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Date

Tuesday, April 21, 2026 at 8:30 a.m. ET

Call participants

  • Chairman and Chief Executive Officer — Edward O. Handy III
  • Senior Executive Vice President and Chief Financial Officer — Ronald J. Ohsberg
  • Executive Vice President and Chief Risk Officer — William Wray
  • Executive Vice President, Head of Wealth Management — Mary E. Noons

Takeaways

  • Net income -- $12.6 million, or $0.66 per share, representing a decline from $16 million, or $0.83 per share, in the prior quarter.
  • PPNR (Pre-Provision Net Revenue) -- Down 6% sequentially, but up 23% year over year on an adjusted basis.
  • Net interest income -- $40.5 million, down 1% sequentially, and up 11% year over year.
  • Net interest margin (NIM) -- 2.63%, up 7 basis points sequentially and 34 basis points year over year; swap termination expected to add 9 basis points in the fiscal second quarter and 4 basis points in the fiscal third quarter.
  • Noninterest income -- Down $1.2 million, or 6% sequentially, and up 11% year over year adjusted; loan-related derivative income fell $854,000 sequentially; mortgage banking revenues totaled $3 million, down 6% sequentially, but up 32% year over year.
  • Average assets under administration (AUA) -- Down 1% sequentially, and up 10% year over year for Wealth Management.
  • Mortgage pipeline -- $114 million at March 31, up $33 million, or 41%, from December 31.
  • Noninterest expense -- $37.8 million, down 1% sequentially; salary and employee benefits rose $693,000, or 3%.
  • Loan balances -- Total loans declined 2% sequentially; commercial loans decreased $95 million, mainly from commercial real estate (CRE) payoffs; residential loans fell $21 million through continued amortization.
  • Loan pipeline -- Total commercial pipeline is approximately $156 million.
  • Deposit trends -- End-market deposits fell 2% sequentially and rose 3% year over year; wholesale funding dropped $50 million, or 8%, sequentially.
  • Loan-to-deposit ratio -- Stood at 96.9% at period-end, slightly lower than the prior quarter.
  • Credit quality -- Nonaccruing loans were 81 basis points of total loans, increasing $27.5 million due to two commercial real estate office loans added to nonaccrual; past due loans were 33 basis points of total loans; allowance for credit losses was $41.1 million, or 82 basis points.
  • Provision for credit losses -- $4 million, almost entirely driven by increases in reserves on the two office loans moved to nonaccrual.
  • Office portfolio reduction -- Office exposure declined from $300 million at its peak to $230 million, with continued reduction expected.
  • Growth outlook -- Management reaffirmed "mid-single-digit" loan growth guidance for the year, specifying commercial and industrial (C&I) as the main driver with expected high-single-digit growth; CRE growth now projected in the low-single-digit range, and residential essentially flat to 1%.
  • Margin outlook -- NIM expected between 2.65%-2.70% in the fiscal second quarter, rising to 2.75%-2.80% by the fiscal fourth quarter due to swap benefits.
  • Expense outlook -- Expecting a $1 million increase in the fiscal second quarter from advertising, mortgage commissions, and project implementation; additional branch opening to add $500,000 in expenses during 2026.
  • Wealth management revenue and flows -- Noninterest income in Wealth Management declined by $205,000, or 2%; net outflows contributed to the AUA decrease, though market recovery in April has partially reversed this trend.
  • Provision/future reserve guidance -- Projected provision for credit losses of $1 million-$2 million per quarter, depending on loan growth and booking timing.
  • Buyback activity -- No intention to repurchase shares in the near term; management cited a "relatively high" dividend and payout ratio as key reasons.
  • Digital banking initiative -- Completed conversion for personal accounts in the fiscal first quarter to enhance security and technology; business accounts migration will continue through following quarters.
  • Commercial talent additions -- Recent hires in C&I, CRE, and business banking to drive loan and deposit growth, with institutional banking group launched in January showing momentum.
  • Branch expansion -- New branch scheduled to open in Pataka, Rhode Island, later in the year to expand northern state presence.

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Risks

  • Nonaccruing loans increased by $27.5 million, primarily due to two CRE office loans, with a $4 million provision reflecting specific reserve builds for these credits.
  • Management acknowledged "net outflows" from Wealth Management AUA, indicating client attrition beyond market-driven declines.
  • Commercial loan balances dropped $95 million, primarily from CRE payoffs without commensurate new origination during the quarter.

Summary

Washington Trust Bancorp (WASH 16.90%) delivered a mixed performance in the fiscal first quarter ended March 31, 2026, balancing margin expansion with increased credit provisioning and selective loan portfolio contraction. Leadership outlined that NIM will benefit from swap terminations and projects incremental expansion each quarter, while new commercial and institutional talent underpins loan growth forecasts. Expense management includes anticipated growth tied to digital projects and service expansion, alongside a planned branch, but no share repurchases are intended despite solid capital.

  • Management revealed that the entire $4 million fiscal first quarter provision was connected to two specific CRE office loans recently placed on nonaccrual, with the properties described as having "strong, sophisticated sponsors" and expectations for potential resolution or performance restoration within quarters.
  • The office loan portfolio is strategically reducing exposure, down from $300 million to $230 million, and management maintains a "cautious" approach, balancing ongoing monitoring and proactive reserve allocation.
  • Deposit growth initiatives target business from new digital capabilities and geographic expansion, complemented by internal talent additions across commercial banking roles.
  • NIM forecasts depend on further realization of swap benefits, with fiscal fourth quarter expectations set at 2.75%-2.80%, up from 2.63% in the fiscal first quarter, as management prioritizes margin resilience amid subdued loan origination in some categories.

Industry glossary

  • CRE: Commercial real estate, encompassing loans secured by income-producing property such as office, retail, or industrial buildings.
  • AUA: Assets under administration; signifies total market value of assets overseen within Wealth Management.
  • Nonaccrual loan: A loan no longer accruing interest due to doubt regarding collectability, often following significant borrower weakness or missed payments.
  • Special mention: Regulatory credit classification denoting potential weaknesses that may threaten repayment, warranting close monitoring but not yet considered impaired.
  • Swap termination: The act of ending an interest rate swap contract, often resulting in immediate or future balance sheet or income statement impacts.

Full Conference Call Transcript

Edward Handy: Thank you, Sharon. Good morning, and thank you for joining our first quarter conference call. We appreciate your time and your continued interest in Washington Trust. I'll begin with a brief overview of our first quarter results, and then Ron will provide more detail on our financial performance for the quarter. Following our remarks, Mary and Bill will join us for the question-and-answer session. Building on the momentum generated throughout 2025, quarterly performance was driven by continued net interest margin expansion reflecting the underlying strength of our core banking business and continued benefits from our December 2024 balance sheet repositioning transactions.

The Q1 results do, however, include a higher provision related to reserve builds on 2 free credits moved to nonaccrual in March, and we'll provide details on those in the Q&A session. Our capital ratios remain strong, providing the flexibility to support continued execution across the business. In the first quarter, we completed a digital banking conversion for personal accounts that provides enhanced security and technology and a better customer experience, reinforcing our focus on service and relationships. We will continue the conversion of our business accounts in the ensuing quarters. With recent industry shifts locally, these investments position us well to attract new customers by pairing modern capabilities with the personalized service that defines Washington Trust.

We're also leveraging our strength as a community bank that prioritizes local decision-making to attract experienced bankers to our commercial team. We recently added new talent across C&I, CRE and business banking, all of whom bring deep experience and strong client relationships in the region. The institutional banking team we added in January is showing strong momentum that positions us for loan and deposit growth as the year progresses. In addition, our planned branch opening later this year in Pataka, Rhode Island will further expand our presence in the northern part of the state. Overall, we're encouraged by the progress we are making to position the company for long-term success.

With that, I'll turn the call over to Ron to provide additional detail on our financial results. Ron?

Ronald Ohsberg: Okay. Thank you, Ned, and good morning, everyone. Net income in the first quarter was $12.6 million or $0.66 per share compared to $16 million or $0.83 per share last quarter. PPNR was down 6% from Q4 and up by 23% year-over-year on an adjusted basis. Net interest income was $40.5 million, down by 1% from Q4 and up by 11% year-over-year. The margin was 2.63%, up by 7 basis points from Q4 and up by 34 basis points year-over-year. Q1 included $116,000 of loan prepayment fee income, which benefited NIM by 1 basis point compared to $516,000 or 3 basis points last quarter.

Noninterest income was down $1.2 million or 6% compared to Q4 and up by 11% year-over-year on an adjusted basis. Loan-related derivative income, which is transactional in nature, was down by $854,000 compared to Q4. Wealth Management revenues were down by $205,000 or 2%. Average AUA for Q1 decreased by 1% and increased by 10% year-over-year. Mortgage banking revenues were $3 million, seasonally down 6% and were up by 32% year-over-year. Our mortgage pipeline at March 31 was $114 million, up by $33 million or 41% from the end of December.

Noninterest expense totaled $37.8 million in Q1, down by 1%, and Other noninterest expenses were down by $1.2 million in Q1, largely due to a $1 million contribution made to our charitable foundation in Q4. In the first quarter, salary and employee benefits expense was up by $693,000 or 3%, reflecting merit increases and higher payroll taxes associated with the start of a new calendar year. Our Q1 effective tax rate was 21.6%, and we expect the full year 2026 effective tax rate to be approximately 21.5%. Balance sheet total loans were down 2% from December 31. Total commercial loans decreased by $95 million, reflecting mainly payoffs in the CRE portfolio. The commercial pipeline in total is approximately $156 million.

Residential loans decreased by $21 million as we continue to amortize that portfolio. End market deposits were down 2% from the end of Q4 and up by 3% year-over-year and wholesale funding was down by $50 million or 8% from the end of December. Our loan-to-deposit ratio decreased slightly to 96.9% at the end of March. Turning to asset and credit quality. At March 31, nonaccruing loans were 81 basis points on total loans and increased by $27.5 million from the prior quarter, largely due to 2 commercial real estate office loans. Past due loans were 33 basis points on total loans.

In the first quarter, we recognized a $4 million provision for credit losses, largely reflecting an increase in specific reserves on the 2 Cree office loans. The allowance totaled $41.1 million or 82 basis points. And at this time, I will turn the call back to Ned.

Edward Handy: Thanks, Ron. And now we'll take questions.

Operator: [Operator Instructions] First question comes from Justin Crowley with Piper Sandler.

Justin Crowley: Good morning, everybody. I was wondering if you could start off just giving a little more detail on the 2 office loans. Just anything on geography? And then maybe some more specifics on what occurred to drive the downgrades in specific reserves -- so just things like occupancy levels or perhaps just how close they even were its maturity, I'm not sure that may be necessitated a new appraisals?

Edward Handy: Yes. Bill, do you want to take that?

William Wray: Sure. They're both loans that have been current up until this point. In both cases, in March, there were sort of triggering events that led to us deciding to make the decision for quarter end to put them on nonaccrual. Both of them have strong, sophisticated sponsors, and we're engaged with both of them right now on. One was a maturity, the other doesn't mature until next year. We're engaged with both of them on the right next steps. So I don't want to get into too much detail on what that means. But we -- like with most of our assets that have been in criticized either special mention or classified most of them emerge unscaled.

And in this case, though, we took the step to put reserves in place that we thought were appropriate reflect any potential loss down the road. So again, we think they're both solid properties with solid sponsors, and we expect that we'll continue to drive resolution, and we're hoping that within the next few quarters, these will either exit or they will emerge back into performing status.

Justin Crowley: Okay. Got it. And then Were there any general reserves allocated to office? Or was it all specific with regard to these 2 loans? I guess trying to get a sense of how you think about the risk and the rest of the office book at this point and the cycle for this asset class and the thinking there has changed at all?

William Wray: Well, I think our office exposure peaked at $300 million a couple of years ago. It's now down to $230 million. And we think we've done that with a fairly small amount of charge-offs along the way relatively. So we expect to continue to reduce our office exposure over time. Within the CECL methodology we make sure that we use qualitative factors especially to address issues in office. And so we have taken some of those steps. And we believe going forward that there's always going to be a handful of properties that are sort of on the bubble that needs some attention and focus.

But -- as you can see, these -- all of our other office properties are performing. There's -- there aren't delinquencies there that we're concerned about. So we just expect that assets will move into lower ratings and then we'll emerge from those. And we certainly spend a lot of time thinking about maturity wall analysis and refinance risk. And so we're constantly juggling those handful of properties that look like they might raise some issues down the road and try to stay ahead of them.

So I guess the best way of saying we're cautious on office, and we'll continue to be cautious on office, but we also think the scale of the problems within -- are well within our capabilities to handle from an earnings standpoint and a reserving standpoint.

Justin Crowley: Okay. And then I guess, somewhat larger-sized loans here. It sounds like they were self-originated. Was that the case or were either participation? Just want to confirm that.

William Wray: I'm not sure which ones you're referring to, but there's only there's 5 loans.

Justin Crowley: The 2 office loans that's migrated and...

William Wray: Participations, we're we're the lead on the Class A. The Class A office space one, we're 2/3 participants in the lead, and then we are the minority participant on the lab space.

Justin Crowley: Did you call it maybe 5% growth previously. I know a lot has changed since then with some of the geopolitical now. Just curious for an update there?

Edward Handy: Yes, I'll take that one. Thanks for the question. We're -- yes, so the quarter saw pretty significant pay downs, payoffs and mostly in the Cree space and not the kind of commensurate new origination that we're -- that we're used to. But the path ahead looks very good. We're sticking with our mid-single-digit growth for the year projection. And it's important that we talk about where that's going to come from -- at this point, we're feeling like CRE is probably going to be low single-digit growth for the year. They've got some making up to do based on the first quarter payoffs and then we're thinking kind of flat to 1% growth in CRE, which is somewhat intentional.

Most of the growth is going to come from our core C&I business and our institutional banking business. We're expecting sort of high single-digit growth out of our core C&I business, which you'll recall is -- has a current outstanding in the kind of $560 million level. So you can do the math there. And then most of the C&I growth is going to come out of our relatively new institutional banking group. We expect $50-plus million in fundings in this quarter and the pipeline is growing. And I think importantly, alongside that is the strategic growth in deposits that will come from that portion of our C&I business.

There expecting to kind of fund at -- self-fund at a 30% to 40% level, which is much higher than certainly CRE and much higher than our core C&I business. So that's an added benefit. They joined the group in late January. So it's to be expected, it will take a little while for them to get up and running, but the pipeline is growing as we expected, and we're very encouraged by that. So back to the start sticking with the mid-single-digit growth, if not a little higher. And again, very encouraged by the types of credit, the quality of credit that we're seeing in the pipeline build.

So -- more to come on that at the end of next quarter.

Justin Crowley: Okay. Great. And then just 1 last 1 on the margin. I think I might have missed this in the prepared remarks. I know there was some elevated prepayment fees last quarter. Was there any of that in the $263 million for the first quarter?

Ronald Ohsberg: Yes, like 1 basis point.

Justin Crowley: Okay. And then I guess just thoughts on the margins in there. I think you'll get that left from the swap termination, but could you just remind us the benefit there? And then just also how you're thinking about organic expansion through the year?

Ronald Ohsberg: Yes. So the swap termination will add 9 basis points in the second quarter and another 4 basis points in the third quarter.

Justin Crowley: Okay. And then I guess just go ahead. Go ahead.

Ronald Ohsberg: Go ahead, Justin.

Justin Crowley: I was just going to ask outside of that, just the almond benefit on the swap, just how you're thinking about this margin lift from here as we get through the year?

Ronald Ohsberg: Yes. There's modest expansion by quarter. First quarter was probably a little higher help by the prepayment helped actually helped a little bit by the shorter day count in the quarter actually added about 2 basis points to the NIM. But when we look ahead to the fourth quarter, we're thinking $275 million to $280 million in the quarter.

Operator: We now turn to Damon DelMonte with KBW.

Damon Del Monte: Ron, could you just repeat the last comment you made on the margin, the $275 million to $280 million. Was that for the second quarter? Or is that for where you expect it to be at year-end? I missed that, sorry.

Ronald Ohsberg: Sorry, Damon, yes, just to be clear, fourth quarter.

Damon Del Monte: Fourth quarter.

Ronald Ohsberg: So we're looking at $265 million to $270 million in the second quarter.

Damon Del Monte: Got it. Okay. Yes. That is with what you were describing from the benefit. Okay, great. And then I guess, -- maybe a little bit on expenses and kind of how you're thinking about the outlook from there? You've made some hires. I'm assuming that's all kind of baked into the numbers. your -- I think the expenses were around, what, $37.8 million. So just kind of modest growth off of this? Or do you think you could actually keep it kind of flat?

Ronald Ohsberg: Yes. We're actually seeing about a $1 million increase in Q2 and some of that is -- really, there's 3 areas we're looking at advertising, mortgage commissions and then we've got some project implementation expenses that will be coming through in the quarter.

Damon Del Monte: Got it. Okay.

Ronald Ohsberg: And then -- further to that item. Further to that, we're adding a branch, which will probably open in the towards the end of the third, beginning of the fourth quarter. Those expenses will start to hit in Q3. And so we're probably looking at about $500,000 in 2026 -- related to the branches.

Damon Del Monte: Got it. Okay. Great. And then -- on Wealth Management, AUM were down a little bit this quarter. Is that just fluctuation of the market? Or was there some outflow of clients?

Ronald Ohsberg: Yes. It was mostly market -- and by mostly, that means not all. So yes, we did have some net outflows.

Damon Del Monte: Got it.

Ronald Ohsberg: You can see markets have rebounded so far in April. So no one knows what the future holds, but it could at least a lot of the declines that we saw in the quarter have reversed so far in the second quarter.

Damon Del Monte: Got it. Okay. And then just lastly, given the outlook for the loan growth going forward, how do we think about provision and kind of the reserve level? I mean, obviously, you built the reserve this quarter for those loans that went to nonaccrual status. But if we assume that there's no other credit deterioration, do you kind of have the provision such that it keeps the reserve flat given the loan growth?

Ronald Ohsberg: Yes. We're kind of thinking somewhere in the range of $1 million to $2 million per quarter. And that covers loan growth and maybe that gives us a little bit depending on what we book and when we book it, it could give us a little bit of a reserve build going forward.

Operator: We now turn to Laurie Hunsicker with Seaport Research.

Laura Havener Hunsicker: Ron Maryville. Just to stay with where Damon was loan loss provision. So the $4 million loan loss provision I know you said, obviously, that was heavy with the office. What exactly was the dollar amount there associated with office of the $4 million build?

Ronald Ohsberg: Laurie, it was essentially all of -- yes, all of it.

Laura Havener Hunsicker: Got it. Okay. Perfect. And then I just wanted to dive a little bit deeper here in office. So just I have a series of questions here. So thanks for the on this. So you've got 59% maturing in the next 2 years, $136 million. Is any of that currently in special mention cost side, nonaccrual? And if so, -- when is that actually maturing?

William Wray: Well, of the 5 deals that are in the office space in special mention or classified 1 of them matured and that was 1 of the deals that we moved to nonaccrual. There's another one, the Class B special mention that's actually maturing in the third quarter of this year. And 1 reason we moved into special mention was just kind of as a marker as we work with the sponsor who's a well-known and committed sponsor on a refinance approach. And then the other deal that went to nonaccrual doesn't mature until the third quarter of next year. So we -- as we disclosed, we look at all of our maturing office loans very carefully.

And when we know enough to with an emphasis on caution, we will take steps to make it special mention the deals that we talked about here, both were put on special mention, 1 at the -- in the fourth quarter of '24, the other in the third quarter of last year. So -- and you'll also see that we've had some positive migration out of special mention and classified, the large lab loan, for example, as special mention now and as free rent burns off, we believe if contractual rates pay us agree that, that will be coming out of special mention before too long.

So we think our migration track record is pretty solid, and we feel the same about the deals that are in there now. And again, there's 5 that make up that disclosure.

Laura Havener Hunsicker: Yes. Great. Okay. So just for my clarification purposes, you had 2 moved into nonaccrual. With -- was it the $22 million that matured that triggered that? Or was it the -- okay. So that 1 matured.

William Wray: No, the $22 million was not the one that matured. -- matured was the $6.5 million.

Laura Havener Hunsicker: Okay. So that mature. Okay. Got it. Okay. So the other 1 -- so the $22 million that matures in the third quarter of $27 million, you said?

William Wray: Yes.

Laura Havener Hunsicker: Okay. And then what is the occupancy running on that one, that Class A?

William Wray: Well, it's it's solid. I mean, it's north of 50%. And there's actually been a fair amount of leasing momentum. The move made here was more triggered by a notification of a potential lease termination for next year, but that tenant is renegotiating. So this generates a pretty material NOI. And we feel it's a solid property with a solid sponsor in a solid market. But like most sponsors, they're looking ahead and thinking about what their capital requirements are going to be. And so we're having discussions at this point on that topic.

Laura Havener Hunsicker: Okay. Okay. And then just the cross fee that you mentioned, just that $3.8 million that's on special mention that was new to special mention. What is the occupancy on that? And how are you thinking about a resolution there?

William Wray: It's in the high 60s. It's got some solid tenants. It's a well-known sponsor to us. By the way, all of these are in our core markets in the Tri-State area. And so our expectation is that we'll work something out with the sponsor and keep it on special mention as long as we need to, to make sure, it's payment season and then potentially do an upgrade. So again, special mention here is sort of more just a prudential judgment to put a marker on something and watch it through its refinance process.

Laura Havener Hunsicker: Okay. And then obviously, with the...

William Wray: It's the fully performing loan at this point, and we expect it to continue that way. But we are being cautious as we face the maturity issue in the third quarter.

Laura Havener Hunsicker: Got you. Okay. And then the lab space. So I had thought there were the $33 million, $34 million, I thought that was all related. And then it looks like just 1 you moved over. Are those 2 completely separate loans?

William Wray: Two completely separate loans.

Laura Havener Hunsicker: Got you. Okay. So the $6.6 million that was triggered by the miscerity. What -- and determine coverage here is 0. So occupancy here is 0. Am I thinking about that the right way? Or what?

William Wray: Yes. Yes. Occupancy, that building is still in its initial lease-up phase. So it doesn't -- it's 0. The other building is effectively fully leased and it's just a matter of -- as you know, that's a very competitive market. The -- as free rent burns off in its payment season, we expect that to come back to fully performing and pass rated. We're just watching as tenants come out of free rent and make their payments. So there's very strong positive momentum on that one. On the other one, again, we're in a situation where it matured and we're talking to the sponsors about what's going to happen next.

Laura Havener Hunsicker: Got you. Okay. And so the 1 that's fully leased, the $27.5 million. In other words, positive momentum happens this year, happens next year. And I guess when is that -- go ahead.

William Wray: I'm sorry, you cut out a little bit. But if you're asking when that comes back out, again, we think it's probably within the next few quarters. We want to make sure the tenants are making their payments as agreed and that we're going to let it season a little bit and judge that. But we are feeling very solid about the leasing status and the performance status to date.

Laura Havener Hunsicker: Yes. Okay. And then 1 last question on this lab loan. When does this $27.5 million mature?

William Wray: That is 2029.

Laura Havener Hunsicker: Okay. 2029. Okay. Great. Okay. And then Yes, I think that answers all my questions on that. Really appreciate the details that you guys put on Page 11. And actually -- oh, I'm so sorry, 1 more question. So you had $2.2 million of Class C that was in special mention last quarter, and now it's gone, which is great. How was that resolved? Was that sold? Or what happened there?

William Wray: No. It ended up being fully leased -- and it was performing all along. They were paying as agreed. But now that it's fully leased and we've gone through that process, we've moved it back into past rated.

Laura Havener Hunsicker: Perfect. Perfect. Okay. Great. Okay. So just 2 more questions. Now for you, Bill, I guess, this goes back to you, Ron. Do you have the spot margin for March?

Ronald Ohsberg: Yes, $259 million.

Laura Havener Hunsicker: $259, great. Okay. And then Ned, for you. This is my last question. buybacks -- your capital levels are very, very strong, and your credit, obviously, ex office is very, very strong. You're 1 of the fee banks in New England not repurchasing shares. Can you just help us think a little bit about your approach to buybacks and how you're thinking about it here?

Ronald Ohsberg: Yes. Yes. Laurie, I'll take it. I mean we consider that all the time, -- and I think we've talked about it on previous calls. So I can make some arguments in favor of and also, again, doing the buybacks. Our dividend is still relatively high. The payout ratio is still relatively high. And so at this point, we maintain a buyback program, but we really are not at this point intending to be buying back shares at this point in time.

Edward Handy: Thanks, Laurie.

Operator: We have no further questions. I'll hand back to Ned Handy for any final comments.

Edward Handy: Well, thank you all for joining. As we move through 2026, we remain focused on what has defined us for 26 years, paring personalized service and local decision making with a comprehensive suite of financial products and services. We very much look forward to quarters ahead and sharing the news about those quarters with you as we progress. So thank you for your time today. We certainly appreciate your interest and support, and we look forward to speaking with you again soon. Have a great day, everybody.

Operator: Ladies and gentlemen, today's call has now concluded. We'd like to thank you for your participation. You may now disconnect your lines.