Good day, everyone, and welcome to the Northeast Bancorp Fiscal Year 2015 Fourth Quarter Earnings Results Conference Call. This call is being recorded. With us today from the company is Rick Wayne, President and Chief Executive Officer; Claire Bean, Chief Operating Officer; and Brian Shaughnessy, Chief Financial Officer. Earlier this morning, an investor presentation was uploaded to the company's website, which we will reference to in this morning's call. The presentation can be accessed at the Investor Relations section of northeastbank.com under Events & Presentations. You may find it helpful to download this investor presentation and follow along during the call. Also, this call will be available for rebroadcast on the website for future use. The question-and-answer session for this call will be conducted electronically following the presentation. Please note that this presentation contains forward-looking information for Northeast Bancorp. Such information constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which involves significant risks and uncertainties. Actual results may differ materially from the results discussed on the forward-looking statements. At this time, I would like to turn the call over to Rick Wayne. Please go ahead sir.

Good morning and thank you all for joining us today. With me are Claire Bean, our Chief Operating Officer; and Brian Shaughnessy, our new Chief Financial Officer and Treasurer. Brian will discuss our financial results following my comments and following that we will be happy to answer your questions. Before reviewing the slides, I would like to make some overview comments on the quarter and on the year. This quarter was our strongest one to date with net income of $2.2 million or $0.22 per diluted common share. Net income for the year was $7.1 million or $0.72 per diluted common share. Earnings for the quarter and the year were positively affected by strong loan growth, transactional income from LASG purchase loans, gains on the sale of SBA loans originated by our national SBA division and the repurchase of our common shares through the repurchase plan announced previously. In the Community Banking division, we stemmed a significant run-off of the commercial loan book and with the refocus on commercial and commercial real estate lending in our main footprint. Across all divisions, we saw positive results. Now, for some of the details, please turn to slides three and four. For the quarter, we closed a $111.2 million of loans which included $54 million of LASG commercial loan purchases and originations, $21.5 million from our new national SBA division and $35.8 million in our Community Bank division which included $28.5 million in residential loan originations. In relation to the SBA division, we sold $15.2 million of the guaranteed portion of the loans for a net gain of $1.9 million. With $2.4 million of transactional income, the purchased loan portfolio generated a return of 13.4% and bank-wide net interest margin of 4.7%. During the quarter, we repurchased 230,726 shares of Northeast stock at…

Thanks Rick and good morning everyone. I’m picking it up on slide 12 to provide a little more color on our financial results. As Rick noted, it was a solid quarter with net income of approximately $2.2 million, up $0.04 from last quarter and up significantly from $0.05 in the comparable fiscal year 2014 quarter. Results were driven in part by transactional income, which at $2.4 million was similar to last quarter's total and also by gains of $1.9 million from our national SBA division, as compared to approximately $370,000 in the prior quarter. Turning to slide 13, over the past year, we have seen net loan portfolio growth of $96 million and 19%. The majority of the growth comes from our LASG portfolio with a $165 million of traditional purchases and originations and $48 million of loans to broker dealers. As noted previously, the SBA originations are shown net of the sale of the guaranteed portion of the loan, which produced net gains of $2.5 million in fiscal year 2015. While loan growth has been strong, the growth has been offset by a high level of pay downs in the purchase portfolio, which averaged just over $20 million per quarter in the current fiscal year. These results are further detailed on slide 14, which shows the composition of net loan growth over the past four quarters and this is mainly on the strength of originations by LASG, which had growth of approximately $52 million or 79% in the current fiscal year. In our Community Banking Division, residential loans in our portfolio continued to decline as we’ve been selling nearly all production into the secondary market. In addition, the SBA loan portfolio increased to approximately $12 million at the end of the fiscal year as the majority of these loans…

Thank you. [Operator Instructions] And our first question comes from Alex Twerdahl from Sandler O’Neill. Your line is now open. Please go ahead.

Hi. Good morning.

Good morning, Alex.

Good morning, Alex.

I am sorry if I missed in your prepared remarks, Brian. But was there something in the salaries and benefits line that caused that to increase by almost $1 million over the last quarter?

Hey, Alex, this is Rick. First, good morning. There was some – as the quarter got better, we had more incentive comp in the fourth quarter than we had in the third quarter.

[indiscernible]

I’m sorry.

That’s related to production volumes in the LASG business or is it the SBA or?

Throughout the company – as we accrue incentive comp during the year based on what we think we’re going to have based on how our performance goes and we have a – as you can see a very strong quarter and so we had more incentive comp in the fourth quarter than we had in the third quarter.

Okay. That makes sense. And then can you give us a little bit more color on the SBA division in terms of the production they are seeing and in terms of the revenue that they are producing and whether or not do you think that the run rate that we saw in this most recent quarter is kind of a sustainable run rate or is it going to be choppy and was there any impact to that business by the SBA lending authorization ceiling that was temporarily hit during July.

Sure. First the last part of your questions I don’t forget it, there was no impact. They shut it down for a few days and Congress then pay us the legislation which the President signed on Wednesday and we had for loans we were a PLP lender meaning we have delegated authority for most loans unless there is something that would otherwise require us to signal to the SBA to approve. We can do it on our own. And so as we were working on credits, we have pulled the number for those which gave us the ability to close those if we calculate. So there was no impact on us at all. There would have been impact though had the delays until October 01 which has led at some point, some people were talking about and I think it mostly would have been timing rather than permanent differences. We still have been working on credits. You just have credits that otherwise closed in August and September that would have closed in October probably, but there was no impact at all for us. With respect to the business, we hired as you’ve heard us say in a bunch of occasions seven BDOs on November 02 in a group which we refer to it as our national SBA origination business. It’s led by Jonathan Smith and we are looking for BDOs generally that can originate, once they get going which takes a few months north of $12 million or $13 million in some cases larger than that. And so I would say that what we saw refer everyone back to forward-looking statement, but what we saw in the fourth quarter for volume is what we would reasonably hope to see at least going forward. One of the things that we – as we moved into that business, we thought it was a very good move based on our ability to underwriting service national credits that we would have the ability to do that with SBA loans, but in a way it’s complementary to our purchase business because it’s an origination business with more predictable flow around it. It is not the same in any given quarter of cause that number couldn’t change, but I think for you're modeling purposes that’s a reasonably good baseline. As we go through the year to the extent we hire more BDO’s and that number changes you will have a chance to see that on a quarterly basis and adjust.

Okay that’s incredibly helpful. And then my final question just as you look at some of the trends in the LASG purchase market one thing that looks like it’s starting to become a trend is just the purchase discount, which has been lessening or decreasing kind of over the past couple of quarters and the discount was only 3.5% in this most recent quarter, is that something that’s indicative of pricing in the market or is there some seasonality in there, can you maybe talk to sort of what you expect to see in pricing and may be kind of relate that back to where you start coming out of the last cycle in the 90s?

Well I think now for the - I mean what you said was accurate for the quarter, I think was 96, give or take you may that we purchased, I think for the year I want to say was $0.80 and the market’s changed there is in a better credit timing, there are a lot of lenders that are competing for loans and there is a lot of - the buyers that were previously buying non-performing I mean that market has slowed down incredibly and now on bigger approvals they are coming in and giving, on the performing loans that we’re looking at and in some cases, while we have cheaper funding generally and we are collateral constraint on how much we will bid, it was a general rule we won’t bid more than $0.80 of the collateral value. So we, for example, if you look at a pool of loans where there has been good payment as for the last couple of years and we were private citizens with your own money and in this business you can make a reasonable investment at, believing it’s going to continue, but as a regulated bank when we're looking at loans secured by real estate collateral, we have guidelines as to how much we're going to bid. So, if that is a long way of saying it is getting more competitive for sure, but on a more upbeat and a more rounded discussion that I would make this point, one, relative to our size it’s a very big supply still. We were not looking to, you know we bought $80 million about in FY14 and we did $83 million invested in FY15. And if we are able to buy $80 million to $00 million based on the other business lines we have, it is very good, and even if you buy at a lower discount not so much 96, but if you buy something for $92 million and they pay you off in 18 months, you know you are still getting a big yield on that, but I think I would want to - I think the fairest thing to say is I have started with is getting more competitive and there is more compression, I do believe we will buy our fair share and I believe that we will still achieve above market returns compared to our other alternatives in life.

Great, thanks for all the color.

Thank you, Alex.

Thank you. [Operator Instructions] And I am not showing any further questions in queue at this time, I will now I will turn the call over to Rick Wayne for any closing remarks.

Thank you. And again, thank you all of you for participating. Alex, thank you for your good questions, I guess between your questions and my unnecessarily lengthy response we covered a lot of ground. And again thank you everyone for your support and we look forward to talking again next quarter if not sooner. Thank you.

Ladies and gentlemen thank you for participating in today's conference. This does conclude today's program, you may all disconnect. Everyone have a great day.