F.N.B. (FNB) 19 Oct 232023 Q3 Earnings call transcript

Good morning, and welcome to the F.N.B. Corporation Third Quarter 2023 Earnings Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Lisa Hajdu. Please go ahead.

you. Thank welcome call. and our to morning, earnings Good This of F.N.B. conference call reported Corporation statements Securities measures. files and the and Exchange financial forward-looking the contain with and to Commission non-GAAP of not due prepared results accordance with addition be our in should measures alternative for financial to Non-GAAP and as GAAP. an reported in most release. in of materials our Reconciliations the and to financial GAAP in financial non-GAAP comparable GAAP earnings presentation measures to our measures directly are included

and website. corporate in refer statements to and and Us, non-GAAP the October related the link Relations and filed will registration Please of of XX, reports Securities forward-looking disclosures with About webcast Thursday, Investor section call will our available materials, website. contained available on A these Exchange posted this be until the our and be Commission our replay corporate to

will I CEO. and to turn over call now Chairman, Vince President Delie, the

Thank to you, and welcome third quarter call. earnings our

our our income F.N.B. Officer; are per Joining Financial and Chief diluted today common common to available third Guerrieri, Gary million reported of share. shareholders Vince or me $XXX $X.XX Officer. Credit quarter Calabrese, Chief net

represents performance in the quarter's This growth of EPS X% quarter.

reflect growth results diversifying generating risk primacy, management, income. the organic geared F.N.B's. execution client strategies Our long-term towards fee-based and of

ratio efficiency Our third remain a expected is pure basis. the to XX.X% quarter equaled upper and in relative on quartile

industry increased operating a on on return at has $X.XX of book year-over-year XX.X%. XX.X% a was of and share leverage equity addition, per to higher In the year-to-date level Tangible basis X%. tangible value is solid again despite common impact

liquidity volatile of guidelines. to in F.N.B. and to previously increase have positioned environment, our position market the our adherence this mentioned, underwriting consistent we given As and conservative strength steadily capital and well share is

mix from third noninterest-bearing billion, quarter of a deposits the deposits stable relatively at increase $XX.X Total quarter XX%. of while ended maintaining second X.X% a the

to of HA the clients. Federal our continuing Our and demonstrating once with outpaced for deposit strength versus outperformance linked as the industry base geographic well the and Reserve third deposit diversified growth our primary quarterly the again footprint be trend goal bank granular deposit data, quarter a as our

FDIC operate In ranks that X nearly share in we X in of MSAs in released September XX%. revealed fact, in top and and deposit nearly the the in the F.N.B. market XX% top data

acceleration position Despite X.X% F.N.B's deposits as end. the the banking our competition than demonstrating deposit have trusted primary spot customers' of year-end throughout industry, our less XXXX, since decreased operating

linked outperformed Our level production from benefited also the this Commercial X.X% X.X%, across was our year-end year-to-date, quarterly quarter achieved have the effectively of while was to which by ratio growth growth loan deposit of we X.X% highest in HA XXXX, CETX funded growth XX.X%. which meaningfully footprint. quarter loans, dollar-for-dollar our spot building data. growth loan Since entire spread

X.XX% of equity to even backdrop this the rates. totaling common asset against continues also build, higher to ratio Tangible tangible quarter,

Additionally, of ratio cost our optionality balance comfortable solid a and better level position loan-to-deposit at the support remains The sheet our liquidity provides to capital needs. XX.X%. and than clients' peer ability funding

the and to customers. digital in for We outpace also business gain competitors, we continue in particularly deliver market offerings invest our share capabilities and retail to further

a offers better product a Our award-winning unique eStore penetration. platform customer experience and driving

adoption streamlined loan products simultaneously universal the our multiple single a for services, application of common of a products to Our a apply will common In products the for we which to the recent common consumer account accelerate multiple the should products our application application, onboarding faster customers customer will majority deposit add eStore application. and most meaningfully creates months, the enabling consumer in manner. few facilitate implementation, across very and

strength superior customer digital footprint. relationships and of advantage X-state across offering and sheet our on balance competitive grow to our capitalize We our our the will with acquire

our in the have been off charged we would at basis charge-off, information mentioned call. Gary charge-offs quarter delinquency during net second his XX and stood a During fully the X isolated Absent provide quarter, total presentation. we basis points. and that earnings modest commercial more will loan points industrial total

strategies management. a risk diligent are on by balanced growth focus Our

monitor business risk to as ways which credit underwriting our us cycles, managing times. market-specific manage enabling part economic serve competitors and to throughout customers in balanced, approach We steadfast philosophy to trends a well-positioned credit closely of We to us our economic core cannot. remain cycles our macroeconomic in in softer well served our portfolio through and has risk consistent maintain

I to call will additional our now performance. to over Gary the credit turn provide information on

and year-to-date of XX NPLs and basis points the Total down and XX delinquency quarter with at asset bps solid Criticized basis with and at end We XX XX decreased were metrics morning, the Vince, respectively. decreased everyone. quarter good and our basis remaining year-to-date to end quality period for you, to at points loans points charge-offs the ended and levels. Thank XX bps. good OREO in basis the net XX quarter points, XX

with credit isolated were the XX conclude the quarter our Vince year-to-date and period that charge-offs my Excluding on and update risk portfolio. I'll CRE credit net respectively. an remarks strategies noted, and X points, basis for management

upon supplier, in earnings disclosed our ongoing call, subsequent was on later including findings bankruptcy balance our borrower we outstanding pledged previously loan the charged C&I second by a Based primary alleged nonaccrual. its $XX.X on million the investigation, off. uncovered and fraud quarter As single filings and during

will portion and We the to continue opportunities charge-off. aggressively bankruptcy pursue of to the a monitor recover closely all process

it we loan the at charge-off quarter prior stood allocated the million expense growth $XX excess provision in the Total for $XX.X and to end. reserve of the mentioned previously providing at million for quarter specific that

or $XX.X position our inclusive our solid loan reflecting strong position million reserve quarter and strong our $XXX loan in the Our our peers. relative X.XX% ending discounts. at X.XX% decreased and a NPL of acquired at the including at to loans reserve coverage unamortized of remains stands stands XXX%, million When unamortized funded discounts,

which tests a continue balanced portfolio recent well-positioned of basis. We economic loan confirms to outcome us result quarterly downturn We exercise, management were pleased the the economic enables a diversified of and cycles that portfolio maintain on stress remain to withstand portfolio perform our loan scenarios. underwriting consistent risk of with various the to full and committed throughout credit the to

nonowner-occupied NPLs and in portfolio, our respectively, confirming at underwriting strong rising delinquency rate and points, remain a ability the basis that low sponsorship very consistent CRE perform and XX XX Regarding the to environment. demonstrates

monitor quarter aggressively. growth individual closing, In we'll the and loan ended and quality markets trends We asset generate the in macroeconomic metrics diversified our we continue attractive and manage good to at closely risk in markets. footprint, to continue levels,

philosophy, us core served As credit well economic cycles. our part which has of throughout various

to turn now Calabrese, for Officer, will call our his Financial remarks. Chief Vince over I the

and results morning. the and Thanks, good guidance third the quarter. focus I updates Gary, on will Today, quarter's fourth offer financial for

they footprint. with deal success grow tax leases billion, common to financing to million closed and bringing earnings part $XXX.X our at their quarter, originate per Third per shareholders energy related quarter our Loans totaled our of year-to-date or solar to high-quality diverse commercial ended share strategy loans the to or quarter, $XX of renewable quarter a model, large $X.XX. leasing net from share, contributions available $X.XX a across transactions driven include team growing The the income credit. X.X% million by business results investment this linked as $XXX and

loans the in Commercial quarter billion, contributions Carolina quarter led X.X% and X-state markets. million Pittsburgh, of mortgages. $XX Consumer the $XXX million increase $XXX a at North ended by or loan was our Mid-Atlantic across of or geography growth growth third in X.X%, linked with notable residential

of Total The reflecting split last investment and duration September deposit AFS $XXX fairly quarter. a at municipal flat our a securities is at increase XX ended to X.X%, September growth organic deposits million even seasonal $X.X portfolio and $XX.X between X.X The deposit with remained or inflows. healthy HTM. billion, billion portfolio at quarter with of linked similar

as capabilities deposit growth by Federal gathering deposit continued the deposit higher Our outperform was $XXX noninterest-bearing nearly decrease industry points XXX which $XXX interest-bearing The million, and points since to shift demand of basis deposits deposit as for the basis in data $XXX respectively, the and XXX slowed and more deposits HA this time moved where XXXX. into quarter have year-end customers Reserve offsetting quarter than deposits, mix the higher grew illustrated million million. our modestly

intentionally will a average rates that of have the weighted fall, maturity XX so grown, deposits have have when the with downwards. kept we to these ability time As portfolio do short months, balances we reprice

deposits XX% total XX, comprised to June deposits XX of noninterest-bearing As at at of XX% compared XX% September year-end. and

strategy. stable to total loan-to-deposit deposit base, of industry in believe granular a even our rate longer outperform higher deposits Given The interest growth million, with deposits at to totaled for level will favorable continue remains a driven ratio comfortable Revenue the environment. XX. noninterest-bearing and diversified we in mix fee we our flat income of income, XX.X%, by with $XXX reflecting June of $XXX net noninterest interest income a million

securities. of a and increased last deposits. the quarter. yields X.XX% on by cost interest-bearing from points net noninterest-bearing points, was as investment basis increased deposits quarter's of decline The of reflecting XX The funds cost on X.XX%, offset earning to to the third loans X.XX%, assets XX $XXX basis the was points yield higher basis decline interest and increased points point XX basis XX margin basis contribution moderating to Total XX partially from

manage to at deposit the XX%. total cumulative ended bringing and deposit actively beta to We our continue X.XX%, the costs quarter

the mid-XXs. projecting cumulative XXXX are We end in beta to

sharp capital a from that syndications Turning income a versus increased more income. negative $X income markets the in total markets $X.X marks to the increase third mortgage given contributions led totaled to fees, X% quarter than in Mortgage with million, quarter. the International banking and capital noninterest by income production operations mortgage income and during debt Banking second saleable fair expense. swap rates million from offset as quarter last Noninterest solid $XX.X due decreased increase million XX% value increase

digital XX.X%, $X.X ratio expenses up from slightly campaigns inflationary an growth increased totaled Net of largely expense equipment million and marketing million efficiency helped $XXX and due million, quarter. environment. $X.X solid from The X% households. a to or impact increase million technology investments deposit occupancy due additional macroeconomic expense increased of the XX% drive which timing quarter. last $X.X the of equaled acquire Marketing to and last Noninterest the

For totaled months the XXXX. compared to XX.X% first ratio frame the the in X efficiency XXXX, for of same time XX.X%

loan the through strong ratios capital While remained our robust supporting growth, quarter. the

at finished TCE investment Our for the X.X%. held-to-maturity equal and marks X.XX% when would quarter adjusted

remain portfolios. is the with in XX.X% and in line our including even AFS ratio and Our fair value we peer capitalized marks at median, well CETX when HTM

by $X.XX value more September common share of per demonstrating value XX, value XX, full of tangible common $X.XX higher generation. our the quarter per share earnings the or level to which reduced June book at tangible $X.XX. current an increased common end On XX.X%, per offsetting impact share retained than book internal year-over-year a book basis, commitment Tangible the a increased increase capital dollar per share AOCI, of from was from largely

projected year. income between is expected look diverse revised to fourth XXXX our balances. spot now rest rate gain Let's as capabilities balances $XXX grow the full to additional with the time no the basis, XXXX On in we year-end end quarter for and for digits guide to increased at spot share of objectives, to upward invest to are previous starting we Total year hikes the balance be geographic million footprint. loans quarter year-over-year to this interest to The our across single flat high our $XXX market fourth take million, mid- a deposit assuming interest relatively sheet. net financial

driven million be similar be around be increased will fourth of for quarters of to $XXX strategy expected growth noninterest benefit Fourth quarter first quarter guidance $XX million year revised to million, million, continue investment businesses. Fourth net fee-based is dependent our expense Full quarter. $XX guidance million as year to impact macroeconomic inflationary a is by we guidance to $XX between the and the loan tighter is activity on and the provision and which charge-off $XXX X of levels the environment. our the is from spend to in diversified of band noninterest and to for expected income

commercial the and and full XX.X% the rate benefits between in rate between credits XX%, XX.X% the through of tax be quarter. business and transactions financing should tax Lastly, our quarter the generated be XX.X% is effective fourth reflecting expected investment to tax of effective leasing year and

that, turn With the I to back Vince. will call

goals. we at the of collectively was in and in quarter's this F.N.B. innovation, from team achieved The this all highlighting our garnered appreciation working our also to and dedicated family-friendly our leadership compensation excellence again, culture feedback our national Once we and culture building honors, for our wellness on multiple of employee for rooted collaboration benefits to efforts earn own and development. diversity team inclusive employees. performance through recognition commitment the our programs, F.N.B. is awards to received based independent on culture continues additional reach financial members, earlier year national

engaged having believe shareholder superior an in strongly We value outstanding appreciation. and performance employees culture with result

quarter's We we deposit and are our loan continued reporting while as position. philosophy adhering capital pleased with to to industry conservative our risk results this management liquidity growth the outperform all and while strengthening

in our prepared to sheet to for all clients stakeholders. consumer meet strong strength our is the and success of products of of needs business the you. Given a well achieving broad performance, and with F.N.B. commitment balance a array services, and a our Thank

comes from first Instructions] [Operator from James. Tamayo question Daniel Our Raymond

of had month any thoughts September think Wondering like on kind details if when and margin you yields, from bottom? what you margin And a might look on stuff? about you that bit could the of if more perspective the talk a updated little

couple Danny, a that. of I on comments guess

given the peak think year, withstood was quarter. everything industries first I the clearly, this in

at decreasing points look XX quarter, third basis in the -- moderated has XX% The been million averaging quarter. around income commented, you NIM a last points I after interest from since X-X to for NIM only net If month decline declined monthly May. on in as we basis our the compression, $X.X

steady coming been that it's but within So pretty down range.

what's in is into quarter we $XXX with $XXX million quarter margin, outlook for our of fourth of baked the decline kind third any doesn't as what guidance. the rate I million, to of in increases, it Our kind have the mentioned, saw similar the to

here That's Okay. a moving sustain about at just growth And growth. growth? about curious pretty loan sustained to Appreciate how strong over loan in I'm you're the thoughts economy year next loan higher-level of kind then book. that the ability XXXX, curious first helpful. on in of But throughout slow, mortgage kind particular, the level just to it's thinking it. growth physicians of the potentially if kind does residential

Yes.

I think, who of banks are relative issues. that position first liquidity with a many to and particularly in strong of we're really smaller all, many competitors, I struggling think the capital

us it can could we're basically, on offense where We more through F.N.B. able puts needs become with capital after to we in our So go as support and go the a -- XXXX. opportunities we position move clients' confidence.

in moving successful, there think from be specific be choppy for we're We be didn't where give perspective. maximizing GDP guidance from in to going focused my year, But that for markets the into I going really perspective, a next very into to growth 'XX, numbers. have so to us good on markets demand it's I moved stay can't continues to loan to expectation our to growing still solid market everybody share a speak those we've for

think I help one us. thing that's that will

multiple span versus size, years Secondarily, today in. I opportunities the the company pursue were think given we where ago, have of we to markets

borrowers to think that bank, right? into on creditworthy going competitive. find that more be I economy to 'XX, more it would it's going be we environment, to the So In I think depending will shakes challenging out, how want

So I in, those people Pennsylvania us across areas the be a to heavily versus having spread somebody benefit Ohio. or think would concentrated say, that's right

So I of in play think will our that all favor.

we've think for that us. in to also invested I certain heavily pretty drive income fee will platforms continue

should year facing. were we our that in so. in invested from us offer we into systems, or our business given and So the processing out. and perspective capability app help platform, payment been gathering pretty upgraded clients We've growth, as loan well the lockbox digital fully and in did small But management move we a common we income fee pretty is the in invested last addition heavily with has pressures perform deposits still quarter to that in we've treasury capabilities which this built

transactions capital Capital Markets, we the in to to markets continues meet and have our that lower-risk us participate enables that bond debt to we and ability offerings well internally. and in perform built up still participate move out for market platform, return through our thresholds and us

well of into we that play for all us So move will year. as next

confident performance So the are a well. environment into I quarter Demand I our why next play I as you, the and -- will macroeconomic this think more role. those But quarter. feel has be to caution about reasons that there then will

has commercial occurring So be investment on the capital to side. the anyway,

from The next question comes from Michael KBW. Perito

deeper that on I on are I made, think of if in of the here. a I the to you go mean from a trying start of comment I to was guys wanted layer a it's kind guys you financials to and strong wondering investments about Vince, take on are side evident industry. you and that. obvious advantage position posture the making OpEx the willing

type that opportunities to obviously don't what you in are look and What fully of opportunities biggest think could lot front and you a looking them. some take but growth XX balance here? really the you probably months investments of difference advantage you And of at? have next peers kind the still as of of have do some So the sheet to make have

sorry, I'm you little up bit. broke a

to specifically your Is speaking question? You're digital. that

think are share of the in I or and Yes. but you're that at broadly, position. months mean, initiatives the a terms kind while next particularly imagine is more fruitful I you in guys to kind areas things XX continuing any of investment could be you looking of that take are like focused of most over of the being growth on weaker pretty just industry digital, able

great and go down X this move of we it's next first year. talked all, to we've about Well, into as a Yes. are question, paths think I There internally.

face general margin in is the industry banking facing it, Let's compression.

a from depository revenue. struggling Some It's to perspective. competitive banks highly are grow

lot next I of year. moving there's into So a certainly caution why understand

strong have in capital, we're given strong position. a think I But capital position, we our

tremendous liquidity. We have

which expansion investments online, with in expense coming novo made space, are in that. retail We the comes de along have

So started invest we've in to those already projects.

we're to this contribute beginning they last the revenue -- depreciation you'll start with to or year. So the we number where see those. our of late expense generate of at We online right? them coming now at just But or should launched point year, a effort,

of So perspective. growth as we should higher feeling much more there. And legacy a be not seeing principally good from as other are are growth at some markets pain that some success markets those the

So about. we're our optimistic about that very I of about there. We're performance the common also optimistic app the build-out spoke

products loan depository multiple time. the able multiple going You in products we'll can training multiple products on doing and been loan to capabilities some and is for systems today. quarter, By on one our our platform of be And purchase with on this We've training buy end the application. field. on the our

you're to pay off. think to that going I see start

We also people. in branches changed having started several instead the the We our bank. and model tellers relationship ago in of out consumer platform bankers years rolling

those more profile folks So that bankers basically a finally of transactions. And terms should region trained we to in then are position, doing the the with other cross-sell help sales this -- number bankers over highly last out in just are have of which beyond converting branches We're driving institutions. and the branches. closing bankers in there higher banking back product at pulling

with So space. platform from the quickly, us more treasury I investments will in opportunities management, we've in made pretty help . We clients. made our companies. long for made to companies capital presenting invested presents clients more I commercial specific, digital think a calling position clients. and time to of heavily becoming them been capabilities we've in We've us market We've a that for been more a wallet -- investments with mid-market with by primary efficient different business which in on institutional share onboard after go think to platform to we'll after in be the client more right, that for we've go to in investments have -- assist that perspective, itself a larger

than think results on. experience definitely really, we've Well, we that it. peer number I have to that's of we're worked a think because areas So going I my commentary. better of that And

business our also, small platform. built out by We way, the lending

into We Where treasury bundle and is continue program similar to the a our integrate to on management common plan app. that. services focus to merchant

to be going on the in quarter next first of is that worked So year.

either the We small are XX,XXX have or clients about clients that depository in business loan segment.

X% about merchants So a there's -- to in X% I with bit we think that have penetration space. quite

those income growth more bit made. it believe moving be So and makes it the investments year. do that for perspective, continue for are there's And during from when pursue time, revenue I investments this others that this there to to we've sense of at fee to we've some on those opportunity quite strategic a company and that. of do difficult XXXX into focusing drive been a might next And

Yes. No, that That's a flavor. makes a lot sense. of great

and and me then let in. jump step I'll for someone back lastly else Just

capitalization franchise, a size, of have obviously, a executive as the at about you team lot of curious, the side, with guys And the right Just is. growth asset the around spectrum conversations imagine Board you projections, question. more and high-level there's near-term constant of the question a what I level the than the end the conversations on But about the of think capital. higher

was grow don't -- conversation curious higher here? the it's balance internally of moving level what you what what but around capital over kind any And just obviously, what kind is updated mean over you the F.N.B. just everything to the just taking thoughts think than years sheet have right mean, around share I it number and like the think right the that's months? I'm do think maybe XX of for forward? a continuing get last you now, you to as given few there I happening. next about capital is -- curious

capital we and position we Well, cover that of meeting board liquidity have. company in the Yes. every

investors and in we talk when we're That returns. balance Board around to expectations. what performance. happens detail strategies we every discussed relative how then and various go the those in And we street the pretty elements of expects sheet a the financial We over our meeting. So performing team about have separate and expect maximizing what

had we time. a the for that long topic a I on think capital is table

less AOCI the in because seen impact I businesses profile capital loan as commercial position, that conservative. capital in, participate risk consumer with operate think a you've having others reviewed within we actually that the the while we very lower we we're given impairment categories

you $XXX billion from our greater, I is we growing, are you're we XX%, we in I greater today are for and comfortable of we look pretty X.X% a TCE from that If at at perspective. understand with where capital and where ratio feel CETX with see in the been positions going to regulators where today, better are given think expectations we've years. one we're But capital.

We portfolio. have We've a lot a spent solid in very energy. of time

has lot. job portfolio off with a done tremendous pandemic a $X hospitality, de-risking that sheet the sale We've we before Gary billion adverse the with credits moved occurred. the of of balance even the over of basically the have Regency, done sale sale and

great in We are where it position at we a today, we're every feel think from we capital and I So meeting. perspective. address a comfortable board

If on we're common you quartile. look at equity, upper tangible our returns

at good so very and performance ratios, with capital even pretty ROE, XX% -- still we're we solid higher profitability. So

questions taking you Great. All appreciate right. I Vince, my today.

dividends thing on billion over by $X.X capital or capital, well. more One share deployment as We've out billion to $X.X through to in shareholders repurchases dividended the or over way.

I management, that we discussions that's the part So the think Board, in to there. just in throw capital when you with of the company about have think that

obviously, And much capital distribution higher part of we capital, benefited have So have that from capital equation. of that have retained our ratios. the immensely. shareholders we That's

evaluate are anyway, quarter need to where we that every So we we feel sorry.

from from The Instructions] Navas next D.A. Davidson. comes [Operator Manuel question

a bottom the up are where kind NIM. next thoughts What to on wanted have there of just I it year? follow-up updated I follow on and then Just deposits. on could

bit Vince I'm sure are where next us ahead, today. Give the Go Yes, we little of think not Vince. year. for let that color I'll question. guidance I a answer

mean guidance far fourth of -- I at quarter kind when mean as think, I year provide a I we provide but mentioned, as coming our our in projects third I thoughts as quarter. to down we'll next for again, I And just to -- budget next half year, year have we mean for our do of next similar started year. we level maybe the first the but January,

hard think kind there's bottoms down our kind be I somewhere quarter, of I exactly still for it things would of in of finalize to but thing clearly the middle on So could budget a guidance came change call January. But when $X based is some million. movement compression but sure, to net earlier, are talked they interest mentioned today, the by in 'XX the we way only third the down similar out down quarter put as it's moderated. the time comes about the income, and fourth the If is I

So the low a the important, very it. think the our driving of XXs. part I net interest efficiency in And right? key ratio income That's sustainability of is

I So more January. might actually as on. to the bottom far to it as commented what it's as moderated level come in compression I know But don't out. definitely

there? have some where seeing on looking you seeing -- of through On appreciate you customers, for. breakdown is kind the funds? I customers are what you're is just current customers Can from color bringing there. talk deposits, the engine do that you from more CV definitely new powerful. winning -- what It's over Are you're

I would Yes, say...

Yes, -- Vince, go ahead, I sorry. I'm think a it's

you No, ahead. go

think a combination it's of going all I -- above. the I to was say of just

I persuade is part dollars the to to folks of think strategy over. bring additional

of campaigns on principally So some focused offering, offerings that. of money The the we have. the market some that CD

I think new quite of bit customers. success bringing in a we've had

XX% customers. in So the is money comes new new that north of of

but XX-XX, worked. than better it's it's So

because that the Let's and with betas better the into is customer put able that we're reason to and migration we AI successful, principal base a little really we why our of manage with the and way. have put insight the place it But our a behavior. the think we've within been I tools lot really our than able look scientists our us at if little spend we're we disciplined little been data of we've and more funds Maybe and better. data pricing. to And And the helped time that's a with you I others. hub have, margins that a think analyzing cost of that

a So critically remarks, shows consistent investment management for mentioned that as I I I that and that things in treasury being the also requires said principal bank there. But businesses, is important, it believe all kind early. technology, services, my consumers in the of and

hand. both go in So they hand

appreciate And have new just your -- best on rate offer? rough Do then book that. average the percent I you briefly? talk muni current CDs a or seasonality a the in the what's rough about

don't details the you know. my Vince, those Yes, I I fingers. have of at Do that, Vince? don't tip have

Yes. promotional above. right a and around little rates have little mean, of I below rates couple the or I X%, things. The been would market on money a say, CDs a

all place, balance the -- had as data that. overall supporting have money of to talked million through to tools kind since $XXX the is of what we've is muni we've we of million in in. Vince then And with I've always brought $XXX in in about said, million dedicated So comes the May sheet. the analytics flows, And new close kind really that's and range it the $XXX

that the the year, And money where during you as small the quarter accounts more is in and most of builds go of a kind the of at really through first amount always that and higher November in is it's categories. the the that end -- trough money the most flows through. sweep peaks troughs kind and and spread recent It's of throughout quarter, it's then DDA And that. market really and through October, the

then above second. had much obviously, given that And And a appreciate of thoughts through this of All your organic walk in, buyback? fits on -- that probably growth are But for quarter. just switching right. that. updated kind so is first can kind target? limiter I of You topics just switching just that Is there? kind comes buyback where growth. main you gears the CETX What

our comment above so target. we're Sure, a the I can mean that. little I on XX.X%,

the with the during work third not an quarter, always, that's manner growth the uncertainty, be managing a some opportunities second third aligned expectation active, in with in when to assessment, we to money to we -- active just was special during in were committed there. think we're great quarter there I we the that third shareholders. the might happen the and had, were of as fully to quarter. It's And capital decided plus put there quarter, the the timing

active have plays strong. the the XX%. we've room We we our how this of payout that worked put overall number to to strong kind in to the and do The get but there's to it always and become fourth But will and first out. build, all generation to And now work. loan monitoring growth cap. that. closely environment we that stays down the hard that use growth. of we're dividend to quarter, earnings That's So loan may want best We really flexibility the we'll support have use where with clearly, really it. see ratio We'll

wanted other the transaction is the this mention quarter. thing to that we closed credit tax Vince, I

field. is asked, transactions, energy We Some folks the a business have that like have pursues particularly in that onetime credit tax No. actually event? a

So over pipeline there's tax credit we've a we of the number few of And them a transactions group, that done last the years. pursue.

delivering power, actually is So have a to the from running sometimes, or business you to financial our it and it it's because that terrific up takes certified we finance build done a they corporate and time start time takes before whole a it over can be last area, perspective. right, have. because to process lumpy But years. and they've the out job get few It's in that a field solar get stuff

the book tax low ends So because margin, I you confident tax many positioned benefit. we've a his the the up all well, the . But doing that team mix And as have that say, of just profitability up show and a next winning everybody that, very done well Tim keep well, continue pursuing expertise, would a get just to impacting that profitability the and then understand. you're into we would on right? year expect these opportunities. extension to credit, perspective it because because add actually very has and so That margin, we of from then I benefit, well developed asset an that of well a that that's the doesn't we has way as part but we're of same to that people

that's So additive have ongoing something And we that. clear next wanted as some that, well. folks to on were an and pursue us that make basis will we asked year to I about sure be

capital provides too, right? it And

Yes. Yes.

from The Sandler. Schiraldi from next Piper question Frank comes

hike, mean, mentioned if If I terms rate wondering the we rate of In get do you no NII, I'm for or anymore of guide hikes. a in additional meaningful December November just terms that's just balance how to an the NII. on what sensitivity about annualized outlook. if a for that And maybe could sheet bit basis rate longer managing little adds talk you for you're the higher

I Yes, would say...

Yes. I'll that. answer Vince let

rate for the any doesn't quarter much it's right, do the mean quarter. fourth late I Yes. in movement, really Frank,

. When status out neutral there. to if impact mean, be of at has as look getting where towards get at that XXX position, ramp kind in X%, a we've IRR mean, naturally is not not to an of X%. I by been minus around our -- each benefit Q, gradually And with XXX are, gone plus when that big there. we rates year. next I we the will I you So kind of it's the much quarter look ramp IRR even there's our mean moving

a loans we're securities So to continue rates putting rate. have be portfolio there's actually higher benefit both because on on the you than ways investment the

kind XX the January you to that. grand not benefits in bake really not move guidance to from that into going it's much. we dial. it going So but of the we'll do But doesn't it And it in things, give get basis points the -- when it's out, scheme of

thinking a think the the as lot run then being you investments think in a that as so more about point? just And talked an to about expense right potential Should about that, Okay. about guide. leg of rate think that a you better at way just we expense are there's the made. Is is about investments XQ acceleration down doing, this or to and given potentially, guys everything

you Vince, want know I don't if to...

talked in comment I the can invest that. we've I as continuously Sure, mean, that, on about, Vince Frank. know company.you

You a covering for have time. us been long

we in that, the XXs. a the revenue. very company to been generate ratio efficiency able And good maintaining So investing how it's do we've low to future part run of

the investing And CapEx and spend the right? revenue of business. just have we our in where we conversations drive can part markets, it's running So internally future are always focusing

very the [indiscernible] are Charleston through markets attractive. strategy, ATM new markets and novo added de through that our strategy expanding Virginia, We've

part -- investing revenue quarter, for in. accruals and to future then us. I of which that's lumpy the mean incentive little in a those the it is the fourth comes So investment in generates year, markets, the new of or be a also it's things the can types as it those always end plan expenses of finishing up

So mean next have as guidance we'll year. taken $XX so in as out cost when a January target we or cost have grown I the every we scale. do million we've and savings we've for year, our in created

generating operating Vince initiatives de that's how And the growth, ratio. So we infrastructure XX% talked novo that support to efficiency we company. part and positive low that on digital having a always about, of run investments, that the the leverage focus

a I us So focus company. have it's the not And easy, but within think the it's served well. investments

So it it. to will be of continue part

to really not it's really question, company. Frank, good the run So step how it, of just a we it's a function but it's part

kind look you 'XX just of XQ? just that could Would over transaction totally that tax activity this that that expected a part I'd lower, as the that -- Or renewable part business then deal, Great. ramped the you get. bit just of see guide, lastly, these of on get to XQ. potentially And rate kind where that for that your say just credits if the than energy sustainable? degree say, you and lumpy it's economics too? tax XQ more except up is just and Is would that's rate say several the last the a I in of at that's quarters has Okay. -- of Is you the there

closed we next the The that transactions the the the third team go in it kind into deal effective credit the as that of out a quarter. gets the of year is kind But is already same for and completes rate others also happen the carryover benefits tax after. actively year that this there's fourth on then solar that fourth tax Vince in smoothing And Yes, quarter. that said, working and to the bulk to third pipeline Frank, could for the quarter, And tied recorded transaction. quarter there's level, really we of 'XX. continue just

really tied the just this but to -- quarter. the the kind of of So smoothing and fourth it XQ into is transaction

[Operator Montgomery. Instructions] Brian next from comes question Our Martin Janney from

but quarter. one guess, for guess far on contraction the Vince, appreciate I me mean, I margin I to a abatement of funding -- the DDAs here as the color as this minute, guess, go, back the a the Just I slowed pressure just the for again bit on the I -- and

on just where we're that how Just about just in there, kind new you you're nearing think production of update maybe thinking if kind bottom is a and an loan wondering on? of coming general

would I I say, guess, me Yes, let to... talk

ahead. ahead, Vince. don't Brian know Vince, I which know don't go -- was Go I asking.

X.XX%, I if that on that you which on maybe, be probably new second about during the The talk noninterest the bearing in quarter, Well, good. X.XX% quarter. on And we the came Vince, made it loans. at would afterwards, then can third comment the loans want was strategy to from up

to rates we mortgage kind on where third the Xs the quarter, here in of mortgages and the are. and in just loans sit mid- came the So today, high Xs as given are those commercial during mid-Xs

me. spot above so benefit that where have level and pretty is basis at higher that good mean long of every the then and -- that through. the meeting, and going we've points is. And versus level pricing that X.XX% XX% from part new peak So the in familiar were just to it's every of loans work hard focus grown right? I has of rates do, on coming And you're at with. we as before portfolio everything a we're can, board portfolio We've you're as high Brian, to that the getting to up we were meeting, we been I've pre-COVID, as noninterest-bearing week been as XX%. the portfolio We slide keep I XX% I kind deck, ALCO deposits a overall mean basis XX with to number think here overall every a so... rate yields, on Vince made we

from as noninterest-bearing a on people during it We I've to didn't at here then, fact margin used a see all you pay you then wasn't the the I and much. the people them Page drive talk back we it us to to benefit attention STP frequently, deposits, XX%. if in XX%. rate -- our to comment to deck coming mean, value provides benefit actually with performance our stimulus. didn't and Basically, the substantial about but with the lower you goal been XX can talk XXXX, time, I point. a I great. know were today, what surge them strategically, Demand was But on environment, buffer deposits. in perspective. And goes really up if the Yes. pretty saying the go XX% investor look, interest It's about that

We we're on we that. client He on chance So primacy first about focused are. trademark has good feeling where a pretty term.

investments depository businesses. And So can branch calls consumer again, depository and side. bank make our he disbursement payment for client products like novo principal just said, demand place move in primacy. back that the that internal in the principal new locations other to bank. That's to and don't of we deposits disbursement rolled to ourselves strategy the on de drive It's products digital. the some consumers that and be services, make much. sure households and a we're put that the bank we I out we We've where continue hub invested around We've TM establish the we in why help that invested these in as us

it's week. to in to in go being -- many the on are relative So disbursements mean, balances here. to a cover have cash services, that to just parked month used a or others. not They're come those remain not instances, balances throughout I

much pretty embedded. it's So

their to demand deposits. little pretty were say and not deposit rates our individuals, including in mix pressure companies of leaving a money course, about That's when So here. because lower, we're we're there sitting confident sloppy feeling about myself, wasn't

changed. that's So

returns expect the consumers balances and think I the achieve given the expect can invest businesses those they today. to

hope sources. So are a demonstrated I that depository of institution low-cost time heavy here over pretty solid long helps a on emphasis -- that I funding you. we think period very Anyway, we've that's with a

up Yes. could go but No, lower, peer that's better still bit a helpful. It and sounds holding still well. it like than

maybe ahead. go then And okay. So --

Yes.

can think we'll if future peers. going model. it'll I outperform because to bonds. I in interest to future the trading who -- here our think of I think I we're speak rates, can't -- predict where to I business be at what the outperform wouldn't going But the we're think I knows -- be because that

So that's...

Got you.

this Okay. how in kind just conjunction quarter, Makes the strength to the mean sense. reserve. marks, the with touch but pretty think reserve the about was Maybe I of in Gary still inclusive one down wondering on of just a for healthy a credit? level, the reserve

the Yes, peers. quartile, position it Brian, about our good and perspective. and strong here upper it's it's the of from discounts We the portfolio reserve, mean At of compared I a the I the in mean, year. feel entering terms with constant unamortized is where end of focus X.XX% to XXX% the

expect would go to forward. as it similarly to track we I continue So

And portfolio me, big other there I portfolio, this some there a SNC SNC think your remind credit banks how was Okay. out with Gary, is quarter, today? a

essentially balance is it grade. and up investment right Our grade XX-plus billion. of it of SNC essentially the percent is today against portfolio is investment $X

portfolio well. has It's So that performed extremely extremely strong.

we focus buy Our don't -- paper.

customers customers focus Our in and really market. our is we on that know

that to and generated it We've has Vince focus portfolio really period exceptionally itself well portfolio well very continue significant that a to perform well. over that proven time. -- So referenced around continues has long as in of that deposits

So very strong portfolio.

portfolios. to answer can't loan you syndicated compare every question, hate I bank's the because though,

have buy buying a that ancillary bond business, we're participations leverage going our we're finance if that have, deal player side, in not participate we're economics. participating customers, we the think we the portfolio because having to of in a have a a just than in we're on we just rely in deal. is Those us company. So rules that to on of Their one -- bankers to get a America go and and for type leveraged different relationship transactions P&C Bank They of buy a out are that's portfolio you or can't less into with bring the particular, yield.

have big also, of we a we portfolio. And credits So Gary's syndication grade a syndication because then out. point, a we lead that investment of have we in looked that number effort credits to chunk

So so in the that we're consideration. be would be that needs into number included all taken -- where that left to

Yes.

not private We the It's on with. As leveraged really have Vince indicated, finance we call we're have relationships business. business. equity don't markets that our a in in customers and

So business for it's book very of strong been a us.

but there. color commercial not giving and quarter. this the guidance just pipeline. of you're just appreciate the one on was the I all Got growth know then kind And any consumer last maybe 'XX, given I you. on

see relative where kind Just are Just it? to frame pipelines you today do of at the quarter? to how want last

we're funding quarter. a We off previous can of -- coming

So typically, we what set. happens is pipelines the

in XX% the statistics at rigorously. markets. I across think pretty just we're of between market looked the I track and and most down X% it the

say So down but X% to I'd still XX% building.

overall, our that I think rates. dramatically because portfolio when dynamics slowed you climate the I the that look commercial the one, of at loan of think portfolio, attrition

balances. I to two, going demand going stabilize capital slowed that's think So for has into help year. the number one. Number That's next

the Total what is have then on a tend to be utilization of close overall. build mention what front. So pipeline, little focus bit, thing versus it depending some ways, about with again have slowed on I short happens which was focus slightly, [indiscernible] rates obviously, -- XX on days that's I'm the confident the build. And more which X% an the economy is or third I I pullback. because the will year, But wanted it I indication, rates next That's declined at into And that pretty think pipeline in decreased we and down part why that to there's right? going X%. look particularly, both interest a

rates. we're book, the an X% that X% And in decline back. a commercial So kind are to indicator to in me, that's pulling borrowers seeing the utilization of

those pipelines And just X% Or lower you. you're X% that both the was talking for to consumer pipelines commercial? yes, Got -- primarily and commercial?

more basically So space, If we're sheet, consumer need more conformance margin becoming little I to we competitive talk the off competitive which in mortgage, push on No, more the We're I'm is was the space have mortgage a right? you're it we stuff. commercial. which to only in. speaking sorry, bit. than to depends Consumer It want sheet. balance -- balance the impacts gets off we pipeline for

growing been and we've mortgage our consumer successful very business. So

that customers. book mentioned looks to 'XX, there segment, in mentioned call. states. a I the about customers worried earlier I brought moving pipeline an the I to small care which pretty emphasis small that has do falls developing have well. too said, not pretty of The for health huge across under business pull off I'm is that good. And we business on group, I into up. that. opportunity those area of paid boatload we care, pipelines physician's So as program has That that performed are have products XXX,XXX in which a of The health has I kind specific we think consumer business and we in business grow expertise really Small business. on some mean head XX,XXX small have X of we're why lending first the our

So and to for recent the I most capitalize to levels, our small continue business at record pipeline us at was on would that. expect quarter

the that not the and higher -- mortgage consumer doesn't but the in purchased to pretty mortgage don't or right, heavily where the a footprint, loans, our is that the -- rate really, much anticipating invested it we're the issues money with platform that pretty total, I That's know bode are. interest contribute loans I as retail recently. should for the broad the across environment we've majority originating in tougher, well we of bank. we're

in 'XX. business that consumer the that confident with pretty have. application we we're equity we in opportunities achieve the that think also results other we us opportunities leads better to and we home So will the mortgage like help And than out, can segment. And peer then in rolled

a space. open home to account a able loans and depository for loans will consumer us simultaneously originate in being applied metric help the So

Got you.

the last just on efficiency. me one was And for the Okay.

the and ratio what that Just feels level this going managing is XX% think about given of expenses we a we saw comments kind efficiency here quarter sustainable forward? should like low of it the

XX% to we're target part as That's always what our of program. here -- we as all because well We achieve. obviously low we hope said possible, XX%. target as want expenses right, to We to we've keep stay to incentive incented

I to as move very grow investment, on a going capital stay strong we're I difficult growing given risk need managing have diligent. I we also our we into to very our we we're capable on think time. to revenue through we think as But focused digital be think what going liquidity, that very So position We're that 'XX. And this effectively. in move of here,

revenue on side, So to least the contribute believe manage I outside at -- an the to positive opportunity to leverage have relative operating peers. we'll

expense So but there's it. there's revenue build, coming also along growth with

people kind been periods [indiscernible] long a time. it's for of and strategy. the that's where So know I there's the issue. into It's strategy lumpy ask

believe. an the can outperformer over of to I don't been decade, at peers a long relative period we've see the You a results for time

that's So anyway, where are. we

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

Well, very I thank questions, very detailed to just -- the again, questions. questions, good for I'd like everybody

to time, thank participating. our it do I can't I every like people. So thank would again, say you great without this employees also for you but

employees. employees enthusiastic and the shareholders you thank to as for end you what No a continuing through thank us. to confidence the at to and engaged we the work together because I'm But team. in matter come basis, the have So we

as here. choppy deliver these through to continue will years we move We

everybody. So Take thank care, you.

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

now may You disconnect.