Cadence Bank (CADE) 26 Oct 212021 Q3 Earnings call transcript

Good morning and welcome to the BancorpSouth Third Quarter 2021 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions]. After today's presentation there will be an opportunity to ask questions. [Operator Instructions]. is event this note being recorded. Please like Fisackerly, Executive now to of turn Will to over conference Vice Finance. the Corporate I'll President Director and ahead. go Please

Good team participating I with the morning for today. of begin members management by introducing and us. senior the you thank will being

Officer, and Chairman Operating Chief John Chief Financial and and Senior and have Officer, Dan Officer, Bagley; We President Executive Rollins; Executive Chief Chris Vice President Copeland.

Also during company's be call, financial future remind factors discussed the in you or may of forward-looking made discussion regarding reconciliation non-GAAP can Actual regarding the may the XXXX in these the performance. be materially begins, found I'll financial third to measures measures forward-looking these Before release. these differ statements the performance. the and/or can XXXX factors find concerning be from results company's risks. of you XX-K. indicated quarter If statements Annual future of certain so, certain company's BancorpSouth's could due certain of that Form results in Report on variety earnings Information a those

be will during the to speakers Our prepared referring slides discussion.

comments find you'll to can Exhibit them page, on Relations our the Investor his these where them we and website. to going you for slides Investor And bancorpsouth.com You to link can afternoon. or X-K our in clicking turn our These the our Dan webcast, yesterday on view find section by at filed Rollins of Relations the the now, that slides financial are Presentations also to results. I'll on

efforts. third more credit I'll answer and executive we the questions. by conclude will prepared John quarter management our you Chris regarding will results development team for joining discuss After our happy results. other quality making Good will the today begin remarks be us discuss Thank provide business our to on morning, BancorpSouth's quarter. to comments, and color everyone. a financial few XXXX

at looking few has X results. presentation our to reminders Slide and the minutes Let's spend contains slide now the discussed. third turn Will a legal quarter already

financial a our for is quarter, Cadence the I X. provide Bank, results the update like on into Slide on to I'd Before highlighted get pending transaction which with brief

and As received to our actively end we our teams Both about transaction engaged of forward regulatory are the closing of integration approvals, previously we are the look very before finalizing this all and we planning. necessary future have week. announced, in merger and our together excited

to daily the extremely am The our man we made to of I bankers, new spent As the and our and know meet combined spending to Cadence of since planning. visiting we upon time of know have team. of have hours five been enjoyed the BancorpSouth proud many us invested Cadence in are hundreds our and time has getting been to personally considerable have discussed the in with building new ensure I have meeting the Bank. announcement know Paul, past, team getting in merger teammates. into Valerie Hank, back have Chris leadership aligned continue Hundreds I our we progress and April.

expected think all quarter. this are deliver we and execute Slide merger. teams to our provides the highlights the benefits I confident for our ready are X of

pleased other $X to reported was sustainable for the recorded income, evaluation expenses million the factors, weren't performance. in of diluted to adjustment quarter available income per of during operating merger-related a had our a first elevated common half or third $XX.X the positive Net of and and year $X.XX $X.X We the million the number continue shareholders share. MSR quarter. million with results volume, we While known of due mortgage be core we've PPP to

in net XXXX. adjustment an diluted payments assets under items operating a from the other retirement common per elevated PPNR reported that partial a share. the for thus totaled $XX.X non-operating for which or record annualized adjusting items, settlement MSR plan accounting the had pension lump basis excludes excluding average When million income, far we these X.XX% and to on sum Additionally, $X.X resulting charge we of we MSR quarter. rules, million $XX.X $X.XX of million or incurred

quarter. As we will deposit growth to business which deposit our look a on annualized in or development discuss of Chris an customer moment, XX.X% for growth, million another great reporting for repo $XXX efforts, we had basis over at total more quarter the and

payments nominal This $XXX growth we forgiveness dynamics X.X% the for loan a marks industry to a reported quarter. consecutive excluding From $XXX a liquidity of the quarter growth. the loan the of continued on positive perspective, able While we spread, second be of approximately million, are a to in drag organic organic million net received generate PPP the margin. net or

is Their As PPP to the generating managers a continue rebound the loan relationship prior quarter from success most our has clearly our we quite mentioned to across quarter, result decision last to have well. most focus since of sell business. pandemic. our allowed footprint in third our on a calling our is perform and portfolio efforts new the quarter standpoint economies demonstrated as The and growth renewed to successful

As bit just provide Chris little in will I a said, moment. more a

quarter. great Our fee also income businesses had another

which by during Our quarter, almost historical loans mortgage $XXX standards. produced team a the third is quarter million great in

of revenue an quarter, On is commission for over which of XXXX. reported to insurance increase side, $XX.X the quarter third the we X% of million the compared

one new to The successes market to experiencing. firmer that credit continued which industry proud is would Our management of touch that the insurance team most and of. like producers is the the is item premium I to on our next continues business be win quality,

remain stability continue the that metrics, a recoveries fact quarter. quarter trend, classified which reported million very levels, $X.X resulted levels non-performing combined in in of to we $X the provision is net including for This the charge-off and low, quality reflected credit Our million. other of asset release and for with

be the continues. recovery last The to to it's bullets revenue of to on relate While couple report touch management and a nice deployment. such I'd capital as economic quality source, credit able this pandemic isn't from like to positive a the sustainable

repurchase year-and-a-half, able over X.X of shareholder been average due able program allow first of million metrics advantage to remained program a of reflected at take the associated strong our the economic during $XX.XX. just of significant it of in and share have to our capital which We to stock We've expires the remaining retained the been discuss until our with the the resume current capital and authorization, price year. to I'll weighted capital X.X very the portion generated now over financial XXXX is a still our shares repurchase last results. call quarter of risk-based merger to are John in him of our not XX. have at end of which at at million September We total to the uncertainty paused shares We the ratio to levels, complete. quarter XX.XX% third the and pandemic John? our Cadence vote as was had pleased turn we've

items our as Dan. second to X the my expenses. well Slides as through I'll as few our our other interest well margin, revenue of compared quarter morning X this of Thanks, show focus that as on net non-interest XXXX. summary comments statement details a and variances have income

Xst will on first This the May these financial information impact will we the begin, for the comparability May the acquisition. two full is shown I Before of the that transactions slides. three you remind of that impact the quarter close

Slide we quarter. the to on a notice in million first increase $X.X X You'll interest X.X% net that reported or revenue compared

to to protect small have spread been a dynamics to our pressure that liquidity the net mentioned earn continue able we Dan margin. While dollars, income interest that

margin, rate deposit remain the compared the resulting margin stable Our exclusively components function quarter continue of individual to from accretion third fairly mixed interest as net for X.XX% the and was second excluding are shift for the to yield The XXXX. growth. trends elevated of almost quarter, a X.XX%

compared to respectively. while Our security were yields and accretion of loan cost second excluding basis deposits our X declined very yields points PPP, quarter, and both total the stable

and of to total renewed to higher expect our as than funding costs new rates. deposits decline remains the We our considerably continue cost current time

the that's continue There's will very to through for non-operating Additionally, this of $X.X renewal. cover fund quarter upon elevated a partial retirement shows payments, of work to X the made re-pricing a expense merger regarding the breakout our did quarter. expense. quarter to two as $X.X compared the Slide that the charge over was already Dan XX% non-interest fourth Similar public well the nice million the the settlement. sum cost our really settlement revenue pension of result mortgage has Slide see increase in of our and mentioned charge items million. provides little comment X insurance. We of as the of here as components. classify deposit exceeding revenue we from we incremental the second threshold to to service lump higher of plan deposits XXXX non-interest details around Dan charge

Beyond I that two salaries increase. this with these the million additional There significant worth increased additional believe benefits, of and activity $X.X item contributing factor. quarter-over-quarter warrants to which other several only mergers associated The are is contributing factors items color. months' was the one

Xst. adjustments, Beyond effective driver on their which annual that were compensation was July the primary

Finally, our financials. color activities. to provide That and functions. geographically wage Chris both the my now we all the comments will on board development continued across significant on see job Chris? across concludes pressure some business

mix funding everyone. deposit Slide annualized. million the of for just and the We morning, total XX% over the good and the to continues John, liquidity. whole or reported trends growth you, as experience bank and organic industry reflects our a unprecedented X quarter. presentation of $XXX deposit Thank Clearly

relationships managing Our and protecting focus deposit down. remains on cost

and deposit the just to there's mentioned renewed points, new An total mark. for our quarter example, John our while As rates below basis XX that time that today over was continue still opportunity well trend. are cost

be as As mature at public re-price we opportunity also to lumpy before, an and down I've draw that will various times. fund somewhat further, have mentioned but costs they

see received X.X% million this adjust the you an or annualized organic our X, for the data for quarter Slide to you We PPP When million. basis. over similar portfolio. $XXX loan trend for will forgiveness just on in was of growth for net payments quarter loan Moving $XXX

the mentioned, Dan quarter non-real we've C&I saw of is in opportunity Tennessee estate, second organic Texas perspective, growth consecutive this loan the was our the commercial a growth the estate, and that net of As markets. consumer meaningful geographical growth in and After From real during adjustment, most portfolios. PPP quarter our mortgage we experienced.

a quarter perspective. from our team C&I growth a corporate syndications loan Additionally, great and had

Net to to million levels a for We XX, our of provisional be the asset continues classified quarter. to with story Moving Slide us. for quality recoveries consecutive for in recoveries quarter. $X.X a $X contributed declines of net credit second the good combined lease million reported

ended Our the reserve coverage excluding X.XX% loans. PPP quarter at

credit of the impact on Slide assist we shown early decisions continue to as monitor lingering part Finally, we pandemic. the of during made XX, to the customers

Our converted are loan deferral quarter totals in after temporarily that decline to interest-only either to been that have or quarter. continued

be million Slide last disclosure. money. particular economic a for in our we this and in the volume a which to look a quarter, origination really this scheduled to months. schedule had view, change and quarter non-story As regular we interest-only purchase we quarter was deferral $XX the reported products. there's XX% of trends, of X/XX, that insurance $XX the point is Mortgage our to $XXX over million and all return cycle. five at the XX few Unless next results expect mortgage million for provides payment this the are In at in will in this provide

multiple decline a slowed a more slight our what standards. pipeline Refinance activity geographies. markets urban demand the are normal have across these The as around strong expected, seasonal would primarily examples historical on our in call footprint. seen products as strong e-listings we our has being well. the that remains into results average is type without in market the but smaller below quick level, Historically, While anecdotal or asking in by housing offers resulted extended little of margins more

A success to the Moving high Total rate reported on and has the very firm revenue basis continued was very near nice to quarter percentage grade we $XX.X consecutive insurance result growth growth commission insurance. second to team. comparable marks prior for double-digit when quarter customer revenue that revenue a million, the a business which for combined in in quarter for compared market the year. the retention the

Dan to concluding it his remarks. turn I'll back Now over for

effort of it's Thanks, together a that reported make sides managers and to results are the reflected for taken us exciting time we on of everyone The relationship Chris. both the in the It's results balance working possible. sheet. really our evident

And and processes. to wealth of are lines risk All is our by managers, very our a our the efforts mortgage, our perhaps of quality contributions and underwriting are testament, metrics very well direct performance. the standard. This performing to business, any not quality also insurance only most relationship strong importantly, key making of credit of and but meaningful management our management

Finally, create around the is working upcoming Cadence high, all-time for the we the prepare operational optimism around to executing for close bank this company Bank. been to begin teams an our and as week the both The to our integration at Cadence have support with legal merger expect new our clock our to on closing and later Cadence processes.

Operator, with today fact, to our Valerie In Toalson, Holmes. answer here team Murphy, questions. ready any is us Paul now and is Hank

We will Instructions]. now [Operator question-and-answer session. begin the

of from Hovde Brett comes question first Rabatin Our Group.

go You may ahead.

Hey, good morning, everyone.

Brett, to from Hey, hear good you.

stronger gets on big Cadence would the maybe you in the a at that? years ahead things think look this organic quarter, Can commercial you growth I you brings $XXX and deal from to how growth you update and have for one that for us is pipeline $XX with obviously and million BancorpSouth the guys when of million Cadence the an you do BancorpSouth maybe much and ask, first expectations where of to about Wanted been. how effort give here

a on weighted million looking take for the people I've you're and $XXX that heavily of into plenty Thanks, When side. was here help can Brett. stab got I'll Sure. us C&I that at that.

an PPP You C&I it, C&I away We went don't the million the out increase that but in to see of perform because well. $XXX CRE. from saw continues side, came

want on pipeline in the to really are Cadence. what's talk can good. tag you looking about and at Hank Chris, do pipelines happening Our

the pipelines growth look growth meant heavily that that more mentioned add just PPP that towards and C&I good. I'll our Dan Yes. XX% it; organic was weighted of our about

guys think the -- a all few in all a and we're I across Hank, we're lines. saying you look business what the getting seeing? geographies opportunities at different quite are

takes call thanks, I question. Brett I'm our nice to with transactions we haven't time. and it's Bank. that were Chris, we the seen geographic that no There the Yes, BancorpSouth some loan was I'd across and little concentration or timing our quite appreciate longer. specialized it excited in And in about to add the to also seeing And that the real that close concentration volumes C&I being on report a would really board. like on committee

next year growth end through year. of we're of optimistic that So seeing the the and into

that performed their well they better the have crew also out and same volumes they're did last trending We advances during in loans, a nice direction strong COVID CRE given And as like portfolio to that year quite this we'll see is going of do some construction than this well. time. and year

headwind looks. and comments pricing growth are a only and but I the from we they optimistic getting we overall we're Really the those, pipeline about lot Chris's going steady. review some So perspective, seeing would of good echo there forward. a are is as pressure,

going long and good for we feel the new growth. little the footprint time. Texas in two been two announcement Texas a XX% at. you quarters, happening you When had I earnings team us the and pickup of look and BXS for When Tampa and our little the we markets the the many, there's look guess than earnings the see at had also forward you think while when the had states we Orlando Cadence earnings positive market, to at can the breakout has side, you last then announcements announcement, And being quarter. our growth Atlanta and less over the at look what's best our the BXS five in Florida, quarters brand in Tennessee And Georgia, Georgia XX% and we're we've a grew and about many in pretty I Texas look a

looking think I So feel forward, Brett. we pretty good,

for you a too stab percent to it Dan, outlook just thinking take at basis? care would growth a a Or that? at to an about early is take on loan stab

Yes.

relationship I making footprint, think, say us in our heard talk we'll been past. out been ago, a than and more managers over about me been talking as the excitement We've I Cadence opportunities the minutes do a that the rounds. that we've a there's you few lot customers think are around, for there, done of story, think for our to percent I the around to we but all we've all

but at So I We're looking think our economic for the markets footprint's you're footprint the standpoint, well. performing when open, from an transacted. open businesses are being

think I So us. opportunity there's for

liquidity Cadence has just the was looks the you the quarter, question Appreciate other maybe there. guys the about obviously and more color you and bought the then, the of do. like what than guys you from might bought around securities a Can side billion had you And about Okay. in you what Cadence liquid even purchases $X liquidity this in with talk the quarter balance do equation? I sheet here, from

Liquidity, problem liquidity not our is right now.

of that. Valerie, on in jump that We have plenty side? you to want

Yes, sure. Thanks.

have significant think we BancorpSouth in see the obviously yes, been of eager had our securities. the been that to merged. you'll So, liquidity buying get Group is we've I has active that more both have banks And doing things us one and banks

And so doing holding from to post-merger number far. things be we've sheet able been balance on of that off the so a do

our balance of put scenarios ways. different outcome obviously But we're variety as at both well-positioned we in put different So strong to some be work in of and looking to liquidity to go-forward. we've together strong our with the able liquidity, modeling capital, our with that we're got sheets a

buying? John, the are specific we what was

and buying big unrealized We AOCI quarter-to-quarter. you in loss that's reasons rate the backs, change see from variable were mortgage the Yes. one of

what mostly right buying now. we're that's So

That Brett? you, helps

you helpful. Thank That's so much.

your All time. right. Appreciate

James. Raymond with comes Our from Rose next question Michael

go ahead. may You

questions. Slide wanted thanks X. start for everyone on Hey just I to taking my

both billion the the the they're original except improved wondering pretty the I'm And same look all and just relative $XX slide size environment having for of growth I to when out deck. So asset of good some just the metrics, some at We'd Thanks. Are the what closing -- just could updates where love sides. numbers Why updated? on not they be versus higher? April. maybe wouldn't be those of merger some in of what back assumptions they were kind the

to That's and The the few updated that's this what size. closing the asset read coming only a the was that team's number up working days. for ready slide footnotes on be you was really hard in the

out on And So hard. working here when mark-to-market boxes looking lot at you're what announcement accounting is The going looking let combined basis. a a we numbers. again. on at like on accounting put in at team is look of other still the you new Valerie, that's haven't numbers I'll we -- team jump behind that. The any activity hard. working There's

Yes, the all be of no, right. Those you're that are we'll close. exactly numbers as updating

time. a while so and and for lot for quite prepare not that prime there's lot of a forth, analysis a ready to going lot and And on of so trends of work

Is that be to prove environment characterize ultimately those it? it has be conservative. could that though, it fair the the thinking about numbers we improved way should all to as and Is

us some back, I more I April; in talked a going about market are was April. in all look certainly have environment, as a rate had reserve The when on think April. grow you environment the hasn't economic releases last got pretty we we've from mark hard of since the lot fear back But look improved interest then. in the in markets taking But and Both at the coming the a mark forward improved We to for down. quarter. margin I knew the us. there We've were think activity opportunity think things to the what improved. you're looking

a economy them situation. standpoint, seem with So improving the turn liquidity the that an of where and and credit us -- quarter. are tremendous can't in to growth from know in going quality From standpoint flowing the both a off we deposits had and got deposit we a we're we've

And continues interest so that margin. to our damage net

I questions. all That's Understood. taking for my had. Thanks

your Thanks, Michael. Appreciate time.

Truist Jennifer Securities. question comes Our next from from Demba

not go ahead. may You

what looks I'm appetite repurchase share your just wondering near-term. the like Dan, over

the left You've on million shares got like over X authorization.

Yes.

think that have excess be, capital. we I want to we

it, done opportunistic So be past. we've want in I think as we done the to

deploy be we capital this or I arise that I that here, think expect quarter. onto be the in Anybody should that opportunities looking we'll in add to and for Valerie. back to wants Thanks. that opportunity Paul would would the market.

Yes, absolutely.

you Cadence In saw are in addition right and the when to million quarter, we've also active acquired worth. during third acquired shares BancorpSouth markets markets the both the what so X.X been

in it right combined, a was at repurchases million total quarter. $XXX in So the

Yes, meaningful.

and can also want Dan, XX investment your really technology to talk next emphasis months place near-term you about where or priorities you so? the the over over

make teams that are. Yes. have we understand to really working The try hard been sure where and we tech

process processes what's the technology customer-facing? state. through we've inside doing then So want today? What are gone we And for both in to what And we our be current be then to state. What driving? we've teammates driving today? of. off bank are was identify to driving identified we also the What are future What's we a

And get our to now. us current we've to is roadmap And so now that process from future to state got state. starting build

end in week that groups conversion But on platform all We final executing the XXXX part will couple two end the future So of spend before of and when the in big and XQ And -- in the steps. a operating think coming consumer XXXX. clearly, that'll be of a We phase and think one at those be year. but teams in on other customer over you're the will doing will that have commercial doing. or on be next all converting We'll it's year. that that later big what's teams looking this one plans. XQ of the computer investments, the together, platform the what's process, be we'll mortgage of our stages by consolidating begin we

teller treasury making And IPMs key reduce out consumer us product looking a helps machines, there of costs well products and you're management, video for got been features in us both and So at or that's in the our process interactive app we're have machines app the consumer treasury of and we looking us. at deploying branches. us for that's around side management that place, when sure working the that's teller the we've in

lot a that there's front. So of activity on going

specific item I to don't I would that close have any that. Paul, callout. Although you're one

Well, calls, it organizations these we more some are but but of about on Jennifer true. it's and we I, at a look really good was pleased combined things -- it's it's we've the the I a mean, summary. talked prior that slogan, really

We together. are better

we example, So digital which has substantial at, some for initiative, is look our and traction.

so has that look initiative they're go have on, further we're we things have, to a some because faster they if at BancorpSouth more going focusing weren't to And a we similar just robotic initiative going process automation We're to together have. resources.

will able of be do the conversion We business. to mortgage some early

be it example, For to quarter. fourth probably got

process conversion companies one things for So longer-term exciting is big track. can more on together the how is faster. do as of Dan is about you the things mentioned, those But conversion it two next putting fall, the more

to for And quicker can you get more clearly a the the have you steps resources. some that much things when right of us or

Thank you.

from hope All you. hear right. really Thank week. this do Jenny. you, ask Good for well to to We to us

Our next D.A. Kevin from Davidson. comes question Fitzsimmons from

ahead. now may You go

pulling team's the Just expenses expenses, personnel And partly being there I to still saw was the to; on I pickup which on reference out working a did, quarter. I know I activity. the non-operating know linked we merger expenses question items due up believe

little the a some forward basis or forward? non-core, going that – related the pulling we it would you trying it, call combined maybe versus non-run would drill should a make on is expenses was identified of deal any call say, So as didn't in might inflated quarter you I'm you model of just load base that that down to but expense that rate in it and to or expense third what

little may that. be there of a Well,

when only you a months look the two full three specifically, in quarter. at last the months and acquisitions acquisitions the remember at we last had third quarter. of benefit of We costs So those salary two had the

John review July So annual time. there's salary the of our X effective part process is of increase. mentioned and

impact that's got we piece an experience another then, And of puzzle So to on that's wage that continue inflation. it.

an the there you folks I But out opinion talk pressure, that. wage tell I we're pressure is today about there seeing that inflation, So transitory we're have want a to don't feeling that. from can wage that and on

think in I that that specifically don't little would bit. identify did I probably we not be wage able of answer that, may future is around; some kind your there right? to My But I number. is have run, that question know costs be a

We I continue do entity. think to down and the to closely standalone expenses have to as a we drive ability watch continue expenses

see cost little when able the you obviously, You you can of it'll to while some a and some on? should add turn that seeing we take we together, don't be us benefit start coming that. to it's I of but put off of a gate, think different We'll some the media, saves out the turn investment. Valerie, want to

it said you well. think I No,

to into as we acquisition that date expense obviously, But layer in we will XXXX announced can. But at of working As get impact our we much of savings, soon are that or of the starting absolutely planning. most that we're in as as think, we we as the be XXXX. look full to

anything run identify rate? tied to that XQ was you specific in that's would John,

much process rate. I Valerie that'll we as as mentioned, it's the No, run -- identifying later pretty for road. No. in all down in cost think, really And the on be we're big Yes. the XXXX, step first achieved budget saves that's

hope them, Kevin. you got I

Okay. That's Yes. helpful. very No, I appreciate that.

were get closing for obviously all and quick the past were can had close? to but holding do, some balance that want you examples that there get Just if past movements you earlier, holding some I you doing, are Thanks. that you're back you one could those one believe were, sheet mentioned us doing of back give other until what kind things of you you Valerie me

be Holding liquidity one. would

mark-to-market. So ahead, we end Go up in don't Valerie. a

exactly That's right. Yes.

balance modeling, how liability strategize get the we which liquidity. together then of the overall modeling, now evaluate sensitivity balance sheet, wanted to to on of together deploy together, have on portfolios asset our to some do our was sheets One we and do combined evaluate asset things to our this

value impact curves to of and it is but on the the lot we there to the the because is we something going way and impact know, right of on -- pay rate As curve the obviously where rate a that rates through you starts the attention increase. do when portfolios are those that, at to of

combined start spending we're a bit us of that and you'll more near as the company little see on talk time that very we're to in a lot about term. So strategic

question KBW. Mealor from comes next Our Catherine from

now go may ahead. You

Slide that either and anything think to just credits but EPS when this and X see to accretion a be we I are to deal? so there the question, think with been I the would book deal that I just aware about from or lot anything would wanted totally guess, is there also accretion value also sheets tangible Michael way, follow-up looking the of I tangible should, EPS at is better, the accretion I Because lower better value the forma, that on if accretion Rose's should bigger. that's appreciate the mark on negative book and it updated, and pro be be is, that balance are

bigger but impacting And the liquidity still -- so the are this the sheets is course of all the liquidity. because margin, balance of

accretion I EPS bring better together, And imagine, so well. coming that would as should

that just a accretion was we it EPS when any was aware lot us today to that actually than maybe headwinds deal that of kind should look better announced? be So the of allow wouldn't think should

that is assumption bigger are sheet credit right, a and quality. think I -- think balance I better those

the the tangible have I point, marks if what we to negative we net biggest different basis been the this again, making but saying happened, numbers be deploy in. continue book is, very all don't credit And bringing got had down, than value few points deposits to on move along, April. we agreed bring but we're as we're we're deposits in me, that and back obviously to positive And it'll to we at know it's in. think announced be the We've that. able that

good improve loan, to if sitting and economy So the we back feel the to front the footprint Valerie? pretty so in, you're operability to of the us. grow can we're about in opportunities that continues

it and but the in that fact liquidity. held and sheet less there that lot that'll we I inductive. past well. all said And be better, think balance are that you a And are stuff deploying will think I definitely, the is that obviously bigger, about it's of excess they positives be it

this, perspective we're I have markets biggest Houston. the for from credit the should in that us So a loan and say or biggest presence markets Atlanta two is

[indiscernible] So us, I thought but perspective. about [indiscernible] markets growth pretty talk were strong, for and you going look of from to a both those the

BXS. I mean attractive quarter, Think just chime it's here. efficiency we XX%, a about model in quartile earnings efficient nicely Cadence merge results, PPNR little I'll it's thought organization, with attracted historical an top last and ratio, operating are and going I but well in maybe better and to

No, I'm savings. cost quarter My tonight. the wishing is totally is maybe not All the at. Maybe timing brave going this look be about we understand question to other good right. well just full think on Feel of Yes. you to probably Dan. tonight side; as a expense

conversion was the said I think slated you've for late last, XXXX.

us numbers? kind we'll kind fully the of conversion, the we forma any So give level upfront we get cost a savings to and timing see rate of what quarter then in full when see cost savings of before could on run you pro thoughts of could

Yes, you a in rate run I think XXXX. XQ full see

for But to it some we XQ, as up combined to you think to would today. on spending Paul us. we're know a I that of things stepping coming year. able turns you've can are think to that Every putting ramp whatever saves in or next turn way run Friday the what don't that So language exactly rate we use that start see cost continue what you savings parts expensed certainly will be XQ to a all XQ, out bank analysis be and time of see into combine going got the we minute I a will convert you'll what I or in we different we I to about gate. less consolidate, ago, long there of cost do tell rate. talking think we're run we're moving want where go together. have XQ, see And that things full will that was the together, But off than a

Jon of Capital question Arfstrom next RBC comes Our Markets. from

ahead. go now may You

seeing at companies are here. and A Most both say a been of handled, improving. that terms you're trend a Is its that safe pipelines couple questions in is lending fair but of to that growth characterization? the

in and let here jump Hank Chris one. that I'll on

fair. very Yes,

agree as well. I with that Affirmative,

Okay.

more color. You want

the I like the that companies? changes kind come of and once appetite two the lending an answer. as credit to risk Also, just question on is together any merger approach for done,

to And as don't we expertise have And that earlier the business fit together that including in in almost just and well we're we at they that opportunity don't synergistic. we some different credit gives very us Jon, we very two opportunities, much, look some from a times. in more Paul said And we're different have. I lines together, put sheets everywhere perspective. They They've that balance grow revenue have. well, channels so. better loan together got think, changes

certain I way dealing each levels you those opportunities. think And were plus, concentration with to they business in both bigger. impact additional perspective. de-risk drive a we're concentration lines -- segments in before that gives that kind in of one fuel, from the positive we some that we more That's of banks a

of some your expect would even take you larger of to a you customers be that in would able existing So fashion. care

from those very side, positives. perspective, tell We've of excited. we're can a lot are together. time BXS the from So I think loan together our a policies all I you credit spent putting

want good of we parameters our together. very are where very, We full forward. going the feel It's putting the strong have underwriting been Cadence types do of credits in and very and credit the house. productive about We loan side side we and positive to views the confidence have good on policies of journey

positive. it's think any? do just you I so want And very Hank,

is only do doing was to was doing thing the the and what that going Well, add on said that we team I well like getting what side. was would it to the C&I I Chris BancorpSouth think

team community is a we historically I bank, building do teams think I us on have know to that -- are And our also and bank. brings that I so, as an acceleration that some together. well. done our excited this of opportunity more Cadence at And there believe what that than there's about we little on

think add. things well, it and I'd I'd said Chris those the I So are

we and we. the few a just coming into We're the by days they from Jon the

Thank you.

I that -- overlap. reminder know, you market know of well, good the one of the one but is situation, very both just there's us Jon, things a about our little

all let's sheet. really, balance a bankers we've of So over go bigger our Paul and got back down

committee this We up meeting coming board first week. have our joint

on but some decisions limits on have, but inch bit. going little increasing we're exactly going be bigger will to big hold able limits, not we hold to be we're we'll final so lead really And make making what to a to out going just transactions. We're move a

help. for us. effort really market the on double will But right calling opportunity that down the to just So again, us before is

Okay.

on each have anything but, that this, to discovered all announcement get you'd maybe synergies familiar answered You April may other. you've else you the since just Dan want callout as revenue with

there. about I anything along is don't but all same would new that know that excitement we talking callout, that the been we've there's

partner already think mortgage And Cadence the a and are in it or in new the the just to know ability bid We actively Georgia Cadence exciting, insurance Our the we've insurance mortgage before. Florida with insurance those today. big about chomping recruiting team bankers markets. be Cadence quarter. have doesn't some growing the out, we're we've that want in team, We team is business as soon presence talked this the to up footprint. is revenues get to

just opportunities moving to So forward. and there's we execute keep fairly need

[Operator Instructions].

from comes from Olney question now next You go Stephens, may Our ahead. Matt

that Thanks. kind the go of Cadence the anything back question Good same to on the unusual. expenses expenses quarter operating morning. I side to and guess I Valerie wanted about third

get quarter. you'd million a then the in to another run callout you Anything $XXX run unusual, think I callout rate in third that the core the wouldn't here? else merger this rate from be around that's settlement and expenses

Yes. a that would higher is little bit bit Thanks, Matt. other unusual incentive I The a accruals. only factor say is little

look we've overall had throughout obviously credit through and year this the impacts incentive excellent we accruals. the the As year that results

Other factor as than employee see as the really benefits then line. fees we regulatory so of that the there that of well. part for and in part what definitely you it's expenses and really that the merger salaries the obviously into in And the plays and in captured increase most some

it. Got

itself. Thanks. want to you nice each rates Can just the Okay. I combined sensitivity sensitivity topics, That's speak rates then and changing And on guess to about maybe higher then interest there's to company? rate bank. It higher upside more ask by the some like thoughts helpful, to Valerie. combined of the I seems for bank bank

first? are Okay. higher Can when going rates you us be to tell

guess now, to but whole a going from lot. worth Dan, my I'm a year guess isn't

entity helpful. you've specific that's I that Yes, we're all Go Valerie about excited for Valerie. ahead, numbers the some Okay. time. the we've sensitivity. think got been the do modeling combined

Yes. Sure.

the take two So actually asset increases sensitivity, half. BancorpSouth probably it combined, sensitivity about when Bank you banks it around Cadence decreases

largest portion growth that neutral. we with loans. that the some in into liquidity leverage little The balance additional is being existing the positive loan So in C&I That sheet both a we'll is our lending. are over of as said, seeing be banks

asset to will higher. push sensitivity that so the continue And

coming about loan driven. On C&I two-thirds actually our the got of growth in Cadence side, that's we've is today

increase number on to by a be we to have you muted all you'll But banks help rates. from loans so movement the and and rate that floors, more very more the one, And certainly impact their will as of that. start do past positive get so first start will once that. or see along first Both of so

industry costs be with and to appropriately We When raising CD help rates. re-priced also believe are deposit our our have to the we will that fixed significant levels will also that some that non-interest -- where able if see of those we deposits certainly have those benefit. bearing along deposit lag see where and that both when positioned, start

downward of still planning we in to Cadence cost. BancorpSouth same But side deposit cost. the for basis seen the on quarter seen. on not deposit We're some still cost the a still down or really I have ability our time. movement X walk X we've got points or got X the and think aisle that deposit that the drops has big we've good

Yes.

you pressure you Do downward deposit you on in some manage can with far -- mentioned as the on give cost think Do core you a And Okay. lower I you deposit lower think as point, loan line also pressure loan yields. those last costs think deposit yields? Dan, lower that overall opposite.

Yes. that I with conviction. any for I that answer don't know an have

some if the loans be I growing out competitive sure that trying to maybe are some searching to today. and think know There I Everybody more a we all, competitive protecting wants certainly folks on folks don't at terms. customers. will make buy they're to market There are are we're moving there price good is that credits. that clearly very term loans.

customers that price. Sometimes on protecting means up good you're some getting you're when

is, today. So the benefit up I cannot. have is cost us way. don't hope us you know that question mentioned, keep What as I that's a any just we will do will some tell we deposit hard but modeling or that think whether could in would that we can I

have bit little on of as the I volumes, loan some than deposit those think an being yields look loan going to the And yield, volume. it'll at that cost, to it's we pace significantly on gradual. you originations pretty be of meaningful impact yields. to That the cash the get a If take depend lower yield those on for the better a more be are going net it's investment. to back said, going

drives BancorpSouth from add that quarterly on the loan I'll also side, sheet balance yields. putting we're And

don't the real big growth while up from side, a little on you was talking going field get move where side, we've if side, the quarter-to-quarter. to know on opportunity bank grow will been and there's to the Hank so estate But C&I just that that bit. And growing that you're about

the Dan to remarks. Rollins concludes our any for closing conference to question-and-answer like back I session. turn This would over

all you for Thank participating right. All today.

excited what hear start you on a Cadence to you the to up your you soon. with in new clearly time us can As you looks excited hear, for place We're the for I forward again we're very Friday. future really Look about that think much can all combined as catching company. Thank like today.

you concluded. for Thank attending The conference presentation. is today's now

disconnect. may You now