Financial Data and Key Metrics Changes - Net income for the quarter was $25,200,000, a record excluding one-time sales of PPP loans [5] - Total revenue for the quarter was $62,700,000, also a record when excluding PPP loan gains [10] - Net interest margin was strong at 5.1%, with a return on equity of 20.73% and return on assets at 2.38% [8][9] - Earnings per share were $3.06 basic and $3 fully diluted [8] - The allowance for credit losses over gross loans increased to 1.28% from 1.23% in the previous quarter [9] Business Line Data and Key Metrics Changes - The loan portfolio grew by 36% overall, with purchased loans up 40%, originated loans up 27%, and SBA loans up over 200% [12] - For the quarter, $362,600,000 in total loan originations and purchases were recorded, with $216,600,000 in originated loans [5][6] - SBA loan originations for the quarter were $107,300,000, totaling $408,500,000 for the year [7][14] Market Data and Key Metrics Changes - The company noted increased competition in the purchased loan market, with more capital and cheaper leverage available [13] - The SBA tightened eligibility requirements, which is expected to temporarily reduce loan volumes by up to 50% in the coming quarters [14] Company Strategy and Development Direction - The company plans to remain active but disciplined in the purchased loan market, focusing on opportunities while managing competition [13] - There is an emphasis on expanding into new verticals and adjusting marketing efforts to attract suitable borrowers in the SBA segment [25] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the challenges posed by new SBA regulations and the overall market environment [25] - The company believes that New York City will continue to be a strong multifamily market, providing future opportunities despite potential rent control impacts [16] Other Important Information - The company is investing in new technologies and automation to drive efficiency gains, with a significant hire in the role of chief of innovation [44] - The effective tax rate is expected to stabilize between 33% to 34% going forward [37] Q&A Session Summary Question: When do you expect SBA volumes to snap back after the decline? - Management indicated it is hard to predict exactly, but they believe they will climb back as they adjust to new processes and market conditions [23][24] Question: How does the current pool of loans for purchase compare to last quarter? - There is a lot of activity in the market, with optimism about the volume and competition for larger transactions [27][30] Question: How much transactional income impacted the net interest margin this quarter? - Transactional income was $4,094,000, which contributed significantly to the margin [31][32] Question: Will there be any offset on the expense side as SBA volumes decrease? - A significant portion of costs is variable, so expenses would decrease with lower volumes, although some fixed costs would remain [41][42] Question: Are there any new technology investments planned? - The company is planning major investments in technology and workflow AI to enhance efficiency [44]