BankUnited (BKU) 17 Apr 242024 Q1 Earnings call transcript

Good day, and thank you for standing by. Welcome to BankUnited's First Quarter 2024 Earnings Conference Call. [Operator Instructions]. Please note that today's conference is being recorded.

I will now hand the conference over to your speaker host, Susan Greenfield, Corporate Secretary. ahead. go Please

Good today Olivia. call. thank for you Thank our morning, first us on conference quarter joining you, and XXXX results

On our are and the Operating Officer. Tom morning our Chief call President Chairman, Cornish, Raj our CEO; Financial Chief Singh, Lunak, Officer; and Leslie this

to, regarded Before I'd that views operations, to the Litigation Securities achieved. company's should uncertainties Reform risks remind those the growth services of XXXX like other everyone impacted may current this call plans, outside among Private we forward-looking of statements respect the the the as the start, future reflect relating circumstances the contemplated with company's to contain the by events as by subject within or to future external financial this impacting Any of statements including that call of be the things, subsidiaries current forward-looking meaning are and and inclusion forward-looking performance company The including, will company's limitation, or financial results, and this company a events historical plans, adverse are liquidity, that strategy financial various condition, representation estimates statements control, information as performance. and such expectations. prospects, made estimates on company expectations the by based without and during direct industry. on the assumptions, and Act its forward-looking business not Such financial company's be the

otherwise. factors of factors by obligation results statement whether in Form be which turn or as materially Information forward-looking XX, new those The Raj. actual developments as on at found information, exhaustive. report of not the call to to update are annual subsequent the forward-looking on SEC's A for statements. important the to year from not any XX-K the a and With company can on publicly number company's does These construed indicated X-K, cause that, differ XXXX, current undertake should report or or over could Form any to ended result these review factors XX-Q like December website, report www.sec.gov. Form be any the on quarterly available I'd future

us. everyone. We the into Welcome, announced I EPS Thanks a this an Susan. quickly net $XX checked for was per of XX% share, joining day ]. you, million. yesterday, We'll -- morning jump [ at Thank before numbers. income of think consensus I a $X.XX

to there's $X.X about of assessment. only happy additional much it's numbers clean There's out. where include -- that, this noise numbers. quarter. pretty X do point So item we These which than not FDIC out, a set is pretty the numbers Other came special the on in million

deposits very million. deposit accrue highlights that a part nicely $XXX grew this of -- it DDA. The large for about quarter not was number non-broker $XXX again, we was the growth DDA, just are of and But million

DDA to total back up our to So is deposits now XX%.

to [indiscernible] have we funding, done we quarters, down wholesale previous which is in pay continue this As down quarter. the

have deposits the total I by we last advances down by billion, paid look grown FHLB last XX billion. March since year, back of So months if $X.X our and $X.X

since quarter fact, of year the In last last but the in now advances just not all at X in like to first think their way lowest I level, FHLB years the going are 'XX. it's back

funding we much improved have mix. and balance very we're So happy the the sheet about how

-- all to important deposits the is end deposits. at excuse pretty Cost came out points, the quarter up XX the or the much that of we of we or the note deposits The same looking quarter quarter the at on cost [indiscernible], last the most during of that average flattened thing but of is quarter basis was months, me. beginning cost think X.X here the at at over of have now of was cost back number. the the deposits in The for X

had of stability, but we looks margin. like bit out. a of but And it pretty cliff earlier, inflection that in we is important this little actually thought good a this thing happened couple deposits would big into news that second XD We to on weeks, it's So we're a obviously despite been occurred even about this pretty have it happy it's quarter, point happen that. cost quarter. quarter, that achieving a And point means that achieved which for only the

growth, always negative. for residential of production. like that growth we As this $XXX our of in we want for the loan we Production a payoffs declining, did loan keep rest dropped year. reason, trend loans, in on balance the utilization bit been projected, declined have sort exactly continue slowest to come that was again continuing commercial reposition sheet we And to this on they is left of by and where terms the some were the side, that line unexpected in did growth some that but have had little million,

at quarter the came ]. for out [ margin X.XX% The

we quarter, were margin it This somewhat will in would. told basis X.XX% maybe be of last thought [ we that stable, think came at down a points. you I had ]. much pretty couple We where

are almost assets charge-offs Credit nothing. loans are are down, to down, nonperforming Nonperforming looks down good.

points. This quarter, X charge-offs at basis came

million. annualized quarter. was are NPAs down year, They're at million X I $XXX basis $XXX points. from last last think

SBA XX of That's So basis December. to just guaranteed from ratio basis a down excluding is couple NPL points. improvement point loans,

book strong. is value hedge built is Capital Liquidity value, up. book strong, all

side this, and DDA talk -- and both So on pretty will about on more the the the deposit how happy and side. pretty And quarter pipelines up. especially loan decent, shaped about are but the also Tom

in guidance put this these with together, January. together, So time months, very around, to you to as this happen you would But the that plans put have fairly year of environment. of next would late we're is what when do tracking give And that can and far, course to what happy. those coming so you expect we terms we I the the guidance, easy over close not in numbers in thought guidance I'm there a which off say often, often, we will quickly. to XX very And so here up volatile is in go

in So margin you will in guidance, January told no the it we Whatever grow terms Deposits of Loans, grow. stays, changes. quarters. should over will resi, of X but course keep declining. next not

you change So the guidance it. we've in no all given stays,

And what here. else

he Let Leslie. on over a and can more little numbers details into to before me the turn get the it Tom,

Thanks, Raj. Great. Okay.

So first, we'll start off deposits. on

million. grew by quarter. the $XXX As for Raj grew million, by by grew $XXX total Nonbrokered $XXX million mentioned, and deposits NIDDA

this we're was I in that's got mean number. growing big the We number. the about business all all even was looking lines number particularly it feel business. like So geographies quarter, NIDDA is exciting how operating like beyond a company. very XXX of where we've across what at core excited came and from the about within based And it broadly and obviously, great momentum

terms was this, is no it piece which or business So numbers and X team kind in see. were really there any of really, X client of dramatically. every to to drove enormous It everywhere, good contributed of that

good number new on over were and the coming such As that of business terms quarter perspective really a pipeline proposals, there, really management deposit quarter, look a to is the good number next off particularly side treasury Raj and going near-term in from strong deals of quarter deposits we $X that acceptances, the pleased billion see in this out things the of nature. indicators of into leading of mentioned,

So we felt really good about that.

DDA this I that third want quarter's interject, growth was, about to make I X the Tom, happen quarter. in the of point may it did if month

than March it quarter forward. in What this should the didn't benefit more means that in benefit happened as months. X our it So it first as really margin going much is

point. So detailed just a

loan down $XXX loans down C&I of with resi $XXX $XXX total overall in the million. CRE side, were On quarter-over-quarter a million and segments million down

really to of certain actually originally with ended As in number what Raj high paydowns It We and I line in expectations is the say, the segments, quarter. was expected that what an mentioned, impacting quarter line good unusually we see. more have, than up for production did were. would really was

corporate we the quarters. robust as third look second, the into pipelines the are all business into core forward small the As particularly commercial fourth and C&I of come we really banking, year, in and segments, rest of banking

for continue good loan we feel to about overall year. the growth So

Since, [indiscernible] the modestly. a CRE. kind for businesses business of supplemental we warehouse, they uptick also would to Other detailed I know down that's to say a forward, performed Mortgage as have this some provided bit everybody. Refer slides deck great equipment, of few an spend were as look municipal obviously, the on where a expected. good. we've we overall, disclosure. look you finance minutes Franchise very I pipelines interest we But quarter.

In capital total capital total our CRE past, book So talked XX% percentage view, our overall, the of it's risk-based risk-based XXX%. as we've the modest. total to CRE in of in as exposure a is is loans.

Just XXX%. you $XXX call as the in average portfolio and total a data, billion look range, comparison, at the accretive XX% to total capital if for billion is report for $XX the banks the risk-based XX/XX/XX of

you I our everyone UPB I'd is than the core below always been compare fit total of less So modest that of out has think, group loan into the kind when us well And comparison, we CRE. relatively to also is peer predominantly. the where market we're, in a book from within construction would normally point and XX%

data points and March the its ratio guaranteed of as are loans on average Nonperforming CRE rate. debt CRE the XX, the weighted in next loans portfolio about was than coverage the XX fixed the service of SBA matures other in of XX the X.XX%. you LTV average XX% at If some look the and About in CRE XX% portion months, X% of weighted portfolio in negligible. months the matures the portfolio was

I to office a bit. little So for turn to want

of so would about portfolio I all have front of of in of billion a made office them of we $XXX total So medical billion. It's office, that, have traditional $X.X office million $X.X me. [indiscernible]. up is about be

How much do have? you

follow we a market loan mostly individual by basis. on X And each segment quarterly by

portfolio March debt with of . service weighted XX. look you entire average geography portfolio. X.X% weighted on So the There's at breakdowns in office of office coverage that the deck The can the we're supplemental was by LTV XX%, at very was portfolio ratio familiar the average

$XX is only loan million. largest Our

the of majority substantially between Florida, in suburban. average be where majority is Our about in demand to $XX them million, office generally of of the vast demographics portfolio. book favorable range [indiscernible] is is the the to portfolio the all and of the XX% portfolio continue loan Florida actually the is

geographic XX-month that XX within of Our Manhattan, by overall Tri-State office are breakdown property There book, them of much to actually exposure roll loans, portfolio, of call further on that tower again, and months would towers very office Florida. have in XX% about small give to the York XX% rest New I . With Manhattan, not office central at lease suburban business XX that are the kind all modest, the we in is charts a again maybe difference, in and million Slide occupancy a about you respect $XXX is XX will buildings, of the in some district downtown about XX that. type over over portion of next the portfolio roll X%. Rent is XX%. of substantially

We have and pointing what increases of that a you I issues out kind bit by like to of criticized have seen couple loans. see office give of expected of classified some situations. a maybe a sense thought look those little in I'd we

the these allows Miami occupancy we generally in are payments. it's they months you a see classified get we an our into this transition, high when where new that the where a So today tenants categories. for fit loans to that that is demand office couple One, what of as and office came unfortunately, and large X into X lease actual building category, tenant and ago, XX%. to or of credit demand have loan in XX buildings months criticized area But largest at happens fit generally, tenant lease a is suburban undergoing in concessionary X look days

building the So period cut you of economic actual the a the time where XX%, less. the occupancy but is far is have of occupancy

service maturity when could start. of who lease that XX calendar. will coverage know cash lease is, payments We once payments, know but we lease until normally on -- like kind those be tenant -- the count flow after it's it a lease regardless to payments. we start government, which don't until look debt it we do when what U.S. in will start, have the paid commencement days on place the So payments of of the is the the have forma the a We pro

that like where the kind you in you is be stage would XX% buildings tenants. range, policy see this new market, in that properties where that loans several being have of have also pro have have of well are kind occupancy activity suburban kind you situations the in transitionary there the where whatnot. stage we market of loan So going of everyone And we is in formas where Florida and sort guidelines, vacancies, lease-up they're that you on we and in some really market. this particularly subdivided past seeing have up where with But transition and in the lease but have above are

then takes to the you vacant might time goes So XX,XXX and through kind square work a you have and to of foot have lease just it that subdivide property, this.

They're kind work their book They information them. did making transition equity of it, just dimension in be thought be are owners office have. asset of general, and assets, But understanding I these that the we time want I into significant they're have in as handful in of for that we think would In situations putting through lease a money of phase. provide think period properties. we'll this the a for investments of bit sort the anecdotal a I the little we helpful of you to supporting

that, it over Leslie. So With hopefully, was turn I'll that helpful. to

Tom. Thanks,

loans for As really That's to resi $X.XX at up including is are The higher Raj yield income was compared X.XX%. transition rates quarter per portfolio on said, quarter $XX X.XX% net last from this million [indiscernible] quarter. production as to or paying The loans, down. new lower-yielding just margin on [indiscernible] share. the coming was was loans

from for really This retrospective we on accounting The a by is Raj artificially yield guess, fourth sense in as the appears basis high. that to term, up this mentioned, probably fourth run X.XX%. was to the seeing [indiscernible]. rate. I was better a that now adjustments from securities of did XX yield, quarter better made cost decrease points deposits What The you're of X.XX% quarter driven of lack stabilizing. booked be And

really that's going margin the forward. good So news for

those FHLB The down [indiscernible] we are average quarter paying cost was higher to as advances. last advances of rate down

you expect to I'm the Our NIM low for guidance, anything again what matter. moved our our to balance sheet. NIM it sheet we What's to and of in going the our and on balance to moved no transforming compared margin basis 'XX we drive to and full to same sheet the assumptions is that questions, we ran the guidance point. more do in And answer 'XX, in expand doesn't It to number to much transition it this do might to X might XXXX, by really with the going Fed on a your QX continue and way. in a point. margin the cuts in that, just is the scenario think year do. was doing based that trying success by continued to we're success both sides, remixing the or on And than balance not fact, remind

and reserves Provision quarter in to loans basis the loans to to was of ACL portfolio. X points from this drivers XX provision [indiscernible]. an and ratio increased increase that million. related $XX the ACL. in reserves, ratio the basis and office of big XX provision of a this was the in the ACL The the increase The increased qualitative nonperforming to to biggest The quarter's lot points

on the in the on a offset that chart the you XX was changes driver that And reserve waterfall I C&I, were The and by use unique ACL. have partially term, of migration talking of deck commercial and the CRE, all and economic because see I'm the and franchise can in gives finance Slide portfolio, rating risk Pinnacle Another you warehouse kind all mortgage those when risk equipment profiles. about not forecast. those in improvements a finance,

was that [indiscernible] fact X.XX that the we was But number. the prompted of XX, commercial that [ really and some migration spoke reserve qualitative March in build Tom March to there, earlier. The not as was and ] risk portfolio at have XX. by office this rating they're reserve So on at seen most

now would total loss Xx rate. right CRE also reserve I our point our is historical that out lifetime about

there. So reserve pretty generous

in comment quarter. here. Noninterest not quarter. this income $X.X additional residual assessment losses we expense, of $X.X in special and about quarter residual this FDIC much had on equipment to [indiscernible] to million lease on And million $X.X compared last gains million

I changed. over the hasn't guidance our closing then any going in caused The line. was questions. can it comments, discrete of this ETR but and that item, your we a a Raj that because that, With forward swing around So will for little fee X high to quarter turn take

about looking optimistically. X happy this We're -- as rest everything clean with have is hoped forward we very for of a the as could days quarter ago, where and very year the good and landed to

So will take now. we Q&A

[Operator first Gerlinger of with Citi. the Instructions] Benjamin from question Our coming line

Are because but to it amount of -- then circle. I'm good, sounds a you I more increase I you overlay. much, just through and associated then also through so point of but losses? accounting? expecting CECL know I'm is bit the terms are dynamics reserve think trying It X about like we can circles the like that. was trying sound just kind lot increase talked curious, kind that also the square those just in things the thinking provision Or things hate good, did healthy you reserve? of [indiscernible] with just did the But the then the I the helpful. I is And but of just to too square talk to you really, increase? really quite there's office qualitative a CRE a

Sure.

the did be what think we is to reserve. I why there. expect just assumptions challenging, property that us and we some have? going to losses on I'm if kidding increased commercial current have impact [indiscernible] CRE manageable. reserve -- just [indiscernible] they're rating we But come our going not risk particularly to might migration recognize -- and for guys what have us it more office with don't increase also that as think any around did qualitative it's been environment, a cap to lot You in then, we up And seen No, rates broad asking that some us very of made the the portfolio I we expect indicate that so prudent to kind than forecast around we

sort was risk I that lost So we portfolio, -- right think are content a that in hope but we're lot seeing of challenging, we that do the some about it. this how we do recognize thought is and of helps. environment I not the expecting

the loan to does to an trading risk comment in what about do. that. We are going as of a customer to for games the does whatever conservative. try don't borrower -- X want honesty or We not risk you is rating loans, middle not it to We determined migration. try not eventual risk does We a our thing risk do or intellectual be very by goes determine rating performance overly general call they're not eventual a overly does are performance play down pack, ratings the I We call because to it. or the say risk see to we try ever don't way that into seriously. we add conservative the take the

or your what that it's credibility with if play with is loan you regulators lose think of you along way. what you games just you. the investors rating have Risk whether or that, stakeholders, try And

straight when aspect the path be a call long to important and I And down and build company credibility running ratings. ratings risk we that's very down risk risk we we try see will a it think of out, we the So as term. having up, on in

we country. will risk how out health them ratings, head point we not a fact our we've industry like saw the you call saw the had that to stretch the risky risk we lot downgraded called biggest crisis I and that COVID and our do the peers in more we during of our and situation given early because also, that can the of not risk

qualitatively about So And was office risk -- comment today -- just also we're and few it a ago. is a than in reserving we're that. calling but reserving out, there it months for obviously more

a Raj's think follow-up I about And to comment COVID.

downgraded We loans. our All never increased loss saw content any the in [indiscernible]. of And that, reserves. we we've

I of I Got kind appreciate guys for you. And kind in know you pivot Yes, one. that's some color. I just of it. helpful growth. here can the baking that next are

ending I year-over-year. think loan for balances you said higher

growth it might curious really sheet kind asset this cadence of the from the of into PP&R going Because balance mix seems Just like. like driver on of trying be what I'm on come the that really side the where to of back point, it to from? is the is

down trying just the a like touching rail, margin third it are of minimis know kind but de kind for growth and you margin if narrow considering that I'm of just might So get cuts your of sense based where your be to your could I kind outlook? party exit rate of on pricing, curious the

Yes. -- the we say last from year. to guidance That's told in to of you quarter. the end we we not Xs unchanged be that you told is margin expect similar would high by -- quarter, the what I last what the

We at last over X quarters. you've amortize the down expect about the continue resi to seen pace portfolio the to

another for year, million or $XXX so. probably So -- the

CRE, portfolio, the but We that growth we primarily come to market from double-digit segment. our expect C&I, growth some C&I, expect core primarily maybe commercial and middle in

market to which [indiscernible]. the Pinnacle probably [indiscernible], continue dynamics small, grow. but for probably will will down. being, Pinnacle that's probably Bridge the and in very not will given that time getting Bridge wind So pricing are now

Our from Sandler. Piper [indiscernible] next question coming

to there's I you here mean, dividend continues wondering the the was thoughts updates up capital I share one, this guys repurchase, guess curious, any your took I was around on I if build. quarter.

might you You've do these been building the apt at reserves be to like levels, a more buyback. that seems

wonder any just So updated thoughts there? I

do at We it Board an to meetings. continue update. each not of talk is our There about Yes.

meeting, we a I'm board have May will the yet. expecting again a but conversation, buyback not in So

are sheet. our We mix changing our of balance

resi a low So replacing talking assets about keep with we assets risk-weighted risk-weighted are risk-related mind, perspective, assets C&I. and like in from higher taking them down

yes, does as a up, of mix ratio of much up build will TCE doesn't because up, which but assets, to capital build the necessarily or improve force margin. So is of SEKX build capital quite but change

So we -- we when will buyback had the Board the February -- took we action in dividend. back talked the on about

about talk if half in but to May, be will of We of in the discussion, in think I don't probably front I it take get will May. that look year in I want when second and more we'll at buyback is it a it's is probably doubt harder the if this.

take kind points, That's X right, weighting where kind more down? basis helpful, scenario chart, just you and if number I And up that forecast? about reading Or thinking that loss down of waterfall the kind economic economic the of on I I'm -- made some reserve, But was our component Okay. of to was look obviously, Rush. -- dynamics that around the curious going there that of at loan that really am then adjustments -- see that I incrementally guys went protected. forecast what's the and

the months at it just is forecast that ago. is was of than better Most X

Okay.

scenarios? change no the guys to to various So you the waiting way are

we're really, that quarter, just forecasts. better tweak but seeing every We

model so else in loss [indiscernible] Nothing coming results down. And the are .

year? pipelines know the you there? or contributing well. pretty progress you've great noninterest-bearing as on to can do I and be on how like sounds hard the it's of momentum positive And particular, the much just you Dallas, there? think the side the of treasury predict for good of in seen, the what through me. not deposit, may said, maybe Kind it. then an And full that to momentum Got curious then update were thing kind may what Obviously, sort Tom last on

It's Dallas to for too anything to contribute meaningful. early

of these number. to There is really So it's small but total numbers But Tom? there, because debt. the not obviously growth some are compared

us. would the Dallas. hires Dallas. in in, We the this this at teams yet. good frame was major we any in really corporate in It good -- Atlanta. made look some say teams When we're that early quarter was added hiring I space is added for for a kick results Yes. banking time in last to particularly key markets the the We in to We too

numbers million more are We coming activity, $XXX good that's you of but see the predominantly in, that build that across business NIDDA really of and lines growth, the geographies seeing driving existing business. in not was good pipeline existing

it. think based on general can what . progress guess, that message? I pipeline, in Got seeing the And the is continue you're

Yes.

Fantastic. all on the progress. Congrats

Shaw the coming And from question line Barclays. next our Jared of with

just deposits Maybe the following up on and funding.

of by average trends account at basis an the money -- With say new offset existing on are that I the like from you the do average guess, seeing in remix or sort bottom would customers on we're customers one, DDA, DDAs also seeing you Or continued here? bringing feel in? you

say. hard little a It's to

happening there seeing, net older bleed is some is you're million relationships, think I the which on $XXX still is growth. or what so

to door. -- with kind new that running some trying to in that not still coming of are there's are it is of . front the trying think happening, -- I we So out we but business we're

leaky it's bit think I So bucket. of still little a a

if think asking think what I I that's still that yes, -- you're about there's happening. of but some

like this also business up still based what the on momentum is closed -- but bucket quarter, yet, think You we but bucket new on of based what's the lot but think business. on the phenomena a haven't And leaky do with filling was pipeline. true, you in wonder I I you woken have

decline rate we should deposits? deposit Okay. having retain on remix start do gradual don't not even And much as of get interest-bearing of the then see to here, a up cuts, beta, or we you from peak pay in that expect to market those seen to think if we've DDAs some to either

from far at Feb, looked the so DDA complete column, -- I usually, been book the like hope Jan, and the got what cost And every report right look we're seeing March in funds certainly stable. change is to or numbers looking before. seeing least at I the April, It's pretty basically night into of cost deposit it's I in flat. funds of morning stability are stability. see total to the nice or which absolutely

looks we declining it yes, certainly, keeps the reached like have the -- When we stable. will point, building that. we that So inflection up declining it's will as well. But are it would DDA yes, start Feb it moving the start if way thinking without

Okay. on me And office finally for the side. then

is rate concessions tenants. levels tenants I confidence pace have of having of what concessions you landlords? some about X talked you you the to new pipeline Is noticing rent are part to just that that attract new those expected those And landlords into Have occupancy of insight You been then the increase or temporary. lower it. either get the the some -- to for gives the guess

would say has period I the of I in markets think X expanded. Yes. don't concessionary most we're the things. that in,

better that. not Now in markets, changes Francisco underlying in San sure And kind what's growth major Chicago, the of if The or true. generally, you're period in that's confidence in But happening comes I'm time. of any sort of a the really market. XX-month we're seeing seeing you're from of demographics

if just migration, in through mean, Tampa, activity amount exposure, -- at Lauderdale underlying and the markets we business that. come at mean whatnot Fort the out virtually start-ups inflow Florida. Beach look demographics throughout strong of -- Florida, So the if market being have in new you that companies really example, business I you that to Palm significant look like where and expansions office the spread migration seeing a of I in you're in and new Miami for is done are from every there's good. market [indiscernible] and it's lease-up

to see confidence very, these of very just seeing professional, you that that business all requires gives and buildings across you're at strong of as within lot growth what population Florida. technology-oriented, a segments looking services-oriented, and that's industry are you're growth those So

the roll would the next XX I Manhattan, is in in point X%. in And also over out particular, months only rent

comes had new we in country they journal, the return you look, think office was even in there New yesterday, of City job a New a into growth said And York Yes. while and I I to buildings led is X.X% those creating have that if I number they environment, the mean in in tech new don't report lot recent the a York, buildings. tech-related the jobs. think,

markets business to that that seeing in, us activity. the will we're leasing confidence I So are lead think, reasonable we're giving activity that generally

Tom The single him, say, sitting has we've it other portfolio. would it the but of front with every jokingly, I in and office of the loan details of in here kind said thing a stack paper really of on is

this portfolio do what the attention about gives think these. us confidence and at We every granular know portfolio. loans and are I paying monitoring on we what's and gathering this is in of So level really with in the X information the which going each

level. different Portfolio been [indiscernible] management has

teams are on to talking They're I granular knowledge agents. visiting I have and every They're these of each consistently. level leasing properties the is mean to mean going they owners. our talking at of asset the very property. what a

next Our Woody question with line of from Lay KBW. the coming

deposits. noninterest-bearing the on question follow-up X Just

all it month the sort like no there? you of deposits it factors seasonal be sticky. mentioned, all final of quarter, looks came on As should There's the those in

to simple monthly a that growth new are business. certain There seasonal in. businesses lot but there mean, I we're trends, are was trends, there that of trends No. are

up seasonal That we're high happen. We Some happens build as in December, now like last of a DDA that and well. was season, we it's not quarter decline seeing -- continue in certainly that always as will in are to had it buildup.

keep the So helping we us we seasonal summer. get expect as the changes into to

quarter here that worried is No, the there next about on isn't any no. lumpiness that and quarter, I'm on

it. I then wanted to Got And shift.

I I if was that's And do basis. you a that you trend here? saw release, continues runoff. dollar could on from just you think shared you that wondering quantify national credit think mentioned some the a in

me those in Tom let don't expectations right Woody, front I of now, have numbers are. but I'll [indiscernible]

I management and them and to quarter, And see not versus we're those in would where optimistic is in they're forward exit this couple strategy given say, where typically happening to we segment segments. the kind what our treasury there And that and at economy. They're segment, make more mean, when and decisions of industry -- a of as viewing the long-term we upon consistently lines areas might try business typically based industry we are we risk when comes see we we where it those were to make look bit that credits operating look episodic those whatnot. a decision. about bilateral to accounts be trend with build kind of that's a I that how business in

in We about we XX next do do this have try the sector corporate side estate have when to -- to we XX maturity at confidence both we are in [indiscernible]. to going. opportunities real it where we and But side. months from some exit And think don't, the generally shared national take the and credits we is on

So national have bank? those banking portfolio I majority relationship with credits have they of full that did relationship? And a the your credit were a the does exited, mean deposit

The we relationships. credits have did have that depository not exited

[indiscernible] have different of into Shared We our down the of breaks a portion Credit book book categories. National kind

relationship. some, would lead to the -- agent are we lead be in that for I In say credits going have not the lines, we national Shared we're where if general those forward. agency depository bank, national across deemphasized shared the would the relationships the broad agent all neither X but our but credits which the are are, may relationship. not we the the the be statement National shared are Credit, bias have in example, going nor bank probably And depository credit, we it's then For we are on depository we -- in many the of were be

helpful That's commentary. Got it.

Steven And Alexopoulos of JPMorgan. with our question coming from next line the

with you're as larger CRE. do you bigger you it peers think know this mean, you've of banks what your as bunch you in what's Office inevitably I your the experiencing or some the Do that? typical? time you're had fairly are guys see I Office I you but on the trouble in Where I risk picture a your risk, doing. -- what rule asset or are that challenges. When Do the investors working to of bank. guys. all the a that these analysts are on -- really answer is these through regional to the see question banks holding the for had that outlook? hear peers regional the class with agree questions, response you is you're CRE, questions your exception an like didn't

then you and I'll So chime Tom, start in.

think top exposure would first agree where the the do is somewhat banks, the I more CRE I XX general place for in example. fact banks that have regional than

Yes, you So banks, the I all way banks a of up ratios from CRE community to And risk-based just million. size with regional ticket have look banks bank do different banks, But on, capital will disagree. the more that. have Different can at exposure. like start have of or actually smaller average to CRE. CRE regional there types to $X.X

$XX risk we each banks them then have different million $XX that X there that exposures. like will very X are Another and a million, regional of have do, And profile. very large

be So bank beyond regional can doing, generally speaking, that each bank regional CRE. statement only to banks kind That's But really generalizing and we next. just what is have dig the quite from to have it it more beyond into saying, lending yes, X applies. the of different that,

bank portfolio. be quite those But large about would of done, with book $XX We and obviously we the of $X.X point, also a size, the we ticket doing CRE serve, of another either. it's lower have different. very it's than And the might have fact than the that be very complex that think more with we our pretty CRE super ticket CRE we've best, average starting million in million making very to very the markets loans, really or good small the statement. don't much bigger of that can't But -- we've typically risk CRE, much [indiscernible] loans million I have mix about might and bank know large don't I profile type that that kind generalized risks $XX we feel million, have we but have, to small very talk $X ticket sort our our your we size

and project -- good would billion the limits. of billion you we allocation in maintained within within I end our also would if look overall said. $XX that banks add, or I total I asset so XX% a with I scope the entire asset We're have the CRE No always lot the thinking base, book Yes. also in out portfolio agree what and to I portfolio about than all one the CRE of of more asset a discipline when time diversification at of within $XXX exposure, is asset around total and book. clearly think spend think, allocation we lower and Raj range. would at that and you

So above estate asset a would is million of kind Raj not major in towers within all call construction real We're across sitting as CRE We're and portfolio. range. portfolio said, to $XX not generally, loans. middle $XXX classes I with our million what $XX on the loans market million typically loans

higher risk part period generally, your cycles, as element, most is our portfolio loan risk I a would construction of a people the is, modest part a overall over agree and last the of very portfolio. always think in that long been And that's

X% correct. sits now, the at of right think portfolio. portfolio, about it I [indiscernible]

numbers. thing. that same to suburban CBD X And X think exposure, between stark. and risk difference versus The the about paying a suburban But more it with shed mix banks just I lot light CBD that, it's it can difference between And could is pretty same attention the banks, is. more the where -- if

to. submarkets, of overweighted Even piece staring area. it break by we in I'm any that within this No referring at submarket And keep down we submarket. paper is

levels. of because of pretty a different of these York, keep levels to we Lauderdale attention levels New Fort Miami, economies levels, project business mix. -- in submarket disciplined what's this. in levels, pay difference, asset we So in it all -- Tampa, approach And asset have we We're types what's to do what's what's so allocation in at some

questions Thanks detailed answered. other for response. My it. have that been Got

Our next Group. . with Bishop Hovde of David question line is coming the from

Leslie, quick question. a

there this I think some on the were CD quarter. or book that waterfall mentioned repricing payoffs maybe you

the currently? like what curious maybe or and looking what like X quarter rate over that like next looks Just that and book looked what the average is maybe on

the somewhere in But first basis [indiscernible] so or had cliff. repriced really we about $XXX points. I mean don't was quarter. between the million I know, that

spread I out. it's and forward, going think pretty tame

think funds of the the the the in can past you So for and see that . cliff, embedded of we're I quarter. the cost kind of change in impact

And it. fourth Got in in fee and -- know there then were noise obviously quarter. income the -- I some

curious the decent think out approximation sort the a represents a run year? or quarter of rest to rate Just heading the good if you first of rate

portfolio part, is the predictable regular yes, sporadic. items be these enough most leasing small with for to are I occur that cadence. and The mean episodic don't a residual going both

some you So of that. saw

yes, little You've the be that will and you quarters, out, that quarter pull But a in things if seen those last probably. several bit sporadic. every of

Perfect. and my answered. questions Most asked have been of

I to this queue no And Raj see further call over questions closing at I Mr. will back turn the in for any remarks. the time. now

everyone, for joining you, us. Thank

you [indiscernible] reach again meantime, We how us. Thanks. in to speak know to will you Bye. the .

does Ladies for and our today. conference gentlemen, for your that you participation. Thank

disconnect. now You may