Synovus Financial (SNV) 19 Oct 232023 Q3 Earnings call transcript

Good morning, and welcome to Synovus' Third Quarter 2023 Earnings Call.

[Operator Instructions] Please note this event is being recorded. And I will now turn the call over to Jennifer Demba, Head of Investor Relations. Please go ahead.

Thank you, and good morning.

During today's call, we will reference the slides and press release that are available within the Investor Relations section of our website, synovus.com. Kevin begin President, call. and CEO Blair the will Chairman, end Chief by and answer He the followed Gregory, your the Financial at to will be available Jamie Officer, call. be they questions of will

include differ uncertainties, the list update assume materially any press and these in available comments to materially. are might that statements and could on and website. forward-looking any which obligation are information, filings, our actual statements not Our subject to These cause risks be factors vary required results new otherwise, SEC We statements. our of by results in release or law. except forward-looking may We because our developments do early as to

we call, reference the measures will performance. related financial During company's non-GAAP to the

measures these in will of reconciliation the Kevin to presentation. And quarter. the see an may provide our Blair of now overview the appendix You

thank Good joining XXXX call. and Thank third you, for everyone, quarter you Jennifer. our earnings for morning, us

X the business while growth. past build the order rate months, environment, expand actions continuing taken a several long-term deliver to for in interest higher diversified our for Over challenging and bank better longer has position model to Synovus sustainable to more

to meet our sheet announced, for profitable further which in to our independent of immaterial fee wealth mix sale of third client discussions level we will additional that end, client's reduce us enabled selling a partners business wholesale investment accelerating to We team. allowed loan As are The while future GLOBALT strengthened the The and September completed has sales proceeds to partnership we XX% relationships. To than asset greater expand up loans. firm of to by believe long-standing loan needs. with CETX the our management higher the and while relationship-oriented returning an indirect adviser building freed transactions the income path GLOBALT and the our third-party explore office to potential during and to target. Also, medical capital simplified allow our divestiture a held-for-sale continuing XX, to bright funding we to previously on business bank auto be our reallocate X to earnings lines management more as balance and its capital quarter, make the continue bank wide from range GreenSky.

benefits Given our potential details be ongoing more There X currently in over next discussions, guidance. the any our not revenue XXXX included are X forthcoming months. to will

of the performance the to operating interest quarters decisions navigating and We short-term by making sheet around optimization higher expenses, rates which are all by headwinds generate tough and will better mix, balance come. presented years financial the business in

PPNR to result and financial further contraction. Now but let's more Slide as margin for revenue third of year-over-year highlights. quarter and and adjusted deposit were net leading of Synovus linked moderate diluted X quarter EPS the higher continued of quarterly EPS There $X.XX. interest move reported a costs, $X.XX headwinds to

market commercial, lines production. Core loan was This middle investment As loan and activity second higher growth. the quarter. on There from deposit $XXX which has lending, more million contributed to be C&I on returns translated stronger to an and increased yields emphasis relationship-based new or increased continues into X% in deposits primarily multifamily growth corporate building office quarter. X% medical and growth the third attributable outside construction draws specialty to was less sale core expected, than loan the while banking

clients period deposit Importantly, higher use funding excess, remains continue less third generation the slowed modestly as rate declined time demonstrating the in Also, accounts deposits third to and XX% margin strong personal first quarter. and the second levels during to asset our quarter better deposits from XXXX. contraction costs. higher and was as funds. quarter production but their with consumer same in continued Noninterest-bearing expected the market approximately as to operating significant are shift not strategies Net due than yields compared success money to interest

our operating rose the the just very containment the was prior a from X% on from quite evident and increased pressures the expense year. Given as discipline margin, Cost expense quarter adjusted high remains second noninterest priority. X%

expect we reduction in fact, in adjusted expense should of In variety flat a noninterest implement we relatively more be as XXXX cost year-over-year initiatives areas.

As increased move low continue we costs historically expected, credit to as off levels.

and and in evaluating recourse third the includes with other industrial recent of However, charge-offs net X-K impact our avenues the we a all related basis are filing. of a in which loan credit in quarter to XX recovery that sales, to specific banks points, process excluding from XX-basis at discussed remained assessing point manageable Along legal the commercial transaction. syndicate, include

capital to a above our Finally, targeted a strong through we at our economic continue CETX we ending more position the slightly environment. are focus on levels. And quarter navigate maintaining position as now XX.XX%, with volatile we capital

our target uncertainty. levels economic of Over to continued in the capital the we preserve near term, given of continue expect excess amount to

it the Now Jamie to third Jamie? in detail. results I'll greater turn quarter cover over to

Kevin. you, Thank

to you million was and As reflecting includes at function total levels X%. of balances commitments recent a can or billion, third ended quarter the This loan portfolio. a Similar multifamily low sequential to impact quarters, of of billion CRE payoffs. the X, existing draws office the on sale see decline loan of medical the related $XX Slide growth $X.X of $XXX

Market growth. commercial C&I to the lending Middle and side, Corporate and Investment contributed On Banking

don't rationalizing objectives. At broad-based new Our same with strategic fee more lower we fundings lending relationships. a and customers are our remain areas the time, profile that income have in loan credit-only deposit relationship on growth focused or meet return

Our loan over be near loan are sales should No balanced. and portfolio and continue relatively balance the term, being the further growth efforts deposit future. contemplated meaningful over sheet core foreseeable should optimization

balances or quarter, driven partially Turning to by in increase grew offset deposits. decline a deposits, time deposit by sequentially which in X, Slide core the during third a X% million noninterest-bearing X% XX% $XXX was

funding points, public XXX declined funds wholesale to by or liquidity million reduce $XXX position $X.X which X%. funding by wholesale we our leveraged billion, while Importantly, basis improved our ratio improved

The a first we is the as slower rate noninterest-bearing money a decline from excess and is the during money in than was second quarter market deployment the continued deposit of the pressures also There quarter. environment. the market to during funds from shift slowed. accounts decline byproduct in This of decline and moderation a higher experienced CDs accounts

experience deposit to during expect the targeted with some deposit efforts. this of along Supporting growth year. We core growth seasonal our the tailwinds are gathering remainder

third of average our As second of of to to the June to were to points rates, of the basis which month the basis rate deposits look than in third X.XX%, we XX% and of points. deposit a September, in quarter quarter. From the equates slower XX the deposit increased cycle-to-date total increase deposit month costs total beta a was quarter cost XX through up

costs noninterest-bearing by the were deposit on deposits. and as Our pricing core decline lags in as betas interest-bearing impacted deposits the well

total Our at to are slightly now to expectations reduced deposit through-the-cycle year-end. for XX% betas XX%

our to the year in Net third X% and offset better further Now those remixing decline side the moderated pricing the which benefit X expectations. down disclosed the higher to basis deposit versus ago though versus our interest compression portfolio slightly of a balance rates third from NIM quarter, is point quarter second within NIB sheet million X% XX prior previously decline from quarter, and quarter gains. The X. moving Slide than the quarter. continued $XXX of a and down sequential higher income during our was in points basis X from second asset deposit

noninterest funds X.X% income of noninterest up mortgage $X.X factors. shows almost fully which X.X% reported quarter-on-quarter in as activity. fixed There a year-over-year. was be due fee and by relatively Slide million outlines variance of and $X As income our repricing negative and the NIM X.XX% as was a with we look estimated asset million market assumes on income capital at more lending XX-year. Slide markets now is headwinds a graph by and Adjusted and a fixed down followed liability July, forward, by change soft shift. The to third from rate impacted repricing approximately a the the categories to to levels there. quarter, the the quarter revenue $X for That third quarter quarter previous fee was to NIM million, on to of program we is asset XX a noninterest September impacted million. of rates more in has NSFOD deposit fee stable The by reducing similar to revenue relative remain NIM followed marginal overcome to the gradually X mix attributable listed fourth quarter. repricing in amount XXXX, than the the constant in in the the around expect enough first total of This income our quarter $XXX as also decline been the muted and deposit benefit to end. Core rate combination expected Fed X $XXX expansion million reflected in is margin

stability the which fee environment. However, our the the many time insulated relative income highlights of diversity volatile are rate over streams, of of impacts revenue the of from

the revenue treasury and invest past have capital and over years. client as noninterest to markets demonstrated payment core continue few growth such We in deepen that streams healthy solutions, wealth relationships which management,

million and simplify September gain GLOBALT third a year reduction per sale The million in and and asset nonrecurring in optimize XX income expense. mix its on approximately of to continue noninterest also to result management led should reduction business the firm $X $XX We quarter. team the in our third quarter management to fee $X.X during million during

million expenses operating from Slide million million. million $XX X% second quarter. X% during expenses X of previous $XXX special retirement year, incurred an be Adjusted Personnel a cost representing fourth benefited million discipline. the the the charge quarter. from was in increase. by the was noninterest quarters. Reported flat prior and million voluntary quarter FDIC and loss assessment Moving early during expense were A third noninterest sequentially, reductions our were our up $X and expense should to headcount $XX $XX noninterest $XXX by impacted $XX or highlights loan from million the expenses. the Reported sales

with reductions this program quarters, remain reduction headcount. second and in disciplined expense will in third retirement challenged in the voluntary implemented a X% quite supported management we company-wide in a which early revenue Importantly, nearly proactive environment. We

initiatives which several in these during various noninterest industry discussed areas In expenses addition, details should keep as rationalization the of Kevin more adjusted at be conferences our flat mentioned, initiatives fourth we underlying forthcoming will have expense underway, XXXX. There relatively in quarter. year-over-year

XX credit Moving and on XX quality. to Slides

million quarters, from and idiosyncratic losses The for point past As expected, over have trends reflects risen primarily $X allowance losses migration uncertain the an X-basis primarily increase economic environment. credit X loan our and growth in charge-offs. credit

sale, loan medical C&I half second charge-offs, of guidance the compared net this XX XX to X.X% the XX modestly a for national to million. XX% still medical to office Nonperforming Excluding excluding building were credits as credit rose building levels. low third point office X.XX% our criticized classified previously charge-offs but metrics attributable loan of loans are disclosed year. Approximately a basis were quarter historically to points shared manageable increased sale, totaling credit the slightly and of basis Total from loans. total $XX migrate

XX loans basis the to charge-offs average fourth net to expect We in be quarter. to XX points

We of of high our continue have loan portfolio. the quality a degree and strength in to confidence

advanced will and monitoring analytics continue practices We and to portfolio originations new management. underwriting to and loan apply conservative our marketing

third total Tier supported As accretion strategic now increase in and Retained points seen common XX.XX%. and at transactions quarter, the Slide with XX.XX% equity capital capital to ratio XX position of our with reaching in basis X XX, the continued capital on earnings quarter. the third risk-based

XX% addition, sales we commercial the achieved quarter a to allowed though uncertainty. wholesale capital building quarter, continue our $XX Synovus medical us level near given the there's of has the result its special indirect office the In third-party of estate reduce and CETX loan fourth funding a in total Moreover, our preserve to real still exposure. Even than there from auto as be amount more accretion proceeds expected target, of over will macroeconomic greater million and capital FDIC should term, the fair limited assessment. and third

to now future. I'll economic the guidance. if capital consider Of any it we reassess back to environment be opportunistic discuss our Kevin may appropriate in will management turn regularly the course, and

the with now fundamental the for I'll to growth updated continue year. XXXX. of be XXXX expected our for Jamie. X% remainder X% Loan is you, still Thank guidance to

and in quarter loan as XXXX. muted by fourth to expectations construction our success growth production the continued at market to tailwinds remains funds the holds should and Growth for in and betas previously mentioned by similar that on the banking growth fueled versus by will well quarter revenue is as XX% middle expect deposit be Fed X% to core expected X%, and end company lines. We core the of to investment to current now outlook assumes of as through XX% funding in a for to reach third growth deposit strives X% of corporate which be We rate loan new versus the to balance growth be which quarter. X% seasonal The and year-end Deposit third quarter, X.X% aided are the initiatives. levels maintain XX% year. draws XXXX

expectations adjusted XXXX We growth the fourth previous X% to special in expense impact to noninterest incurred expected FDIC of not have guidance does be lowered X% in note the our versus expectations X%. Please X% assessment approximately to million quarter. of that the expense reflect upcoming $XX to the

shifts strategies, continue resulted and our and in remain in we management. has diligent environment we growth the strategic to While in priorities, confident remain expense

have various have the guidance initiatives. reduced year, expense range we implemented as of course Over the our we

Moving to capital.

level. call the open on return target and and build we are supported Synovus, still XXXX. And that in optimistic to to we positioned bank's proceed continue short-term time, near remain closing fashion. should through strong the We overcome through we At a let's recent taken, We growth by in tax to are there investments. At at the focused strengthen is uncertainty operator, approximate XXXX to We the XXXX, headwinds now target capital this execution of Q&A. amount to we in a we term, foundation and better have out is the as tax for rate now anticipate the federal think the that a our it fair for are maintain environment. XX% still CETX macroeconomic given over prudent actions

we of The Poonawala Instructions] first of Ebrahim America. question [Operator have from comes Bank

Maybe a question to Kevin, on credit quality.

hit one But But by a the around So not. I and your impacted I'm that's where sure us credit looking not of X.X%, at to criticized third there's quarter. in or that just headed. from the credit that appreciate sense talk if loans just is

just under then quality about talking credit decade the cleanup on happened under a that has the GFC. post spent You you Kessel and side

credit we a book, sense in So next you Like expect is costs think headed seeing over macro a us And give of your the coming within what months? then you outside on XX of from loan terms the credit where should stress? way one perspective are potential over lumpiness from quarters? the

basis to second credit, which you're we've you me noted disclosed still provided start, questions some talked moderation years. half in a that one points let syndicated as the second lot that we the But credit. many where with off, take in the -- we've guidance large Bob we this metrics time many, it about and one quarter some was a XX was and of I'll cost. around And been that there's that the publicly of during a XX Ebrahim, that quarter we're some in credit from cost of what question. in credit, about year. let comments charged lowest talking off, So levels and lot and we've as and And the normalization credit know, for add But that even of credit seen comes seeing within of the

gave although that very in credit is not the fully guidance. believe It's when still that it's content So, you ranges honest loss manageable. we the we considered with be had that large that anticipated. we moderating, transaction, And that was I'll within

little our So would than in anticipated. that came we have in general, tells you less credit a that, cost what

and sales. comes So will it's been but some points, the half XX territory. think increases the XX be with in Yes, there's I believe the still excluding that and that classified second manageable. We of NPLs criticized to the basis loan year

points. clients or many margins range. And inflationary of that But XX their the XX it when it's by going recessionary our environment, and basis think it's having are that full you for in we look between -- again, -- and downgraded. all are come As manageable still year, happening, being that a numbers things within compressed at we're to see that efforts you in the in this results

what all in just seen years. And would about there's increase to really we're you we've add over Bob, a for previous net the modest So discussions talking that? that charge-offs, what

much in of say XX% general have normalization Bob. made sheet balance we wouldn't other it's to our recall about just just wholesale add our corporate Ebrahim, that Yes, up -- we particularly businesses corporate than of is I that businesses. it's

For years, those numbers were low. extremely

they as territory So move to as credit back sort normal of it into relates costs.

range, of as Kevin pushes kind You to XX-point that number in XX your said.

overall like reasonable in manageable these ]. us. don't that's for some we of stress expectation And portfolios is [ feel nothing a but is think that I

if sense we -- easier? one getting they are can offsets just of as Around balance fixed And side in things of as as deposit Are next give a earlier are talk to guess the rate And with Jamie. competitively you some year, they maybe Noted. just potential I repricing. in us what the seeing asset you, maybe were the into summer? market? for competitive assets the move you Or the pricing around of sheet

of the Ebrahim, think I champion you're questions in multiple one.

make I'll me on answer start deposit with -- seeing what this, sure them all but hopefully, production are Let we there. and I'll

were production on than the of the of included cost XXX the If of points quarter-on-quarter, at is XX XX right up you increase in we that And production. what's the ongoing the in little points, look deposit basis third basis going the in was rate deposits, cost a quarter-on-quarter around CD -- production more quarter.

around that's X.X%. So

little month pressure bit reduced But recently been of the a in on rate the CDs has September.

approximately XX on saw And now deposits, points We basis interest-bearing come we quarter-on-quarter. basis XX points about production quarter-on-quarter. almost good about then we other feel MMA down production So saw down that.

about will be impact -- production our interest-bearing going Mix good within trends we deposit of forward. that products. So feel the

fourth be of we the probably through will increases in deposit deposit to I gave But to XX% cost we the quarter. So would the third similar beta. the overall say cycle guidance production cost, quarter in saw all in, XX% our what for

we CD So repricing repricing. that has fixed line deck CD see the the to in the What we quarter, quarter actually with of fourth impact it Page the you impact earnings expect continued with increases the the existing fourth do has of bit the than would production rate and of decent-sized in put less do X there book. And with repricing. to table a has a the And is below maturities. little on I point to

[ billion the in The mature ] more quarter. that a ]. So we those have on $X little [ is CDs rate XXX than in fourth about today

And the so the of as will expect in headwind have further rate. We reprice in a deposit fourth quarter normal the production those in we to costs noninterest-bearing on going quarter. kind deposits to fourth do declines

so costs asset get is side? rate you And XXXs. to you we of year the think asset through-the-cycle the me, result to remind that Will that the that deposit month in XX% the And for about upper all asked sheet. side was balance you to the the mid- that in of December, on XX% and the of beta net the

wondering [indiscernible] terms year, of of I whether and churn, was in see the growth? Yes. enough just going next that that be magnitude the would to the that repricing we're

Yes.

a we we'll few next as at year, -- forward happen. look things have So looking so

that see you to through starting can of to how you same year. But see we that in chart fixed the in line think First, go just with you flat the liability impact -- assets costs rate the or then And the side, on early peak and repricing. as cost that rate XXXX. the benefit asset grows deposit -- total start going deposit will the back fixed see you

the the stable That margin decline quarter, And you go and And incrementally be NII is CD fixed benefits the the margin. when quarter. can a repricing, chart mortgage the go repricing securities nice then relatively as easily each dollars and will a of see in commercial million rate tailwind the portfolio, that expect hedge we to the because impact -- overwhelmed fourth you in first XXXX. of loan pretty you as in repricing. of the commercial couple both So quarter through to residential that be powerful through by is XXXX runoff

Steven have now We Alexopoulos.

on So in operating I start XXXX. the want to to leverage ability generate positive

you expenses Kevin, in to you On pretty the plan adjusted expense XXXX. hold side, said flat

substantial? and on hoping modest could an that. to talk do revenue XXXX first at start a very you Maybe opportunity So to think see there. show color as juncture, want give this And about you you it I'm also operating then leverage? could we'll little more I Do the opportunity be

off. kick me let this Steve,

for As we quarter. -- well, first, speak strategy look I'll longer communication fourth the to term our

out a couple So of weeks, different be X the presentations. next with we'll

our the you expense where speaking we'll a details then the term. But fourth are We be early where we'll in when strategic of the [ have we will initiatives. look and our more Sachs some give more And of and have December, details on of in longer give Goldman we where we're conference right financial the to quarter ] then now Feb today's, we third outlook and expenses. presenting update at quarter, where including of

So expect relatively adjusted in third then as XXXX. versus term, in will in adjusted quarter We a -- million to down quarter. be the the had stable be we expenses range expenses very $XXX we expect on million $XXX near to And said, expenses. the we fourth

assessment that in fourth onetime the quarter. FDIC come the excluding we're we to expect course, Of

still We guidance. for a us exciting of core lot go growth flat really, expense spending base. it improves have a our in And And that to behind lot expense how of that outlook, to what's just market. is to grow different we embedded is client initiatives

see So that what is grow. our still businesses to spending us growth, see drive in you'll relationship see core from you'll you'll

our in embedded and of that's so couple up we'll a in in strategy, weeks more to speak And Boston. that

ago, just you had rate operating growth such when XXXX, revenue revenue a challenging look the calendar for you Ebrahim's lower powerful. it But because and because the the the year NII about where it's But fixed strong leverage half is very XXXX than of it is first outlook. run repricing today, exit was that increases, XXXX. just about think good yields at to minute feel at are and we to when so rate question And goes tailwinds quarterly on that positive back the entry simply of

have positive calendar go calendar leverage year you're year powerful XXXX. 'XX simply through issue calendar And year just 'XX. while for operating pretty if we may comparing quarter-on-quarter, year-over-year, it as is year The versus calendar at you so XXXX, gets looking not

helpful. That's maybe it. And Got then other one just one.

So when the noninterest-bearing close about expand, are your pace it's again. deposits, seeing seeing underlying on what's in noninterest-bearing you the outflows And of of sharply fairly XQ you How to where down talk fairly a stabilize then abate deposits materially. the bottom? are assumption Peers to expectation are? for NIM and

total NIB for as outlook Our to said same remains July. the we in

we in that in that $XXX we non-interest-bearing grow embedded payment would impacts But rate million decline December. expect again, more deposits. will give deposits. do environmental do around outlook decline well a fourth believe that, significantly due businesses on look impacts into in we're our so longer-term that, somewhere both NIB to total end in and slow, treasury with around to early the slow continuing XXXX. the and the of year details be we out like as And We And will And quarter XX%, that strategic to we'll believe to solutions. that that's as as

from Raymond Michael comes James. Rose question next Your from

where of to has just estate some your initiatives, Kevin. Day you might And MAAST question kind Can us interest happened those a rate Maybe think, the just it targets as broader lot you, this going commercial of broadly, I to out since year. maybe initiative? laid get and earlier you But to then, environment. be and some efforts you on the think an of sense whether the that you step-back last Investor require opportunities additional for think some we some a that real just are of investment or update you you what in stand the Obviously, a give of where forward. move here? Obviously, are areas the in are tough back wanted be kind for achieve just from

seeing about I success question. think of also great that Yes, the Michael, with some of the had the it's we've with It contraction, our And margin part new to in it talk the some stands it continue initiatives, to tell in different improvements see share, X-year like the past, in we top would our interest just for we quartile productivity, targets, you're questions wallet said relates you, that it I credit. of environment. this to performance, as rate of our that's a of not things under did a of is environment, some kind that. But of did core forecast we've seeing businesses And around you're when answer just masks where deepening sort our initiatives. underlying as that that obviously,

numbers something a MAAST. goal that to one a focus by top was partners. quartile outperforming a from to When well wanted those on the prove independent the the be we things competitors. Our be as we to is talk service but beginning would like that solution speaking, hypothesis was set platform, a banking software different, that and this of generating received continue of But our initiatives, we performance, about gets out our relatively and may when it of into some vendors that

software of the $XX in phase. $XXX in million. payment additional going have billion approaching the the last the on X XX about represent that portion onboarded ISVs As said we payment partners think spend call, pretty and through proving that hypothesis that pipeline, platform. payment Those would is we've we're I I of already facilitation evaluating the the in Today, volume. partners clearly XX and onto And contractual the partners

shows deal there's MAAST in a the So great solution. it of that interest

will desire. products payment part be to users end Today, to capabilities The fully that second type of and products the end had the able AP, checking week, would users. a and to additional include provide banking objective we facilitation right was just card. strategic with that of partnership the capabilities we ensuring offer Fintainium, announced that we the a we which that debit But have signed a of this suite AR

we minimum that product. viable have just We're into additional as expanding we this, So entered solutions. a

by adoption early that providers, where the the have on have of we software the about stool end have the whether it the the the banking we the banking-only that's we're optimistic want very of as it's And that's leg But into equation assess pipeline and of services, from and a viability remain demand don't that of generate still part payment the a the we too third tell. facilitation. deal great this They some actually based to the The expanding just need solution. to is And users will we actually the revenue. today. XX% solution, folks utilization to of

also betting I to in expenses million the this We we're bank note, spent year-to-date. important on think $X it's not about initiative.

it's us. so onboard. corporate XX a been CIB, we're banking, investment for clients about up we've XX to FTEs, to able have investment we that And and measured

almost We revenue a outstandings in market capital from million in $X standpoint. year-to-date and $XXX have million

that is progressing. So

to time is it We a and going continue get $X we've to that's Again, this exceeding at point. traction, but our year-to-date. expectations continue spent P&L from just build, impact take to about to million

that's to third starting revenue and on consumer at talked solution fully our with just platform. we We're our has leads some of us. combination of So that, clients, the commercial And we're the the betting and and year-to-date, lot the about I'll side. about incremental It's We proactive consumer scratch providing just initiatives. of provided to that in and booked $XX just up million mention And advice surface. from any the operational many. And is insights a one on one these the really importance the not farm both analytics. analytics

the firms revenue it's I'm impact things. Day, going but -- big Goldman. let said in where rolled to we're today. of not prepared this create X really ahead but again referenced out I one, then, had. And initiatives some the the haven't me the platform discussions one GreenSky in say down the private and me with But new new in currently and at Investor that about sources of today, of the the from we I GreenSky in are add this that equity that let remarks, road acquiring the just in answering impact years long-winded small we schedule. X scheme are Again, It's grand P&L about of and I'll So numbers as February

portion around their a only revenue. The be know solution. new held-for-sale of program and months. excited our Michael, 'XX much the continue have with the a in a broader all and that program their on in discussions sheet-light service originations, program about a -- million this with small we'll as you That with distribution as of created and this, Our was would contemplating would arrangement since production, to sponsorship I that support not business a specifics origination the into continued very banking in guidance program been acquisition only of the $X about is reminder, a that balance about financial it we're And us across we're a built but XXXX. Goldman a we've sharing which after production liquidity-neutral allow Greensky know coming to quarter on benefits and

just think but pretty loans Kevin, year, obviously, next challenged given think X% that's growth of third-party going to kind understand up arrangement I of great I X.X% color. higher we And balance be follow total. that Jamie, X%. sheet leverage to as about year a are about forthcoming we positive that. next maybe to Should of level expect the to operating GreenSky, down this is just with

production a get some sense. quarter's sheet I light. a into like if bit just this Given know as next early, wanted more it's seems move they expect seems have we robust could momentum. It a growth we balance to little I year?

clients. X to the look continue on core are that further and see that market. We objectives some to But there you We as and to client more will is see remain growth, look grow noncore do a can other we'll we expect take win. about faster what further we even you'll deposit have and out -- we so right loan our there believe are and and detailed grow -- than core client weeks. see our in decline that's that may you'll our balanced flat businesses as in we the noncore multiproduct and objective we give Michael, or businesses share that our believe businesses. again, margin here Yes, But outlook out,

you'll forward. bit a little quarters so And we there few a over as go next the see of mix

of We have now Gailey KBW. Brady

growth. of of about future, Tier now. it's over I be XX% think have you as So And a the going equity lot common not to probably X

good still You're making money.

of So that the sense barely stock value. sometime repurchase book reengaging top tangible Do that going in creep ratio sitting here makes in to share it still is you is consider on higher. XXXX, The to think program?

Brady, point. to first, X XX% back we've above get in as to objectives while well been you're Quarters, and a achieved those we that aware, now your capital accumulation mode about we've raised for

So in mode. now are management capital we

that, believe will the are deploying in been clients. just that repurchases. we always in So for our what priority is capital now, use important capital the ratios discussion. appropriate, of things that X to beyond But And we our including is manage that has as share right past

fourth the the a do quarter, that have fourth if in expect that quarter. you not lot capital FDIC to assume in fee, we we accrete First, of

believe still lot Second, of uncertainty. there's we a economic

are the going But been past, the likely with clients. us prioritizing the then us sideline like mode, you'd you've quarter. right repurchases. we're in see we've on fourth sit to in we with in where And management So be likely in now, balanced secondarily, here we'll share capital XXXX, seen

and half a Slide of it. All I second see just little the of is NIM, basis understand question to right. like the then expansion. I down on and you NIM helpful. in like And looking the of rate it's path you're in XQ suggest fixed that at I some look know points bit then where especially my of mean only XX at back that's the stable I piece then That's if X, starting expansion more the year.

engage entire X% any look be the is the at way expansion reach this to bottom? So after company possible what NIM could we there

for through chart. let's Well, fixed on today's what is let me -- go purposes, not rate that

include production our clearly headwind than And within be that is would or third deposit higher what deposit doesn't production the quarter, around which products within was that It product any in of costs. does include so not first, would even increases. bearing. rate XXX are interest not And and any I in us between noninterest-bearing include shifts for as mentioned, total deposits deposit the mix It cost. interest-bearing

flat is look. And so of forward a rate our all guidance

were we're of to if it really But rate something have increases. also where would they it there any spreads. widened. because loan index to loan include good been so impact for to really I happen, then rate story want not a floating include X spreads have consecutive expecting material loan not spreads And the And point us. that. And quarters We've had product doesn't to

we're the we're we for accretive paid balance that so risk sheet. believe on capital. And We believe putting it's the getting to

that's And trend so a good there.

X are those So things that. not in included

but should they because chart. I bit a the little the see those what fixed X what mean, see on to you you that negative, first a as trend more repricing Now similar shape are were are headwinds, tailwinds on the it's likely have that rate

Montgomery We Janney have of Christopher Marinac now Scott.

had of and do the the will land of I go question SNC that to in about It's purchase a for portfolio next focus? on into and kind you more kind that where think Bob future. club year business. want Where combined you as comes

and the total now, would SNC Right question. SNC definition. we're of the for of is thanks Chris, sort what loans XX% book, official that's defined our be as Yes, our around at

or would over X% level. We more a club a in syndicated deals, I $X billion of little also sort regional what have call another X%, of

true number, that. we're those $XXX around you agenting of around of we're take XX% of XX%, that being together, that if So kind sitting X SNCs. Of sort of million

think fee for So that's what for us, worth, that's business good et cetera. how we

and range think percentage that limits. range. of in to XX% to XX% this concentration I of in We we're We're there. terms kind of like sort relative comfortable

manage and But we are our that's that feel in slightly got that as we've that look a balances, to think range. think and certainly on been of good stay we focused range forward, strategic occasionally business, really this there. opportunities a going declined we it the some, ahead I of where us we'll space we be just long we there in I business, present kind of we're not and terms but that as running you we'll think very like that, expectation if can be, need more can bite in group nonetheless, bankers Obviously, in of kind as we've time. you book saw. But

sort kind Great. That's you quick of and Are of DDA still Kevin, from to of Or going any helpful. And XXXX? those now? quarter then, is flows that MAAST. question fourth just a about seeing be

quickly. the that some $XXX flows. starting with still payment because They're deposit We're I see million immaterial of to point at pretty transactions moves this referenced money

that in in million story year. revenue and about will with MAAST We'll come this revenue the $X the it. So deposit make

So still infancy in Chris. it's the stage,

thinking about can we But about... now, probably definitively year Great. just more there, a talk from progress

Yes.

the the I a payment the some payment we've more once slowly getting these X obviously just with think facilitation intentional been and to $X.X at billion in business we only note deposits are as lot sure the in new from we've it's billion banking deposits your start why relationships, get think we about $X that into to onboarding room expand there that side, as we talked business. And right. important of it if there's that facilitation because I only point, pick want you play to about That's the onboarding platform we see make product And well. XX-plus the having business, on talk we up, just clients. in about waiting and to

Brandon We King of now Truist have Securities.

out thinking realized current you're how your expectations? think I biggest in wanted you according Jamie, know could take next But expansion to your risk to of kind just half to lay pushed being So is maybe it, angle about position back what the at expectation or laid of you another just out out being the and for year NIM the -- already assumptions. that not you

think Well, biggest about Fed the policy. risk is margin when there. you I out think would first say the I

And so either moves if big Fed -- on either you have of policy. side

out RRP drop and the take sheet, of the With were liquidity down significantly their system. if they to lot of a balance

benefited that second for also, to start next same I were industry year, the headwind. could then would way be on the if think easing in up they challenging lag a half the be the of the But that industry. banking

second of in end if Fed half you margin will so easing that you're And year, of at next quarter the that or assume just starts third be then the next the headwind. the year, a looking simply if at

in it's the front an easing I believe we end before, we've flat. temporary said it's a to cycle curve lag. the would sensitivity Now is And that the because argue of relatively headwind as our

we itself definitely -- lag that contract but margin the So impactful that to would whenever not to happens. be the would expect in be

Fed a slowing the would I And in pleased NIB we're mix is and general quarter. in trend decline risk, the of third then shifts So a risk. the deposit policy are with say just

fourth that's in the again -- end those to We and point decline some risks to of slow the that I to outlook. would of the but quarter again expect as XXXX then slow

profile also that And think, grow helpful. guess, with theoretically. to you on faster growth a how impact could and would follow-up just Very that loan expect commentary the slow of loan help you away square higher I us would But mentioned spreads, that growth And the spreads down than then market. the loan your to you could those Okay. bank? items? You maybe

that. take Well, Brandon, I'll

kind are -- quarter of today back X about with the is with What and to XXXX pulling specialty one little doing is through in in it we'll areas. Maybe our where last question to a the growth pull to us optimistic correlate market, want the correlated C&I grow Jamie we're And as bit, we more those look The capital. loans, also continue as a mentioned up lend But that. competition our mark determine think that our will grow allows was that the mentioned, year-over-year. When being be I in goes. growth some level to to up be payoff, pricing. allows fast we're of CRE. see X% us this loans. we wildcard relatively over into impact of not We've necessarily a flat we're ability at through just to organization, selective middle lot of and talked where at And about about lot earlier, CIB variable deposits. to we demand happens now. the how will rate Pipelines through based the on demand back off want activity future production points the look and you spread will And we over right XX when what Jamie are loan the what on for paydown quarter. we're economic our index, marketplace basis

know, interest pay haven't payoffs and cap so a and we have rates seen downs. and we very you moved, there marketplace given of a where rates had haven't As lot constructive

areas to some economy. So as payoff delayed is cycle. to exceed up our production just it as our hard the underlying to the year bullish in this next and that paydowns keep we're goal you of of that CRE, can with may be have But been continue on grow. the the through rate noted, we growth And of

of D.A. Fitzsimmons Kevin have now Davidson. We

Just a quick bond portfolio. question the on

wholesale pulled Some down the banks something restructuring. pay loan that perhaps doing, help is to what flows or you've borrowings? the more that have trigger just Is growth fund the on using been on on Or doing table? cash focus you would

like that, be would a think we at sense we heard that -- industry, on to as time you've payback But mean excess something makes at what do Kevin, to like that and it point bond limitations time. at restructuring. the much XX.XX%, But that that think capital have capital something entertain. that X.X-year something this we it's any to there's would others something would I and to the restructuring. don't of get don't consider do from you bond restructuring incredibly we today, look is at capital you call if being significant. use look but that I we I be use could from how intention in there about we would we X-year we how we the a similar payback or have, a portfolio, think it

Okay. Great. And one quick follow-up.

exact wording on the you GLOBALT sale mentioned but about the you forget I streamlining. -- streamlining On your about that the used

more little to that on what it with some was I'm the competing -- if banks wealth just Or want about with so sale? made you platform? And can that more streamline was larger other it a you wondering management add color

for And -- it's really management simplification we Kevin, firm we've said of I some -- think it's money our owned a business that it's model. time.

an largely funds. financial compete. look under know, back as to do advisers use with so didn't served put wealth money. from the It investment ETF the for actually that for vehicle so more efficiency returns, assets can the that other as but it a of our origination, and put we'll end or we you and expense into in of management into either And them place advisers high-efficiency as or And products in we front the it financial optimizing They business, business. And to from we really move businesses clients' that continue an them wealth can the sort partner our to best take it's private believe earn operating their the it the standpoint. advisers we and

really operating redeploying businesses and those it's taking So higher have returns. that expenses into about

We now from question Fargo. Timur of have Braziler Wells the next

your that and variable some compression the go schedule actually the over couple quickly, Or first an could quarters rate the I wanted about on fixed I'm following wondering, that to NIM I see to base. easing would of commentary circle just I slight back circle a NIM color wanted loans versus back NII cycle. to a lagging deposit repricing is given down easing? bit rate and appreciate we an a more offsetting little Fed element?

would more loan repricing, have depends of the But immediately. rate mean And through. would it reprice of lag. scenario, think have deposits think you that we XX% timing. would In immediacy then the about to floating loans are a little that the I our than on I

about ease And a decline -- for directly our those index-based -- deposits Fed there mean so index of early would even of time lead also periods immediately. think based. I as them all in likely -- would to you for those if reprice you may XX% could margin periods. not they're the It

and exposures, look this time incrementally period. residential portfolio, about think mortgages, especially to those way being like beyond securities you years That benefit you rate of this we the just the fixed you here. quarter said, when repricing, end this continue 'XX -- this -- look at just in so continues Now displayed chart because doesn't that it fourth multiple at wouldn't for we

headwind Fed this will headwind the to of that when the overcome lag issue. benefit will that ease, -- does temporary So will be be start a

And point, at ease, there quarters. so will fixed for if repricing. the move Fed long-term from be headwind rate an we you is have a of couple a And benefit some do assume a next

a Okay. last That the cadence PPNR X? timing Does at something at performance NII the that the just looking what the of the over makes of NII is the in see bit cadence couple next maybe And quarter? activities sales loan the than we expected other then little on quarters. Or least sense. that just follow there margin through and Maybe of over or performance be sales would talk margin? some next within the recent better of quarter timing

with along trend will It margin. the

'XX. loan combination as quarter a through the flat and see margin decline well as NII fourth then you'll you'll So the in then with as in see And go quarter. first growing the expansion you of growth

of Preston Brody have UBS. now We

that implies the NIM commentary in I'm I've I put a got expected step just think and in would down on point have fees. guidance million with The the missing but something I about wanted revenues? more the of think kind revenues. Jamie, a we I down that fourth it to there because with the guide than quarter finer implies the operating Is some stepped just $XX it of a bit I like

So looking at revenue. there Brody, that I you're is in fee think what really

million and revenue included quarter the $XXX in we of $X.X revenue. had fee of And million third that GLOBALT so

$XXX adjust was quarter fee $XXX around revenue when our for So million. to that, you in the million third

because quarter quarter, portfolio. to as and on of And impact we then also third so full quarter $XXX mentioned, looking sale that the expect the deposit margin be to fourth to -- the will the overcome be but -- what have saw -- million the NIR office from incremental retail the forward similar in on in there medical as an we $XXX the expect to it we of fees up decline impact to but we flat fourth to you you then in slightly quarter. And side the NII, a amount we the the expect headwind headwind, in of from

Got it.

for on to reading not spot just And I is the December of in like the and Jamie, if expectation for the beta correct? the around more Okay. clarify revenue expectation slide correctly, component, the a I of was the like that quarter, beta the kind average think

the month of It's correct. December. That's

Okay, up guys underwriter I real quick. SNC have on cool. of that you follow on? -- you percent Can said Bob what the what just on portfolio will SNCs, Bob's Did lead

portfolio, Brady, about it's Yes. the on million. $XXX SNC

about of $X.X So the that of $XXX around we're billion, million. edge

Okay. a quick of I did portfolio? have couple do on have office any then ones. last And just you of ACL the Bob, the

let general. we're I'll -- don't we X.X% are NPLs allowance Jamie generally obviously, follow today, the portfolio then ]. office disclose speaking, up Yes, X.X We just down. in perspective, classifieds but But the CRE in an XX%. Brody, me, are But than our range broken that, classes don't by less asset with asset criticized our we from class. within allowance [

obviously the working now. before. allocation We've the we of allocation. now, and right the talked that. that that portfolio, of context -- follows performance we CRE a there. is size We've list relatively But the not have the it's stable on about in watch just see been So stable We're -- relatively

quarter. Brody, continues to the list before. perform, no migration and And in in mentioned, portfolio, that same the office seen in the watch and the new third about remains as discussed negative portfolio one It as July Bob we've net we've thing

as And kind portfolio. you of perform impacts any But sort about was third was obviously C&I continues migration what for to the allowance business. loan so life the of the quarter, in the the we small in relatively portfolio categories, allowance ran the loss the CRE the within ratio stable we when of increases that saw expected. When loan we and we think was the to in estimate where saw for allowance quarter

see And for basis we'll so believe guide outlook. to updates XX and give about see good what we charge-off in front quarter, more continue to aligns the of with that can XX We we fourth us. clear it feel we point as

for portfolio, I you just Got well line built perspective, it. you just performed Bob, remembering pretty yourselves. that if other versus a guys I'm housing one. it's good have credit then And correctly, of you have for think And on also that to into a X with extremely senior business some a the last banks from outperforms And bit, of other yours have just maybe category and that that of banks takes understand kind some kind that senior around relative housing. help struggled little puts why generic Could housing us maybe exposure? a portfolio? the better senior

Yes. Sure, Brody. Thanks question. the for

Just time. long been a We've it. business a on couple in of this comments

have manages a team book. We that this very experienced

Most to continue put as rates. last industry on X But here industry, continuing some increased months rates. it it. You're stress labor increased rental our the it staying think right, around the cost. question implemented or so, is is an and here operators We relates billion. in stress of it's today, there's this certainly increased are, interest positives have Certainly, higher to about $X it occupancy about some that rates the see no as feeling to

is it rapid going it's to increase the improvement line just overcome top time revenue some the So -- in for not there. to take cost. It's

our relates put but that within certainly from within XX%, and -- quarter. manageable, we're specifically to it here criticized drift was is We in the ratio expectation. nonaccrual our a in very our couple number higher. XX sitting those content at bps very XX today credits few was again, our of the it's number credit XX% loss portfolio, That in nonaccrual we think -- rate a this increase to little loans guidance. low this performance in classified As to around XX%, But that overall, could on that

there's way term long performing performing is it's the stress, within but client again, think I selection expectation. way portfolio And the just business, overall, the our it's this overall, we So in some underwrite, Brody.

And just all Brody, class, looks add the in same, asset that this nursing, some skilled memory more I'd are senior housing pay. you when everybody look more care, at assumes private some

operators, in Bob's skilled better client performance. more selection private nursing long-term I here, dealing think has point less with pay, resulted to overall

driver I big that. So of that's think a

Scouten We Sandler. Piper have of Stephen now

around to about maybe rates buckets. default of loss think guess I about the credit think given I you and wanted kind how different

to I ability have such think that surprised that were severity. people that a credit, SNC the for just with lot of

and you credit how wondering of overall? at other kind you just think maybe I'm within So look about SNC that the as book categories within

a couple case I'll of Stephen, back specific to procedures, time a be there. Yes, idiosyncratic spent norm. event. given that the of comments cetera. default a consider and was et make credit Obviously, particular Obviously, and We lot our at of do time spend loss going looking in that way and that processes we and dissecting of outside lot an have

we have is that work that of good all from conclusion Our still processes.

enterprise be for valuations, you of think the was just loans. but of as the quickly et and with enterprise a to where general a with to get on third-party our are years. to went default underwriting generally down exposure not way that's to loan is period of short the perspective, stay that very took inside that in we underwriting the that billion. cetera, the loans. can, cash led look and over spot time of assets couple all that happened the on certainly risk value. enterprise -- $X within is that value given your We pay wrong loans, normal just assets, sound, that kind it stay any loss Our very time. Generally, closely for speaking, outsized credit would my default us. From generally period as to when reporting. We the guideline we given a get at for events number those frankly, on hard Those rely a have value-based manage we not around loans us about certainly those, though, of into Leverage leverage look our -- underwrite quite place and We all at loss speaking, of

those that's that but at Stephen, we So a how does look of little rambling, types credits? on of help bit

any I mean, more severity or Yes, relative to that that I point I at you this CRE. having terrible really broadly from say? Is helps. think fair perspective that to C&I But is segment maybe risk guess, don't view a generally,

to that's ignore that say, there we've time. business we selectively over make but returns yes. the and appropriately. risk do credit think do fair We think manage certainly chosen We could good I it it not can to and

doing And add loans higher anomaly. We generally exposure we loss default have of when recourse. small C&I, doing a many of is there. when credit I of repayment, C&I, investment-grade credits. where Bob's repayment, where just have generally Bob's think if referencing sources of Steve, that business sources we given you to -- we're a then And this these about it's you're think primary our point, secondary don't here are in unsecured think about comment, an I'll lot we're there's And

so when the think given on CRE generally low talk default when they're that underwrite and we're we And about you lower in way protection talking would cushions about and loss those, or just having loss scenario the we business, over keep equity LTVs and about based there. like that have there feel of where you you XX% defaults the enough given LTCs, C&I similar

So assume SNCs that defaults erroneous higher much all have to credit. it be this on based I think would X loss given

returns. And my higher talked question risk-adjusted out you Great. then guys other about seeking is, have helpful. Very just

on leads we credit, You've be you bit more as perspective about talked move to from you rate where as you into pursue do those a floating endeavors, spreads a active these segment that think 'XX? widening

was that that? missed Steve. I What again,

Yes.

Just does Where result? you a come of higher that -- risk-adjusted you kind of as think seek that returns you wise? returns, as where from much your where are does will out those I widening? where growth lead segment guess do

argue to risk. question. of No, I say that relationship, you're a you're returns getting with it it's it's loan-only great great And doing unless you're would hard lot -- starts that taking if a a

We're suggesting not solutions, we just we're and have that. full by right So businesses suggesting where is the win a lending of set piece. to providing focused where opportunity that the the not the we're on

business side. We're treasury depository, owners. cross-sell getting relationships the personal getting on we're the So from

And middle that, commercial our that. very, with very well today, see market so we're where you doing

and industry core much commercial, banking and additional business investment in kind going markets we're commercial, fee community our our and those where our able and bring makes small where treasury income corporate higher. deposits market Our capital it of we're to unit, even returns and to and areas verticals,

So in in doubled a where that the touch you believe past matters, That's we consumer affluent we but to we've have of mass focused only segments down wallet. on allows kind market greater that space. personal But we us and share where go the talked we're not side, that to of get share. the the a commercial fluid when we're winning advice

where So that's XXX. focused. we're It's relationship banking

why win really, J.D. real because doesn't like things sound and it we it and Greenwich So comes down it well. really we that. Power how And do sexy but do that's we delivery to

follow year-over-year. lot of when production, Greenwich me with because time at deposits, you that so a decompose clearly, you success to our up that let we're lot And how up third together when deposit production, production, and our do and And now about up when our XX% production. deposit when a the comes from that Power those production, an we deposit quarter nonmaturity CD this of with network, and has MMA success even you because the do Commercial are on with XX% our interest-bearing growth look that over J.D. Banking, deposit look you fund at But year-over-year. retail from out then back

third quarter, sustained. And diminishment. reduction we So that's a production then positive trend in the saw that's account a in

So the quarter, XX%. in on the down third almost we to quarter the side, the consumer diminishment second saw relative

side, this the year-to-date. And big been the approximately commercial XX%. down almost same the has On thing headwind

good reducing to the it's see So pressure on this.

back Mr. Blair would This conference remarks. the over our Stephen. to to like Thank any turn closing question-and-answer you, you. concludes for session. Thank Kevin And I

you. Thank

close to challenging flexibility. the to everyone in and been the navigate we with rate on attendance their various operating I Synovus out associated thank As executing want recent longer, balance higher expansion fourth returning for and optimization more repricing interest half a up NIM 'XX. we've their the proactive interest opportunities. and fixed strength, Despite in operating to demonstrate continues quarter and in today's initiatives sheet pursue environment, call, to in second rates Synovus. expected economic a environment. Through With risk for business strategies, resilience and to of a the completed support simplification to expenses should freed stay create asset higher path and liquidity trough our capital, We've

market, CIB, payment by We're and margin middle masked growth in the steady treasury experiencing wealth Somewhat contraction. healthy and solutions. like management areas

that over of selection transitioning with footprint posture credit underwriting, and economically core businesses, we in as of taken to to manageable diversification a southeastern new sources traction as of the our from result to monitoring client continue economic to one through -- believe generate losses our well XXXX, strong in growth growth. Most into coupled and years more Continued defensive more an on forward levels look vibrant actions this a revenue, will we importantly, cycle.

a with And that and our hope the operator, This others has in in deeply firmly session hope, repeatable can capital including a maintain today's and to I optimism uncertainty, to we true of prayers and to what concerning dedication see the are of continue of Jewish the members I that will region, valued magazine, East. We you were and close and to over conclude certainty for replaces for peace recently and healing ranked in our piece. With of will continue uncertainty. Thank flexibility quarter each team ongoing hope with path call. I to outlook long-term in want day. team sustain clients. and third to allow company the control. Best message Synovus our be many members fifth are for $XX of a XXXX friends assets lot and for that, is whom in U.S. and My my is lead very and resolution, it and healing many signs thoughts position nationally. Director's community Banks NII work and Bank Middle have and many we revenue resolution, liquidity hope, peril. to our are concludes clearing analysis. strong for growth. But sheet in who up, situation lives The control Lastly, effect reasons, earnings to your our recognized hard as see across talented a we balance billion

all for joining. a Please disconnect your conference have your conclude of lines. call. This Thank now day, rest does you our you lovely and may