Umpqua (UMPQ) 24 Jan 232022 Q4 Earnings call transcript

Good morning, and welcome to the Umpqua Holdings Corporation's Fourth Quarter 2022 Earnings Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there'll be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded.

At this time, I would like to introduce Jacque Bohlen, Investor Relations Director at Umpqua to begin the conference call.

Catherine. you, Thank good and Good afternoon, morning, everyone. for fourth our you today on XXXX earnings us quarter call. Thank joining With me of this CEO morning and are Cort O'Haver, Credit Chief Holdings Farnsworth, Financial Officer. Tory Frank Ron Namdar, of the Corporation; Nixon, Bank; President Umpqua Chief Officer; Umpqua President and prepared remarks, take questions. will our After we

earnings issued Yesterday our quarter afternoon, an we XXXX fourth discussing release result.

at which Both We have on umpquabank.com this to morning. these during section. can refer the our also prepared in website we a Relations Investor our will slide found materials presentation, be remarks

today's forward-looking During and statements are subject provisions covered call, to by Harbor law. intended securities uncertainties and which of we will federal Safe the make to are be risks

to of cause SEC of that may X list well differ our actual earnings a presentation materially the factors our X please within Slides disclosures contained as and to For refer as filings. results from expectations,

will We encourage alongside discussion provided We of non-GAAP results. reconciliation appendix. non-GAAP in GAAP review to measures also reference GAAP presentation earnings the to our you financial the

will over the Cort. call to turn I now

Thank Jacque. you, Okay.

year. quarter $X.XX For quarter in reported which $X.XX to million. $XX reported last of basis, to and of Ron and merger earnings $X.XX will quarter of share represents the the EPS excludes last and we shareholders expenses operating an $X.XX interest-rate This in $X.XX On quarter that compared fourth the $X.XX review, number a year. driven available last of to items the per quarter, of fourth EPS last compared reported fourth of

XXXX leading in decline a as XX% in to dramatic EPS revenue. shifted and interest increase between minimal, variance quarter the revenue higher loan drove pre-provision the to rates QX, in XX% dramatically XXXX despite QX net the interest banking increase For a mortgage income, and XX% net was growth during fourth components XXXX

to the a impact Over to income intended growth. within changes structural portfolio moderate limit of reduce mortgage the expenses, the and have year, changes of mortgage we banking MSR past number made the segment, statement

will planned through quarter actions Additional this work. continue this

for remain our the for West. Mortgages remain we and important to product serving bank customers our and an communities throughout the committed

shifting towards operations model a operating our net financial we a impact statements However, model. retail and mortgage under and to we and gross prior are bank smaller expect our

our at with received Banking earlier the Turning now to to Columbia we intend We this close February. announced of merger approval pending System. end that and FDIC month

Our heightened teams a closing outreach. are core focused customer level this system on scheduled quarter conversion and of for alongside

execution look quarter's you to one on laser-focused on team. officially are we next are call when forward we and providing We an update with

know, targeted to moving and next As year savings, and discussing a our now. are as of we is you there been lot parts for cost revenue on focus tools associates our drive and teams months near-term the integration to a service opportunities achieving the our giving customers high-touch the have couple complete synergy the providing we over over process our of that

and there in of never Back XXXX, imagine would XX over October announcement months between be close. we

significant there this upside However, to been has timeline. also

work, which day culture enables that but a originally of post-closing to touched majority joint set was has have one us it Columbia and the team be and not been framework associates we waiting to idle. We planned been associates have on has The occur Umpqua one.

us our conversion legal decoupling more perhaps to closing our one XX and the targeted February quarter, products The combined core enable for scheduled importantly, day date enabled and has has to prepping, excited use of this development immediately. originally Further our and planning a maintain that the planning, the year are and despite over integration date. earlier from place teams we our taken brainstorming them tools synergistic of

and have put humbled to for six by countless effort honored I'm impressed the take associates hours have lead Bank and I the that their years. opportunity and organization been this dedicated incredible outstanding dedication. our at to want for this your past joined they Umpqua I work. thank XXXX to into

may capable hands. I and to organization as it forward Chair, the look communities enhanced While be it's shareholder of And bittersweet in combined placing I the them to watching the Executive know reins, providing West service pass I customers throughout return. am

Ron, away. that, with And take it

Okay, thank be certain presentation. to I those and you, along. for earnings call, numbers Cort on I'll our follow page to want from the referring

a volatility which GAAP of measures include on adjustments along our Starting our basis. in presentation, slide The XX. costs, ratios fair both exit the X and merger on contains various detailed with value from to are disposal interest internal and Page appendix rate Slide performance operating which operating on changes the

continued NIM QX in to points up strengthen Our X.XX%. to XX basis

while was ROTC X.X% PPNR X.XX%, GAAP ROAA and operating our was PPNR increased ROAA to Our XX.X%. operating

XX, P&L. Turning to our summary which of Page contains quarterly

Our GAAP QX $XX million earned basis, we $X.XX or million share. $X.XX an for operating share. earnings were $XX per On per or

$XX.X moving QX, million representing net combined economic recent asset provision with growth consensus rate primarily million the the credit or as $XX.X to continued had driven X% increase of slight forecast. Fed increases. by the increased loss We For in with parts earning interest income the a compared for deterioration

increased increased changes related merger expense increase later $XX nonrecurring to in million marks mainly detailed in income expense. in the and the value appendix Noninterest noninterest and mainly fair nonoperating as other expense from

$XXX investments spring difference, million balance due loss. This lift lower were to in million. AFS up XX, unrealized primarily increased funded the a and the of was and borrowings for cash short-term the net with $XXX decrease deposits sheet As related loans on Slide in

total XX% represent Our total off sources of deposits. at sheet liquidity ended billion available including and balance total of the quarter assets $XX XX%

in bottom due on AOCI value mark part our the tangible lower rate increased XX, AFS on book investments. Slide As to the of noted

and million income volume mix, increase with building increase from led a increases the rate loan of resulted volume strong highlights growth. a million up $XXX $XX recent net making million rates continued $X million standpoint, XX interest QX with along Slide in to $XX in rate to the the increase From difference.

our net the margin are our our change increased presentation for represent loan and offset XX to basis Again following was NIM on on on waterfall rate in is costs the X.XX% It that XXX of funds interest QX, here in QX. rising NIM that, key for X.XX%. point of funding the than the me Following right the XX federal in our a for knowing points month December during margin. total increase cash more basis yields page, Slide of the trends the the and

maturity noting The characteristics change the repricing in our includes loan this portfolio repricing information mix no next and slide of past quarter. significant the on

last changes and two shock for on have run back years. in is we the a And scenarios both left, following simulation our interest future sensitivity continue so our projected though in future This and test quarterly quarters. assumes and sheet. to static XX, two, ramp over even in rate The quarter to on upper the included net upper right taken comparing that, and income balance Slide we do we've sensitivity steps will sensitivity this a shows from reduce quarter

used we cycle beta on the the future the deposit for while table is comparison. cycle from simulation deposits rate rising on the deposit rising The in right rate interest-bearing on XX% the show last left current them rate changes. current betas our The for from shows

on XX% was beta Our deposits. interest-bearing then

points QX Our cost basis in points basis of XX from interest-bearing QX. to for increased XX deposits

spot for basis year-end points. Our date this rate was at to XX% deposits. is cumulative data The cycle XXX interest-bearing now on

to well deposit our but costs interest-bearing We level. model below again increase in stay QX expect

value. XX. loans was non-interest our netting detailed Next carried change trends, segment positive income fair on Slide within We continued offset by at mortgage our on a consolidated weakness banking value mostly fair

combination on Majority XX Slide our upcoming this to Turning merger expense. to the of quarter Columbia. with related expense for increase

In along didn't view expense in had increase with addition, as state and local not an recurring. we which taxes other I

Slides core segment mortgage include GAAP banking XX. on Slide basis. core the XX. stats on Cort benefit Mortgage banking XX by Suffice on The say The segment the plans continued The operating two loan earlier segment banking the Banking mentioned underway continues Mortgage it to XX quarterly reported disclosures and consecutive second next later rates and loss. Banking. segment pages are non-GAAP growth, rising a Slide while a within segment and from to on

new couple driven billion loan forward. before of to turn XX, it the $X.X tightening by we've continued in non-relationship On maturities. included I in a given was And Quarterly and payoffs intentionally over production, quarterly slowed offset outflows Slide We've Fed. deposit advances net lending down billion roll balance following in final growth industry-wide by the by ones $X.X continued originations Frank. pressure loan with

in Slides quarter. the the there and changes XX and composition statistics no XX provide portfolio significant is on additional and

Slide let for take to and credit loss. attention allowance our your XX on Next, me CECL

and high CECL unemployment is reasonable exception of forecast a economic consensus forecast As incorporates period the for of XX-month a use in all supportable interest We process the a which forecast thereafter. reminder, period for Overall, continued and and supportable uptick reverting quarter reasonable mean loan a our rates. slight portfolios the output with inflation economic November. rates C&I reflected peak in the the to with gradually this updated expected life

which sensitive quarter again X.XX% most The QX. from ACL the a With variables. shows this, economic million we driving the end, commercial forecast, on the over to slightly from X.XX% unemployment This credit X.X% with the loss to to majority the that up loan growth for million portfolio and provision X.X% $XX for at rate increased million and quarters' of $XX.X increase $X of increased slightly the their horizon. in for deteriorating recognized the for leasing page peak

to Lastly, Page I capital highlight on want XX.

on Moving XX% remain fourth was regulatory January record equivalent holders common our The ratio to ratios level dividend on and capital level. quarter's January total that was of in was excess as February's We capital risk-based per payable Tier XX.X%. XX.X%. well-capitalized and levels, X to the $X.XX our ratios share total all ratio XXrd XX, our of a declared risk-based Bank fixed of of

combined expect date February with be determined dividend Given targeted Columbia, we for XXth action by next closing Board. the merger the our to our

credit. will that, with Frank I to over call the Namdar to discuss And now turn

you, Thank Ron.

of to ratio total X.XX% Slide was quarter's stable. X.XX% assets nonperforming levels. ratio to steady XX, loans classified assets to was our past relatively with back our similarly loans And of Turning total

XX charge-off the in net within FinPac third quarter's the points the level and increased annualized as basis from up leases average charge-off quarter, loans Our activity percentage was as points to X expected. net basis portfolio

the FinPac portfolio were X% notably Following tightening credit in quarters. during the charge-offs several for the implemented below elevated range X.X% to charge-offs pandemic, and historic strategic

have quarter. gradual within norms in anticipated calls, X.XX% discussed quarter The on portfolio charge-offs net primarily a have reflects within in we net the migration uptick we transportation in FinPac to the X.XX% historical to and the portfolio. increased FinPac's increase third past accordingly, from charge-offs an As fourth

that trends a our the in the yield loan XX% of shift our an indicator remains the as FinPac portfolio the may also segment portfolio basis, profitable It average book range. risk-adjusted most early is serve warning risk-adjusted loan an of consolidated On portfolio. which to of overall X% with can

we fourth had do weakness see the of not associated portfolio, in quarter. just X bank basis in any However, which level charge-off a the point

of $XX million For level $XXX,XXX fourth portfolio charge-offs for billion. all of of context the minimis XXXX for near only and de $X.X is quarter a on a activity bank nearing

with quality active We remain of credit pleased metrics. our book and the continue loan as our balanced in we to quality practices. to high-quality to We pursue loan effective be risk continue management very confident growth with continue

to Cort. Back you,

Thanks, comments we and your for Frank and Ron questions. take your will now

[Operator Jared from Wells Instructions] Our comes Fargo. Shaw question first with

Your line is open.

morning. good guys, Hi,

Good morning.

is earlier and the the you've great beta loans, go point we to you into benefited data on optimistic with jumping-off margin here that at from Yes. Or starts stay at maybe widening to that 'XX? the than will Maybe you yields as optimistic you performing of both think that for us some Do benefits spreads have longer? more maybe like we've and expected. a could with spread normalized looks -- better year, level beginning looking quickly revert those are -- do

in rate -- is at of Hi, We spot Jared. bps XXX about the good Ron, This spring deposits the year. talked the being end morning. on deposit

continued So spend to we a into costs in expect deposit see do increase QX.

on XXX you amount We quarter take asset yields looking will amount though benefit also versus if the the December almost bps earning an the extra get forward.

moving dropping where was the staying about back around good not feel definitely I to into current the So, from that nice levels, quarter margin standpoint. pre it

turn to me to talk Let Tory about spreads. over the

Hi Jared, it's Tory Nixon.

been we've level pretty have On in part our that. one of C&I that's I increases spread real kind most so us in business pretty for be where difference of there the in some contracting, are other about feel construction for stayed we business, our estate front, the we think, the us spreads but that seem business. got good The I we to pretty steady. that fortunate is for spread places know holding

of mix a of kind our it's customer think base. I

Okay, like banking great. fee the That's mortgage franchise? model do to we of and just some when once a broader reflected going mortgage restructuring that look what revenues percentage there, good should a we in color. at business as Thanks. the a as you're of sort follow-up, look thinking that And integrated then, banking revenue be fully of across the

Hi, be standpoint and Jared, that lower. Ron. but from it's also I'd also obviously to profitability expand or say lower will some bottom line contribution volumes

So you we've got much volatility asset through the less and be, the year what this July specific to here and look of a as we basis. in April say the changes coming for over the on key on on get balance will quarter. point, is of but MSR we that percentage Talk balance as the the combined the out the about hard definitely update hedging at a would

Thank you. Great. Okay.

moment. Thank One you.

D.A. have We Jeff Davidson. with question Rulis a from

is line open. Your

Thanks. morning. Good

expense expenses any meld I at got wanted get think Just NextGen for question further versus sold and on a to operating it's if the growth banks. sense cost stuff don't you've saves know side, kind the of for XXX, versus a I

number that side into to thinking there good go that lower than combination. That's if Just use. modeling any XXX that a or the number, pretty a about we're is is give pretty to

probably basis. that, less happened right? with on -- I So, say have side, operating sorry the on especially home I'd what's lending don't XXX the than is

expense. expense about expense talked it tax of tax other also call show actually adjustments non-recurring I'd We state there's income about, million $X net up --

that by and before So rents you reductions to down million would in that's lending low the it looking the $X in another $X.X million, be knock get plus to easily XXX can forward. home that range continued

Okay.

that was XXX whatever So included that out. meaning in should that or was your tax up figure that true back operating

Correct. Yes, correct.

out Cort you on sort then FinPac just and and see appear thinking was seems for growth, it where doable? the And of in there loan growth of from growth of heard terms the looking to think I be portfolio. I what of loan about Frank I a you. risk Got outside rate, 'XX, doesn't comments at kind high-level spreading

Hi, Jeff, this Nixon. Tory is

look house. relationships company the the very the we of and several quite I in years full we think side prospecting sales the The on in side particular. significantly the continue remain for the shifted base last house C&I the active has over customer banking in of of to will space,

continue and So And I see on growth folks hire coming for kind the we product growth there year. the us continuing loan for to continue of work I to the we and over company side. feel good about

from number we to the little there's I'm in excited activity, low customers set Pipelines I think demand our certainly is continuing to And growth C&I down bankers are and -- to a to I mid-single-digit see and down comfortable loan prospects especially with work that to mid bank. continuing current space. XXXX. still really a feel in find the of good bit, but want

you. Thank Okay.

comes question Brandon next King And our you. from Truist. Thank with

open. is line Your

good Hi, morning.

morning. Good

Yes.

for quarter DDAs mix wanted sense in shift I I from outflows interest-bearing, in to uptick that were deposits. of there's are get so the saw assumptions deposit a your what So CD into

want sense So to what assumptions current of I in a your strategy? are just your there CD get

this is Brandon, Ron.

say analysis? you're talking assumptions terms interest just You our about sensitivity rate of in

like further going just see DDA continued into see do of accounts where forward? interest-bearing accounts -- No, remixing do you you

were consumer percent. side simply were on incomes was the up a of that but was like relatively fourth say, outflows [ACH] specific the side, the decline flat business the What to hard saw a standpoint. here XX-ish on two-thirds we in it's -- would I about it consumer about the third is, with Yes, the the it. Got percentage DDA consumer from side, quarter in on trends

that And see so you'll decline.

continue that's that to hard say to it's level. So if going at

it's pricing be I cost-sensitive exception expect I balance think from bit would there some Fed's still would we deposits deposits. a will as as used and industry have larger pricing I to tightening would pressure that the side, sparing. more some on on well. into here and the QX little hold-on of commercial a continue the mix just expect, probably

interest-bearing increase industry pressure aspects. DDA it's mix. we more just an you the on side in specific on and trends the But probably two in continued ACA the net-net, that's should continue So see see

you. deposits, funding. you CD Got of to the term these more looking if And-- current out kind time strategy for shorter-duration are

generally would On side six be in standpoint. it the XX that between CD and months

On the borrowing to two considerations. just side, given we've the month been in four range, LCR

a loan multifamily key a And contributor now. growth Okay. for while to then into deeper a been dig little wanted has

what curious far like the be space given this is kind pulling then and seems banks from concentration there other demand there also growth in Just as for outlook of back looking is consideration multifamily in how concerns. might of as

is Brandon, Tory. Yes, this

is think multifamily specific lending in complicated. our multifamily we've multifamily the have is I that then -- you do seen lot of In division division. it's business real-estate lot this growth for in group, of regard, over a and saw, pretty a multifamily us we where XXXX. specific we And a

demand that really historically so than We and very for was is interest-rate XXXX it It's in that. have-- XXXX. less for demand that's sensitive, much product

flat it's So for relatively us.

We continue in division. the and in to where real can active active to be in continue space we be estate multifamily we our space this

projects. outlook flat be larger for six And to the nine over I coming to So there months. relatively the see

Okay. for taking Very helpful. my Thanks questions.

Thank you.

question a you. Thank Stephens. Andrew And Terrell from have we with

line open. Your is

or bank any analysis elevated to levels, done kind just Hi, specifically sense in balances consumer you to deposits trying still there curious if I'm your pre-COVID of the back just today type at any side. balances Maybe compared of good there. morning. kind be of go would you the if to as get the kind you've of still that on a accounts consumer can DDA remaining I remain look bank, surge of

on difficult a specific It's give beat Ron. is this it. to Andrew,

outflows, trends obviously and lower. they but the given Just

identify, would Just right, the was hard don't ago, given fungible while that, cash it's the to shift bank and a five mix I of key decade. business considered let's three obviously items think you to Tory back changes much over-time, was say not. DDA here XX made this one and to just Cort is lower where still the back but I and years ago, last when expect the just revert in significant that mix. though, great surgery levels recession, those over mind, mix keep to years the

balances within will So, commercial today much of deposit stability. us higher-level some the give which book

is, real customers. tightening near reactions on the instantaneous DDA. where mix-shift think inflation given with what plus that right seeing side, But with just decades nowhere was it in you're overall, consumer just the now I that continue just the expect outflows I also in terms of Fed and the continues. back, so

about about revenue shifting That's going guess, I if appreciate does that take. of within it's you mortgage to tough to just just post change Yes. a to I the mortgage that but think good back specifically, how can moment. maybe can And a percentage more business just fees And of towards I structurally, I go-forward maybe your mortgage a go you're the business. mortgage retail that. kind maybe commentary realize the talk or point. the for contribution some as actions going-forward. of probably the profitability

Cort. it's Hi, Andrew,

a with you to did change we that has which transition branches. we're the doing have what are lending retail we traditionally, company, So a going the it, their local generally group mortgage mean in-place will. communities XXXX, that more home had traditionally local That's we to with as it's and way what more that for and served mortgage of our saw, they of we markets. operating support if mortgage rates of do in and locations retail movement a lenders is model, obviously call operation met first by traditional until the And we what operated

And volumes do at are communities and we it's with right to with this think be where staffing. now, of the bit a on give To just make just your we're a of actually where get hard this point, since the little lot the making alone, any in to we under during will beginning and quarter. themselves is Staff, think volumes settle it indication all point Tory We'll to has these done, the year. moves out. where comment them staffing I'll you going

guidance So, on Tory FTE. some

and industry Yes, significantly thanks, it that. less we're I would is to is demand responding the than contracting Cort. certainly itself -- and what was

home I the we our pandemic, height business, during was so of which think at XXX were associates. or phenomenal the at lending about

this and that that we I making XXX as I and and terms to of customers to to today we, as moving our we'll and people we customers our somewhere that X in our down commercial are we our communities. south our range to customers, think is sure in new and continue bank pivot in private model, different think we high and continue retail serve land XXXs actively the serve the customers

bit and that's so get we'll time And headed over of in we're that little direction the a there.

our I this our a lending just are strong one to group moderate to which we call, commitment to to not listening because for on and our make communities, in I income serve inside to that not comments, the made a merger CBA committed finance, to provide first opening we've created follow-up, just mortgage not This firmly are mentioned mortgage our other low committed mean moderate-income sure people low we to we We've are. to work community. finance, analyst agreement and just like does community.

six are about I this of here key business out in as I've long to will want we of part part a be as It and than does longer in to as serve This it been size we record. our to double been weeks. of a mean that here bank we on when continue make So continue pulling sure has just not it goes mortgage. the big for

about and Ron, goal mortgage comments. on have in profitable to a this is I'm be, add is we to to Tory's talked going earlier. redesign within the Andrew, Cort business just Obviously, going the

expense metrics quarters. positive couple compared of a it's sale just So, get margin nonetheless minus to but on beat hard specifically last the to

to, also will forward, given The size, to we is it a be other separate going move the it longer I'll expect segment. no thing add

terms about changes income it, we'll in of level So fee changes. talk just and expense

the color. of for acquisition, to I pro just or closing was forma Any the to levels good. which thoughts of the updates very fair could deal just If a in, I appreciate wait maybe now value that there date see. one good capital sneak kind set until close. Okay more is or kind marks on all

this Andrew, so volatility wait quickly this we Ron to given deal much. I that, closes changes, utilize time able pretty one up let's that. And is capital that from again. capital say, to rate turn that I'd guess into that's that till I'd also ends But also just standpoint. point why accretion wherever over into have the out be also will of excess going the reasons additional

talk about April. is obviously we'll So in more that there

today. Okay, very the good. Thanks time for

Thanks.

question moment, Piper next -- from Sandler. Our Clark comes from Matthew one

Your line is open.

Good questions. morning, thanks for the

guess, accrual tax or low Just for stripping the low unusual lower that quarter, increases out first 'XXXs the non-mortgage run rate year merit your accruals expense expense, the standalone, consider I tax one typical comp noninterest of kind -- clarify rate on to not. 'XXXs does this mortgage on run

is Hi early increases end part towards Ron. Very QX. QX. the of generally Matthew, this Merit of hit

that, and then tax the an of too the off and will the over also have this outpost added cetera of with the look to cost in couple for the which it see year, combined get you -- benefit tails as balance the see you in right first will on front. past comes then quarter, that will that in you QX close, increase saves sub QX, generally more first in merit over on updates So for et of like on combination year with basis it by run it's and the quarters ahead get outlooks next rate the year the something close with provide sure, we much on 'XX,

Okay.

clarify, any Just, quarter, seasonality to first might the does low you though, just include for have? 'XXXs

Correct. be lending number. lower Also will in noting home as expense that well

it. Okay. Got

sure margin. if I mentioned comments, in to circling then earlier Okay, you not you mentioned December great. think it. have average the the And do your -- And in monthly back just NIM but you I'm

X.XX%. Yes,

great. X.XX%,

the Yes, month December. X.XX% for of

it remind retained And you shakes around Can forma to basis. repurchase you your the the assuming capital. stock by nice then to not, earnings be out on pro pro level forma us just to where have you constrained Okay, and maybe still process a on kind given that excess whether of great. some just and be negative capital or able a

Sure yes.

that carry -- acquirer. given will and will just We combination forward this accounting the

balance our process straightforward. value non-objection as quarterly FDIC of the balance goodwill from excluded legacy, is sheet. driven ago, So capital. pretty is continue and which the will based state is with And by loss were decades sheet It's process forward, the credit was fair the a that which The Columbia on banking this losses. from

forecast bank to it. forecast the Holdco do on the dividends outlook base excess So, the the at have that -- an the and on process, but still We FDIC. support Holdco with same the share which process we on to go the through definition repurchase like capital from capital follow work shareholders well the stress of [indiscernible] with doing we today and

a about stock did standpoint. a and year from that repurchase we point will that back out half I

the outlook. the I as earnings and retained would runway to together. be will course no came expect combination that we pretty straightforward came So get quicker process Other nonetheless on in positive to change But than, the to much future. it

Just March where today that be accretion rates will in are based on over time. where the

you. Yes. Great, thank

Thank have you. Chris McGratty we from question KBW. with a And also

open. is line Your

question. the for thanks Great,

just the if obviously sheet, make some this you've In Ron, for maybe you -- terms tweaks you to opportunity got balance of just need to.

from little you might about also be So securities portfolio thinking bit your lending head I what I'm from guess getting about the just a interested concentrations. perhaps

FinPac sheet. balance any about get how high I diluted will any comments think the on we think came should that about tweaks down you X%, level talked to but about broad obviously

but mean it we'll consistently talk Yes, of pretty in I more it's a in April, function environment sensitivity. this about reducing

the the on sensitivity funded within go with help duration So future. month two longer to bond portfolio in advances be four out extend looking where depending will to reduce [indiscernible] will and rates

manager Fed extent that's that And probably the the continues matter So of then be in. primary borrowings the just to managing standpoint. to chime the from one --

And then I guess more on --

Okay.

Let me to that on add too.

was add the second concentrations, on from part full on your tilt that question adjust of capacity we've Sorry, vertical -- got standpoint any on we've given great loan got no me the our side, too, including let anything lending to to continue FinPac. a mix, to the that need no to plan

Got it.

And outlook -- between totally of is of in where get guess the time If rest FinPac credit, problems. looking for the besides economy pretty and you're distinction Thanks, the and on spending your Ron. book. Okay. you are terms I the sitting of the most 'XX for I FinPac uncertain, down

Hi, Frank still space say office like that's that's future remains risk probably all as to the like unknown Namdar. surprises. the centered me in around big and unknowns out going to just shake don't would where area that a into I people because an don't and CRE like

So we but eye that or one that property but it and mention that is would out I special sit be strong try It stable classified that as this on. space keeping office not -- have a the close do time, one assets. at a ahead we of to a remains figure we're today, here we mean point, very

Okay, thanks.

to other are there back And queue. to closing any call management I'd questions no turn like the you. in for the Thank remarks.

me on we Please on quarter This XXXX and for call. your you Bohlen discussed will items is our clarification Umpqua participation in call, goodbye. Jacque interest or if in today you any the thank to Holdings fourth and contact materials. of provided conclude our would earnings Corporation This like our presentation would like

today's conference Thank concludes call. for you This participating.

disconnect. now may You