otherwise Thank walk unless noted, comparisons of through quarter be all of I and you, with statement. as I'll with period prior Kevin. our begin the financials, the XXXX, first income our will And
second interest the an in net Our was million income $X.X quarter, $XXX.X increase of million.
increase an improving on yields, reduction investment assets yields an X Our a points and shift in quarter-over-quarter securities. basis interest-earning mix driven in loan by increased
total by cost mix. declined basis fueled average funding Our by X borrowing lower of point, a
were second inflected net quarter. The the margin we anticipating as for interest
X As X%. FTE points Kevin our mentioned, net interest basis margin is to
accretion, margin accounting was the X.XX%, an purchase from points net increase quarter. prior X basis our interest Excluding of
and margin third We in in incorporated sequentially our same quarter, approximately increases the is continue the of to interest expect fourth in guidance. which our net magnitude
flat, our slightly loans that relatively from suggests we that the interest-earning be full quarter, portfolio year. to runoff borrowings. This this investment reduce the for remainder decline will to will anticipate we intend and the of the our through year assets Again, use
the income second X% we of believe of we When interest the in half year trajectory year. the we first the this, consider the our over half alongside increase to X% in foresee will margin, net
flexibility have XX position as strong us borrowings begin We light our This as toward we in basis a forecast [ relatively current more point in rate sheet rate rate moving the of that XXXX X liability-sensitive note ] cut mature. should neutral, view revised a our You balance in quarter. our to gives fourth term expectations.
commercial half of the undrawn in the our discussed our further quarters, on that and, particular, year. second For the our subside we construction negative will last the belief margin in the line impact several impact of have
that reinforced This view. quarter
Total unfunded were We a right will from X%. quarter lines million weighted lower point this not over as approximately unfunded ongoing around just at move average end materially at forward anticipate $XXX will balance level. us this of do rate the the of keep production the
As new the continue market to to at will normalize. rates, production average continues occur weighted rate
previous second us. in in Noninterest income priority quarter, Improvements of over quarter. the fee was X.X% businesses our the remain $XX.X for a increase an million
as in Kevin pleased solutions. movement the positive early So treasury said, we're with
business. a remains experiencing still challenge, minimal our mortgage we're and However, mortgage volume in
XXXX, that incorporated is guidance. our and view We into expect through this to continue
Moving also second declined to expenses. Kevin million Noninterest as in expense, $XXX.X million. to the $X.X mentioned, quarter by
to year, is into this quarter. guidance. insurance medical remained Our quarter, below also expense in the our our the in expectations level so anticipate reported lower consistently incorporated We third this which will has far contributing the normalize
focus investing maintained we our in while on where have our hires. strategic businesses We managing selectively And controllable expenses needed. making levels staffing while have reduced
quarter onetime guidance. the approximately and the net a in $XXX,XXX the credit on prior reclassification, from form reduction effect basis, net versus in quarter, taxes expense line. had expense reclassification accounting per had prior dollar of line expenses the $X On dollar a increases noninterest tax the change as go-forward reduced the by quarter income this moved to second which in million about per expectations. by of a result This expense X over also We is which a the reduces a tax
the X.X% we Our are over net In forward. be which increased tax by this rate, projecting income to incorporates $XX XX% to XX.X% prior summary, to million. moving treatment quarter
second relationships, Loan by Moving to permanent to declined $XX.X Loans sheet. increased million. balances loans as in quarter. increase offset modestly balances. C&I and was increased line draws. financing, along the customers, increase that to in several emphasis on by garner This potential the commercial balance where million full an our we our and industrial with Construction in a seasonal but $XXX.X our loans most and in deposits moved owner-occupied see reflects smaller customer
million $XX.X quarter. in by the increased Deposits
quarter-end balances. of larger-than-usual our balances include to Kevin noted, deposit year. be this did end from the through anticipate customer overall the in As relatively deposits one ending flat We
Moving we reserved. credit quarter X.XX% office $X was to the was million. our quarter to amount coverage for fully loans. charge-offs metro for and due Total credit. the to provision quarter expense of which property million, specific $XX.X increased points X of were that ACL the About in for were half total Net one basis
on Now the further the the for third-party the for had the Based update we in We to this X on an nonperforming Kevin in disclosed loans valuation, we first specific that quarter. loans. credit second nonperforming credit reserve the increased C&I mentioned. quarter moved
resolve We working of the closely entity management this situation. are to with still
discussed The quarter an other agricultural is XXXX earnings during relationship nonperforming we loan fourth call. Kevin that that our mentioned
our This in of this on relationship of paydown received positive restructure about optimism we the resolution a loan. XXXX. completed quarter, a supported balance later credit the on This partial and a has this
our to want nonowner-occupied we touch office define as cities. which also and office major located loans I within construction on briefly exposure, metro
to our quarter at third Our from of of prior declined disclosure end category basis points exposure loans, is having modestly about of total this the XX the XXXX.
declined and same which general commercial properties, During our to estate total under of period, as exposure, both office define X% loans. that construction total we nonowner-occupied real office general
a higher XX.XX%. saw capital. was quarter dividend $X.XX of Tier the of And a Tangible increasing XX per quarter improvement XXXX. equity or in our we ratios in We X capital X.XX%. Moving at X.X% equity continued yield second declared to to the points for with slightly common our second share basis of common
comment in I finally, weakness on briefly was that XX-K. And our did want the material included to
we'll glad week. XX-Q are and when We include we report this detail to our in area, additional progress positive file next
back I'll with Kevin? And Kevin. that, to it turn
