 billion. This last round, we've done about 1/3 of that, a little bit more in terms of clients, but 1/3 in dollars. And in both of those situations, we've added new prospects that previously had banked elsewhere that either couldn't get their PPP loan done there or were in the process of switching banks. And so on the middle market side alone, there's at least 500 or 600 new opportunities for us. We think we might be 1/3 of the way through converting those folks. And in addition to the attractive deposit business, and hopefully, loan business, our treasury management business is just on fire right now. And so where many clients are growing low single digits in terms of their treasury management fee income, we're close to 10%, and I expect that, that will continue well into 2022.

Okay. Okay. Maybe shifting gears a little bit here. Talking about the mortgage banking and Mortgage Bankers Association recently raised its mortgage origination forecast again and refi volume now expected to peak here in the first quarter. How is Wintrust's pipeline looking at this point? And if refi volume contracts as the MBA is projecting throughout the course of this year, what can Wintrust do to offset some of the revenue pressure that may come up.

Dave, do you want to talk about that?

Yes. I think you're right. I think the first quarter sort of baked in and the volumes have been extraordinarily strong for the first quarter of the year, given winter time in Chicago. But -- so refis were strong. Purchase market, we expect to pick up in the second quarter. We'll see how strong that is. But with these low rates, I suspect that, that purchase activity that we saw finish up 2020 filters into the springtime of 2021. So hopefully, that will keep production volumes strong into the second -- at least the second quarter and probably into the third quarter. But they may tail off a little bit, given the little bit of increase in rates here. But I don't suspect that, that's going to shut down the purchase market. But the flip side to mortgages may be falling off as far as applications on the refi cycle. As that with the spike in the tenure as we sort of ladder out in the investment portfolio, we should be able to get some expanded yields on some of our liquidity. And also the MSR, we have a fair amount of MSRs that probably will see some increase in value and will offset some of the production loss. But those are the 2 things rate-wise that would sort of mitigate some of that loss. But we still think mortgages will stay strong during the course of the year, probably less than last year, but still very strong. So we also have a fair amount of our service book that we haven't really mined yet, because we've been so darn busy just taking inbound calls that we think there's a good chunk of those, 40%, 50% that probably could refinance that haven't. So we'll actively try to mine that business too.

We're in the process of doing that. There's -- Murph, how many loans do we service in the portfolio?

I don't have that number in front of me, but we've been building that servicing portfolio probably for 6 years now in between our core generation and our veteran's first generation of loans. We've built that up into a fairly sizable number. I'm trying to -- I'll see if I can pull that up.

I think there's over 3,000 loans in that portfolio that have rates right now above 4%. We are -- now that we're -- kind of things are slowing a little bit, we're able to free up and contact these, direct mail these people. We don't want to direct mail before and then overload the system and not be able to service. But we're not losing them. And then we're calling, guys, you could save x and [indiscernible] there. So we may have a little bit of a tailwind on the refi front. But the -- we're moving into a heck of a purchase margin right now. And I think that will help too.

We service over $10 billion of loans right now. So even if you said there was 30% or 40% of those that could still refinance, that's not an insignificant number.

Yes. Got it. Okay. We talked about loans. Let's move to the deposit side of the balance sheet. And first of all, are you still growing deposits at this point? And then as part B, how long does the excess liquidity or extra liquidity stay on your balance sheet? And is some of that going to be permanent in your view?

Tim, do you want to talk about the fist, and I'll talk about the second?

Sure. The answer is, yes, we're still growing deposits in part due to the PPP process. But even above and beyond that, we've seen good growth with clients, as we've talked about the middle market clients coming on and even on the personal side with a lot of the stimulus we're seeing additions. How long that will all last, we'll see, but we were north of 20% last year. I think with that story, though, is the continued decline in the cost of those deposits. So we are still seeing a nice drop in the cost of deposits from both the core portfolio and then obviously from the CD book running down as we work through the next year. So about 80% of our CD book will reprice in the next year. It's coming off in the $150 million range going back on with high retention in the 30, 35 basis point range. So we expect to continue to benefit from that as we move through 2021 here.

On the investment side, we are doing a little bit of investing, but we're not jumping into it and putting billions of dollars of work at these rates. I firmly believe that the rates are going to move up substantially, materially, and it would be better to wait to do that, especially with the new PPP growth. And from an earnings standpoint, we should be fine. I don't want to lock these things in right now. It doesn't make sense to me. As I said previously on a call that we're going to come roaring out of this thing. Supply chains are so thin right now. There's so much pent-up demand that it's [indiscernible] moves. And you've seen it -- already seen that a little bit of the tenure is gone. Interesting, tenure is gone, but mortgage interest rates haven't moved really, because government is holding those down. But the market is telling you that, that's going to go up. And the government says buying will go up substantially. And I think in the meantime, we're going to maintain [indiscernible] a little bit of work in there, but we've enough of it that why -- let's just wait and see and -- how much liquidity is going to get spent, where loan volumes go, et cetera. So we're in no rush to do it right now in crummy rates for the rest of my career. We're going to wait and balance it all out. And we're in great position for rising rates right now. So why do you want it? I mean we could do it if we wanted to, but why?

Yes. Yes. So I know there's a lot of moving parts involved. But looking at your -- just your net interest margin, do you think it has already hit a trough? Or do you think you still have more excess liquidity than you may have planned for, so you could see that -- still see some pressure?

A couple of basis points either way is the way I look at it. I mean the core without PPP, Dave, you want to talk about that? But I think you've got a 5-point quarter on either side, kind of a status quo situation. But the interest income is going to go up nicely.

I mean there still is a fair amount of liquidity out there. So I think it sort of bottomed. Where December is at, it may go down a few basis points from the fourth quarter or stay flat. I think it's generally stabilized with the end of the last year. And then if we can get some rise here and the PPP loans help a little bit and if we ladder out a little bit here, I think it will stay relatively flat. But a few bases one way or the other. This is all excluding PPP, because the way you have to emphasize PPP and bring it in could influence those numbers. But we're patient. And growing NII is the key, and we focus more on NII than just the absolute basis point on the NIM right now.

Right. Right. With regard to the...

For 20 years in the [indiscernible] fall under water to come up, it's going to happen.

Yes, yes. Yes, well, you may be right on that. So -- but with the PPP forgiveness, where do you stand with that? Are you seeing these -- the round 1/2 loans getting forgiven pretty quickly now? Or where are you in that process with that original $3.4 billion?

Murph?

Yes. Right now, we're at about 48% with the forgiveness, which puts us well ahead of our competitors. Right now, we're actually in a forgiveness with some of the rule changes. We have had to take our systems offline to kind of just update those systems, because we really want to try to make the forgiveness process for our customers and for our employees as efficient as possible. And so we've automated a fair amount of that. And I think that's contributed to a lot of our success. So we'll be opening those back up probably end of next week. And our hope is that we push hard through the rest of the first quarter and into the summer and get this kind of behind us. So good momentum. But part of the challenge is the SBA and is -- you can only work to what they're currently working on. So a lot of the larger loans still are -- the decisioning is pretty slow on those. But anything smaller, it's -- we're being pretty efficient and the turnaround is pretty good. So we're making good progress.

Yes. Just one clarification. That 48% I referred to is the number of customers. The dollar amounts are a little less than that, because as we said, they are not processing large deals as quickly. So we're probably $1.2 billion or so of dollars, but about half of the customers.

Yes. And for us, that's the challenge is really in the unit counts, because it takes a fair amount of -- largely the same effort to kind of make sure you get your customers all their documentation and everything else. So we're just trying to grind through the numbers.

Sure, sure. Looking at your profitability overall, historically, your return on assets, return on tangible common equity coming in a little bit below where your peer levels are. Just wanted to have you guys talk about why you think that may be the case? And maybe talk a little bit about what metrics do you think are most important in that regard?

Well, one of the things we can do is we'll invest. We invest in the future. We don't go buy it. And I think the easiest way to put it is we were -- asset growth, earnings growth, intangible book value growth, the 3 metrics we look at. You can go out and buy something and add to your profitability, it would kill your tangible book value, never makes sense to me to do that. I mean why do you want to give away 5 years of earnings to add $0.03 to your margin. So I don't think it'd do anything to your EPS, makes no sense to me. It's a risk-reward setting. We're able to -- we take what the market gives us. We grow. We're not ready to invest. I mean our pretax pre-provision number 10-year compound growth rate is above 10%, steady, consistent growth. And so we want nothing stupid, grow your tangible book value, grow your earnings, grow your assets. If you can buy it by those 3 metrics, you can't do anything stupid. You can't give up 5 years, as I said. Giving up 5 years of earnings to buy a little bit of earnings of the EPS growth, it makes no sense to us. So from that perspective, I don't mind being a little bit behind, because it means that we're investing. We could stop, shrink down, do all that stuff, but we are a growth company. We're an anomaly. We're a growth company and in an industry that doesn't normally see growth like we do it. So Dave or anybody else who want to comment on that?

Yes. No, I think that, that's right. And I look at it as the investing community and the shareholders want growth in your earnings per share. I mean, like Ed said, we could shrink down and cut costs and cut to the bone and not invest in the growth. But at some point then, you're just stuck in the mud. And if we grow our earnings and if we grow our tangible book value, then we should grow our stock price, because that's what the market trades off of in different markets. They don't trade-off for ROA. I don't ever see anybody say, here's your stock price relative to your ROA. So if ROA is a little less, because we're investing in growth, as long as we're growing the earnings per share and the tangible book value over time, I think that's the key we look at.

You can't -- we were able to do it over time. Over time, it's an important thing here, because think of the cycles we've gone through to be able to accommodate 10% pretax pre-provision growth. We've done it in a high rate, low rate, bad credit, good credit. We don't make a single bet. We've got to bunch of internal heads at office do that. They may hurt us at some point, they help us in others. But all in all, it's -- you put all things together, it works pretty darn well.

Yes. The -- I want to talk about M&A before we finish off here. And obviously, you guys have been very active in the M&A market over time. And question, given where we are in the recovery, is Wintrust prepared to do a deal if something came up today? And in your discussions, I'm assuming you're having some type of discussions, how are seller expectations now relative to where they may have been pre-pandemic?

Yes. We take what the market gives us. I always say that. Sometimes it gives us organic growth. Sometimes it gives us acquisitions. Sometimes it gives us both. Right now, we're in the both mode. We're getting more calls from potential partners. On the lower end, I think across the board, expectations are not what they used to be. They would rather -- I think the realization that size and bulk is important is hitting a lot of people. From our perspective, we'll still look at the smaller end market fill-in deals. We still -- although we talked about our branch rationalization in the fourth quarter, going this quarter, we're close to 10. We're still open [indiscernible] 12 months. New branches coming onboard. So there's still markets we need to serve in Chicago. But we're starting to think that maybe it's time to move out of our 12-hour comfort zone, the [indiscernible] Minneapolis, contiguous states of Minneapolis, Indiana; St. Louis, that type of thing. Just starting to spread a little bit, in which case, maybe the opportunity to do a larger deal, but tend not to be afraid to do it. In the old days, I may have been afraid of doing it because of the integration risk and IT in particular. We've -- our IT staff put up against anybody's in the country. We've added a number of people to it. A lot of overhead there. I'll tell you, we had to make that investment. We're still making it too with our -- what we call our deep blue project to be able to same better products, same delivery systems, [indiscernible] servants. We make big investments in IT. But we have the -- the support staff has been able to do that. So any sort of larger acquisitions, I feel very comfortable we could do it much more seamlessly than we could, say, 5 or 6 years ago. We've got the expertise, the capability to do it. So I'm comfortable looking at larger deals. I think a lot of people looking at this as a throwaway year [indiscernible] going to be this slow. And then I think a lot of people understand it's higher for a larger bulk. We are a perfect acquirer for somebody like that because of the way we operate. I don't know anything about Indiana and the Indianapolis market. I don't know anything about St. Louis market. To be able to bring Minneapolis, I don't know anything about it. Michigan, I don't know about. Iowa, Dave came from Iowa, but I don't think he knows anything about it. But I think we'd be able to -- we bring the staff if the cultures match, get the efficiencies we can out of the back room and [indiscernible] and let the guys run their business, which has been the secret for a bunch of [indiscernible]. We let people run the business. We put the guard rails out the parameters up, have an eye on them to run the business. We have the extra muscle. We could lose some of the junk out of the way. I think we're a perfect partner for them. And they come from the St. Louis bank or the Minneapolis bank, probably a bank for Northwest Indiana, any place. So from that perspective, I think our acquisition mind is [indiscernible] a little bit. We can do bigger deals in other places. Not saying we haven't discussed this or not. But I think that -- I still think you can look at low premium deals now, because the ability to match up in a lot of these. And we're sure people in the smaller banks and the bigger banks, they want to partner up, we're the guys to partner with, and we can provide a lot of benefit to them. So Dave, did I miss anything?

You covered the landscape. You know a little bit about Iowa, I think it's God's country, right?

Iowa, Idiots Out Walking Around, that's what I know.

There you go. All right. With that said, we've hit our time limit here. I'd like to thank the Wintrust team for their participation in Raymond James Institutional Investors Conference. Thank you very much. And everyone that has dialed in, thank you very much for your interest and hope you enjoy the rest of the conference. Thank you, everybody.

Thanks, Dave.

Thanks, David.