Home Bancshares, Inc. (HOMB) 18 Jan 242023 Q4 Earnings call transcript

Greetings, ladies and gentlemen. Welcome to the Home Bancshares, Inc. Fourth Quarter 2023 Earnings Call. The purpose of this call is to discuss the information and data provided in the quarterly earnings release issued this morning. The company presenters will begin with prepared remarks, then entertain questions. asked note remind regarding has to to company cautionary their forward-looking Instructions]The me everyone to refer [Operator statements.

XXXX. the You Page will Instructions]It Investor call in is with turn pleasure recorded. Director of over X on This February SEC the of their now Relations. is find Form XX-K [Operator this being [Operator Instructions] note to to Townsell, conference my filed Donna

our Chairman, fourth today's Thank Allison; quarter to Lending Financial call. Kevin of Chairman, you. quarter results welcome review Good and John Chris Officer; will for our of afternoon, President with Marshall, you, Hester, Chief Davis, With Bank; and Chief President Shore CCFG; discussion with our team French, to is Centennial Stephen John President and Tracy me Finance.Our from we some remarks Chief of and today Operating Brian the our Premier begin conference CEO John Officer; Tipton, fourth Poulton, assembled Allison. is Officer;

Good how to the This want and company. Donna the conference guys release given quarter afternoon. of that Welcome, earnings our for Donna, day passes. you've told call. firstly that you thank year. correct? believe support to other is this everyone, many year-end quick and years I time I XXXX your is me fourth XXth

That is correct.

to And building of business. dividends us.Year profitable years to assets XXth we of belief we two, and not the year. in had our that finally about our total we and I management of 'XX, failed 'XX time. FDIC that remember 'XX, taxpayers that would actually, it Fed million reserves of assessment length Asset been bailing and with were billion for We they been year book $XXX without for banks.I've It's $XX of and was XXXX Troubled would first years know have have the at In was for every earned We out little time. has and continue earnings you Relief interest. XXXX, positive was since had poor build And the first ended banks million them respective that occurred But year Washington $XX.X the reserves, that and the because of $XXX hard to company those went over borrowed some TARP, broke. surprise the the special for part was profitable X% for over of million we complain from $XX and almost believe has that cash Home heavily criticized at a started program. around million. Fed been it our heard XXXX flow over Bancshares during banks we year. Program paid that on

a much, getting a we point X.X we like during were money, getting I that on were Brian, and don't were X%? time, how remember think we that I but maybe paying

much weren't we Yes, it. getting on

money. the Weren't insurance of did getting think they never did as math, an Anyway, We think our money. made and a spent much. Fed that policy the I I totally dime

that's that paying our certainly other been.I several largest We the seems about of If XXX waited I then, fella or we the buyer Florida said, banks buyers were franchise U.S., did know of at great the has building what out right do the money you very don't fair yesterday failed you the happened. in did while took we I Magnum what are I someone the in what and profitable failed when part beside. Home, banks kept a my it years and share, it a with money? this banks remember become said said now. U.S. one on of their We becoming largest corporation, put that least me, of when run was but it asked it for I like

of banks I money the the did to Fed. million of because repay management to other After best We many, teams. for banks. to way the $XX don't Fed are the it save front like pay many all, having stupidity many, is that, the but

value I think years bank new Under system prior of in the have edge to the XXX% regardless been allows the enormous.I this of the felt borrow lending the security banks stepped with Fed of Fed the program. the their was collapse and of program, value. would market BTFP, on had any face term

had $XXX, Brian, they if correct, I $XXX that municipal think can value market So $XX, if a they borrow right? I the I'm was paid for and

correct. That's

to why So major I rate that Probably to the hoping that prepared free failed done banks.Home not currency, probably a have of small Fed the bankers the had the provide in Bank lot access U.S. the crisis. most Once are the of have banks war did this whatever again, coming, so save was more that that experienced The with many, was time, more reaped weathered up.That's this capital was could saved moved not for for But just and into and was funny provide ploughed the didn't of for fiat larger the best that again, thing stuff one smart. properly capital, team.Likewise, the very were wasn't this serious, out in the easy mistake the balance banks If make not that of huge prepared days dividends 'XX, reserves sheet. securities, that in that raising 'XX, environment. [indiscernible], the storm monsters wipe We a the XX% and teams coming. regulators for getting weak them. percentage Home it we make 'XX, of can't Home was big money. well. but and bank prepared kind team say those management chest would you ALCI totally failed. few bank money, and reserves, when a prepared many banks to it were know have just fortress management of this low-rate another country in management cash, and the Fed 'XX, for if was did almost too all while problems strong funny in long-term of was It's

think to banks with capital, continually weak going limited regulators powder need stretched Our judgment, of us with are told substitute Inn loan-to-deposits efficiency dry up said, growth our simply because good The Wilson, safety the Founder the judgment leadership.Kemmons of have to they're keep less us Holiday comes XX% space these plans, I weak from there and clean for to bank or the hill. XX% whole and to no experience XXX% comes the There threaten capital, from messes. regulators These bad of banks the to of too ratio is coupled some experience very many space. were X% with clearing and entire crazy bank up help experience.

big federal no too the job and union just income And that many it's there buying different numbers think credit know, with and nearly my no way, credit I credit income X,XXX the a another tax. pay regulate unions, unions. banks financial state tax as institutions.If right, X,XXX banks to By country. you over are are all

buying were for to poor control. pretty corrected.Let's union the Fed can't So million $XX beyond a quarter every needs a about We'll that blame be credit talk results But goes was up. after year. good. take you the see tax, control. the results and That federal bank, They time almost we deficit the of the the totally assessment our

how we'd GAAP, to we the I liability and the book the much and past, why Fed time, present they us look the with pay had -- from had not the actually have a how this you want earnings would reported assessment. So right, tell to we Brian? to under today just had we -- both so quarter Different

booked We correct. whole That's million. $XX the

at our if I for We booked $X.X get It $XX And deal court. we're whole amount that's belief think that of assessment.So is cost period today million earnings Without the million. have recall. we be the reported $XX.X it -- time, charge, million. money was to taxes, as with how of that continue Fed a $XX after money up over the law dealing $X,XXX,XXX And much but we tax point time. probably not would by us quarter determined ended of of a of almost some we after because that going will a was court million, had matching the decision million, some that about into lawsuit in in I the is $XX.X which

been have that us that, would year $XXX,XXX,XXX, the at we for So $XXX,XXX,XXX. or at without put

common that around and and assets PXNR a XX.X% so share, the equity would $X.XX without. without Fed $X.XX, nickel, a with $X.XX without. have cost us to beat.Return was would were $X.XX is $X.XX, EPS the the been and Return XX.XX%. tangible And a have a XX.XX% we're $X.XX there, the on with taken assessment So it on and year-to-date, was after. Fed was Fed

been of that ourselves in it was X.XX% point basis we haven't X didn't with to without.Steve X.XX%, assessment we, the the in while. little in We low is for The that that bit our That's margin a a about the more I going borrowing, versus talk XX.XX% margin. with about and a month. little think, created Brian,

of remained fourth pretty quarter, our in So and both flat. X%. continue in the because from good to $XX.XX [ and third actually, kicked fourth ALCI to we're up value stable book pretty third we and assets the at $XX.XX reserve the quarter. our Non-performing much ], quarter earnings the X.XX Tangible in maintain

and at ratios.Leverage to was at quarter capital $XXX.X continues good was money, a XX.X%. was Fourth XX% beat. grow last Revenue quarter, revenue we We're XX.X% and We this And million. were continue to risk-backed making CETX assets we're those So XX.X%. was grow. quarter.

strong like income, we thought So plus almost million on we're expense. up but $XX spread. likewise watching expense. interesting pretty plus was income, $XX of the on good. up on million I interest interest interest I were It's pretty interest up We we're that up were and that

some a down million a of going legacy quarter. at the we've for price hopefully, best an $XX.X million in bought year grew that's million. $XXX.X $XX repurchased $XX.X at for by point of fourth in stop by but In quarters were for the 'XX, full shares a in they to future.Loans And QX, the we million $XXX slow $XX.XX the XXX,XXX were the while. time of Deposits in buyback also down had of we CCFG, $XXX So for million. or grew total quarter, $XX.X X,XXX,XXX at million. price average an total back average grew shares of

I left great a difficult it tough quarter. quarter. just sure lot quarter, Homes We yet. than it, available there terrible a We have next a I told It quarter, should was was of should got. and don't we problems seeing think I shares start be know cost-cutting million in a a embarked I not bigger where are seen and should month as last this was for any on it. after first, I frustrating that. haven't of people got you the month, up not measure. we mean I'm month XX.X repurchase.It show but very quarter, but a,

we'll and if more, environment.Outside back enough, get of Donna, a So I go it's don't tough have didn't some that, we anything. get but really

You what and do to it you have back can it. want do with

Johnny. you, Thank Okay.

from details. with will Stephen hear we Next, operational some Tipton

matching negatively in quarter.We NIM Donna. we in start average. adjusting quarter, cash to have comments. would as which against funding balance by basis in but referenced margin, the to cash repricing late on the mentioned, as his on the improved for NII net the additional X Thanks, NIM in interest When cost some closely carried net I'll was margin excess for QX. reported the side. the down X.XX% the December, the The with at interest monthly impacted X in sheet Jonny calculated the increase points point monitor basis the nearly quarterly continue X.XX%, asset But

The quarter, balances yield increased and quarter, December and at to in liquidity basis, event deposit movement to quarters continue still total to a year QX, Texas the the yield mix for basis million deposit to on the points was was basis with Arkansas to increased costs sources coming of be majority prior particularly deposits remain on loans, income, monthly loans, deposit regions. down discussions year in for of continues X.XX% in remain event consumer. the was strength strong quarter CCFG. Texas prior in It the and points the all to X.X% funding. with basis deposit extremely Total points closing community bank ratio with the be improve full originations, improved rate and of excluding nearly nearly standing coupon competitive. with with on XX.XX%, interest-bearing CDs increased We tangible continues volume Florida to deposits, million X.XX%.Switching XX.X%.With from balances loan just focus points quarter, balances in similar And the under During increasing cost The loan deposit XX.X% approximately XX.X% back X.XX%. regions the our end increased excluding category.Noninterest-bearing amongst focus $XXX great in to risk-based X mentioned balances Donna, On coming ratios the with the in QX. total Alternative line and as while average XX% to continues see to million presidents retention.On customer in loan in an total in offset XX up the a still while total CTFG yield backdrop basis and strong The gathering, capital increase to increased deposits with previously leverage of of QX. an XX at the that, at income, of QX.Closing with billion groups common to X.XX%, Texas of X volume. X.XX%, as ratio by accounted increased balances comprising of total for deposits extremely commitments. deposit you. X/X it XX.X% that only to committees Overall, CD account funding in XX% liabilities. year of broker originations be increased million, half of total growth On ratio loan region with ratio the side, $X.XX all QX, $XXX the in year-end. production their on a $XX in-period million decline production asset capital QX in notably the as company, mentioned, Johnny in $XXX in of loan in increasing with turn the and $XXX the on I'll a equity a picked finished with the core our

now Stephen. the Hester And you, Thank us with provide update. will Kevin lending

XXXX, low in tie with Thanks, happy provide position, which very faced as forward to bow Home, XXXX on good challenges I'm to year. the everyone. we industry Donna, afternoon, new the and able were that begin be at unprecedented to the year of look to and an in X% position combined details past in we, challenging to this strong a year reserve. and asset of nonperforming loans, very solid take loss dues a brings.Our whatever with a on advantage the good loan remains will very that capital quality with I includes moment. Even

the discussed soon. to First, an like have on would that principle last detail the note credits I to closed in at of you very and the have Marina sale we Oklahoma in update par hope on give quarter.We X agreed it

anticipate finalizing afterwards. are payoff the shortly documents We and this occur sale would to at note time

recovery. the asset.Regarding so We on a would which it third a also the small number this property have period office with California, of buyer offer This the we with the think a that and for Poulton short OREO will due property at I a signed a result update. a the Chris diligence property full asset, payoff the in good balance pass Miami buyer with is for to in familiar is an is area,

the subject a foot So Santa XXXX in subject Ocean Monica, is ground building, lease property located a to Avenue California. at office XX,XXX-square

October. in we completed of a quarter, deed lieu foreclosure the in During

property quarter, fourth into transaction the $XXX,XXX bring During over OREO. we costs expensed in to just the

occupied, is space XX% lease buildings operates income the planning our $XX where million, at costs. week. LTV.Building just at just value We're currently As just lease above current part as We putting moving and the just over million. expenses, to was is which carrying just our or building. includes value million to breakeven, office West occupy basis ground of our the from our operating the borrower this appraised other our tax above and is in started that property reduce approximately is $XX XX% over into building to used in The Coast our transaction, this we received $X under insurance

in month. lease prior L.A. Our expires this

that new through on ground extensions rental cleanup third, we're second, first, Our the then building X remaining on the there's our lease; stabilizing office and the areas: been very an the by market loan. located. for property is down media income well and news is building. leases; to XX% this original focus that The preparing it's We've sale.Bad existing in paid good is some news against

I'll have to operate it and We portion a use an income that, is building breakeven current immediate to today.With a for Kevin. space, you, sufficient of the back the turn at

Thanks, Chris.

dues linked-quarter points past XX XXXX which basis Going to basis unchanged is charge-offs back numbers. on flat were average a year XX remain basis of XX/XX/XX linked-quarter ago.Net total basis at were Early-stage and year Nonperforming quality points points. basis to the for of assets down a a X compared at the basis XX loans. on points, asset when

default rates note, low $X all of any borrower further U.S. and for to loans review detailed we significant guarantor and to an overall leverage a interest below growing create very X% would loans geographies. a Southern which strong As This place million noted our taking have an few interest have completed in of lending rate combination with is increase the support, majority XXXX a maturing current over concerns. due of

this a to pushing with continue encouraged you. turn best-in-class that loans I monitor of borrowers' paid hard doing asking average interests I'll it the this and the work, between financial make have, for what we are back footprint it's difference all the for but institution.Donna, and It's take see performing that's and easy with across for to equity and to aligned not needed structure I'd the ours. an bank to that sure the lending but staff will things, risks time.In like the subset be at thank We are to conclusion, we our

go Thank have Q&A, Kevin. Johnny, you you, any before additional comments? we do to

comments any Tracy, today?

the long Well, first close work years. I'd that, quarter story with Mr. all, for XX. It's show could nice books turn on reports. of And they've there's that through seemed an But created.Good things the see as think. our I noninterest entire to XX forward the company in I deposits. look congratulations you I get year I the and there, across Allison, sworn you've expense, It it's hell interesting all 'XX it. a we'll thought this management year. indicated, do and also of team of done think Last as the improvement you've on to and to to that. noninterest continue all have certainly for complement congratulations and room income, of on loans the this to XXXX, bank But just was Johnny? the us

last, I'm I the to margin when Stephen, me, And on now. We think we sure been were certainly thought margins, you that to The you to next important road -- them it I told time, intended to. we've can able try out pretty maintain got maintain asked like looks for And margin. Donna I right that they -- could. just think the we it's

do you think? what So

on of certainly will for. that what 'XX. monthly that We good. pretty It's we those the basis able to continue to previously I be still operated the continue the come think a talked we've over I we're we've prospects Yes, upwards, loans working certainly course I range. tight that think are through of reprice And to or over if maturing a last the mean, in about have quarter two,

pipeline pipeline bit? seeing strong are here or you little the are getting the short, up it fairly a Kevin, remaining seeing easing you So

some in depends it we I areas. No, some opportunities that good the have good but think certainly some folks geography, have on

'XX. in So pretty and feel holding it good there, is about looks I like first quarter

Brian, have 'XX? completed for your you budget

for Board going We're presented it yeah. week. to the meeting Well, this have

or you how And Did raise? you What lower did do do? much you raise?

little Well, a it's down bit.

than Better expectations?

Yeah.

we're are We've said, They down think about about forecasted think down. going to expectations got think. think that? how I be I that to do Donna challenged that. they it be And what next I we better out to not said, be and That's you I asked don't don't what than I said, there. year. I, your

There shot. might some I be think we've got opportunities there. out a

where out looked addressed some one we time when Street deal yesterday. some there point opportunities that at can point some last up.We time at her and Home at ] [ today pick for the going Q&A. and get on maybe If haven't I trying what had in -- out we? sold to back saw I see think, much ready is to We really us months can't You her in to year and the own couple for end.So M&A or in activity anyway, I'm anything hadn't we and think lately, ready. there, have in arranged Donna, down go we of that Texas us, for everybody got out haven't you, we'll really running head -- I'm Donna business to turn it to we Q&A,

ready questions. We're for

the Brett Rabatin [Operator Instructions] Our of first with from question line comes Hovde Group.

Congrats, been Johnny, It's a on years. XX run.

That's Yes. XX. been realize didn't I correct. it's

a first to talk little the about more. Wanted margin

mean NII You about you dynamic manage and would it And like seem or rates, the talked to to how an with Could Fed opportunity growing you you're do margin? outlook year? later about margin fairly I wanted the If the up the have margin. loans, balance does about the could the this trend sheet And it, later might being while so that? and flat able year, to. for get the cut you talk better can this margin an maintain which maybe is feel just

Stephen. this Brett, is

the while tight in tread view repricing this standpoint. that we've traded is to do today a are, where we're from continue we our We couple I have able a we pretty that range we over loan environment we're like in opportunity rate of the of quarters. here last think in, kind said,

talked the book. us or X% X.XX% X that at the which spot year year, end have billion million loan opportunity on to reprice. about of the billion give $X of that was under got over We've we below had mature is our that's we at $XXX December, kind think rate will we over a $X little next the show and last I quarters.I this

on back maybe increase a had seen upward We some have deposit That the monthly we've slowed side. still than bit. we seems basis So pressure in December a have little in to the ability to environment we deposit on a the can think lesser our view to the continue offset have in half reprice side we're of the rate year.So in. that is on this what loans I to that do

I some think $XX billion our in XXXX. view see interest-bearing is think that back us cuts 'XX, is XX-plus the I we've checking some side got at and a do to if point on really what deposit our of done. short We've in we the matures CD opportunity billion. CD gives total book. And percent $X.X that I'm looking book here, about in pair

to these as able even cuts So fine-tune actually that of of be we if we some through, rate come some see materialize. some may

every look revenue it day. is day for every and We generated and at basically We look what watch the that we day, for the it that margin day. at what is

So XX/X here. I we it around live mean,

think we've as not don't about up interest, as expense -- billion revenue opportunities for as there's room repricing to heard up.So interest as I don't think go some Stephen, actually us. to from $X is much much got I So going going you go coming out is

do daily basis a So we'll I have that. been it doing. We'll monitor we continue on think as to

fourth can we little basically bit see, As you the quarter. a in won

said on two did only profitability, was expense beat. some go to some we getting in increase time, side. were to if ways we're at call, fat cost this revenue side it. more.So be. out haven't and And revenue and wanted made I we'll disappointing, to knowledge. we was the the we the committed It's interest committed in point I cut my went The in running that's the didn't over the and just and where that, quarter, third and adjustments it's but we got We went last or do my increase seen and compliments natural control, it back and to we're revenue. effects we The you cost save there.So work happens. we to good and but years, just get to both, to a the enough, appreciate company not to the little about expense it And get expenses yet we cut of back

putting daily out monitor they've run if to a of money.A I of know are Fed, on continue money those we'll it to be about to but can money, these completely from would certainly a trough, ads lot going than gotten that cost, think to they banks person these save adds what I one out of X% is company borrow with in and kind profitability, hell we And of running says those So still to essentially borrow all we're can to you money, banks don't certainly seeing borrowed the it, because we point. a But the less of basis. X% that. somehow. to by -- want deposit We're that the careful try CD

that -- We a up. us margin thought would borrowing, $XXX and little have really suspect, about have I see our would So -- million I did borrowed from been you'll we've

borrowed $XXX BTFP extra program. million. an We

of about getting and million, we're $XXX XX it extra a basis an points. Borrowed spread on

to basis actually up points It's today. XX

points. basis XX

that, that, getting it about that. was that borrowed money get these The thought how but little broke, out are there with I spread feel it the of we save on work, I anyway, and deal, wasn't what feel something intention so the them. a I was doing we Fed. about intention the for. So put then don't program and I don't how of I that know the they we're deal. saved and did Well, banks program ought to were we this the that that to in know

that. X for a the within didn't. for we quarter, that X a basis that the it basis fourth point have would quarter month been in had point, So basis third by juice the our And quarter little lowered the margin point or of

the that So during and actually, quarter. I'm of proud margin was pretty flat,

monitor to that. continue we'll So

lot So it's in but a entailed there's long-winded this margin. managingthe a company to answer,

the about If basis the quarter, will bank, whole we dilutive profitable $XXX have million for points. it will -- but be itself to XX the that be we'll to the margin be

quarter, it about next will be $X Yes, quarter. but margin million to XX%, the by it keep by it increase the all for if we profitability will dilutive

year, helpful. my to sounds increase pipeline to question, number And mid-single It just what If were was for on guys suggests about was continue with to fair you other growth. pencil growth. managed I year, that that it that. be we That's like going And Last my loan back kind appropriate? in a ask borrowing was looked the different around you seem you just growth. some to question have more or the in would a was. of that flattish it could like digit follow-up

this Brett, is Kevin.

I gained still of that's feel some quarter production. at continuing we in least good that last So markets. in in think traction our some I

I as the question more get going is payoffs, even to and into the year. the really we middle think of that's be

probably I than will that lot that single think depend get can I I more but on of bit digits is on, a little something So low mid, think, payoffs. a

markets XX% and seeing they We're we can't of have that get in slow did, different make We're the payoff banks because financed. didn't to with somewhat fact money it we the that blessed loan. stakes

a position loan to So money. we're in

in loan was saw because result come and loan. in a of As quarter to country the not growth had banks the the that, the had fact we that's many money money you to loan where in

we shut and of business roll are will that So a at long there into the for quick time. down. There's relationships, out loaning. there's because recession loans money. with good pretty loan because hopefully, we made a these us, loan came a can't to I loan-to-deposit XXX% not XXX%, mean, lot They'll founders some us relationship just any that here banks many could people be

the from of The Jon comes RBC. next Arfstrom with question line

years, on Congrats Jon. the XX

XX covered Yes, I've years. you only for

the Can on. training first quarter. keep little in have still at a expense you what's it more little it can touched quarter show in or coming? up well, didn't a bit bit you expect? the didn't but I about up the know talk bit Brian we Davis, I but it wheels expectations? hinting on fourth as a You What little So, it show

that there in of November staff this fourth and happened Jon, done reduction most were and with some December. quarter,

every sure to and manager just and support region But every we're everything. -- office of making some stuff, it's show and starting will So up fine-tuning every talked market now. that that's we've type

do improve. to that. have want able been room that still to there's always and always We So to do

think more, first kick should little in will of but there the I more be quarter bit. So a

get said, can you get because And she cost I'm he I I them said, well, the [indiscernible] down. get down yes, sidelines. Tracy, and efficiency girl. had to I told I going said, up the them down on was warming got

Lewis and I'm you was team her game. there the things extremely I didn't ball can't well. sending funny.In pick out down, run Texas, [indiscernible] get some and If the and up were the He there were that in Scott very it think

a you'll or I that So think certainly some see four. branch close actually will of in quarter and first effect that some of the

in the he's of is team cuts. and And some We feel get working we'll ball this And the now we so not getting happened think, so quarter. the I up that, We'll on out that fine-tuning second savings may get that second them. the All see expense doing out till jobs.We quarter, of quarter. that picking didn't management first that, didn't the managers their in see But Happy those we everything. the there just expected.

some second events. closing So in quarter be first some will but of we're branches the the quarter,

So is say couple million. insurance you've I the went million up. $XX group million, mean dollars. a our $XX number. the expenses I number going to million million $XX to That's that.Jon, up didn't of $XX got

going You everything just got everything is up, up. going

in you're great. with reduce 'XX expenses these that things going expenses of control that in the can if would say beyond to So all you our are be 'XX, to hold

Yes.

Okay.

just wanted Okay. on ask I a Fair to credit. question enough.

of kind then on any office emerging should of? call and around. be new were California concerns the or we you quiet for the anything aware But on quarter potential credit, pretty new time the And timeline for last property. anything it dominated resolving just this You Chris, on

that's Kevin. low Jon, were ago. year one. they're any this take from dues, point. what's We're Past any rates, the and through don't Nothing we at last they it's flat there. about. maturing where we've working significant three issues at of said, as below I'll I looked first significance talked those at see a really And quarter

of quarter, So on I more that emphasis there you focus that's last it quarter. was it a and why less was think saw this

now. can take Chris, you that

for it, our value it. I It's office higher if don't And it. say but I would an it's liquidate Jon. think can this we patient elbow think for on it, office. it, best grease I that's Hey, a for little building, I a to be going could use drive one. result we're pretty and the for market I breakeven. tough shareholders need here. and It's a have we put into a this stabilize

view So we my I point that this. the of can value think enhance is of

control and they this a borrower be was to weren't money, they managed little I recoup realized time to think once took get to able not their the going of it. by that well previous it us

it. we some work et have, think, We're do some cetera. I that doing on should leasing, on work Now we

that we right it, get in might owner. buyer. it short-term I long-term the put right position owner a for of not be done and the good Let's but think a We're

three sold two of Jon, out I've of we've been the quiet because them.

And So them. losing on hopefully, money they close [indiscernible]. we

place. them So in And that the because lending, has you got the rule. loan some in They But a a kind of of those a lot of first and done right no you've deteriorated XX/XX job. this, this, no Thank goodness there's like and and you team have they team equity we -- roll values of do times XX% put them. properties XX%. good in like really people value good in times becomes the the want job Brian underwriting.In Kevin, a did to

maintained when have think field, tour It's there's 'XX those years not but may people Home hiccups So some the the some some or to for in hiccups, is Florida there good be made we that's tough substantial a over I going may certainly the underwriting paying 'XX, hiccups. at us.And one deals. not the Keys. be through don't that of It's 'XX off

feels of of we've most we're stuff got, now at the a XX%, because So loan-to-value different XX%. it

having of deals. little XX% So got no deal, a we or XX%, money XX%, instead the in money

some, I be have think -- it think will I we'll So but not a lot.

because So had X. of fact concern pretty I'm of happy that and reason me X we've I the that sold on the pieces was X we quiet property

KBW. comes Our with the Brady of from next question Gailey line

much impact start I feel neutral, we do that curve you see of cuts cuts? amount to an suggests rate guys decent sensitivity a mean, be I but be to margin out, forward rates. rate wanted year. net somewhat this your interest what's plays like of with I the interest to tend your If will margin? to the impact the if rate to there

point, of we've Stephen. I now. today to We're outset think assumptions think past. improvement down been model know kind is see the we don't four view if I call, down rates this budget, at and attack mean, potentially to plus mean, of we'll the or down I in minus our able next X% in today. remember what it and is the throughout margin I little our chose your mean ALCO year. show this if think a kind the of I right, rate short-term at rate a sides or improvement.I margin environment, I model come looking that see as to interest-bearing I both things checking year Brady, some I Brett on year, be the side up in of said cuts the has our

our of work down I a think in that's terms we belief rate as in assumptions, able our improve through scenario. to being

six lots I in cuts, six it's hope correct I politically Brady, that's -- that not a trouble. we're going trouble. But this rate cuts year, motivated to hope behind have it. we if have of sign not we're if a it's rate be in we because

to basis or XX XX% we rate still don't we -- believe early XX a six that not could to cuts in the wouldn't X guy. And basis six in cuts. 'XXs of we that back four But may big late snake. if country 'XXs I come the So us. rate and Volcker I is the pricing of just trouble.So points see me rates rate when reminds we it is hire-for-longer pressure, cuts, points kill have Home. country because trouble, I'm we in understand is rate pretty scary that or hurt to think problems. The I got And the in. major had at of pivoted

think think recession. in I it's -- be, a So I don't hopefully -- end to up long going we

over I all M&A, see know any bank time it. in that at with economic baseline, you've you see is M&A. bank near think, Yes, Do years. you. obviously, the agree has, I unassisted agree term? only Johnny, do cuts last I been My in very traditional on that just KBW you I with M&A, question two our active dethawing bank

Dethawing?

Yeah, like active. becoming more

deals of a I'm bank work. afraid you me, some in just a the expectations some they of the here. Yes. sellers be bought. saw trade. of of the We about talk done. may pretty that, do there really out We just be M&A we like done we've get I'm and know them. I them it hands. probably that can't There to It's that need outside lot good to M&A got and around just I'm won't marks. stronger afraid that trades, But the and -- afraid like trades HomeStreet the sense That's cost make where

told -- the year been get what been to do really just year but our up it we lately nobody we it's million, we have have here and and won't around me it. our because M&A made haven't to involved Davis doing, trying without mean, Brian okay. we've book that's involved been been has done exposure wrap deal, I We would the to would the in we we're have want $XXX Fed -- -- --

So I that's I've but I don't do. question can your good or as know answered as not, if about

Olney comes Matt question with the Stephens. of next line from The

'XX income mentioned the this. versus like market Home you down was you net sounds be with 'XX. in Banc don't agree expectations Johnny, to It for for

to So Home for for made Banc if I'm Johnny curious a what's 'XX, chance, you the targets -- just 'XX? about give want you talk in your

I've budgeted life. scenario. down It's a scenario a never in certainly down my not

growth We time taking had So Board lots be all banks the was in they're when growth hanging and margins lots in really think interest we're is times, going I And strong. broke it's asset growth you against of like I -- I us. in had revenue going not to in the banks where any got all country can't revenue, I'm this wonderful, it are one sitting. opportunity deposits, mean, uninsured -- I where shares we and buying of loans of money, the with the growth we're are in if capital. great we've loan to and a it. they're think for few we advantage like pay -- will can approval, When in going about sitting. to these they depositors.So for revenue, high country, quality all good, and had out vote

built this, this it by have built accident, we've isn't We way.

deal settlement strongest share, of banks it get want fair $XXX of That's a We'll million West Johnny north I'm I is the to but of that without the Texas in north million. I'm a on our bothered be. America. one $XXX That's where number. So us,

Okay.

a doing while surprised I deal appreciate back year. front? looking if if think on that that's drawing funded there get I guys still the didn't about guys and What that at got loan. ultimately energy Well, you growth wouldn't be this and loan done you or to on mentioned Okay. know I you the you an were board?

well. books. on books, going the It's the on It's done. It's it. did We

well. On going books, the

So energy we loan. afraid of got energy not loans. on an We're another opportunity

be think beating the selling rid seen going be like something, is me I to here taking believe time on I'd a going cars I for running to because cars down XX,XXX and electric electric or while. of a get gas say trying long TV the gas guys road, a oil in you've to Hertz for is tells something oil and them. here

and gas. So afraid oil and would do more not we we're oil gas,

Yes.

loan will the did Okay. you dive the properties And reset that a deep remarks be I in then, prepared mentioned in that of I it than lastly, higher CRE think was some just pricing. his Kevin think --

deep or prepared more think just but I mentioned remarks, broad this any segment the dive? region specific a missed or this I Was you any in this.

Kevin. is this Matt,

was interest 'XX, loans and So less maturing $X it think are all an was had it million I in rate that X%. over than

there we looks sure So to rather and of saw pretty like it in any issues. very, want what liquidity was really understand that there's be size to handful And going almost of that great and even any shock sorts quarter that have and ahead really, challenge the when not rate news that had really review, issue, the to none trying a of get matures.So just looked that's of it it gear or project. -- of lot everything good of across things. a we very an board, that just either If make a the to to the the third big know like things could now that lot that going a a low than anything just in is we be strong leverage, there's towards those

underwriting So again, the we feel Johnny past several that is talking that well about years. the like we've done over

a to increase like play still out. this point going it's looking looking rates where several basis you're as when that's comes hundred everything and work think into at in I

I didn't doing know did it. he and he was that,

called said, hey, comfort. next less. he that everything through didn't just XX in gave I is which me find it me Greg. I X% it's matures anything, and hardly went And said, million months the Johnny, $X I just or less, real He think

that, good. Matt, doing us good, should it feel Appreciate that. doing them And you feel appreciate makes make I me So representing investors. to

Sandler. comes Stephen The question of next the from Piper Scouten line with

Would Johnny. ROA, a what a you I'm the know scared when line to release, ROTCE. read of numbers. I looks year, first then be the X.X% I like a and good year the to I looked little supposed at press if is this scared XX% got bad put

result. So good seems a

just think of the top ROE. the I ranked every X, we did X quarter, or Donna ROA, category, quarter, ranked in We and X last --

this anybody. do getting other we kind going of I do. better pay be we're to to It's what we We we're than to So don't We're care, performance. everyone. attention don't performance. than to said, going people's want And better

good. appreciate looked I So we're numbers getting that comment. good performance. The But

want You'll on and or a Brian, him all and go Tracy nap to and Stephen take vacations. just make

peers as you is I whole. in way loan haven't the the we So the this far most of from industry a quarter, of in and of interested strong had. growth mean, I'm lot really so a area lot the guys growth loan seen a much

I it So a not on looks like relative may ton. basis, mean, a lot, X.X%, like but a feel

And wondering then And it. if so earlier color, of I'm on. going to how just additional you're might kind or any sustainable coming dispersion from this or able there's and Brett's that's question of back geographic where to Kevin, be any segments that's land you kind getting think if any maybe you

Kevin. This is

because the so moving Florida those are you certainly, still poised geographically, Florida particularly got Southern that and got part. you two to Texas to geographies So and people who many provide

helpful. banks or think Johnny you've Do and they think continue? So have any ability a and it's because can. who the think have loan. It liquidity Do earlier, choice it -- that's lot can got I to always mentioned I of certainly don't either by it back pulled I

have some put -- So to to a that because much going is still in. have don't well.We're to to issue still that it where we're that bodes people fight deals so having rates the challenge work much rate just you at equity get these to

in still to feels have So a like a competitive that's challenge, that. here it break from a we but little a bit the ability do standpoint, of there's --

That's get are what So into. a that can the from still and to get standpoint yield want we're we the get we points opportunities. to what there leverage working degree we want,

with used an a saying a the the into do in Arkansas, some too.Some getting banks he all? that That's I to Johnny I customer his Northeast customer, them have that at. it's referrals know. referring we're us opportunities old it customer. something changed getting other don't we're getting. is Will and that just look keeping -- for to and just got that seeing introduced we of our that they're getting shaking we're We help done just opportunities, Texas, mean, calling or our from when -- good to on hello. we're But opportunities different coming back down fashion customers, in Arkansas we've that hand could great turned In example, I several was to add, a relationships lot he visiting if Stephen, made someone of has us. here referrals them

you plus. a exactly your just thing right the reputation transactions you to trouble just XX% referral and he's because And what's know aces, in said, the continue I able me kind And it's you XX% deal XX% had referral sometimes them it to see in traces crossing and not say. cost? as was, banks and to flushes, came the that's guy XX% the of coming when come his now. plus point.So figured referral he do what of with keep said crisis country his That's -- in and the opportunity It's you're and to a that's we what bank's at And -- are. we're going it's in want looked to of bank's His right. that company, we'll trouble thing That's you have you and right right money. dotting was. point. have a plus we do you we've price doing building said people to everything like Hopefully, a see guy you, and seen, I the your going your got be you to good to are across Ts Is to what and the trouble the a to do because

We in have some future. think, do the the at to those opportunity reasonable transactions, I of some rate

at And Florida company-wide great I it meet had We credit. me and deal So opened come guy, in was Kevin and resort, his customers a down credit, it. did million and referral was and one his of our this great big guy. with $XX

problem Just why I'm got money, you're banker." loan to of He it, to availability one this having "Guys, do need the got the said, we seeing talk because anyway, led to my another done. the growth. and to because another. So strength He we said, "You that's getting

from know And or customers great. of -- mean, those new there sort yield on And that of number, that what but seeing? loan average you much how new yields, you're the it's on you that's have I pushback if XX% quarter, yields is Yes, mentioned I point. whether -- customers? in average what's plus renewals don't kind a what

The coupon new I on was in X.XX%, Stephen. originations it's QX believe. Stephen,

But every have primes, we've So there's improve in think, this and largely, on as just of quarter able a some year. terms mentioned, may some mix Kevin to right? been of tens some color that, Johnny pushback. I

day, guys the why all out situation mean, the to Well, obviously, there's I comment in earlier get because made remarks mean, is, yes, try our I every they it. that of pushback can every fight that's loan, part every I of and

of working there's to So do the that and here I do and got obviously very you've And part it's of that, we one Home. pushback. things just mean important. it's at

next question from the of Our James. Rose line with Michael comes Raymond

too Did we on and question, if must be if lose to there. on move Michael? Operator, He there's he's another Michael. excited. just come we'll back let's See back

Certainly.

Our Martin next question Brian with will come the Janney. line from of

Congrats, XX great Johnny, on years.

Just me. for a couple

mentioned the X little fee I -- the Tracy quarters lower, side, upside. for somebody think maybe mentioned it last a on and looks some that opportunity think income Just I like been there earlier, bit have there's

kind some puts to where kind of level go takes or there's you a of current where be of into wondering could there? kind as of run about the kind rate and Just there just year, the next or think opportunity

That's opportunity interesting handling a right certainly in people the really the that The that, has mortgage rate interest Keith there's does we been place. of good year. making improvement. think We business operation of right that. the do. fine over tuning, increases we And job got Yes, the sure runs with

out lot fortunate our think trying we fee today. figure very, not we're that could and in income, of to of type just hopefully comes But there a pick the on but Trust So, things really little with identify taking out I the If think account Kevin we've the we whole with -- on have We've non-interest a been the his have stuff opportunity C. better.We're we're service very I was opportunity expense be industries, that back. done the year really, Orr our category every out way done job nice think as and lot Trust of that and that team been analyzed Keith has pickup the on Texas good There's that, We've some also a what out. Star grow not, a our that there. there. got a business, and opportunity to up some non-interest improve of in I again, staff there. Gold together and to just continue at look all thought can It's we've of probably would be and we smooth to that a can go with joining room back accounts.

So little today. in item it's that's always line the but been a our a player field in past,

may I gave I'm Gold value Star that organization with I progressed. was they when just -- no how pretty pleased sweet pretty a it the little saying and transaction That's we I because -- did we Trust all but job. him didn't do is on they have pleased a sometime, tell what good I'm calls it one pretty really it, We with of you understand these that. conference he does.

him have sometimes. to and good explain he be does join it'd what think I

little down investments have a Yes. bit. the Maybe equity been just

that as I presume far that's come So another guess as lumpy would in. when that area, would more volatile that's I when

with I their investment million. particular And income $X.X But income mean, unfortunately, that, investments equity balance. we $XXX,XXX had I we've you, the honest for QX. booked in Yes. say to about is capital equity a when for this couple that quarter, down in about had a be decline of

And income income the line so, loss reduction in which our sitting we on a million, item took the other is in of $X.X statement.

million in QX to QX. about $X.X it's So swing

Yes.

just should some from given XQ an the not on to you I Okay. XQ expenses you on we like said reduction that And maybe expenses, but per at expect as look se absolute think think Johnny, then a in way it, level better basis about further to now initiatives it's year about but stable you're better is the to to for it the think it a got, full maybe along? holding of until full you've a year

This it's continuing. inflation over is not and

-- the expense it So, seeing go we're is up.

they're should don't head, get again. we'll do. So, the this inflation I get $XX out, and if million. go it our a what to not, that -- to ones And to own lowers some to to us. that. got that be cut million to the going think we'll We if We them. back of think some But got I have cut up we benefit but we benefits, can we for of responsibility can corporation profitable if then expenses its $XX do we got work shareholders We if

need what it So we're going we'll to do we takes, do. to do there. Whatever

hopefully, a and it little to it. these said, comes up but the of the now, I out -- the reduction see the that end won't you what get So right compare what because, like is and all quarter expense different we'll year, are expenses we'll insurance, all of for see the

it's higher quarter -- little first bit seasonally be And typically Okay. a should anyhow. impacted, it's

a seems bit savings fourth quarter XQ as the it the anyhow. of though some and would XQ and than second, third these be given next little probably timing seasonality lower in So it's

And on then maybe the the just last of Okay. timing borrowing program.

timing when and to was, as kind it mean, margin, interest implemented the XQ? was what, in Just borrowing I run of what impact impact net income I was the the maybe of for earlier point I guess, but a quarter. the what and just dollars it you far of through basis timing-wise, said the as back missed and timing

That didn't -- mid-month we until December. start was of about about

you're start borrowing about XX so start we program, seeing about We didn't times. XX Let -- or -- XX, it is about four about days. three me days what talked the of

It's opportunity didn't just spread. that. came it. to the have an We need We didn't to have

had balance been in and missed as in because put Fed of time [indiscernible] And the largest the buyer of corporation. this this buyers equity you country We would last time, multitudes would banks. even Had we sheet not in, program have the the have and our were know, bigger of we the borrowing you failed strength the

and right with back to our money the banks, they missed pay to do. we probably profitable opportunity again, us, come then the free that thing probably fair was share. So the because in we Fed came do. which was against right That thing And

them. -- was that of period over think thing We'll see it do a I So I the was think right to time.

spread program the you spread the how getting basis borrowings? points, on, And the total much that on Okay. you're said XX borrowings were that

$XXX million.

$XXX took a million already $XXX And back, borrowing. out at that kind we were paying we're special money we reborrowed million kind the to keep of book. We trying $XXX check had got it. did we we about million. in as outstanding But our December $XXX We've when in of today, million and

and So the million $XXX that's it's points. basis whole XX

Okay. impacting And be? would value that

impact might we business certainly And I feel mean we banks but -- about that of now, good been they see hadn't do this it would we bad us have don't XXX brought today. to about a or if I is if day. $XX,XXX didn't opportunity the it, on, I would us about program -- know have doing doing you out have

probably see wolf XXX will out I'm bad around would would So on business the be they today. bunch of you of out business. of them, business. of banks If runs big out show the they'd to going banks be the up, tell space got a

committee so something I XX meeting XX some borrowing only our we thought, XX thought of I okay, out and executive own at and and first it.So XX. So said, get in group now money let's borrow we're and

a it's margin. income little It for the hurt us. does So nice piece

next quarter will see be if in we it So but the leave it XX be will about quarter, margin, money. Brian entire our said you points, basis it more when

you the into quarter. basis next understand you'll for can adjust points XX margin So

do million basis a But question you dilution margin? extra to I XX guess real want have the an your is, to $X point

real it's money. mean I

Right. the that? And on of expect do timing you or the kind it? guys for right debate that or now is keep to that Is plan up

attractive a point drop in I funds very guess passed the quarter, sudden, it just doesn't do spread what we then have margin, of happens basis really because funds had it we look all it. to with the Fed If the probably on opportunities rate. a and rate on earlier Fed the that XX depends they on some

you. Got

the NII able the of to kind your that into And do just or the this I with you to baked outlook? of margin grow me, Is be as year-over-year? benefit sensitivity far expectations, remind the Okay. expect outlook outlook with here growth and mean, as mean, the just I on dollars

Yes.

on little NII to there. hold the goal. the can certainly a see even where about if it's I And able and I -- in in growth, think environment, that's able outlook we to talked margin we're this at, the sheet we we're thoughts mean increase follows. loan balance I think,

questions this There are time. at no the in additional queue

turn I remarks. call now Mr. like would closing to Allison for over to back the So

patience for Thank time with extremely year. us. your you trying a It's stressful. year was and been Last

the Home when and out all most us. it. through the it electronic broke transfer and stressful of hours year actually in career my banks came deposits you stressful rates, banking at was see going But running think all for I of XX high very

one how through.You good and happen, year. year, see say Scouten -- we it great a you was happened see heard to well Stephen it was very for Well, that can of set it came You is what that we up it way.

have and very your something So buy add you your time I And Thank worth for we'll we hopefully, support. we'll appreciate a good what to support. already to your and the have. 'XX, much maybe money

today's participation. call. your Thank concludes conference This for you

You may now your disconnect lines.