On Friday, Webster Financial Corp (NYSE:WBS) reported its third quarter earnings and discussed the following topics in its earnings conference call. Take a look.
Mark Fitzgibbon – Sandler O’Neill & Partners: First question I had for you with a 60% efficiency ratio within striking distance, have you begun to recalibrate your expectations is 55% doable over the longer-term with the business structured the way you have it?
Glenn I. Maclnnes – CFO, Webster Bank and Webster Financial Corporation: We’re not giving out that type of guidance yet. I think what we said is beginning Q2 of ’13, we will below 60%, 60% or below.
James C. Smith – Chairman and CEO: But we can confirm that we intend to continually work to drive that lower because there is a high correlation of course between the ratio and the return on capital.
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Mark Fitzgibbon – Sandler O’Neill & Partners: Then with the reserve to loan ratio at (1.59). Are we getting closer to the point where you’d expect reserve releases to slow or stop?
Glenn I. Maclnnes – CFO, Webster Bank and Webster Financial Corporation: We think they’ll slowdown – but we think that number will probably be in the (145 to 150) range for Q4.
Mark Fitzgibbon – Sandler O’Neill & Partners: Then lastly, you announced this morning that you hired a new Head of the Private Bank. Should we expect any acquisitions in that line of business or significant headcount additions?
James C. Smith – Chairman and CEO: Well, we mentioned that we actually have added several private bankers in the last few quarters and we have plans to add additional bankers, that’s consistent with the strategy to grow the private bank by offering the totality of banking services to high net worth people. So that would be obviously depository and lending and investment management services. So, Dan FitzPatrick will come in and he will lead that initiative for which we already have significant plans for growth. So we will be adding additional personnel. It is possible that there will be let’s say registered investment advisors that would like to join our platform. Again, as we always say with regard to acquisition, the focus is on organic growth and making the most of what we have here including the fact that we’ve got over 20,000 clients at Webster that we believe have a net worth over $1 million, and we’ve got a lot of mining to do of the opportunity that we have today. But I wouldn’t rule out the possibility that there could be some partnerships formed along the way.
Jason O’Donnell – Marian Research: It looks like operating expenses came in a little higher than we were expecting this quarter, can you just give us maybe a rough idea how much of the efficiency improvement in Q4 you expect to come from occupancy/technology expense versus let’s say lower marketing expenses?
Glenn I. Maclnnes – CFO, Webster Bank and Webster Financial Corporation: This is Glenn, first of I would highlight that there is as I said in my prepared remarks, there is about $800,000 in the quarter that’s attributable to the stock increase of 10%. So that was unexpected, but I think as we go into the fourth quarter, you will see a reduction in marketing expense which will probably be about two-thirds of the reduction and then the remainder will be between technology and other lines.
Jason O’Donnell – Marian Research: Then with respect to the universal banker model, in the event this pilot that you’ve launched here, presumably early in the quarter is successful. Over what period would, you might expect to roll that out to the entire branch network going forward.
Glenn I. Maclnnes – CFO, Webster Bank and Webster Financial Corporation: We would roll it out the network, over say 12 to 18 month period, and we would expect it to have to pay continuing dividends through building client relationships and through the efficiencies we gain in that process over up to three years or so. Also the Universal Banker works well in combination with the changes that we’re making the physical infrastructure. So, we will also over that time, actually over a longer period of time be rightsizing, optimizing, enhancing as we call it the physical infrastructure making sure that branches are in the best locations at the right size with the right electronics and technology to take maximum advantage of this Universal Banker program.
Jason O’Donnell – Marian Research: So, assuming that you plough back some of the savings from this program, you reinvested back into the business in various ways. Do you have any thoughts around kind of how much of a driver this might be to lowering that efficiency ratio over the long period of time? Is that going to be meaningful?
James C. Smith – Chairman and CEO: I guess, we would look at it as – let’s look at this inside the Retail Bank and say that this will significantly improve efficiency within the Retail Bank by driving revenue and lowering costs. Given that the consumer deposits part of the organization is the one under the most pressure to generate returns on the capital that’s invested in it, this is very important that we do that. So, it will also have an effect as part of the overall program to drive the efficiency ratio down for the Company.
Gerald P. Plush – President and COO, Webster Bank and Webster Financial Corporation: Jason, it’s Gerry. If I could add to Jim’s remarks, I think you have to take the Universal Banker initiative and I think Jim did a nice outline of a number of things that we’re going to be rolling out. If you take into account, the enhancements we’re going to be making to our online services and capabilities, you couple that with the downloadable app to full rollout of all image capture machines and the increased usage. You can see that transactions are going to become more and more electronic, which reduces the need for more transaction related activities in the branch and more consultative advisory transactions to take place. So, definitely will be some personnel shift, but you’ll also see a shift of the bulk of the consumer transactions now starting to become more and more automated, and we’re clearly seeing that in our numbers. You have to think to look at the totality of all those initiatives together to say that yes down the road we’ll get greater and greater efficiency. I think to add to the comments that also that Glenn had been making before in terms of the efficiency ratio in what you to expect as we go forward, there’s still a lot more of it, we know that we want to do, and again we’ve made some references to that in prior calls and then also, again in this call, that we continue to rationalize our distribution network, which means that you should see that we’ll continually look to shift our branches to where there will be smaller, better located, more efficient facilities, and I think that we’ll be rolling out more and more details on that, not only into the next call, but also throughout 2013.