QCR (QCRH) 1 May 202020 Q1 Earnings call transcript

Greetings, and welcome to the QCR Holdings, Inc. Earnings Conference Call for the First Quarter of 2020. Yesterday, after market close, the company distributed its first quarter earnings press release. If there is anyone on the call who has not received a copy, you may access it on the company’s website, www.qcrh.com.

In addition, the company has included a supplemental slide presentation with COVID-19 related disclosures that you can refer to during the call.

these the access also can slides website. on You are CEO; CFO. and us today Gipple, Helling, management from and With Todd Larry President, COO Management the summary then will analysts. brief financial provide and results, of we to call the open questions from will a

would forward-looking begin, remind to by Exchange Securities statements information as I of falls under Commission. everyone providing and will defined be Before today some the the like we that management guidelines of the

the made As statements beliefs, company’s part differ concerning these projected. this of the and forward-looking those could hopes, statements and are during of any results predictions materially expectations from call guidelines, future actual

information Additional the factors on company’s the in website. company’s included SEC on which available these filings, are is

but This as for GAAP the other not directly the comparable management financial release contains be press most discussed substitute today well which Additionally, non-GAAP to supplement may the measures. refer on information to and measures, GAAP the measures. as the available quantitative to website non-GAAP of to are reconciliation intended

a afternoon, the be through starting be It on available also XXXX, recorded May website. after XX, this for this and will will conference As one of this replay hour accessible completion call. is company’s approximately being reminder,

Larry QCR turn now call this I time, At will Holdings. over Helling to the Mr. at

our Thank the a with company you, thank time quarter and I financial details results. operator. taking Todd start Welcome, brief on performance. with the call additional update regarding ladies you to word today. for first and will gentlemen, our a will join follow us and

affected to also times. across banks team the want responders both together are and each those other an COVID-XX in corporate and care our these especially of we leasing at challenge thank country, difficult of other, our who and during employees, by with who communities as are clients first our crisis, and impact, company our a are and health a thoughts As the coming providers with support on unprecedented our are to front all for our I lines. most midst the the

continuity and many As been remotely remain our implemented, has working with from healthy home. a business fully working company, people plan our and

continue our access. offering branches, remaining drive-up across services and and locations open banking We lobby through our serve with limited to clients all

addition, and mobile increasingly in impact ultimate the our distancing. this banking In will and clients the online channels predict duration It pandemic our unknown. still for are of difficult important our are platforms its have period depth to customers because on remains social that

our our capitalized, combined best However, these decision-making, strong during liquidity serving philosophy continue We believe we markets to putting and well that clients of be our to serve are is clients. has times. first, way the dedicated to uncertain local with

that storm. have all this helping we seasoned credit to great experience downturns, in all have committed teams We economic are significant and at with weather clients our dealing charters

of loans As have some program allows have part clients out our $XXX form of and and this date, clients impacted X,XXX effort, totaling liquidity. of proactively more million that to roughly we relief, rolled our preserve than To been loan payments and cash of granted leases. relief defer

commercial Additionally, been capital much-needed into to small liquidity existing enrolling lending SBA many our the and new many to protection intended provide which teams actively of and have is non-profit program, business paycheck our clients. clients and

loans approvals totaling the $XXX end from As million. week, SBA fund banks of of to received the our last X,XXX

of effort short teams a in an amount time. very extraordinary with Our this accomplished

relationships translate and into goodwill effort expanded existing hard are confident in clients and both build We with that new future. the this and ongoing work will

too have It determine asset to is full may impact the our on that soon the slowdown quality.

have out to exposures certain loan portfolio we commercial our the lays about information impacted supplemental some provided in have borrowers We that industries.

million $XXX hotels, X, see markets, Slide restaurants at-risk in the of we of is or of three local industries exposure exposure major can X.X% which to than primary markets total loans. represents positive. rather our is our direct you a in on and metropolitan roughly hotel our Most approximately As our entertainment believe

mid-scale loans the majority energy and properties. economic direct the our no exposure are industries to have our And addition, virtually In also or we in of hotel aviation portfolio.

As shown XX, retail of shopping estate Slide that real have both a of meaningful centers on commercial typically mortgages. of portfolio communities. investor A strip local consists loan and owner-occupied serving we general portfolio portion properties,

traditional have extremely loan mall sponsor. shopping one only an We strong with

is to over of exposure X% million segment $XXX total less total the general Our our loan commercial than or just estate real retail portfolio.

that in Our COVID-XX in and values. pandemic be material view real result it economic commercial or will transitory, that long-term not estate decline of a the is should impact the permanent

did Now a form crisis impact word the an our loan increased growth for first health loan of public results. results losses. in quarter lower provision The about and our

our quarter. However, first the overall excellent we solidly and quality credit were during profitable remained

stronger assistance capital emergency with which Our supported and challenges exceptional reputation. company, liquidity a believe we communities levels will We programs bolster these our remain as that emerge continues service, to having from our strong. and

We I are and call creation, long-term turn of through well will organically and profitable value growth the strategic to Todd first over our results. on positioned further to acquisitions. goal discussion quarter for both pursue our With that,

you, Thank Larry.

I is results, As our loan discussion first review some I’ll I focus our with where warranted. quarter on will additional items start growth. financial those

economic the Loan trend second that for the impacted As the has continued caused quarter significantly activity March, by COVID-XX slowed growth production slowdown in and quarter. loan the into Larry our by in noted, pandemic. was

payoffs which impact during We also as an large several well. had the experienced quarter,

declines loan are not the expected the regarding growth. in During the uncertainty organic to be loan range announced to able the Due for forecast offset for accurately real Therefore, we growth full withdrawing quarter, inherent the of targeted our pandemic, estate the in we other duration growth in commercial to a position largely are previously loan year. categories. loans was all by

on were to or linked-quarter our with deposits, $XXX deposit million, core all We that by million this With with $XX representing growth increase amount increases to very basis, by non-interest-bearing deposits. deposits X.X% respect a generated increased see deposits million of pleased across Total $XXX we strong quarter. categories.

loan of our we was our sheet As in our increased growth, deposit growth liquidity. excess significantly well on-balance

ratios Our by quarter. impacted this were several factors atypical capital

as disclosed our shares did total cost First, our $X.X which of in TCE a by repurchase release, stock XXX,XXX of at reduced common basis the million, we press quarter during points. X we

which rate reduced Second, the our preferred $X.X quarter TCE million AOCI rate interest mark-to-market on trust during on was XX liabilities by caps basis our and swaps certain points. securities, adjustments by on reduced for interest

liquidity the which TCE further loan $XXX mentioned basis totaling respectively. by points, basis swap sheet points $XXX reduced at Finally, our our commercial and end gross-ups million balance of XX on million, of our quarter portfolio the was previously excess mark-to-market inflated by the XX and

suspended of impact on our became repurchase our the clear focus is mid-March, stock book in economy our capital As we program, preserving and growing and COVID-XX on value. tangible

and of the future dilutive rate and mark-to-market impact capital impactful our ratios on caps be peak Additionally, we in the on believe adjustments reached first quarters. quarter in our the that interest swaps the TCE will not as

turning interest quarter. margin a real for to earnings. Now was positive Net us this

in mentioned benefited X and in from faster lower sheet decline to as flat fourth quarter yield we on environment first buildup call, short-term our a excess deposit offset was The pace than quarter, we on interest lower excluding the assets. our once benefit well interest-earning well as loans positioned rates interest to sensitive. our acquisition-related yields at modestly X.XX% liquidity in were costs as in funding As a basis balance earnings was down We up X rate to moved adjusted from to by guidance the net accretion, liability of in as X.XX%, points X partially our increase. on outperforming again cost quarter resulting our increasing the the NIM, a fourth significantly declined point our basis

well retail we continue reductions As are benefit funding in funds which wholesale our continue will CDs impact sharply funds reprice lower, to higher positioned of look to from we positively and costs. forward, our as cost cost to

work the Additionally, quarter. we enhanced expect would our portion a put to throughout liquidity to of

expect on loan to our our second in margin continued maintain to net to However, in despite point spreads see efforts pressure our due Therefore, portfolio basis credit loan provide to we at not to LIBOR, prepared given will time. see core specific factors guidance further the are and this interest taken together, the but our downward we continue these increase in our March. quarter improvement rate particularly pricing, decline in

quarter, Now our strong the another which modestly to in quarter of high down guidance the which range. of the came turning income, end income, at did non-interest We $X.X was for first million experience fee in at our swap quarter.

well as $X our robust. Group swap up the our for our The the also remains loans for banks at addition, from million management and of wealth SFG prior fees slightly within fees as In expectations quarter. our Specialty Finance were pipeline healthy remains within quarter,

targeted expect for XXXX to million range result, of $XX our of this fee of a to year income. As source still we the million $XX full hit for

to for meaningfully turning After our our quarter. were of the Now non-core expenses. down items, from couple expenses a non-interest adjusting fourth

million as One to sequential and as decline sale XXXX was benefits for basis. salaries and was employees’ reduced the expense, a of of bonus our November down accruals This is linked-quarter in compensation the components of quarter-over-quarter. larger the of which well $X.X due incentive on RB&T

better of which align the have higher based of our results variability to and a compensation performance in of reminder, component As compensation our with total a incentives financial form compensation larger in compensation is degree to philosophy a smaller performance. in

down and As to such, lower were growth. provisioning levels compensation during earnings the lower our based loan higher due on quarter

be Our overall asset quality continues solid. to

increase it in While relationship. linked-quarter lending we experience due primarily did quarter, the in one to assets a non-performing was

provisioning on decision it methodology. loan and With factors. to to we to use defer was loss implementing This was appropriate existing determined CECL loss our incurred our respect for to quarter, based continue several the that

continues there the regarding of First, uncertainty be amount significant implementation CECL. of to a

pandemic poor to already for methodology. uncertain credit highly new makes creates a which for future very a the Second, adopt losses, current determining environment a time

the existing comfortable finally, degree have of and successfully in high XXXX recession. a are our with to And incurred through saw very we methodology loss us as it XXXX confidence

from to prior to and quarter. qualitative XXXX. in created the local factors changes losses in for same that the totaled factors represented of are December at response pandemic. currently primarily at million provision these economy XX, economy in Both our national first economic conditions up the The $X.X by deteriorating lease they level COVID-XX for and $X the million due Our was increase loan quarter, the

basis a loan the loans of severity provisioning. of As regarding be caused include duration uncertainty you loans. it total by economic providing end our the quarter. X.XX% of going provisioning, discount the not the on unamortized and coronavirus, we When the fallout of future and to this loans, result the points are Because of for guidance represented of XXX lease acquired allowance the losses total on at forward represented increased

came quarter was tax-exempt lower the revenue. due XX.X%. at lower the for of to in mix resulting Our The and rate linked-quarter effective basis tax earnings on a a rate higher

I’d this comments preparedness what our COVID-XX about like manage earlier economic pandemic. shock my Larry created to unprecedented reinforcing wrap by to by noted through the up

strong, and We look into our Our continue to remain We people to forward capital stand when to this the ready communities and incredible are to crisis and weather have to clients entire levels and passes help mode. have shifts we economy us abundant blessed to our company throughout crisis, recovering we a so. help our when liquidity. this do

growth are call this first up our a With stronger questions. we we to positioned shareholder the ready strategies. organization, continue We value from for Operator, open question. creation our your emerge let’s believe for well that, will and

you. begin with ahead. first question-and-answer KBW. Thank from will Please [Operator session. DelMonte come We’ll Damon today go Our question Instructions] now the

Hey, well these everyone. morning, in challenging doing is good Hope everybody times.

an regards expected in the or just participation will for with you fee origination guys average to receive have the PPP. question, the that First rate activity? you Do

take Yes, that is Damon, Larry. this I’ll one.

last all, so, First or opened end back funded loans since additional we’ve the the just XX in then. some PPP because of and quarter program up hours since

looked that of the So yesterday. X,XXX, our PPP we – loans we you from now number up at yesterday just gave just over is number just

bit X%, about little a The fee million. Our average a loan is little $XX over is loan million. over loan going to amount per so now be total $XXX

caught we the caught at In requiring we the basically – clients submit might clients. have but I basically be of yet, majority that our with There’s we a – are to vast dangling from say our few deals information point. this are would addition, up up that

about the feel helped transition. clients good And so our really way this we during we’ve

respect dollar mortgage Got consumer to thank it, you okay. and or color, with number Good on gave color then like deferral, the And the loans? you. of amount. and is breakout loans loan then the What commercial between some the

the in sector, my Yes. numbers dollars the and flip and commercial vast majority let of are The try to here. me

we’re are Damon, and the in the looking in place only And bank, hotel the of commercial we’d we skewing people dollars real where talked of that sector. vast sectors. sectors a so have The is about, do of maybe in have for commercial the those that there, majority restaurants, an because we a data deferrals highly increase loan the

our about space. hotel deferrals XX% XX in we’ve XX represents hotel in that space, dollars on properties, that and So received of the of

side the of On we’ve out that restaurant total – in from restaurant deferral referral things, loans, had of dollars which XX space. gotten XX XX% of that represented request we the

no different. deferral the in those really, broad-based was high. it trends fairly activity, consistent that Other areas that, was were and So than real meaningful

just because you fee previously your and misreading I range remarks, fee $XX in And okay. pulling I’m release That’s pipelines I million to for one not just release, full the your expectations, press million helpful. the for sure with back that think the want it, you’re swap income. $XX more Got question. I were income. make said year you thought, given quick press swap to sticking announced a then prepared the And said Todd, targeted

make So that $XX I want sure the million accurate. still $XX to million to just is

did more now and pipelines We Good Damon. that finalized, it press want go is, that the for up and we at huddled about than with release folks the Larry It swaps, the I based catch. SFG to release. press crafting Since the our on determined ahead reaffirm and banks was we feel guidance. confident and

So ahead do that. we to wanted and go

big Okay. very That’s of your component helpful, because obviously non-interest a that’s income.

step you. some out. all to very So clarity I’ll there’s back much. I you that see glad Thank there. for Thank That’s had now.

Damon. Thanks,

question come will from of next Our Nathan go Piper Race Please ahead. today Sandler.

good guys, morning. Hi

Nathan. morning, Good

Good morning.

just portfolio the perhaps going that pandemic. as Damon’s ongoing more question, given guys earmarked the back risk, around loan to Just just you at

the expect to guys Just roughly fund. or of so curious of million $XXX you loans PPP

sense funds deck? outlined for slide You guys at-risk guys to a going of more those have are the you those what clients that proportion in

good question. Nate, Yes,

If the restaurants, total. PPP of the to $XX of it’s you total. $XX million hotels, are the look at it’s And million out going out loans that

percentage a but dollars, meaningful of huge So total. not the

a gears alluded operating obviously, that’s Okay, On you meaningfully bit. Todd. like helpful. down And changing then little came to, lower expenses,

kind kind your out, of remainder run guys’ for Just rate point going curious, about thinking and as we for of operating about we absolute swap at pans think maybe how have over forward kind the couple revenue of everything that the of guidance of operating this expenses level next – the assuming should be going the this year quarters? of with on? Can clarity we

Nate. Sure,

We’re it some million in million of here When pretty non-core $XX confident be the million. to $XX.X to out about range. QX, going that in $XX the you was strip expenses we’re

production. be expense profitability And somewhere and $XX million non-interest in of depend a the on range to would ultimate total $XX for good of QX QX. million It will range through level pretty

in returns. that. because have well a degrees we that it to would million aligns million But scripted our $XX As to higher with compensation. at-risk We be of tend shareholder like said proxy good comments, for $XX we

seems And it’s to Okay, then to – nicely lot basis floating have loans where going the of to And context, the think Todd. had on basis yields to I some rates difficult your just yields of should already security should very your point impacted should which imagine margin we overall reinvestment know percentage funding guess so predict I costs trend the helpful. you I just that second is a we within basis, how that guys’ kind I’m core cuts. that the we guess, how – Fed we in a floors those just given expect to But trend point relative it saw just cuts point, in guys or rate quarter, at like just more in late what curious given about your following first and Fed quarter. loan quarter? I

moving March. us going with in the reductions a the for of of of are note, big really benefit are, rate That’s full cost a Nate, parts help going funds. us, of to to on quarter course, the Sure. be positive

to to got significant to liquidity, tell here, hard are only enhanced work that’s We through will least put more liquidity going really work. this of you I April. some at

growth We which continue deposits, to we’re see is But put some fairly core work. always in to significant work to good a thing. hard to have to going that

to We discipline. on maintain pricing and are credit pushing credit really spreads, trying hard spreads

little that’s would so and floors the course, We rates. our that, be of – Going floating hit rates do have floating to a helping floors, against have of bit. close X/X with are about

We’re actually But pretty RSA, we a pivoting a about RSL. are margin. balanced to optimistic better little bit more

fair just points to hesitant amount specific We’re basis a guidance. provide any

some wildcard at feel continue those the of moving be Probably So to about are margin. of is work. feel some are We how for to putting We good like this us. it expand. bigger should liquidity we effective parts to biggest the going

just And sense. I I ask more one appreciate on makes that color. could Understood, if Bates.

about in seen a just we relating the there goodwill just second says think in market. given impairment pending to the I accurate line how was at revenue, maybe you and a the press in if I’m maybe curious that’s took quarter, the wealth just think guys recently least release overall sale management volatility should equity we’ve charge of that the that Bates.

question. Sure. Nate, great

reached an to agreement have sell Bates. We

it from continue to any sense exit the make Given longer to Rockford company. us our the own didn’t market, Bates for

were that very expect we of with than to that sell. because an get able reached that until savings planned. the to not overall agreement on integration originally part RB&T I weren’t business would So our we to late close

a XX% in on AUM bottom line We linked-quarter much, there. So did reduction if about see basis. a impact not of any,

persists – be expecting lower bit year. Bates a market. If based management now, Bates’ management time. reduction a of gross the the $X over this a XX% is So trended X% to right just about reminder, impact. wealth XX% And would revenue on revenues for an about assets million under exclusive That we’re in as

we Bates, we’ll that core management. that dropping QX, management, per from be X% XX% and could sense? off make to wealth by quarter Does wealth So in an $XXX,XXX decline see

least clarify helpful. forward, million remainder within management, quarter? pieces of that, Yes, gave guidance you wealth just to between and reflected And moving very that Bates at $XX million the $XX is absolutely, those in year this that expense for per and going

Yes, yes.

guys step questions. I’ll taking I Thank great. Okay, back. you. the appreciate

you, Nate. Thank

you. Thank

will question Stephens. McEvoy from next ahead. come with Our go Terry Please

Hi, good morning.

Good morning, Terry.

Terry. morning, Good

Just around strategy to call just start have focused with it, your, on their current banks A PPP. of lot clients.

guys You add guess, XXX the clients. to, have new taken opportunity I

such those understanding that having Just around then opens the and dealt in of new maybe your you haven’t were issues with in fraud, worked you just primary with clients talk overall fraud? door their success clients bank? for kind you have how that? with And think past. about weren’t And just the that Do comfort

So first one Terry, take let additional comments. got if I’ll that he’s Todd a follow and crack on at

these existing would all say, I markets. in clients First, were potential our

and So companies, perceive we a in as lifetime build the once a we relationships. familiar this with were to opportunity

today, their bank. So we’ve PPP are done about we as primary weren’t – of where people XX% loans of the about for

maybe entities individuals no us had or And of relationship companies were relationships for them we’ve calling years. that modest on with or been most that non-borrowing or

non-borrowers, us was the in us. didn’t just because of relationships and opportunity for too from deposit them to it with And need maybe build their companies was that inconvenient that move an relationships past us, this much to were so most

a side. relationships on a wealth standpoint, standpoint, So this standpoint, help we building from that will when been deposit we record pace of through management a have actually funding from because PPP accounts the get been treasury the think a us we’ve this, opening at management and core from we

concerns So markets that our really people in all these before about fraud this we were started. no knew because of each

our coming than and so these clients can get these them help nimble U.S. majority just new to and would These a need targeted able be. another list. bank wealth of Terry, were wish cases, being for great of on echo of playbook as would them. our This new In not be the agile to The was or clients comment. bank wealth, this random we to that through were way more of Larry’s opportunity continued characterize U.S. vast the I in be to were. was program from most part a but clients. time they result not

he thing. because I our last the basically head greatly conversation with reputation "Your we’ve other weeks," the been enhanced in few local a of community in handled this. had one economic of morning And organization how Terry, development our this has said, locally.

a good thing really it’s from in reputation So a markets. been our –

guess of Nice. as has the the first question think, since loss as then go That’s today, move good respect would quarter wanting my qualitative about changed the here in it to into not the of like higher to provision about, talk about is, I the Todd, you hear. kind ended comments your the quarter line. did follow-up, And a that If think end I your the ratio loan economy and I quarter? factors reserve. allowance-to-loan that

that’s great it’s remain a on Yes. to ask to us robust give say But provisioning congratulations. we fair think way Terry, here. more to expect to I really, little really provisioning, guidance a

and obviously, it more recession larger fine about we because, the incurred duration did of know severe provisioning The feel longer our the the likely ultimate this everyone in is, through are guidance like will goes We severity model. see it form. us not the else, good and It be. We pandemic. the don’t giving on loss

performed now. We think well we recession, expect we to and in the

allows to to of a So with more us and accurately think that real more little we we We little in here loss degree continue think do given history. our the high out QX incurred We do expect build. cut provisioning of nice took model uncertainty. a to

same XX/XX/XXXX. we recession. ramped to of pretty a have factor It at we clear level had kind economic so was And national up the our

Our local economic those are factors also increased levels. roughly

our going performance. information some expects There’ll anyone about be its getting to of now clients don’t think from so metric little I at end real up their we’re QX, where a going time. but clarity be more to of hearing credit show for issues the forward, and And kind

we’re if the the So to metrics drive here. going happen on to that’s going not just provisioning, credit to rely

expect stay you’ve in provide to provisioning comments got Larry, out to continue don’t any the some allowance. on to know, you color. and We more want I build of if front might

the it way of increased the in won’t talked I’ve Terry, they’ve my beginning of at banks, pandemic. a we’ve cycle about included, with our the on provisioning. we’re all the as And or clarity we maybe at some Yes, employees, of end where asked week this is synopsis so, the us be what’s got happen this until with have we to going last

you. Yes, thank the presentation Thanks, help Great. both. you, together the disclosure, thank to who on additional so everyone, put

Thank you.

Thanks, Terry.

will Our Rulis ahead. next Please D.A. go Davidson. question from of Jeff come

Good morning. Thanks.

Good morning, Jeff.

Good morning.

follow-on. couple – a couple just A of

backed you like Todd, versus – close of backs the the assuming Is stated I’m that out disposed $XX.X that of disposition the figure and number, out something the the your – expenses, you or to that? what kind said, On acquisition core costs, so million $XXX,XXX.

Correct, yes.

you Okay, And us on a let on? that the then got March you. do – the you of know margin have March month could margin,

rate Really I provide the number. lot the it cuts. those of was moving of average and Actually, than not think dramatic build to liquidity a we’re parts for March-only a benefit in terms the Certainly, of better going quarter.

I’m not it was but at parsing better out quarter. average really certainly March the for this than So point, the comfortable

added, weakening? discuss of relationship a one sort kind relationship? The of over or pre-existing that credit. that COVID-related about And any tipped on that through lastly, then type And of you sort pressures was could helpful. that’s Okay,

facts, bad had a really discovered it we Jeff, was financial that information It was so to financial problem, inaccurate. it really true Yes. unrelated. receiving that represent the charge It we’ve reporting when been was was – knew we didn’t elected basically the we we And off.

And it? what the loan type of type, was

construction was a – it That business. was construction a

still far. the our so And industry projects Construction really been so very side. has the move commercial markets both – and construction to on continue in solid forward, residential there’s because unrelated

evidence certainly, is that pretty that, days a is as of still anecdotal ago, business couple So of solid. the

comparable bit had to And one. deferring presumably, Got that And timing quarter. the of CECL have were quite may on you, occur? of just work the a okay. you if on level in last you you a adoption, thoughts adopt? then when done the Do The reserve

getting I’ll that answer imply, be the from and what page. some is better trying FASB and to the Act timing really sorting first, the meant Yes, get the the on dependent one everyone and CARES SEC going Jeff, last to guidance everyone them out is same on and to

So I’m reluctant on to speculate timing.

will disclose continuing CECL. track to be We and

one the quarter. have be I’m Q loss million So this comfortable above – that to grown the has some right of in end a over But form number and number. first $X our giving now, soon. an the here It’ll over at and everyone incurred of likely little million in day would little methodology, been adjustment a our over $XX at the

CECL and that difference incurred X/XX. now, be loss the at between right would So

it for me. That’s thanks. Great,

Thank you.

from will The go ahead. of Instructions] today Please Brian Janney [Operator question next Montgomery. come Martin

the Hey very slide guys, helpful, place. That’s so. put on good morning. help in deck Appreciate the you all guys Yes.

Good morning, Brian.

Brian. Hey,

you for would be you one just guys that moment. any quarters? to can me, will to that, Todd, of thought helpful. here you’re the just from on couple benefit Or Yes, – a on just next just for of PPP The kind the any that us over on thought how realize the play back into expecting give income maybe the statement

how the over forgiven amount of the around around fees, remainder uncertainty, $XX Brian. Yes. ballparking of fair of end right and coming now, the much of earnings forgiven be A But of course, Right year. XX% Sure, that, come will of in our might we’re on. and that with now, loans XX% million those roughly the maybe that by is of those early fees recognized of through two-year remainder the expectation period. that

Okay.

is and you’re quarter, other So XXXX how thinking out, in today? the by spread out about it spread half is

best the we Probably point. this would guess have Correct. at

got you. Yes,

helpful. Okay, And that’s then maybe a...

likely one it’s starts. so uncharted year I’m second the while we’re recognizing the quarter in not some possible Brian, it really of and third – sorry, other point fourth that we’d clarity, before this territory, more it’s quarter, of of in it’s probably start we’re

Okay. on income then for Todd. That’s just fee helpful. a the And minute,

wealth a The on quarter I – we’re is that? thinking things. more two the run just about on Or it Well, – that AUM, decline the Just drop you off in an management was it. was guess, that basis decline, of first rate from how were kind XXXX levels? annual

reduction a Yes. on Brian, that was actually basis. AUM a linked-quarter in

So to XX/XX/XX X/XX/XX.

I X% that. thought XX%, XX%. I X% XX%. misheard was referencing thought. to And I I drop AUM was guess I Right. the impact then Maybe was revenue to the the

persists in – so on an this would persists, if QX very revenue. X% compared our in around somewhere expect, was again, XX% to to we annualized drop basis, If actually Correct. But this revenue QX. static

Todd. other you, pandemic Got about income be are or okay. expecting any or should to thinking I And guess, today by clarified. lines about? that that prospectively of the That’s impacted that consequence, be Thanks, you’re have fee think – you that know there been we then should

this or Brian, debit thing people go expect and are less. interchanged XX% income, are down I’ll one and because to credit I’d start. is actually maybe probably economy Certainly, – cards XX% overdraft that income in we’ll their those see using

interchange a overdraw probably income. little a means and less, that So less we’ve got little they

probably space where it’s that’s see So one will not we something. but huge,

just Okay. on just last all Todd, me. quarter. And the the margin, I appreciate – for this one then color the the

be how right going Just there? bit would flattish be, what it your a little margin, level now, Flattish or up you that that. when to, directionally, where least core the next at from would it’s goes beyond that be, be reset quarter we kind reset second quarter’s to thinking should Just expectation down? of just about to or it

Sure.

talk how about with we longer-term. that, is have upward think I bias a would QX likely Brian. more than upside fairly would slight Certainly, static

there action that Fed first likely the from quarter, end this to expect the They’re of some the certainly at point. at nice see of powder in With we benefit QX. out here

And probably more QX, so to little in QX static. a

you. Got

one was that’s And just Todd. Okay, tax helpful. the rate, last

guess, be on, the the any I Given about this – should quarter, future change thinking thought future? we how

Yes.

a versus based on tax ex-income mix So that fair moves amount taxable. of the

in had higher and taxable tends be rate move And where of the normal swap in rate are with to and we streams more income provision going revenue so And lower, in that have a quarter. lower. and is quarter large net fourth periods we provision, large swaps low fees to and then that like

So in point a probably. XX somewhere basis swing, to XX

much. had. it. all I Thanks right, I All okay. so appreciate Right, that’s

Brian. Thanks,

Thanks, Brian.

and the Ladies I’d conclude this to to over remarks. question-and-answer time, for Helling session. will our turn like closing this At gentlemen, back conference Larry

to Thank with a during look again and day, everyone thank our these safe of you all and to joining we Have speaking like call today. remains challenging interesting great you you, hope I operator. forward soon. We healthy times. would and for

Thanks.

conference thank The attending We now has for presentation. today’s you concluded.

may now You lines. your disconnect