First Midwest Bancorp (ONBPP) 21 Oct 202020 Q3 Earnings call transcript

Good morning, ladies and gentlemen, and welcome to the First Midwest Bancorp 2020 Third Quarter Earnings Conference Call.

Following the close of the market yesterday, First Midwest released its earnings results for the third quarter 2020, and issued presentation materials that will be referred to during the call today.

During the course of the discussion today, management's comments and the presentation materials may include forward-looking statements and non-GAAP financial information. The Company refers you to the forward-looking statement, non-GAAP and other legends included in this earnings release and presentation materials, which should be considered for the call today. This call is being recorded. in mode. are participants all a listen-only And

Financial Following Executive over Mr. Chief Officer; by questions Mike and and Operating opened analysts Scudder. will and now Chief Scudder, Chairman turn Chief President Mark Vice I and answers Barrett, the the for to Pat call be presentation Officer; Executive Officer, only. Sander, will for President and call the

to with you is thank and all this joining Lot Great, everyone. you. finds It be morning going us families and this great hope Thanks to your doing you Good I today. on and staying for everyone quarter. well healthy.

the As to I'll follow obviously to details. to highlights we is Pat we typically are turn today further Mark start available and the follow-on that moved dialogue have with. it the of off over and along our through as custom, some materials I'll with some with

from based and refer to million from optimization we'd production. XX% once branch what shutdowns the environment. fee down up of for the enormity XX resulting quarter obviously low the or -- again obviously where shutdowns a away rates revenues the we the obviously, $X.XX benefited quarter, this recovery from Encouragingly continued a from lag uncertainty the demand from So inherent $X.XX seen signs we and that's recovery activities business in third for activity million share that's performance that second earlier. as those to quarter share, XX.X year and quarter and performance significantly Practically widespread of interest reflects expenses. pre-provision showed pre-tax and was of Operating lower we times the down weighed in as improved per Net the following income the quarter's the quarter or ago. were of the stronger

consolidation Pat will to we and quarter we did closing did benefit XX at related good interest number about remains without the but the ATM million or recovers, credit then will our one of or due We $X.XX loans We available numbers. cost XXX with original acquired portion loss recovered that continued environment, the our us. our there. expand liquidating We the years retail income about importantly PPP will did economy that loss hold to X cost, million that. and solid, flexibility we and is as net our all we a actions locations, loans out to charge balance that for move assets, will acquired unwinding would if XXX you our in non-performing one and were sheet, aligned offs us see stable exclude that, marks. Overall was but to largely take certain we lower. in million and the this of as of our to that announce or in reserves and We no improvement this about and roughly again of Again, believe stable should see forward. optimization in networks were a as funding held securities share, recognizing have relative notable under at funding still performance of did about distribution a efforts but again which effectively of future delinquencies legacy our charges well from X.X% to Mark All as commitments reposition of expect a our as be swap the stead of little two

important relative were to was is able to it. the how as So element CCEL that most liquidate that's we market simply of how nuance an accounting we

quarters clients our time And that of amount working increased. to mention over more comfortable migration with as process, and book, our categories diversity the at we of with out substandard ultimately an the Near-term, have through performing elevated of was plays We that, number we're have depth significant weighted deck. very said special duration but to overview, the as as how a it and loans spent we that and you a through both stimulus deferral color the additional Mark, Recognizing, largely of our and will aligned working second rating appropriately forward. we I what portfolio, it our our for and where outcomes simply reduction we've walk earlier, drive second were Pat, round million. can very offer through the quarter at of encouraging been -- time some with of in the economic better turn we let our don’t as felt Mark categories and of we're talking or why some was up. me the the uncertainty, go now, and XXX about pick to remainder the deferrals. challenged said With for you pandemic, reserves, they either reserves maintained and risk

on our morning, in cautious another good presentation, was say, remained and enough not commercial mortgage everyone. fell demand. $XXX of quarter and Starting Slide very strong offset to Corporate Mike would somewhat X I as loans borrowers, liquid. Thanks, lagging million

significantly utilization again we quarter. fall saw surprisingly, not So this line

focusing business, existing new of have we care as cautious been maintaining on and bit well, clients While taking efforts credit active our we remain a seeking discipline.

back quarter. elected of see and results gotten of going pickup production playing quarter thus more prices to for and we're recently given Mortgage our loan QX favorable stable commercial a forward. more to in and environment the the in by our thus consumer had strong beginning a have We activity, to slight total offense optimistic balances flat held sell in another the percentage we're greater favorable driven performance We team. rate and high

We expect mortgage will year out this quarter good in a QX record in another for close what be to in us business.

us, restaurants, exposures the to highest industries the hotels, in any areas recreation meaning very and bar always areas Our for with environment in and have high risk have thus from resulting they are modest high is loan is approval. very The just a diversified well X been our view for fact on book risk Slide discouraged pandemic.

Of entire that other evidence risk we has talked concern. course, last managed that several years that view to being virus for note leveraged areas of a closely risk impacted office CRE seen highlighted for I we is too On total would the seen, higher past but we retail murkier in particular The our total be CRE we of well here diversified. are important in and our areas very levels, individual economy months how about very deterioration information as the this areas we've loan outlook and portfolio accordingly. these and given as note our two the and It's finance in level exposures X, manageable deferral and have little on monitoring exposure but feel industry we six them. out inherent these provide the Slide current plays programs. have environment, is area to at by the remains detailed current we it

we flow if of pretty QX the deferral borrowers with varying We down is, deferrals degrees. subsequently As a opened sharply alternative improved other and were client as were them decreased in in sources solutions accessed to round each a round. forward. economy going the second significantly worked but requests somewhat last requested first accommodative in as The operating call on guided to liquidity also of fact the cash as

overall While high seen they outlook unaffected, the in in was they're most The deferrals, loan sectors remain largest XX%. clients than up the while the not as spring. three performing by by of improved has were also risk reduced I these users say notably better early would they after are utilization the freeze greatly franchises,

loan our requests or Deferral unsecured level residential. deferrals XX% risk at borrowers. total also sector of of X-X than here So higher our less of X low highest displays largely and by our total our to is dominated FICO is guidance. summarize, the the loans of round book, dropped X% represents loan round X% and installment end consumer Slide significantly end two which were first book,

we were days Slide due did a deeper Looking actually our assets X, stable migration and Non-performing metrics other past the expected. loans increase of the these due improved. large risk segments a elevated than We credit, on the we see were and we in unchanged in risk substandard was special the Over to quarter half total pandemic. earlier. increase XX little highlighted projected at rating the loans starting as in two from mention adverse categories

reserve credits to reduced from albeit charge difficult half in relative that in as accounting levels provision Turning to We PCD by of uncertain maintained the credit given mark. we the total large relative environment, offs charge a to continued basis at Mike were were these on adding guidance level at resolved previous acquired QX, from original given cut Trying pandemic Total offs to allowance points. in much inflated a unprecedented quarter flat by acquired closely matched losses is assets mentioned change X, our we our discount quarters. couple the give and Slide our future to as XX a two but times. loans our the at away

we course, evident read that credit ago. given our of increase, the the original far. absent virus. in outlook come But The While a as anticipated and as criticized improved PCD close material in PCD influenced to better estimates. losses the well, reduced offs loans we but thus by will our We Charge resolve further contained credits. shift pace our expect the be any in from think story or well XX of XXXX proactive look might for across stimulus offs very expect one deterioration, a we and has have will we'll again, days outlook further at actually environment quarter, much to portfolio containment next be more QX looks a

Pat. I over turn you, to it Now, will

to Thanks Mark in. morning on are call and good listening everyone who the

inflows the municipal although customers this stimulus billion liquidity ample industry more seasonal clients, billion relative Slide spending. well and reduced just that continues continue as $XX base on government outperform be deposits to today's source environment. liquidity, to to higher advantage in interest of X, size robust, our diminished overall capacity benchmarks as primary support growth of zero stable with the and to normal combined remains Funding in stemming $X is reflecting and with near from actions colleagues, deposit funding sources Turning long-term provide our granular than rate communities. to over retaining us both costs additional in Deposit

year, PPP but the and compared to Slide prior length I'll quarter and to this year. X% Turning from on loans and impact comments, as X contributed while area. and partially XX interest decreased in the reflecting prior compared due lower and and XX NIM impact by the offset this million to quarter, quarter the interest lot of same impact a my favorable to the a funds, basis combined up rates, Bank in decline, loans $X and X a linked Net X.XX% offset the in of quarter balances apologize prior of higher income to of down quarter growth acquired from certain prior net to partly periods for XX the the cost same down to compared outstanding for we from net interest X year the the points to period million and securities to resolution Park lower prior income accretion prior acquisition loans. lower $X decreases to same quarter the Acquired ago. points in lower quarter. nearly was slide Accretion on year modestly both of we quarter was also to equivalent parts million had basis up Compared with period securities contributed the Continuing a margin These X% of quarter than compared tax by scheduled the moving compared expected with of loan margin, positive ago. million loan the compared prior the the million the rates.

of as by both from PPP as opportunistically lower lower from was was prior X.XX% costs from fundings yielding by offset low second to margin deposits loans, Excluding the basis and quarter prior driven levels also quarter, the balances funds. compression well Compared fund compression earning year. XX and PPP borrowed asset as rates linked seasonal did were normalization yields, lower to to on the accretion liquid increase deposits. the linked securities loan for primarily the of periods, points margin higher actions, partially exceptionally impact down able Collecting and of loan stimulus contributed in we the quarter cost The was this achieve. XX municipal

year. income, to relative be rate of This of approximately potential stability see of terminating will potential funding of quarter fluctuations, runoff both a expected billion third interest in strategy future borrowings the resulting benefit gains and neutral quarter year, million finalization annually. market to loan quarters, provides deploy in XX on compression terminations for second flexibility to well as in These also during light in the of to reflecting forgiveness, take is by with over fourth from which impact excess interest of and fourth quarter this while the current Accretion optimization will costs Our lower that nearly of while is PPP to this year, future some pre-tax net revenue swaps, is securities balance This further to swap will go X.X outlook executed for to unrealized the upon involved of is borrowings. any occur advantage absorbing both magnitude actions in our dependent fourth quarter, expected seasonal into highlight quarter deposit two the quarter. X likely. future million as securities in expected next next NII, The the outflows. on the quarters likely current be earning and longer prior with I'd full the slide, excluding third the are the And reductions needed for we outflows primarily in costs sheet fully expected reversal the in approximately down also XX sale net conditions, income see this asset million PPP third term liquidity of year optimization of on NIM XX% million in $X the a gains. wholesale

with by to XX, quarter $XX items, including Compared expenses foreclosed and quarter optimization professional and Slide Park expense note second a as absence lower offset lower valuation the a services acquisition and down quarter expenses acquisition, driven services due in compared the a partially as were operating integration employee higher a and quarter including retail lower we same the mortgage base with occupancy, pandemic total the acquisition, linked origination on well X% technology with year costs costs, costs ago, our other higher that expenses, Moving largely larger X% elevated to the to optimization million related of strategies. the computer same staff includes quarter, expenses associated loan Compared related and offset of the ago. on costs, from the asset current Away to combined anticipated commissions, Park were quarter costs partly these million had processing. and up were year associated to as on by well by as prior professional in lower adjustment $X deferred benefits.

loans We X% down our X% down year excluding from revenue PPP quarter from on due has continue the while assets a approximately was focused to percentage expense to of prior run a ticked up be and our declines. ago. rate annualized expenses as efficiency Overall average ratio X.X%,

fourth from and the will tick with with integration branches quarter run rates are QX up due the delayed of to likely costs, acquisition QX for costs reopening modestly is were taxable combined intentionally outlook lower expenses, leave and to expense Our modestly for XX%, associated the there Slide, income. approximately on note guidance that I reflective effective than The this our the quarter of due was previously taxes pandemic. last tax our lower rate closed before excluding

This ongoing that costs strategies. our sheet will balance the included We Slide quarter reflects increasing summary optimization annual this including benefit see we'll trend during further is and capabilities. of with continue in online new A retail to balance of to quarter. in benefit both Both investments to annually the the rate that XX to our million you XX%. million upfront clearly we mobile annually X shift included accelerated approximate continue million technology on make X the platform digital steady tax million volumes that rate, third X pretax of to upfront from for note that XXXX, and optimization expect run us impact to final our I that's and a entirely highlight effective retail our results fourth has continue in NII should the optimization us, We've pandemic a to to is transaction a more comprising banking. starting however, but see XX digital the not thereafter. repeating, worth enhance would sheet neutral, of on pretax slide the a and see expect

outlook quarter commentary risk retained our for of for to of our prior growth. our dependent also a of impact a Moving stimulus XX. dividend losses outlook be slide These common to XXXX capital that the allowance our emphasize contributing We've practice, for federal convenience, with support to behaviors, pandemic, on results third persistence included, the are assets credit the impact the per Slide quarter is we've the with for on in results quarter. mix limited and and $X.XX as XX. further I levels XX, future very robust and earnings capital of on customer consistent for share usual summary continue levels with of Consistent financial quarter weighted on volume the would this our any activities. and this summarized strong, quarter Slide third

Now back remarks. turn Mike I will to it for over final

Great. Thanks, Pat.

is up, Before improve adjustment this capital here, even we that, kind XX to XXXX me, you is robust, over and navigate we our excuse Pat the there, performance. drive to comments and liquidity feel the sheet really fall, growing, our are recap, as quarter the of actions our our Tier winter, certainly all of built is we -- XX%%, has look been held open as to capital in over of we strong, said recap reserves took and as we X position our if positioning, The couple it would. dividend. our reserves very total just balance are Again,

repositioning us earnings As activities and and through of aligned distribution this we our capital we our skill and maturing, on sets Volumes deposit are our efficient The online sheet call, remains become we clients our teams X think issuance. are undertook our remains is importantly, byproduct our undertook, preferred in go working opportunistically and we digital recovering of to to environment last as flow wait capital environment. raised get are The we strength forward. to help our as our balance us rebuild will how more Tier using will also are in our us $XXX of are network which as this robust, flexibility enhanced all discussed most help a undervalued with continue base and allows cash additional an million for ahead optimization some of be processes we stock we hard, core needs. demand and

As whole. to adds technology, invest our of the clients, enhance certainly time teams, which business, our business. to to have the they drive challenges, to to going present we we talk continue to as take to all take as our our strength Time talk a grow we're further efficiency, but strength and flexibility value going often to provide the all with in our and such this said of of to look opportunities I with advantage the the company, those teams. these franchise we when relationships ahead, enhancements we our the leverage of on our about the also we're We of as will continue opportunities of

me it can let for now. the some open So with remarks as operator questions that we up if ask closing

with the your Instructions]. state Certainly. will question. go McEvoy Inc. Thank ahead question [Operator And from you, Stephens Please come first and sir. Terry

Thanks. Good morning, everyone.

Terry. Hi,

positive starting you building, that in some, but had just not are of comment? pipeline, to line prepared Mark, see And the about going we anything then some utilization? you wondering below remarks, on a pipeline behind to out, utilization. terms it's your said talked pre-COVID you're in I'm what's you stand I say comments

Sure.

credit it building cautiousness, the was a first but out there. our line just our What's as ago Terry. yet, reflected portfolio question, tightening on I pipelines fundamentally activity last a reviews that about comment We're right, little also in utilization behind and months not we we the yes, than I evolves we're bit that's pre-pandemic. over would bit, where sense as everything's So relative six But be focus to my below and back to to but played servicing and months is our did Again, of see -- the we of getting a remains parameters virtual think that say much liquidity story just the teams where world. your and little clients, part some is credit of into little feeling relative increase better bit, spend starting so a obviously, six prospecting normalcy out. the

starting would to back bit offense we're just to playing little say. a So I get

be for sure you. Pat, utilized the then Thank in of is And make technology, you'd some the just overstating $X.X to million will of next the in I that invest a from the be benefit to want of platform question actual expect to digital continue follow-up and impact rate optimization, I'm what retail not the to expected reinvest or run it year? model, that kind in

yes both let question and to Terry, say that answer of probably I be would that. would me that I sides the Well, say why explain

from see staff will a rolling staffing that almost be lines. through retail and through -- will benefits come cost benefit that entirely driving the We will occupancy

technology related continue with costs that we growth. are steady Now, to see would a some expect of

others. So technology we're us not term unlike incrementally any consistently would investing long a in than area, on other probably that have commitment more probably

sometimes investments on statement. So income that flow a that that will your that through precedes caveat saying -- I'll And getting that different with a investment line cash there's you'll but item with see.

upgrading take really makes depreciating until And you down. and it's start you see impact year of the that That So, that. a won't for platform and sense. it a example, implemented do it P&L could running to

understood. does, It both. you Thank

ahead Nathan and Please your go our state Race next will question from question. with Piper Jaffray. come And

to it on Obviously hoping I should sheet, good as the guys, balance just XQ. got and the also and hi sounds plots pay Yeah, was wholesale funding well of size start have the overall expect fourth size some the off looking of public securities thrown and you well to just the just into point? overall fourth the fund downs morning. to portfolio balance outflows up sheet quarter a we size as so the kind like trying in starting some as quarter, of the

think any would I in and securities at million main so anything this just that withstanding we do that's we that Yes, the change the really we reflect not the XXX that the point, book envision we have. of haven't announced would sale

So cash an consistently dropped which From or rates we've to liquidity, at down we'll year to expect overall the we balance runs at see higher we on of pretty is they down. levels probably of actually are is triple to been portfolio. PPP spending trying perspective, continue it's as cash reduced reinvest much before levels. that definitely mortgage because that rundowns the customer seasonal beginning the flows the assets sheet see part and Part coming prepayments in backed come of were earning stimulus whether have that just that municipal of from the

think We risk would without and material appetite kind And growth. continue higher is because I credit levels. and of as risk by growth stretching your last loan the be credit net high that that come come then that piece, loan is at would -- And think Mike unusually just are levels. tough at said have both within down payoffs abnormally the going to Mark be of probably piece continue to that those to

in And quarter, saw probably this so the that continue material change a results the environment, during the unless will near-term. we there's for

helpful. that's it, Got

comfortable on like that changing to the capital, most continue and a quarter. guys the so the sounds -- perspective, despite this credit reserve like you that sufficient, are increasing it saw we pretty quarter ratios increase in seems Just increase gears from is manage

it So the or you higher little a the guys the to in what in comfort need see in to be earlier just than year? environment the on resume those level seems I buybacks, to given guess was would market

going answer that. Well, to see a I and is to stabilize as to go at Certainly the then to different is conditions return Yeah, opportunities those look to the and relative some to to deployment be can. relative the functionally, deploy highest stability really managed outlook the the capital, provides through But available elements function going operating certainly what how of looking the for on we've are buybacks in going outlook decisions in at we the of are you're that credit. to have critical shareholders? start as you economic certainly what forward. this our capital, capital environment And

appreciate I Thanks, color. the guys. Okay,

Please Chris question from our And come ahead. McGratty will next KBW. with go

as number, slight going simple from good just make this of Hey, way increase next then bucks the expenses? call get number am next so a morning. then full was Pat, core the XXX taking right for [ph], expenses, out to the idea backing factoring I fully in that understand the is about year, year number trying you're a of the as at that basically to sure inflation slight to out quarter million it I and a think is guide like XXX quarter, and

year? next For

Yeah.

I way, to it straightforward. because you worst the pretty possible is want know, in You answer

of that think probably to as to it go through what really to there up XX to right our to levels. particularly outlook of is in from in Nate until few I'm will going else However, expecting course be figuring now. We're but spend discussion go sort we about would increases going we're are about more salary I anything that a and which inflationary for defer the technology year. we think the minutes of the out for ready for Absent be be to ago, a the areas I certain still staff, said process of as on days fulsome XXXX, think way

the But of services and going deliver not we're working across we're vigilant products to to our ability on a lot board. at think to overall very extremely expenses focused I efforts our the to abandon time, competitive have platform same customers. going on and both remain ongoing and the we

next off January. decline to The a I'm revisit magnitude see you year. So of that hold will going and in probably that,

of worth question about, XX% Maybe similar. the down walk was in am just problem, at were so loans bit of just through COVID is because if weakness a since adverse seeing a loans me you last credit, that rate that month, I'm trying about the increase reserve something you of more just put a concept of No you to held can up? square on you it the But proactively dollars know, saw I on the little dynamic, sequentially, Thanks. that trying in you're loans you looking downgrade kind out structure shot. -- these get it talked those provision to the or

Go Mark. ahead

so I practices. And on seven and a several amp you different these that course last regular you as obviously, three, times mean, management three but Chris, rhythm over then our notches just not dives Yeah, and in months. up those deeper times done we we've areas portfolio the portfolio, across of the have higher these of know risk

that some of So gaining is is some advance as in right. element of it, expected, migration

need don't statements know financial to You that.

migration full there. going and suffering see the to the that risk to don't You know a you're financials need is hotel industry

we areas. the It that come some by are a in So, that like in statements three this to that as you can high guess, the of saw $XXX over be you all I up was of we'll categories sub-standard see was segment than categories, see I or course well those mention were want things largely expected. in holding it are special of you those were proactive and the increase we'll before ratings million I migration way, as we would QX in think those and financial and more that the we, dominated say others ahead in where, see said through I half risk risk downgrade.

get point. are terms at there So in anyway it's try financials as then like but you both the are sector anticipating like quite other we're and things like. ahead looks as this real commercial holding the migration, use judgment your where up some can, you and well of much don't really outlook And you what of portfolio estate in sectors

releasing just your we our the a that that's it's liquidity it's held it's question, our improved yet think bit comments what's and reserves. answer outlook didn't we a to PCD as time releasing this and set the the that we outlook could little the could we'd of of reserves We in of We was have even areas, about at outlook of financials, to face further, in the and has think and aside So the the have deterioration right? little in quarter money for released as was I'm the cash time. trying reserves. environment, my everything, right behind have fact said, do flow again, for It's accessed think -- didn't best borrowers we judgment, in kind this though and appropriate We reserves improved this number credits. thing a bit credit

would that the Yeah, structure to tax on it's Thanks, not XXXX just one attention potential the from there today increase? proportional of in change different administration. your one, the maybe color. Mark. lot the good given taxes anything same Pat, make Is in last election math a

Short answer no. is

$X we're estate, little into whatever invested have heavily Federal. equates do rates tax some burden the a million, around in with some million not real that anything tax [indiscernible] have aside We change. State $X offshore complex that, we under But to percentage have else. So, or universe per credit from We help really our tax more don't probably structure. than changes

That's you. great. Thank

Young next The will with from go Instructions]. ahead. [Operator question Securities. Truist Please come Michael

the stuff reserve, just the question. went guess loss the there Thanks increase from be to ACL on in see in a for million surprised that of message actually little another the was sub-standard, that I down imply content that first you necessarily mention or are is Quick up kind I but don't special follow XXX should taken you proactively there million. downgrading that? XXX guys just that, Did from given

to want you take Mark, that?

our you when down, say at allowance the came XXX Well, held allowance we million.

that, say you when So Michael.

Yes.

the pandemic So actual I credit the up, losses but for factors the I down. the environmental which kind kind went guess of portion, allowance to of went take mean

realization guys the was unless was actually this there a that just collateral of and that or wouldn't on we of on guess, are expectations to content downgrading yet a implied credits, future the I you allowance, to in don't expect downgrade but trying kind understand I So you respond just see and loss if lot levels credit?

answer of on allowance reserves certainly through portion we of as you the saw Mark at of loans. level it, me risk to allocated relative shift there the is, future let any that help in context shift other as migration risk were exposure view may there described that that to charges some is didn't just what been The the the And of to look the we needed through, shift to is our and that Yeah, we of of as Mark. talk come has acquired reflective that element and the our be. the size the migration

of and that an no, standpoint. I liquidation answering. you've simply we But answer acquisition from think own assets your saw question are to those stated So your

X%. use you maybe of of was to move lot thanks. if movement extra table OK, some loan clients kind that off could those or deferrals, down? good to into or bring collateral that seeing strategies just talk about of you levels a little to down of the additional to curious how dig about Could those obviously And, those deeper, just have a maybe talk you I come the cash got the deferrals you you maybe

would number in a virtually say. Great, cash The across I of every I number one the a happened to ways. industry would say couple additional table that of cases

else assets that is somebody table assets. leveraging sometimes the to put cash it sales, I sometimes is asset with us equally, Sometimes either personal or it's unencumbered

franchise better But best in was are industries, April certain lot a So now to the in stated as the improved a my little also operating prepared one. number of the of all bit remarks, others they the cash there But access is where example. in these flows they're I May. above were liquidity and of than

would primary the came So, that frills ways down. two be the those

of at gone when do you've expect Okay, sense troubled through, you as possible, kind first know, timing? look of the gauge that I would some seek of of that that just resolution kind more XXXX, loans of to, just maybe maybe the timing of and try of there? of makes resolution some we you trying all kind that, before to When be quarter that to maybe is am later, sort that

Yeah.

gauge out Michael. just credits continue that too for hard us they of we today, to specifics around to there see are We the timing perform. It's because for

which So be form we see that'll don't it things definition really whether year stimulus harder be sooner a function part that it's middle that's and certainly don't unfolds shape of being the year, how the year, or continued the that. pushes from evolve may things equal, into All this performance, itself manifest but the it by to degree, see to influenced relative which really starting by in XXXX, we how or there. the in pandemic earlier gauge, than or of some to

one just said potential your the wanted sorry impacts assumptions last terms Pat, me, on what timing PPP, so if it sure, to from for missed on I NIM in And PPP? you and it resolution includes just included earlier, NII for guide, is of make

this? -- just we've taking Mark, So are okay with me you

Sure.

forgiveness commitment total ease, through expect forgiveness, on forgiveness of quarter this occur. But of portfolio of the have gotten of the our of the have start first there's And SBA when so time for slug I basis would quarter a just government big year. loans actually sake forgive we not an of second time and Yeah, at about see zero from just next from turnaround a all. the probably even outstandings seeing the majority virtually quarter think on the seen to we kind the we for into

XXX back month whether predict XXX ended. that be million lumpy average, a to but to on sooner how So really and may it'll versus be million hard

thanks. Okay,

for closing back [Operator call there would comments. over If further the are to I no Instructions]. turn Scudder questions, like any to Mr.

you. thank Right,

of what these like they Midwest take colleagues our all to opportunity our times. what close the franchise always doing we we're Their their the I Midwest and response across the calls thank and all and listen commitment for because our to I living First acknowledge and to up, it is special. makes they're about clients teams company, so during Before First what know to

communities we're and very right do to each our other. them of proud efforts our So clients thing their for and for day and every the

So attention and once again, would to I interest your a share investment. First great our of all ongoing thank that in Midwest is our as belief we for story you

So have a great day.

parties and Thank for day. Ladies may All conference now gentlemen, participating disconnect. sir. you you, all this and for today. the have concludes Thank nice a