VLY
#I gave a range, a range based on everything you see, as to about where we think you should be looking.
In that range.
Again, as we keep telling you, there's 1 million moving parts.
And so for me to get any ---+ even think about anything more precise than that ---+ or even you guys.
I don't understand how you guys are coming up with a number that you could be comfortable with.
There's a lot of things that will be changing during the course of the year ---+ just the debt instruments that are going to be coming off, and new coming on, and loan production coming on, loans being sold ---+ so there's a lot.
I gave you a number or some range that I thought might make sense.
Well, we think ---+ I won't answer that question.
I'm on the Board of the Fed.
People will misread it! I'm not that I know!
Yes.
We have built in some incremental increase in the prime rate during the course of the year, but not a lot.
We are not looking at the same thing that we think we are hearing from the Fed at this point.
I'll speak on it.
Gerry never told me anything.
I don't ---+.
He doesn't know!
I don't know! (laughter)
Yes, it's actually been performing pretty well.
One of the things that we did is that we capped the valuation of those loans way back when.
So even as loans went up to $1 million ---+ not loans, the valuations went up from (multiple speakers) $1.25 million, we did not do that.
And so we capped it out at about $800,000.
And they are performing at this point.
We only have one loan in the entire portfolio that exceeds 80%, and half of them are amortizing loans.
But there's a lot of loans that are way less than that.
There's about 30% of the loans that are less than 50% LTV.
That one loan ---+ I'm sorry, the $800,000 ---+.
Let me explain it.
$800,000 is what we put the value cap at.
And then we only lent a percentage against that.
It's not that we went $800,000; we were lending in most cases two-thirds of that or less.
There may be a couple exceptions to that two-thirds, but most of them were under the two-thirds.
So we had a pretty good valuation cushion on it.
And right now, as I know, they are all performing.
As far as I know.
They are all performing.
They're all performing.
We have zero delinquents.
I'm hearing from my credit people ---+ zero nonperforming.
And most ---+ almost all of them are amortizing loans, also.
They are not all a static loan.
So far not.
No.
Good point.
We are always on the outlook to grow our franchise through acquisitions.
Our primary focus has been in the Florida marketplace, because you really have to focus your attention one place at a time.
And right now we are trying to build our Florida franchise.
So we are looking for additional opportunities in Florida.
That being said, while our primary focus is not in the legacy New York/New Jersey area, if the right opportunity came along, we would be happy to consider that.
I don't know how the regulators think, but I know how we think.
I personally have my views about cap rates.
When I see banks lending, I don't care what kind of property it is, using a sub-3 cap rate, I think it's ridiculous.
So pretty much we have, like we did with the taxi medallion loans ---+ we appraise not using necessarily the cap rate that the appraiser might come up with; we have our own floors that we like to impose on our loans, which very often changes the valuation considerably.
But we are comfortable, and that's how we've always lent money at the Bank.
We did not get involved in the subprime residential mortgage market for the same reasons.
Just because everybody thinks it's a great place to be doesn't necessarily mean we agree with that.
We adjust our cap rates ---+ I think when you hear some of the cap rates that are bandied around, I think it's just ridiculous.
It's interesting that the Florida marketplace seems to use even a higher cap rate than we see up here.
So it gives me a little bit more comfort on the valuations I see coming out of Florida.
Thank you for joining us on our fourth-quarter conference call.
Have a good day.
