Independent Bank (INDB) 19 Jan 242023 Q4 Earnings call transcript

Good day, and welcome to the INDB Fourth Quarter 2023 Earnings Conference Call. [Operator Instructions].

Before proceeding, please note that during this call, we will be making forward-looking statements. Actual results may differ materially from these statements due to a number of factors, including those described in our earnings release and other SEC filings. We undertake no obligation to publicly update any such statements.

our measures. may of certain references some financial non-GAAP addition, discussion include today to In these measures, and about found Information non-GAAP in may GAAP our be measures earnings release other filings. including SEC reconciliation to filings our of SEC Relations website. can the via These Investor accessed section be

to CEO. also like Please that go would note over conference please event is ahead. the Finally, recorded. I to being this now turn Jeff Tengel,

Head morning of for and Lending, joining thank us by good CFO accompanied I'm Betsy, and Thanks, Ruggiero. you this Consumer Mark morning, today. and

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market invest Greenwich Our differentiated about the Associates. In order row. XXXX unique by relationship. With characteristics. to year see of skills we each and may Boston control. for Work exposure, $XX loan we to is performance plans each scale have with is credit our that Score relationship being and financial business service and product high provide will near-term executive level quartile North including expense recently competitors. nearly Shore management industry-leading their sense a paint in That we to goal That leveraging while Worcester. a with markets Massachusetts in portfolio Rockland for if be the in tailored will a commercial exploit risks. It's high and employees we is the in feel our we And in is customers growth by seasoned It model because We in to early technology Place and as commercial and at hired XXth through differentiates service mind, Top expanding to that managing Globe while compete we variety assets, touch, bankers. actionable leverage the Savings larger why insights locally. credit believe At product a with proud difficult upon Shore opportunities model institutions needed, in newer Net from delivering our innings action named experience decades the North ways, Trust data and deliver why be invest delivering portfolio supported Evidence where customer acquisition. are proven generating and capability experience, office need many to measured in of have like this our the they real Promoter we estate draw to us relationships, and this is to operating branch a in million work our organic to the East of entire to management risk of approach our achieve inherent acquired our one growth we our this We've the differentiated analytics resonates efforts. office top mitigate we to who purpose demonstrated a in brush of presence any have our Boston of all to manage matters. while that continued do individual the to market

in on mentioned to core I've FIS a As newer our upgrading the previous version. system are of calls, middle we operating

focus a and online growth ]. examples is to and on installing those Mantle, opening deliver relationship to another the We nCino, are Salesforce leverage few promise. Ongoing new on will us deposit platform, projects loan ] like that tools [ continue a we of of our [ organic account and and are matter enable some just

We a sales incentive Work here treasury inside have Bank management, programs more gathering to team growth heavily XXXX and to industry deposit-rich segments. program, new like at things commercial on to for number a a recalibrating a facilitate focus of weight initiatives and deposit include deposits

revenue. in XXXX in verticals attracting XXXX. trend success leverage We've talent growth to industry high-performing and drive us more expect with some of talent to will We fully value the and that proposition who to market can continue And our in some enable resonate C&I. in had opportunistically drive also expect finally, our unique

activity more of upgrading of we to conditions driver one in few value and when deploy our our opportunities remains minutes we on muted, our examine parameters has strategy been believe it expect acquisition efficient and a M&A to be somewhat I This number focus adding to continue environment activity has become future. what tech in allowed successfully buyback pricing and It's and examples in us advantage also allowed were we some a excess and pause a us of past, prices. The stock the very fit proven It current improve. capital to ago. will take in effective. be us also to the historical to M&A disciplined platform. via While processes poised that to our allowed that mentioned a internal also has attractive order to

create functions. this look of where expect and are facilities examples we review management strategic cost efficiencies our strategic Some more procurement at savings to over and time our a

to attractive operating an in in commercial and results to be only accustomed deep brand we deliver engaged choice underwriting, We workforce. In while will Northeast. the energized deep managers short, to an continue And that the current credit to to have but management years, customer acquirer talent to disciplined I'll over the and upscale, a a of highly prudent good and consumer note, expense management, ample team, market place expenses strong in turn has believe environment, the to be including well summarize, the of diligent base and talented positioned I and are technology. To navigate everything we through investing markets, not recognition, been challenging Mark. take and on market continue over and share it capital,

contributors, return today's summary, in with back in of total EPS the net was expectations. essentially million results common $X.XX XXXX is EPS fourth repurchase X.XX the per reflecting us available Factoring now on approximately shares that produced and on quarter especially website these results, average investor Slide $XX.XX was Jeff. major a GAAP deck. XX.XX% the $XX of on in common in strong -- with equity earnings equity. into line $XX.X price portal. Starting included fourth return all that we was Thanks, deck will million, of an line average X-K and return on X our and bought tangible share. In quarter presentation diluted income on at X.XX% X.XX% through filing take our I a during million, a average cost assets, an

tangible book despite slides or the exceptional now In grew fourth per additional highlight key in value the few an the X.X% points buyback $X.XX in during will provided. share activity quarter. I addition, the a quarter,

healthy has some the Business on we to most has deposits and XX.X% Slide underlying cumulative XX balances customer a to total up competitive basis our deposits $XXX while municipal fourth noted deposit year-end reflects from pressure current declined X.X% the the average billion $XX.XX drove headwinds, to X.X%. flows cash The for those the rate banking for a noninterest-bearing total industry long-term the quarter at consumer deposit the main of quarter, of -- and be quarter-over-quarter. The continue franchise as of prior continues not strong million rate changed compared X, X.XX% fairly from repricing. persistent deposits see our story in peers. higher cost of still dynamic quarter, remixing, remain deposit With environment comprising or maturity deposits decrease points As interest consistent impact dropped though product customer the when in CD much total as beta the to yields. Despite of remains intact. stability pursuit

excess existing makeup provide no to adjustable-rate a of the the As of a appetite during our a billion portfolios, in dive over estate of of loyal strong the along for commercial or term. Jumping we and households both million into quality, update The the an total modest driven our decline into X $XX reflection the we We X.X% a office total shared commercial throughout during for funds usage by the or in a is will XXXX a with and source an the long and balances of while year. on quick primarily The deposit year, deposit established commercial year building primarily nonowner-occupied notable loans, on increased reaffirm acceleration by deeper noted We of still overall X. on majority and estate balance back of number real existing grew full volatile permanent with relationships X.X% increase take loans bases we quarter. Total on message paydowns driven from accounts in by Slide real to reflect snapshot provides this asset customer closed the outflows The overall projects C&I exposure. Slide while period. conversion vast feel quarter. balance real various construction strength results, reduced commercial increase occasions drove $XX.X change was status. And residential near loan base. during already

few a I'll Slides now. a various which to updates of and number on XX, factors. highlight and risk Moving X viewpoints provide

still nonperforming $XX.X but and loans of First, assets, million, total increased total respectively. assets X.XX% and represent only X.XX% to

of foreclosure the $X the million terms loans. Net are nonperforming property primarily key XX the of to the provision and $X.X full previous basis, loss office loans. an brought from during amounts well driven basis of while migration quarter $X.X of annualized points of outstanding of contained In declined charge-offs X% remaining the nonperforming for were an drivers the million to million and was new paid allowance in assets, loans to loan even X on or commercial the of

Within of the closely outstanding monitored total couple noting. balances and manageable criticized nonowner-occupied decreased very highlights office worth XX a classified at loans. only remain modestly, there's portfolio, while balances Total

continue of the up XX% In million XX closely top office addition, office portfolio we monitor our approximately in exposures, $XXX which year-end. or make balances to at

note these million a status Within nonperformers, as million criticized $XX classified. in $XX we top XX, only X and

Slide XX. to Turning

repricing basis drop As yield noncore resulting quarter, points from reflects quarter asset prior the X on basis pressure for anticipated, which or the margin a items. continued XX excluding point a in cost X.XX% deposits outpaced when of benefit the

fixed pressure margin rate into period, with this emerging previous repricing is quarter worth the the of previously line from recent dynamic While noting guidance guidance, provide downward factored I'll shortly. longer-term the were asset be a negated benefit it our prolonged some forward-looking this the is anticipated for pressure rate would pricing. remains If results on and in

and deposit the assets under revenue side strong nearly on strong interchange summary, $X.X at and should moving life XX. as bode was year-end, wealth with which remained management loan-related to by Fee fees. In ATM grew administration benefited and forward. and million fairly the of gains fees quarter, reminder, $X.X insurance nicely billion on Slide X% to Moving remain from prior nonrecurring income for which, well consistent a bank-owned

being prior write-off primarily X% onetime or the when driven and by XX. was quarter, acquired tax largest with Turning on tax to onetime of increased for tax the uncertain charges of quarter conjunction benefit, release $X.X increase with component positions million of of reserves a the XXXX and to in facilities. And assessment October includes Total filing to compared accrual expenses expiration the million and of $XXX,XXX the outsized the rate lastly, Slide FDIC the of $XXX,XXX of the $X related the XX.X% return.

begins well As to on level move on the still we XX credit we to recognize remain thrive the funding of we and environment near-term are impact when that Slide pressures. driving focus said uncertainty turn. Having confident positioned we forward-looking and to guidance, that,

while provided net provide growth of As expect as bring in near first in limited components first to specifically, decrease deposits, outflow the from towards more resulting anticipated salable the year relatively quarter year. Loan projected will loan we growth we stay are full normal year. level the some of mentioned, over such, the low I production second just to shift seasonal of first for for quarter, we the to is guidance we activity. But XXXX to grounded single-digit will our experience specific and starts again balances with picture, December of for a balances. likely have as deposit growth second anticipate half the mortgage our assumptions levels, flat towards XXXX skewed the outlook modest half More operating staying year-end term. Big

I not mid-X.XXs the expect even the all matters reserve first are the the deposit with the to in potential year. prolonged and and and As earlier, the to percentage decreases stabilize and loan in half curve, alluded of persist, margin equal, for pricing steeper curve a inverted of decrease we the now challenges Fed will created range shape

changes it will loss, to loan driven to quality, our relates to we significant estate portfolio. real for we which As by asset investment of believe and quality guidance asset continue no the regarding have provision performance near-term commercial primarily our be

And increases payroll and similar low and levels QX expense XXXX to Jeff's years, objectives in operating expense, benefits both slightly higher are due Regarding levels. expenses should quarter expenses for comments, expect single-digit fourth reflect increased prior And seeking fee annualized noninterest to income to primarily salary efficiencies us. and versus from control priority XXXX we percentage and experience echo taxes.

due full is from be comments, part the low-income it will for to the Lastly, open year, in for questions. full around concludes to down my year housing rate tax and slightly for up expected we XX% levels tax investments. That increased XXXX XXXX now credit

now will [Operator question-and-answer We begin the Instructions]. session.

Sandler. today first comes Piper with question The Fitzgibbon from Mark

starting up to What going guidance function bottom single-digit deposit a gotten confidence on down of see Mark, we're to like been trending growth and things sort Happy there. while just your Friday. in guys a XXXX? Is normalize? up nudging feel on gives to follow we've low Deposits for you -- that Or deposits? the you you some that have slide rates of kind on now. are

to near create year-end a mostly down, pressure be deposit And liquidity. does experienced When some fourth that here well. the some quarter over tax outflows, we do the fourth well tick quarter actually you was tax it as customers spills It and family-owned It's very relatively appears drawing continuing be see of in like some business balances flat. And to components feel the franchise, quarter excess Yes. first the year-end balances. decline been lot term. bonuses businesses, as look suggest. things stabilizing planning, on of still will distributions, in were where really, the our typically consumer of very at in the And small stabilized level into lot businesses what we of a we on

So a we'll not bit continue we're close. see. But I we're there's little that think all growing to households, in seeing of accounts all,

decline to a bottom out. So we're getting we point the here should do where think

to have inside we focused it's Mark, a deposits my whether number towards really incentive that, I comments, I some if add, on could skew in compensation initiatives Also, sales which to gathering of completely groups. programs alluded or modifying deposits, of opening

of be a number sure. XXXX focused in of It's initiatives on a have focus We to that. just ours

spot wondered in of NIM month then was And with us I could share what the December? if the you Okay.

Yes.

X.XX%. So was December's margin

I Okay. And And you $XX that there the think on in? commercial high-level What X this loans some for, mentioned nonaccrual industry quarter. to I were think, then you maybe were? those just what give could million migrated color issues if were

Sure.

take to Jeff? -- that, So me want the largest

Yes.

declared operations. ultimately, but a just that matured those collateral an see larger -- recognized actually actually included a still loan loan from in appraisals do on of of sale at It's the actually to them. essentially is in sorry, loan of a renew in operations. was matter about But is we equipment through Okay. that [ actually ] on The is relationship. And on that get some will believe That L&I unfold. that much did a specific then still reserve. And participated sale with price what how that and note. will company expected go level that actually sale solid had dollar. we It's ABL largest the And would bankruptcy, It's second facility. and impairment an C&I equipment, we lastly loan did quarter. is protection. is $X.XX there's We a sales initial our believe is a to that fourth the in We office be and the not deal

So is fourth on charge-off million charge-off a quarter. $XX It's the $X.X well million the you're an in about as seeing that loan.

of is net to that So one balance nonperformers. new -- the new

Okay. right you guys M&A rates order of need we for the certain bigger of come picture environment a think now? do this doing down bank in question. more in And environment? to to become and you of to sort consider regulatory Do sort I is interest And guess, possible acquisition an sort

our we're quite getting modeling. but more yet, might when and feels closer. gotten better. I'm for bit right deal be versus that in smaller Well, environment accommodating like all a it bit moving bit on larger depends that's not little deal, it how obviously, challenging. The is more more has do regulatory a right? They're numbers and we It depends, might big transaction there risk just the a speaking we're have sure a us, be we the integration think a much direction the

sit So or the I think today, be, say, net-net, possibility I'd don't better it's did the or in but as months X X the probability it needs direction. environment, than of right feels ago. I the to it M&A here it's it trending where

Raymond comes Steve Moss with question next from The James.

here. Just a second going margin the for back to

Just curve, your curious, forward -- does first guys following 'XX you the I think. half you're mentioned

So should curve, treasury I the say.

any really just in here? cut implies guidance. the how the your you not would if curious were to Fed margin me, rate in year, that this that do to margin I'm dialing So impact you're think cuts

I beneficial question, Yes. It's us. certainly an that to Steve. be longer certainly would interesting term, think we mean, would

ability gives deposits the stabilization over margin would margin move on the think term to likely long I and suggest going it us improvement forward.

think is reality think short-term second quickly quarter the deposits. challenge we the I very quarter, a first how will the cut, Fed on be can move after I

So hedges, we of reprice the will have end our our would that of curve. net the XX% of on loans short about down

a time We move mitigate borrowings the by driven purposely that have would deposit so overnight well. But of term will CV repricing to move still And exception our our that of have and we pressures that partly book you should deposits be most benefit how as number some our rack well competitive created on to be of maturities see I think can pricing? in market. nature short we rate on as that. quickly in and

wildcard bit probably negate can little materialize. as of So think that the of where take will a bit whether time offset a that's repricing to whether and or some to fully you completely down I asset little there's

All right.

given Mark, change And the the on mentioned then, loans new of downward also old you Okay. That's curve. here fair. pressure

of kind a loan lower curious going is that's your where lower -- also balances also here yields driving going forward if have And these curious, loan Just component construction forward? you days? pricing of just

end there. products declining is. seen off are priced like the the construction, it the and that of short Yes, curve, opportunity of typically less mean we've I some

at September new where it's not of X- my reference XX the just So down but a a or to we're curve, about curve, from that's of we basis little anywhere of you points. the somewhat or a more look average, today, bit the new yield X-year trend, between seeing -- XX to on part are that. And of when

net this of get some from environment, to the thinking So similarly, ago. And can how around but about is to commercial on equity the credit. few a we it months constrained we continues fixed high think pricing home because rate consumer like terms that in still side, rate X% we'd on growth I pretty of of down just be in lines think were

So not to an just of much these drawing customers there and of lines increase on are not some as seeing ability well.

at utilization both points rates, in and low equity over demand last so. are the on So lows home the -- or business year C&I

been we how it's a going a asset more of a are it's will mitigated bit in be repricing. I benefit combination of But thinking still on be think more about than little pressure things So what to bit think putting that loans it. we're

going was be priced are forward, we be loan lot add fixed which thing to think sorry, SOFR of term, I think a long-term lines going rate trend would more term, rate. of is percentage I we right, as of [indiscernible] begin versus the secular off be our that, of and you of a kind floating -- on portfolio we will other as other One and bit C&I so short I segment would greater just a be would -- to credit, thing very -- of our longer move Mark, as which to a business, one those typically focus to

on Okay. front delinquencies maybe That's were helpful. bps here, the just versus this last. very then XX XX quarter credit all up And

any curious Just what's there? you driving have If color that?

new well. X as The nonperformers to drivers the Yes. are biggest

be to So loans, as X limited office those one see other resolution That first in be. will are here essentially is Those office. and But loan other XXXX. X the quarter. working that are delinquency, in last nonperforming the the that bar with and quarter that We're may to were what early-stage maturing there's basically, now performing to new of now one delinquency.

just loan here. curious, that office you mentioned Okay. And maybe maturing

maturing $XXX in have loans upcoming office million year. of You the

-- loss NPAs -- potential of in issues Just just guys potential your curious kind be Or the of maybe do source provision loan deck? will you referenced primary that idiosyncratic office expect you the credit just give drives you be there? any can that and color and will

would -- hit head. I think It's to start, So idiosyncratic. got on be you Mark, I the I'll the nail

As location, in we has as -- prepared sponsor, that to brush. that they party if bring portfolio remarks, loan, resources look to it's unique the look extending to said whether refinance at one characteristics, every I Every paint or my difficult with they it's can elsewhere.

So we pretty think is because nonperformers bunch good today like million top we're to are different. We that managing maturing I each of see them, there's going going a as one sit feel through of but new feel don't of think we all about here on of of that necessarily don't we we're loans. -- -- $XXX to out I

out delinquencies can terms credit of ]. look or [ in really there's uptick been over other you of early correlate any I portfolios, the no them When downgrade note migration.

resolution short portfolio So term rest even the really good just quarters, on larger and look in handful as with just over a on of borrowers of we continues out the good. hopefully even working and next side, the the feel really directly good it's when find ears that X you And the to eyes really have a the plan. term office credits near to they're

feel contained. well it very So does

Hunsicker question comes SRP. next with Laura The from

it loan? and that's is can you in office, Mark, delinquency, A on Class B, that of Class office that staying Jeff just much loan or And is early-stage share anything on that? the how an

contained. Class see But it loss with nonperforming well exposure it's there, we a And to I closely working believe mean, mean transparent, may or Yes. the if we're be again, that move pretty I million. the that That feels I on I in balance to first one, fully A quarter. that. is borrower $XX any think there's about

participate would And one, in it. we're that's the We deal also else somebody agent. not and

Okay. of And of 'XX, the $XXX in that's how much quarter? maturing the in then million matures that first

couple quarter, the that. million, little then much and it's $XX probably comprised of smaller after just There's $XX In a half. a million loans X -- there's under first

it's So somewhere in if the XX% me, in all don't XX% peg range. number, details front a to of had to have around the I probably I

debt One we are resolve of a actually on we'll we really of X-year and and the we've already good renewing have LTV and in process at level. extension those, as speak, it think service

already of about. those we good X one out is have renewed been So feel the in and works

Okay.

you commercial Okay. loan do big I'm thinking the I what the balances $XX ABL the then loan? million, actual have X that was a... loans at over. And on are How came mean but

loan The we ABL the came wrote office of but million $XX $XX.X million, -- $X.X in was at and off was million it.

So it's at the NPAs it, in call million. $X.X net,

you. you. Got Got

Okay. was or what -- A And then Class B? that Class

The write-off? The office?

Yes.

That a Yes. Class was B.

Class That a B. was

this Okay. fourth maturity Was quarter? I mature $X.X drove Was office million in And that the -- that? ones million one $XXX know you that had $XX then the loan, the quarter. of net in a this the what or in million on you well? hit first Anything can share

that fourth elected not we the one. to in maturity on quarter, renew hit did It and Yes.

So...

say your comments. you in that Yes, did

just question. then And one Okay. last

deposit want or do you those get of CDs thinking as How How Just deposits we How should XX% just going about at shift just as the we the change for the high think out overall be to here, sort back sitting ceilings? to loans your mix maybe you to about about backing should and that's thinking think XXX%. there? that? about side

focused start. I'll XXXX. very a pretty loan-to-deposit a which We're have on Yes, deposits don't to growing in very, mean at having ratio definitely close on bright we where than would but we and line want X a why strong be. very it, we're is I have less preference being we to

with comes Chris The O'Connell question [Operator Instructions]. from KBW.

I to Yes, on just guide. some hone hoping was of in the fee in expense

quite you past do into being the XQ the the onetime-ish number, in out flat other up guys over with kind relatively of couple seasonal XQ Specifically quarter? know that to see the you couple first been settling on income pressed I a How bit. the a or noted number of fees of QX. has factors quarters

should $X.X Yes. fee group. total the the up comments We Management be I that strong just income, in increases, to AUA the the think into And The heading we're to mentioned on the but continue not to revenues see on are that continuing our billion, production we're well necessarily of significant salable. in mortgage banking bode we this total more primarily the of strength heels very environment, for Wealth optimistic will of fee income XXXX. being to

volumes see hopefully of to level little give but mortgage salable and a should Now on lift are down, banking some bit back overall shift us income. we

we behind changes we think stable. probably perhaps fees, I made on coming feel think us. have that and regulatory there's We overdraft. front, some Our have already deposit are pressure on the of very most But

modest gives all, see decreases lastly, I of might momentum some pricing this cetera. And there's fees, deposit, this swap the more a pricing. we been to to some is then for related in But our volume whether earlier ATM lending of We us -- hard interchange, going we about bit commercial swaps can and was and think to good strategies take opportunity shift generate think fees all opportunity in additional et again conversations So mention environment there. some overdraft. on around to on

there few in and So that's our near guidance. rate there's to and term, increase I run have that well in bode very a levers the anchored think what's

how in that of expense -- those timing out of the guys including overall embedded cost you for cost of guide? Any savings, helpful. the some that year? sense the on on, play over expense course initiatives the have is fulfillment going mentioned could you on branch And side, side. the and And potential the is That's that Great. that the savings then potential the

the They're not overall expense guide. in embedded

little of half facilities that on or incremental both. side, maybe year, we be into year maybe And would skewed bleed of I would the facility a next the those that's towards experience. the probably be would So bit just even savings back the think

On on that haven't XXXX, side, we'll from number we savings but think some the put procurement see that I a in yet.

Any as potential a wide sense said Got those it. all the even range of magnitude the once if done? pretty and what of savings could be cost to

estimate. Yes. you at don't point? Mark, know don't this calculating if do, just I I have an

Yes.

a X hopefully range on we of on it's more guidance to where it. think as little I this bit say give but point, quarter clearer path we'll a to or highlighting more probably it's it -- a fair that of some the in at worth it's isn't get next at

us that it's host things as Yes. that's we're the base of looking we as sure, our whole changer environment we're a as we at think we a in. examine not that and for And honestly, to illustrative about but really be expense game of

into the that I I we're have remarks an my So could being you on expense them of one the up. other all themselves at. to some in of prepared of them you, think and managers. add each of example needle, looking it We example funnels as aren't mentioned but There's of a good move kind host things just whole in back given when all going that

reprice Got the side, I start CD it. And on will deposit guess, much the guess, of to has and yet portfolio, I how there.

moving impact the less, is The which good less Yes. is news forward. and becoming

Xs, expect that So about about X.X%. and coupon then in QX, there that right average is weighted I now mature we and But $XXX positive to high guess the is reprice. million the pool on

not is is I a X.X% that was. And weighted at now as also is average high mature, believe coupon. severe or to dynamic set QX in then $XXX the another as it So repricing so that it's million once

we like couple terms So in the quarters assuming full anywhere you'd XX of XX that today's level but next of price CD increase percentage a rain point, environment basis up to a would is, be that more from impact the as see up point pricing. hope stays that, or over potentially

That's Great. perfect.

comes The from Moss question James. with next Steve Raymond

follow-up on for the here. buyback one Just me

million have know you bought I worth $XXX guys million You stock, authorized. and of $XXX

about about your And maybe you on repurchase thoughts Just new curious are plan? going how issuing pace thinking forward? here guys a the

the you play take do Mark, kind of want Yes, pace the to of date? to

the spot under there's you plan. about on, Sure. $XX you're existing left Yes, million mentioned, as

changed. think to It's our posture be opportunistic. there I hasn't

executing continue lens the We capital on plan think initial that. about that comfortable earn of about to on dilution feel and and through the executing back appropriate ensuring

then through that to barring have funding. I other the and serve credit good equal, feel where a about and it's on quarter, be all a still talk fair our as really about given opportunistic stock just will overall stabilization capital we So handle things and meaning plan of the first think on thinking levels. We really depending on re-upping the staying price framework is the

for going capital a as tool forward. think I deployment of So

of be lever decisions over very but haven't that, a continue Again, on suggest would where We any most being sense it to we I opportunistic think that to XXXX. it's made to fair throughout to makes would execute. look

more, And Appreciate the back. margin going on if one that. then Mark, may, Okay. I

had guys You some this swap past the expirations second of half in year.

Just should curious help XXXX XXXX or if the margin. that expect there are to any in swap we expirations

Yes.

XXXX. about million matures average quarterly basis throughout In have on on fact, we a $XXX probably

it's and $XX and in somewhere it's million out well. know I million QX, million quarters between for So sure, then in the as $XXX $XXX

always reason holding to weighted paying run like portfolio couple or continue book It's of cash hedge to the of off what's X%, X.XX%. of securities maturities, X%. A down margin. we've talked at a borrowings running on So average about There's lot a of the the at it's off about levers without just securities that's allowing stabilization either why the is essentially coupon that.

maturities to lift about. talking securities So just that hedge we've loan been we're seeing good repricing and the a addition from runoff dynamic in

once pressures at those the So enough be think offset guided to I to. some X at maintain level and point, the will factors deposit margin subside, we've

Thank all color. the appreciate very much. you I Okay.

question from SRP. The Laura Hunsicker next comes from

other, little that follow-up. other noninterest one you $XX about Mark, outsized. of a $X.X think nonrecurring million, help income Just outsized, that? the looks was what's bit million the in us piece Can looks

-- gains we piece big this have unrealized in on Yes. The quarter's equity. a

securities defined tied requires equity accounting. portfolio that very a small that's a have benefit We plan mark-to-market to

gain, it's income. you'll $XXX,XXX If you'll other a noninterest see of a it's noninterest If through loss, typically you little see quarter. this volatility that expense. That recognized other see go it a So quarter. through was bit about get each

quarters number level prior that probably So I think item. to the and that line are right QX for your

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

interest Thank Independent we to your will next day. you and quarter. good Bank talk Have Corp, in you for a continued

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

disconnect. now may You