F.N.B. (FNB) 18 Oct 242024 Q3 Earnings call transcript

Good morning, and welcome to the F.N.B. Corporation Third Quarter 2024 Earnings Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Lisa Hajdu, Manager of Investor Relations. Please go ahead.

to call. welcome and morning, our earnings Good This of F.N.B. conference call reports Corporation statements the measures. it Securities the and and financial forward-looking with contain files and often Exchange non-GAAP Commission not viewed 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 operating non-GAAP comparable GAAP earnings presentation measures to our measures directly are included reports corporate contained refer registration to Commission and non-GAAP with our Securities statements and Please materials, the forward-looking statement filed in and related disclosures available website. these and Exchange on our

A will replay will October be will turn to over now our Investor Chairman, available link XX, the to until of About Us, the and call of Friday, this Delie, CEO. call posted Relations Vince webcast I and President website. the section be corporate

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

net Credit shareholders common $XXX our me or diluted reported share third Vince items Gary [ Joining are $X.XX million $XX.X for significant million today after operating (sic) Guerrieri, available impacting our Chief ] and (sic) million $XX Officer. per [ F.N.B. $XXX Officer; million of income Financial earnings. to Chief ] Calabrese, adjusting quarter of common

value growth, with common return value with and record demonstrate operating to equity XX.X% book our revenue third maintaining a The drove CETX tangible results quarter's sheet XX%. balance shareholder of of of our tangible throughout produce significant quality and our XX% noninterest-bearing ratio growth average on balances strengthened an year-over-year and ability We at linked-quarter billion. generated loans deposit deposits stable while footprint approximately $XX

nation's market a Pittsburgh banks. to of across proud In continue environment, retail share #X particularly is our position. from the of footprint it this largest in gain share a and in number liquidity achieved we also MSAs competition of position our are important traditional manage deposit some and capital despite our ability We to

about clients. sale, capital while completed balance allowing auto a Vince the gain minimal HX earnings and market assets will liquidity diverse model ratio. $XXX us as and be to loan-to-deposit we the share, details to can well our capital as million to quarter attractive with ended an has again attributed $X.X the quarter, data F.N.B's lower-yielding continue excluding billion, the our at linked-quarter loan of at deposit its billion, which as Total well improving through from ample from successful when as generated emphasis loan his or deposits our on and ended footprint Total billion and exceeded loans provide the business support remarks. indirect growth remove to a a X.X% benefiting sale. increase new sale forward $XX.X inflows. deposit that initiatives sheet X.X% the nearly increase F.N.B. seasonal Calabrese once loan published the quarter from the During to impact second annualized production as $XX.X during quarter, was

to client successful strong deposit and relationships. the Our growth efforts establish commercial highlights our and bankers business deepen of sequential

deposits capture and and environment, Clicks-to-Bricks also our capabilities We households our data-driven generation. app. to through existing through We geographic business leveraging consumer data small in branch diversified lead our eStore Omnichannel, and strides market new from leveraged analytics digital and have and common footprint deposits effectively retail made award-winning

last of $X.X decrease completed needed. loan million F.N.B. to when ratio Our billion manage the nearly execute points generated of quarter. ability to change to of X supported a the third strategies XX.X%, loan-to-deposit our loan percentage improved sale deposits and the nearly a demonstrates ratio quarter $XXX This-linked-quarter significantly In from growth. alone, loan-to-deposit

Clicks-to-Bricks customers' primary across and our aided strategy bundling strategy being ratio commercial our through loan-to-deposit digital both the capabilities. long-term of tools, advanced portfolios, the manage to continue will bank by and consumer operating product We our

X.X% This net all-time noninterest interest revenue driven levels. income income and million quarter's an stronger growth was of total of $XX high by

our We down and share segment. management led including and growth. benefits, expect driven we revenue quarter our higher our further totaled deposit diversifying strategy noninterest leveraging management ongoing expenses risk investment partially of market in $XXX continued $X our Expense strategic support initiatives increased investments, Capital necessary Markets priority, Operating million We and a by our business expense and associated high salaries focus a advance million, remains hiring to to sequentially. will that be infrastructure. expenses streams marketing strategically with to lines on deposit fourth in grow to robust expanding

a growing diverse management expense third the to ratio Our of revenue led efficiency streams and peer-leading ongoing quarter. XX.X% in

area serve our maintaining continuously enabling guidelines, ongoing to is and focus consistent customers. underwriting us of Another conservative

the Over the overall credit risk management to the continues concentration Gary has risk various to credit call proactively team a effectively credit framework that, well. With now credit to review This built will comprehensive manage through to cycles. last decade, and our serve performance. long-standing pass economic in approach Gary? I us to

and XX X were Vince, the the a points everyone. our with bps good stable quarter portfolio. and stood $XX.X XX metrics [ bps the Criticized million XX linked-quarter a in prior XX (sic) finished bps. Total Total funded expense XX basis, current Net at at improvement from asset charge-offs. delinquency for environment. basis XX solid quarter points basis you, Thank NPLs quarter up with and basis charge-offs performance the or basis year-to-date across We and points at on ] provision levels. loans the down basis, ending the economic points OREO on points, covered reflecting morning, slightly reflecting quarter remaining ended up quality at XX basis totaled

respectively. NPLs number XX with ending course our renewed primarily of a related to $XXX slightly (sic) were coverage The position of the were ] CRE and points, prior stands was business in and satisfactory proactively up increase [ up and normal increase on the continue early-stage XXX% strategy delinquency XX increase at the documentation, by of committed one quarter-end The are after unamortized that delinquency nonowner metrics at and to X.XX%, point remains and million, portfolio our basis inclusive XX XXX.X% NPL of remain performing credits reducing placed the discounts. at earnings loan which strong had The and Page at was managing several at from reflected ending reserve current. now matured credit deck. of nonaccrual X of remain that driven to When levels our funded basis CRE acquired reserve $X.X an We as was on credit slide X.XX% including at Our status. NPL quarter. nonowner the in exposure stands million, discounts,

review resolved our largest property maturities, market footprint and previously conditions monthly in basis, have for the we'll upcoming we exposures the a various as and communicated past. On types across

approach any a believe our to engage a we targeted potential stress to allows our credit On risk we along our quickly perform As portfolio customers management test. special losses. of assets experienced to with us full working Vince mentioned, quarterly necessary, minimize with team proactive reviews when portfolios, basis, various

remain credit to withstand closing, again, at levels, our quarter confirming results covering severe our our projected prior stress lower charge-offs metrics solid loan shown provision testing enables various for stressed ended stable. ACL portfolio that quarter's downturn, compared of charge-offs scenarios. to again XX% our have this once and economic current continues our in the the with quarter loan approximately a economic us well-balanced Our to net In results stable and portfolio

in to systems and credit continue align core We and management our credit with invest consistent that risk staff philosophy. underwriting

Calabrese, various strives through while to the cycles. economic Our proactively risk now the Chief to our company for tenured will teams prudent loan leadership Officer, banking managing maintain call turn his credit to growth Financial experienced Vince enable to over attain remarks. I

and and on indirect the walk good morning. financial fourth through Gary, loan sale I will the focus quarter's Thanks, our guidance third including Today, quarter. auto results, details the on for

lower-yielding quarter $XX.X per the The indirect [ $X.X $XXX the net $XXX ratio CETX totaled Third loan performing XX positively $X.XX ongoing million sale software balance approximately strategies. of loan points. million the and approximately capital by on XXX or excluding ] million share management auto ratio as of by million basis operating part sheet loss our were indirect the auto and points million impairment. sale when loans income impacted loan-to-deposit basis $XXX (sic) sold

linked-quarter, loans of the a during level mortgage originations residential billion line geographic million base in or billion. of X.X% benefiting Excluding $XX.X loan remained revolver or a attractive lower of Total second balance mortgage that $XX.X with or led significant across footprint. grew successful linked-quarter total quarter. volumes closings and deposits September at the $XXX and from $XXX.X million, $XX rates of value growth Commercial quarter demonstrate excluding the a the given linked-quarter, by leases was of and in increased sale, expectations, as robust the the million Consumer period-end our ended loan loans granular elevated in leases given initiatives sale loan deposit pullback increase of commercial the our our reflective balance. $X.X deposit X% billion, loan very third

sheet has at point interest-bearing a around growth loan deposits at by discussed total and XX.X% $XX organically growth demand Third implemented. quarter, loan alongside compared our of XX.X% of growth quarter, June strong million deposits initiatives X deposit and reduce ongoing improvement totaled September from a remaining quarter through deposit was quarter-end deposit noninterest-bearing nearly at and and gathering ratio noninterest-bearing in time $X.X mix balance deposit ratio the XX. billion. last slower to deposits. billion The led interest-bearing management XX, and stable our to initiatives increase deposits a increase deposit several led to our $XXX loan-to-deposit team seasonality our to in reflecting fairly Success Last goal balances deposit loan-to-deposit percentage of I XX% XX%

continues mix be due totaled strategic by as prior points X.XX% expect X.XX% increasing XX quarter, earning This deposit well a the X.X% continued to cost $X.X in borrowings shift yields in million, interest the income X loan-to-deposit and an from decreased balances. higher basis $XXX.X increase liabilities ratio deposit growth linked-quarter. balances We the primarily the increasing XX% offset fourth of loan in and of stable partially quarter product or as billion total be higher-yielding points as relatively million interest-bearing focus. as interest-bearing favorable Net asset was $X.X a or to growth to basis to deposits to

March of interest cycle. net August at Fed the XX the X.XX%, interest resulting second XXXX, through 'XX, cumulative our beta rate quarter rates spot our raising stable in hiking quarter's Third XX% Since equaled outperforming margin. the total of was peers deposit began with margin

towards rates We a sheet manage position balance continue interest as to more lowered. our neutral are

Since decision basis quarter At offerings. by current end, lowered in rate CD billion and portfolio reduce currently to deposit have CD non-maturity XX the including a are billion maturing funds products, $X above have market X-month of on rate several we of pricing billion strategically September, X.XX% promotional points our a priced and duration with the deposit $X.X quarter the in money federal Fed's X.XX%. we and average deposits fourth XXXX of or nearly that at at weighted a $X.X

Additionally, $X.X beginning mature and in floating of of we XXX have or of and billion between an rate borrowings average that with rates basis billion around XX $X with of X.XX% swaps January 'XX rate short-term points.

to in market quarter for noninterest XXXX BOLI income international million the a noninterest million largest insurance and activity from higher million the volumes. as increase banking. share the benefits on-balance Capital associated increased capital million salaries speed $X.X infrastructure. of focus reached net the income expense. strategic levels increase items. operating the in in lower high banking strong prior increased prior increased and $XX.X our given an ], declines well salary [ Operating rates, from reduced hiring income expense by (sic) mortgage totaled million million, quarter, income from adjusting MSR sheet employee $X.X million driven Turning $X.X of swap and given offsetting $X.X in accelerating Noninterest operations production mortgage risk management production debt all-time in million to customer continued contributions increase from the to production-related markets our an The X% prior and significant prepayment assumptions saleable investments due with with recent the as and [ in claims. to driver of deferrals impairment reflecting income for $XXX.X increase syndications, grow third due million was quarter broad-based $X.X variable life compensation quarter. $X.X ] $X.X Mortgage (sic) a markets, expense million, $X.X after

the to tied initiatives. for million $X increased campaigns successful expense marketing Marketing of deposit opportunistic timing our

growth initiatives highs into We continue to third at ratio incremental a are common revenue revenue generation. our value expense at XX% the our XX.X% bring a growth, the we expense quarter, of internal efficiency capital of disciplined at remains demonstrating growth CETX cost-saving and XX.X% the providing prepare to up in deploy and book better to peer-leading manage level F.N.B's a XXXX with levels our budget, $X.XX X.X% as a for manner, of to working share quarter. $XX.XX, some to a number base balance. on tangible we With tied tangible last capital value. ratio and On flexibility all-time year-over-year shareholder slightly capital to reached common from XX.X%, increased per to ratio or equity increase basis, commitment expense

on projected a the full the to Loans expectation up year are inclusive basis, XXXX. of balances for grow grow digits. sale. Let's basis, low the quarter previous guidance on of now deposit a are fourth to single from at digits the year-over-year expected expected loan of digits Total look mid-single mid-single

fourth projected November rate expected basis income and assuming million, XX December. cut in is $XXX in interest million point another be XX point quarter to cut a net $XXX Our rate basis between and

be Given of level, generation, strength to than activity. the quarter quarter $XXX we're million, and be third is expectation to is $XX on We noninterest provision our million continued and and charge-off million. million. growth to quarter between $XXX quarter loan and lower $XX net Fourth million noninterest fourth expense range the anticipate a $XX to $XX of dependent fourth the million expected guiding between income

any does the tax that between tax activity be occur. year rate not effective should may Lastly, assume and XX% XX%, credit full which investment

sizes transactions that, will uncertainty when of With occur. leasing part recognition our financing the energy and of on back investment the in turn call with tax model renewable are mentioned, previously deals business stages company have in we pipeline various I to credit the As will Vince. with the

to We as success work customers behalf the to our impacted Thank impacted Helene and with deep recovery F.N.B. team by communities. months. to coming includes offer healing those Vince. to our who want weeks we On affected customers fellow is if reach evident top the support relationships grew we hurricanes encourage the our continues the hold or neighbors. days, and they we F.N.B's Milton, directly and We out F.N.B., penetration by markets support assistance. in build our to in members, you, I partners in deposit F.N.B's are require throughout reputation the of strong our ranking footprint. share XX% now year, area we Hurricane and X within nearly our of MSAs including over XX% in maintained X MSAs of the top nearly deposits in states. past across operate the F.N.B our in with in the deepened in

Our additional one as recognition quarter for Mid-Atlantic. we and diversity Newsweek's most workplace medium-sized Companies, Bank in this Best regional as culture, and one experience. Notably, designation again enterprises garnered and client recognition awards World's inclusion small- and our performance Admired Best national once of of the Finance global Magazine's with and America's received Time's Workplaces for Global

retaining workforce. We of the conveys experienced quality and focus the our on individual. talented performance also most Our hiring and

to enables Our scale our effectively. investment workforce in us

of operations larger and/or management experience to and wealth fact, accounting has institution revenue-generating senior areas. XX% our knowledge our and risk of team a public bring management, In

revenue, call ongoing open execute Thank success. our and and optimize As mitigate for caliber and questions. for I risk, proven often now Their translates ability these in strategies our effectively up for high is I the diverse have cycles directly various dedication the our support. of stakeholder to on balance to teams their our economic through our value. we experienced you, their directly calls, F.N.B's grow stated results correlated successful on sheet and our will to team. shareholders navigation our employees thank

Schiraldi Sandler. Frank The Piper with Instructions] comes first [Operator question from

against Obviously, in deposits. bit, seeing about -- work all always neutral mentioned time in to term? that neutral talk But just moving bringing you good could growth near these Vince, core the on average you position. least rate Wouldn't side rate be deposit a the interest And you're a this at a on a more the inflows? towards

of say would couple a I things. Yes,

in significant quarter, fund borrowings we quarter. we second last As the growth had growth said in loan strong that had to very we short-term this

was $X very those billion total brought of X.XX%, in CDs, deposits, money. term, goal the mean of new it that did. $X.X bring billion, So rate. of new billion And combination In and short I we $X but a around deposits money in market we to was short-term CDs. X-month meaningful money nature very of are and

flexibility on in. rates we So we liabilities brought have a of we the to forward reduce move lot as the

positions us a from ratio. loan-to-deposit the XXs. it We I think were well in

kind as that in billion. months, X that meaningfully at that rate. sheet liabilities at around $X.X Our X.XX% billion it $X.X brought course, of of from rolls And balance whole, have portfolio, and the end next we're $XX we another as cash investing we to flows quarter, a between to the billion $X XX.X%. look bring you sit subject X.XX% we CDs the then forces, And to next have months we goal market is of of mature billion have today, billion investment the it here if at the And in and X off of down down, kind in about are we X.XX% repriceable of $XX a X.XX%. in and that the

lot reprice. So that obviously, there's there help of a levers, us

September, has loan an kind the moving expected, of period. impact With points X-month was Fed over a XX maybe our bigger on what portfolio basis in than that

that. that catch-up have can there, here but So of we'll the kind we be offset some kind of levers playing

deposit to different continue kind And started bring rates on our and of down We we've variety and rates bring bring rates CD ready down. positioned, of to points to basis team down. to brought XX categories. down our interest We've rates started and is very already a well offer

have well so but positioned levers feel that we move move lot adjust -- we of a said can kind to rates there, have down. the we that I So forward as

Great.

could a And expectations points, the few you deposit updated the mentioned now conservative you just pretty what wondered I cuts. you've of way for down, Any year? -- these in of your -- were rate Okay. then basis seen cuts XX deposit that think, F.N.B. have deposit a cut few at like we've was in that was rates. I through you thoughts beta the of least on on early sort already that end some first cut first the bank beta look

Yes. has, cuts more baked point is kind of XX end the I I'd basis obviously, say that. XX% into we would plus of a can implies our year. by that. do better this to think X like XX guidance the our What guidance than beta like

all, to to of adjust competitors to everybody geared been an able do So rates is we're so there's be A ability up have lowering lot prices. that. our that

year. is what's our So kind that XX%, of in the end of than would goal by baked do to better and the be

just indirect And Okay. the sale. lastly then on auto

Just sheet yield? moving this this you kind business of Or the balance -- and given exit point, any little here. to box on the on looking at of thoughts the bit? this Was are additional just opportunities of credit kind a

our down deposits substantially. to of that call fairly about balance with not competitive with move and there balance to exit sheet. our looking deposit coupled more last loans, an to the ability bring a generate in play. it not We -- ability basically And our earnings it was We're in to the environment. to It business. some particularly those the was assets about questions and for ratio. us managing do particular, off the grow saw were this credit in deposits and -- at loan-to-deposit with were our we to ability overall opportunity sheet low-yielding sale able the looked some It We our

loan-to-deposit servicing. sheet as proved X will there in loan in we time. number I We've I way capable of normal business sales manage would course to the done auto of of a used kind manage it we're that the doing to from indirect it a that things. we that ratio. the our say We've always of and those times. think retain But balance portfolio, be time

clients maintaining So We to services clients. we're to on use still them. the to do those try other cross-sell the information

So that credit it for works not not play. But it's pretty a us. -- well was

And I life X-year it's it. a very mean, to short-term asset.

basis. the CETX or basis income added an paid ratio, on off, ratio given just earnings statement And points. points. go-forward a XXX So really standpoint, borrowings we we impact from capital. the by alone it XX reduced And on that no picked added loan-to-deposit XXX there's basis up

it's attractive... So an

essentially and much puts It's an a attractive better us clients. to position it transaction helps capital and in our support with

loan to better. have economic thought on credit calls pick demand just think about, a earnings is it benign folks seems will that than and I've the read is little the that up. I listened and environment would based It more

election, demand do I we and Once think I there's C&I be right wins, of there'll irrespective a lot in past see of book, the wait who particular. in think now. get the

want we course that. able is able over balances. positioned to and So of are generate on I institutions quarter, here, deposit display and year thing of think, Frank, the And themselves to past they're to financial be during great last advantage the this fund take to the other

And -- been the among the of the leveraging and share share. have We've of the There some in in business talked analytics in data inability markets talk prominence we've markets, there's we have banks to regional markets. model. lot about our gain about for we're the wrong. how talked proven a that that lot of bank a been We've our midsized CEOs and larger and positioned the about

model business works. share. our grown So We've

If Mellon mentioned passed you up with share. legacy deposits it I here at look the franchise Pittsburgh, we Bank

real in And -- those deposits. customer just are the So turn. last that's

All quarter. demand our well faster much are Others in billion. said doing sustained model business in pace. balances to primary we've at $XX we're that very the proved embedded at which acquiring becoming at around is have this our the seen regard have client, things in We're been deposit migration have doing names. out So why well a

it and I again. to just want So said over know I we've and that, over emphasize

is results. proof the in think the I

with Russell The next Gunther from Stephens. comes question

what if of color what drivers to just start bracket high revisit prior a the to XQ the you that simply could the some fees? provide higher the the you took could range? guys expenses, minute, you was for end then that And that I around for results Is keep through were XQ. towards Or end tethered on hoping guide? of

an in you for couple range on $XXX million in The a know, quarter, Expenses the that $XXX billion of do basis The came we $X.X drivers deposits. the at increase July in as to key operating decided Sure. $X was things, million. to $XXX guidance in million to to were million. provided marketing, which we grow

So risk $X ], a obviously decision and extra staff hiring related that, There's in release, the marketing, opportunistically for it mentioned we that was to spend some Higher then third well. production-related investing continued been -- the was raising And $X a benefits, for We management markets increase the key worked the to something then things. income us had the few growth. money deposits the that million. we've fund was and producers It's quarter. that [ noninterest the another deposit an some just we having comp in in income. very strategic our fee in to workday just and support more in in on incentives, driven some million success bring And by on side. commissions

XX.X%, the results. were best those group. last we of mean So to efficiency ratio, kind we range. quarter, bit post a kind look drivers to of at which I little we our top But get quartile you us continue peer XX-bank among above were were third the the if the

back, well million This prior quarter, we're quarter which third million, using loan level $X I cost you from fourth of if But lower. a XX it is to the But it's is and guidance. hiring. staying noninterest absolute the the you think the we'll would seasonally things, compensation of a impact up slower the the the be supported step few deferrals in be levels FDIC it then again. to a income, from fourth so variable key. And expect million at go range compare strong affects down then XX.X%, quarter, kind production, ahead and $XXX FAS as the continued to higher of overall, -- level $XXX we quarter, insurance

great or that Yes, into balance. it. okay. expense That's forward, looking revenue then guys conversation and I just And about taking bringing maybe Vince. remarked appreciate color, forward you growth

So you and a guys leverage do need leverage up 'XX? as look positive see to we drive something be deliver? expect positive Fed for to able Or the efficiency deposit end is to cycle we to lower costs easing meaningfully operating 'XX, to deliver really catch operating more and

No, more a next curve would getting to positively I difference. yield say, it's would later obviously sloped year a make

of So I getting yield having portion key kind will think is 'XX curve some the think But having of achievable. driver 'XX be it definitely versus for I there. that to us

we're in positioned, if you our balance how having well extraordinarily that we sheet Yes, an our performed look appropriate slope in drives and -- at curve the environment.

success, than key we're in profitability. obviously, is of But the that's if to other ultimate that different terms So scenario for banks. look, us no you our

of in to some benefit. for see adjustments curve the of we slope hopefully, appropriate us gets end So the short on the the position the curve

Yes. as income and get to And net higher interest net that point. move you that drive interest margin meaningfully and will forward

Got it.

And Understood. then one Okay. last for just me.

a You mid-single-digit growth guys reiterated for guide the year.

you any potential accelerate a about thinking Or guys to exits are headwinds mid-single-digit paydowns that like guys clip? we you would forward, for being be -- should As able optimism portfolio we look additional at that is keep pace? there or

position a we're right in now. I think don't

here think look overall. years I next XX I've given year. job haven't back But guidance time. a of XX almost for years for very I historically, in We we've good over this done would a been period seat, long

our and loans to mid- loan of opportunities, pandemic, organic growth the So maybe when high us I've the balance markets the we've pretty to the we've there of would irrespective shifted time. And sheet. sustain size sheet deposits didn't a single we X into loans sheet, trajectory grown think It's size move that up balance grown our growth. year put in right? been over the the But about the here, could we've I consistent as of grow provide strategy just digits, with was maybe quarter. of time balance irrespective every we've

played I time. So out think over that's

optimistic I much so believe loan once in comes market the to because of that back. uncertainty growth we're do that anyone next position say I'm So best can't generate there's year. the right But about I

a growth up So [ that put picks the demand let's that way. way ] in it hits scenario,

The Braziler Timur next Wells comes from with Fargo. question

the on back strategy. deposit Circling acquisition

still at reduction ahead, wondering, dilutive the the into off Or cost basis quarter we the the at composition is of looking X% growth X.XX% acquisition in CDs, look here? money XQ as this Just north still new I that's that of I'm mean level? just just the rate. that X.XX%, new XX and of money to point is deposit overall and

Yes. don't total, tell that basically specific around to market. you money listen new price you've get that strategies into on so competitors going that's rate the how that will while we got our we're think in to don't at the in, coming look in. I it I But money is

CDs money in market the X-month so it's... it's Yes,

bringing now in a money deposit. but CDs driving market demand in of that mix in or the we are shift component clients. are There is primary that. There's runoff

that have operating have do accounts we balances. well the So as free

also borrowings were us be would actually that I rate. it's to So we that then it comment upon based move would as much to -- along. a we replaced at able accretive, And benefit note, expect higher I not short-term your

X%...

X%. were They

beneficial. So it was actually

Treasurer. at rely the nature. have of forth environment, interest some our look or clients, funding back Scott rate institutional Scott's on I hey, in basically funding rather I and way the say, source I'd clients it, than right? New on I wholesale that's and depending go other So

trade shareholders. very was So this good our actually trade for a

loan-to-deposit as us of rest the actively as to reprice be the ratio flexibility bringing Yes, able did it gives the to portfolio. down much

there's... So

I'm And of the it standpoint going because relative competitors. the say not from a we're again pricing to are in outsized we context our to competitive in, environment

to profitability. working, accretive So in margin a our that business our driving are is way in share the our market we model is and and

having over in flexibility So to market. changes -- to according and the time, have clients, the we price new

we that's accomplished. well. as profitability strategy So it a to ultimately what the leads higher client per on behind basis Anyway,

just still is of we're going would the one after pursuing. success add that past had on we're in thing, deposit very And and going additional after to meaningful last great have we've that relationships. quarter, there's meaningful commercial I we side and in bring a Yes. the pipeline accounts too, amount a

great then color And back the That's maybe sale. indirect again, or to loan auto just circling sale Okay. there. auto

kind you choose any did which this characteristics the Just quarter? of how underlying that loans portions were I divested sold? portfolio of guess, of

through I'll because let actually reports Gary. Gary that that up question answer

any Yes. is was Timur, That due. account current sample of past that not sale in portfolio did the across-the-board transactions include it just portfolio.

So it with average high-quality high X FICO, an of was life years. paper

lastly just there's then me, name of your for growing And Great. into the mix. Okay. M&A, been some kind of speculation Mid-Atlantic

update to M&A get and into fit where love an going thoughts to might your around as what that forward mix? deployment would Just are capital

focused there. still want haven't book size, in changed out smaller on material We we're -- in what's our comment position. if to transactions, of terms tangible we're being on think even in I doing dilute in was but the we to indicated deals past to a in I specific not us, opportunistic that value don't that We've available are looking that way. don't market,

So the above capital. have of cost be in-market immediately earnings acquisitions with on I've limited to our well has the to accretive dilution, be cost tangible book deals value said. as And with would return list. The saves are to then

going deviated to out don't And think there I all. strategy. So a true rumblings are stay our of we've to there, but lot at we're

focusing few the well last going move book think forward. over returns. our value as I we tangible focus it's be that's And we've and -- on to accretion done years,

question Raymond James. with Daniel The Tamayo from comes next

Maybe on income. interest just the net guidance NII for XQ starting for

-- compression about fit to Is balances margin third pace Is your side, guidance? the impact trying look like of to into to the the rightsizing that in something there growth would where fourth of margin could in the the how what a get sheet think number? down? for average something could to to come get sense clarification, in that there number the Just the some on was quarter? you that terms trying Just that is quarter balance see

back you in I a September, had Fed Danny, said that's beta think right? If the there, -- I moved to implied about that. the partial what of XX only in So impact month I it earlier, goes

that. XX. of And more impact quarter's full the then have X you'll So there's

beta end we're as So I year. don't think up by have then guide, sit using the XX% can there's there's portfolio NII anything we that. some here today. to that, than the of a or conservatism in that We We do exits our but upside better any teed other like

some quarter, But just seasonality uncertainty some have with election you it earlier, activity and of slower the is to there's and the activity. fourth Vince So like would everything. be then said kind normal

So no, some still there's level.

Loan that we've side the guidance Our giving. is still been on mid-single-digit same the guidance

the unusual. the us there's of So now we year. between managing It's down and nothing the get end just rates

Understood. Okay.

margin some and increase fourth So year. that see the issue that likely fair? the we to at before the assets point in in a average quarter, Is quarter fourth it's start stabilize earning next

points, would margin I say few down, as a I Yes. And would the flattish. it's if not just I mean it's basis that characterize down a lot.

starting just comment. So a

then That's Okay. the volatility the but just of about think run specifically And the thoughts third Gary net the little higher current got bank your on the credit next term? for rate you kind All bit for environment. what charge-off quarter, net the how a one right. think you charge-offs good in be Obviously, helpful. just interested maybe about as a near around -- in for you might environment,

some perspective been quite ahead credit have and and a the all of a and We've to charge-off position a clients staying we're risks continued understanding think low now. from for levels management their from the portfolio. our information and risk that at/or risk I and the standpoint Daniel, metrics time flow with record management exceptionally perform near very well aggressive in

bps result there. to year-to-date we points, in we on CRE at some is as the quarter, This and know, which XX a see really, were strong is And be XX all surely which here environment really basis, basis uncertain. continuing bit stress to continues a environment, this

continuing over we would as years. normalize, up very sit of and last touch? have performance put may the to expect we I I as edge ahead, the outperform I to mean, it we up about perspective. number a industry's feel from So good continued look where And going but is it

fantastic team Gary making of a the that done are sure job risk current. have his ratings and

the gathering mentioned he So information.

where is the I think exception that to the stand where basically, we're stand going major global with tomorrow of in we economic any shifts today environment.

way. So risk. testing it we're a not going to let's stress of job be that sitting basis, surprises, here on We and a and thorough assessing pretty frequent evaluating do risk ratings underwriting put with

what for that's see And us, job. fantastic get. a you is think very what has true Gary So long time been for I a you done and

So keeping us there.

The from Kelly next KBW. Motta comes question with

to more beat hate up to a I margin. things a I button few on want but dead the horse, just

a done the haven't budget deposit the the just On the next if as you two, total deposit way beta year, broadly just know or end the that's XX% And ahead clarification, beta, for on of betas But I level, anticipate year. wondering from quarter? by look point commentary next the interest-bearing how a this prepared more you wondering about down then high of we one? past

look of we And deposit level some beta is historically statistics by of The the XX%, from cycle. the talked total Yes. past kind mid-XXs we've of kind have a the about on down we at Kelly, year. end the

what's So that's of kind head. our in

the kind a XX-ish, beta know, would I of our say, total this end of don't of by level year, as next the end heads kind by year point. again, next at could around of -- I is So be in deposit what's it total

of versus it. markets? more And side on in markets what how in seeing some legacy any up markets between you're That's that's just in terms how of commercial Got for wondering Loan be differences the Mid-Atlantic you're And spreads holding then seeing your Carolina if helpful. your loans? the might things, performing very of

be across fairly it's your expect consistent And fairly would implies. question you to as different consistent. it it has board. Surprisingly, regionally, But Yes. been the

in I think exiting flexibility pricing the space, capital with there's more a CRE little bucket. that

high-quality function find back a margin back That's you well. little pulling out to as a financial and you're nonbanks of opportunity, CRE banks pulling a today. it more If able get of

to So kind change would back. C&I of a move expect my that that held years XX I say board being right a as a Everything there's next tells experience bit don't across of is lot from a we I ball, perspective there's me on crystal hold. gut and demand would not year. of quite but have into now. I the

to a well. gaining across the benign. a equity C&I. higher then board. suspect company has that And the I on moving pretty remarkable next see as that demand, to done our installment happen. side, into much mortgage little So I for level direct year, home consumer expect been share of of would to up able we'll and that particularly expect Consumer a be the pick bit would has job And pretty I

answers pretty much the to the So we are don't profile, question, there. across the would upon board. margins based I pretty much succeed continue it's -- continue to risk that hope but know to I if your the same The same.

start talking with rent then double very of That's about interesting. new know about talked the expense the again, is Expense on build-out carry That's early And the the of the one you side, to too it's have next headquarters. I helpful. year, thing but

timing $X of track next about year of that, of kind to think the million -- it I if come Just space? on out you wondering new to over was move the still as that's

on the the Yes. I is that is know I We're but building don't date. scheduled $X move November actually in track. XX, it's million, to -- it on think,

know the is, Thanksgiving I worst picked when don't be we'll that's I think we all but -- over possible what there. -- it moving

all the place. on one nearly north We moving We're X have buildings side Pittsburgh. We're scattered here of location. over the employees XXX into in

in I think we'll by out together just eke productivity. being efficiency

much. are in the office pretty Our people

baked immensely. out That we carried a in the think and year will we that's have length according I of we expense accounting, into this built the over that to us the total basically So because still talked right? rent gets about, lease had gets rent building. that free lease that help So GAAP rent, of

So forgotten. that's you've that's why if occurring,

be next come to of not I would So portion the $X back of that portion a back amount, a total expect coming year. million. it It's but that will

lay we can't see. receiving out accounting space. perspective. but I be going to to benefit yes, for Now should a It's be hard apples-to-apples, that GAAP from theoretically, be additional there might demand a

noncash. The other is rent

comes Janney with to Brian next The then. We'll next Company. Montgomery. Manuel question Davidson go Navas D.A. next & from with Martin The the questioner is questioner

on. that and question The did just see this guys success going quarter. Vince, you also you the one DDA new and primary down And bit. the on your of commercial, deposits where I next a opportunities DDA at a then Or I Vince, is as you that at back from bank that -- way for in do about think talked a mean, of the about kind that here customers I come Just the know being lower to to for talked today? still the does -- the about minute, have that, kind couple it's of the you at look guess, see kind that level quarters stabilization of expectation your is it drifting level? you XX%

models a Demand Well, new where been it's Deposit plus lot brought pretty the but running you consistently. category, period at a outflows mix moved down. $XX we're in been Obviously, on the a some billion in around see we've so, of we shift,

to rates and that. come believe able as be it able to grow it it up, I saw down, as we rates over maintain time. maintain you went should we So were

So I to can't the overall. speak

of $XX billion If Total going overall beneficial us. well. it been you at compare look look you of peers, the look And really Deposits smaller. to to at you But we as pretty percentage a up the that at sure, be and in to Noninterest-Bearing Deposits cost and it's has Deposits if total, match our Demand funds

the main that's But reason.

the all on, Noninterest-Bearing management the and to clients have, we new balances a to operating the accounts services services pickup brought used of as disbursing I that have able for their stand treasury grow we pay because So grow funds to we out have would we're say, customers for a we'll is up But nowhere get and because there's opportunities close and we when right? over the they to it's There's versus right? time. were to what very where can environment to to higher of difficult still Deposits pandemic X, has balances everything Because was -- in Demand maintain a Deposits excess go. yield, looking anybody that during Demand get category

to continue brought we've So I category. Plus expect that well, done of in think well a and I we -- okay... but do us lot -- would in to

revolver to impact is saw on the from to make the we a some balances, DDA pay being everything to also election DDA going on as going reduction going these balances, down in moving which decisions balances. also debt customers pay during that's some was in about did to X% say, some cautious Brian, I of revolver with down times top us,

So there's a slight impact there as well.

Good point, Gary.

too, And there's been side I'm with new new that have just going for customers. of those relationships, them, the a full an bank broaden the a really we've households Brian, names, to over our on Retail we be added add, clients once opportunity that's plus and lot to new commercial to focus time,

Yes. Got you.

like have that year yet, sound you people, a banks things loan really guys a their give know it which cut getting from rate didn't loan -- will the think that the maybe least bit sense from color growth rate past you a year. other on And first like And customers. in growth sense. here? sense with first optimism did for more at nothing the seem the new maybe spur side? on you and I saw, that immediate the getting Okay. of of next said you like next customers election guess is getting few cut that terms people Any handful just said seems thought. more that but there we interest of All pickup I quarter, your dialogue some than is kind then I optimistic in I next just just makes Vince, were

to Yes, interacting not seeing customers I used as the I'm clients. not of but the to yet, some be, to to as and be bankers talking I'm the close with I'm honest. that

cuts. wait I see still think of kind let's additional they're and it's and expecting

point be is take thinking, here down reduction. a everybody cuts", signaling I'm forward dialogue, of to they're to be there much going road right? and the I'm may everyone there get that will basis additional this opportunity rate leaping I'm seeing better advantage going XX not So because So "Hey, but saying,

the plays all out". on can table. I and Postelection, let's corporate taxes lot "Hey, the think the of they're are clients election kind see how on saying, A of are of table, that things our kinds sitting happen. impact things back

add So Gary, don't want again, maybe. I to they're know, going you to say, wait that's I'm And I back and happening". much of "Hey, to what's see insight have and don't And want what as as anything? hearing sit kind and seeing. I

demand. way are get kind would the moment. where XXXX right things start this see year would the that Yes, when everything quite once and the Vince, stronger expect some with getting of it on the active, at That's here that of I feels middle you pre-election based we into we'll period part I that agree said. we

I've I've been few out last been I've all in been Brian. Ohio, around the Winston-Salem, been months, Winston-Salem, place. Pennsylvania. mean, I've in I over And the

anything might I So I'm hearing hearing be But full the not on. information mean same thing. getting don't different. again, I I'm have the I biased picture.

I next can neutral, if in fourth into And year. of to is that? some sounds and one pickup side, maybe immediate immediate stable. are see can general, in on the It Is year the how went the us just what margin, you is remind I quarter. you here expectation if on in And Yes. get the as the And bit maybe just to through just of the you margin. to then get like some you the of pressure that keep yield maybe margin the it what as guess later Vince you the about kind -- stuff though then on And reprices, the you secondarily, -- relatively little guess a loan just you modest think steepening, sounds the the curve reprices? I if get then think but expectation

moving Brian. to think that. XX I said help good perfectly, the it your job question, out Yes, a Slide does with just parts. initial you I would But laying

if X-month remind at you the see as that of I loan repricable look are mentioned that the to we earlier, liabilities chart the in today. billion Just there levers have, over we billion side $XX the reprices everybody, a XX.X% you have on the And can $XX.X period. of that

months is $X.X coming portfolio We next from the and in in and investment X that have X.XX% $X another in the reinvested that X.X%. will a CDs today, at flows next X rate cash billion X.XX% between in $X.X mature then X.XX% billion and the at months, off be at billion least

that kind gives key you moving So of are there. that parts the

you. Got

And mentioned, Okay. hiring us call if the to you And you just guys the there. then fee can you you're I on the to quarter, was It mentioned Yes. on what income of, the income I point you the some doing also don't it, question. BOLIs think the that then one mortgage like a on or want had nonrecurring Vince somebody just just on Maybe maybe side. and on maybe done sounds then fee call kind just this negative said modeling impairment that... -- there

neutralizes. of kind That

an Yes, $X.X was of there MSR impairment million.

other. So they offset each

Brian... income, fee the at look you If

Yes.

makes sense. that Okay,

trying the about hiring markets, talked done, there about I hiring just you've then guess, to comment Vince, was And there.. and area Okay. you're think focused as just far I it I'm you capital where that is as some understand on? an -- Was there

In markets, expense. had in folks. a one Yes. uptiered little bit certain added replacements. of the driving that's We We've that's people. increase We've replaced salary the we've the with area --

bring in group AI risk on that for felt we efficiency to operating to management to because building an with really And people hub, drive able data then stood able with operations going in. we've So been we're our investment our framework, changes been talented we be some the out our we've and up area our efficiency operations. that and in are going

So put efficiency we was but out, a in changes. help some some press the drive brought us process people, and deal customer talented we we've some release made in and back to that with improve risk There office. was hired very -- satisfaction engineers

of the while embedded large expenses, pieces not haul. in there's higher, salary as that's long benefit So reporting in increase It's what's there. rate because all not a that's total expenses. we're that that the us amount And run the should in end the really as of front kinds over

advantage a production those production, directly if into right, there demand, Some can income then in pickup changes of occur so with short, it's in commission. we produce We're duration I to and good position But paying down, interest next revenue the our we're in that and areas right? is short funding, think pretty investing take efficiencies. a of in in in reprice fee that putting year, higher ourselves areas. related both create funding out keeping strategy rates moving that So

all of our So those drove are the factors decisions. that

Got you.

Okay. what I I me, just be it that are on guess sensitivity the pretty me. Is guys at you should from nothing's remind That for I standpoint, you guys you're where neutral? a heard? guess -- sensitivity today? changed are

that. -- neutral I've it sensitivity, than still calculation say show we're all rate towards I Brian. clearly we're would more towards and at would levers our mean asset I neutral. shows the XX-Q, if I still the about, you we're I moving but asset would No, say mean, but looked talked what sensitive, Yes. different

Manuel Navas question have from we from a Davidson. And D.A.

Can now? you guys me hear

Yes, we ahead. can. Please go

in kind into a have geographies where where more of little the lot questions it continued momentum? driving market and So of bit you can share seeing you're are expect best But you gains just been answered. a my dive deposits? What

Pittsburgh, Carolinas Yes. We think success. we I great continue double-digit, fairly to Difficulty] where [Technical saw area was that's we've one success. had have some

huge we now and bigger have able to effectively have the happening. scale that's because mean be still share it and new itself. clients we market on I bring a on and think here, I here relationships, compete such to beats

well. we're done extraordinarily -- Pennsylvania, the we've there. that of So benefiting In central part

right? are Pennsylvania Charleston, you Mid-Atlantic it's quite probably I in into in of it's that the [indiscernible] Carolina -- much in into. market then the pretty also I think the So and expanding South bunch had And and right, we're we've say success then we of brought South bit good the markets. the then move much and Carolinas But that -- would leading results well And us. markets for region, Those we've part is there. I done the everywhere, Pittsburgh. a as central a Carolina pretty guess some charge, we're

was Yes. We we're MSAs from share that MSAs had XX% of either in in. in. XX increased we the the operate that maintained, it XX And or of growth

increases think that Carolinas, it's So the And markets we're in a there had result. of we I in very good X in so...

similar It's I was pretty story. data But I just pickup. referring consistent. market to referring the to quarter-over-quarter. share increase pretty it's wasn't

middle do just quickly business? see? of significant rate upside fee about You're improved rates? year, Could next we convert second, a get that relationships talk upside of for Shift if the what's cuts gaining kind to Can the kind Mortgage [indiscernible] fee you Carolinas. that by with new of you in lower

Yes. Mortgage it really hinges us, we're big for money purchase -- lenders. business demand because hinges on on

supply good. more there, to there's But I housing more out be hopefully, sell. people decide that So think will

tell out going the hearing swap, think to swap get to seeing commercial coming. they're a because asked can moving the income there's that media think is we it that customers, the that watching I customers you from I on, Well, in thing yet else I somebody question, the go what's they're there? fixed not are that rate looking that was you additional they're repeatedly what cuts the one Brian, and are

when So that's yet. do they you to dialogue -- with I'm anything them, well, say, going not

But I grow. think to that business has an opportunity

business market, We're M&A, getting which Syndications of will expanding We're market time, and particularly -- in building for several the end also over finance the our out have our there'll think We've us. favorably we're I public middle lower also middle into because the opportunities capability. Advisory plays be more areas. business.

generation are have lead today. 'XX even don't in things that will fee we that to there So

look thinking but Anyway, gigantic, -- it they we're it we -- So be I have the things won't are won't those think will and about an be forward. as impact.

capital debt had record year this the markets a year. And

Gary Yes, looked has And capital clients really we markets pay numbers utilization, at down markets, balance, and balances the into right? zap Our very capital said, debt quarter. are he online the should this why right? debt reduction demand obviously, moving that their which been using that's cash next said driving have to in to -- "hey, going is Gary deposits", your good. revolver events in continue, mentioned Because few clients larger

balance customer So coming. that's what on base of the going within they're little for a bit and we've those seen. what's And there's too Anyway, sheets, probably their reset area... preparing themselves

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

everything you, in Okay. us, Thank appreciate next I and And employees everybody. Thank appreciate continue and forward to have delivering. and you've invested time questions. you quarter looking I for the to keep we're with do to really direction. moving right done the us the the

care. you. thank everyone. Take So Thank you,

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

now disconnect. may You