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SBCF Seacoast Banking Corp. Of Florida

Participants
Dennis Hudson Chairman and Chief Executive Officer
Chuck Shaffer Chief Financial Officer and Head of Strategy
Chuck Cross Commercial Banking Executive
Jeff Lee Chief Marketing and Analytics Officer
Stephen Scouten Sandler O'Neill
Michael Young SunTrust
Steve Moss B. Riley FBR
David Feaster Raymond James
Jeff Cantwell Guggenheim Securities
Nancy Bush NAB Research
Call transcript
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Operator

Welcome to the Seacoast Fourth Quarter Earnings Conference Call. My name is Ellen and I will be your operator for today’s call. At this time all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. [Operator Instructions] Before we begin, I have been asked to direct your attention to the statement contained at the end of the press release regarding forward-looking statements. covered issues Securities forward-looking their and are to discussing meaning within comments be of intended the meaning of Exchange be will that statements constitute the today that Seacoast act. the within Act, and recorded. this being Please note is that conference I over Mr. the call turn will now to Hudson, Dennis and Seacoast CEO, Chairman Bank. Mr. begin. Hudson, you may

Dennis Hudson

fourth very XXXX conference full-year much. and Thank and morning you thank for quarter everybody Good joining the Seacoast call.

us also and Marketing XXXX time are David found time growth, investor Strategy, on strategy, is and our outstanding Analytics distributed yesterday investor again after find Credit was market Officer; our presentation Our which can website Officer call that on Jeff and release, in Community balanced our be financial here Chief Financial completing Kleffel, Risk our Lee, Presentations. sound with for our We which while significant organic and This investing our an our we us within Executive; growth here Banking of of enabled South in unlocking today. Officer approach Executive; effective acquisitions be franchise. will our as has year the press banking Houdeshell, us strengthen Seacoast. continues title and Chuck discuss the to our close portion results. includes M&A Cross, Julie the the and Head and enter operating and with Tampa Chuck our Chief position in prudent to under Shaffer, our today, market, value as to well Florida. Banking the Commercial

progress the last cost controls initiatives growth We operating ambitious goals part losing and made our February our XXXX. of as on management. outlined on Vision focus executing are We we prudent risk towards significant without

compared share our XX% For achieved XX%, despite million the target earnings an per the We impact in $XX.X adjusted and of million, Irma. revenue increase meeting of increase Seacoast net of the reported $XXX $X.XX to prior adjusted Hurricane income, full-year, in of an year. net generated range

value meaningful year. increase per true our delivered to also book our last average, $XX.XX our of to is tangible that point also out to an loan are share profile, below We the and our granularity XX%. strategic preserving I want from shareholder the remaining $X.XX value of we is Maintaining that risk to increasing objectives. portfolio. guardrails core our well achieving That’s credit industry

the also our We believe credit foundation sustainable low-cost process that returns. future with is deposit coupled scalable our franchise for

of the term we of in In our the to balance closing MSAs strong Community drive Beach print by our the expanding of growth loan the view moderation presence and Palm consistent That loan speedbump During rest result saw industry and we over that the a the the and will the fourth County. across we expanding long a Beach primarily growth, lingering of quarter, in our the in as short-term moderation quarter, Bank said, State continued the in-line strongest of fourth confident effects any we Florida. with and growth I’m Irma. Hurricane foot aided Palm M&A approach acquisition

which We complete now of institutions second it also in acquisition acquisition MSA. very closed and largest Bank, on proceeded convergence these is both Tampa, is the smoothly. second of our of NorthStar The Florida’s

our with We are generating good traction new customers.

We as high Orlando regions have in playbook. expectations our follow we both

growth to organic our on to customers XX of example growth has Orlando. an bank have and become we The market a thoughtful track record top Orlando in know, acquisitions acquisitions. you build leveraged generating our As of three organic and proven retaining excellent

under which Seacoast We in umbrella. the are now are template Tampa, that GulfShore following on same building in acquisitions, our operating by NorthStar

Day during extended commitments the last on good February. making are our We Investor

operating costs. sell, our customers We and we to cost our are how our lowering focused on lowering serve improving

our of two XX previously three in months, to On the and closing locations the our XX of another next our XX% cost branches side, years. announced XXXX we five to in to on targeted goal including branches way are next two the well over

as Palm of acquisitions three Beach part of the In NorthStar and Bank. addition, we Community consolidating are locations

momentum our transformation, I I business, today, tremendous to As invest further previously XXXX from line continuing announced will both in utilized go expansion. deliver tax the accelerate customer to continue driving cut and towards while business will to look growth, so, the do additional To exceptional digital service. at anticipate see top We as bottom financial objectives. to including our potential as resources well our be that our we

fueling legislation In the closing, as the significant of Tax the four advantage years take let we of of the state are primed for come. positive a share throughout me to major Cuts, thoughts. growth to Speaking see opportunity w and

on we’re targets. cylinders to relates First, firing it all our as XXXX

We about growth creation. value opportunities have the in right strategy balance and we’re place, continued for optimistic the

market organic efficiently and digital ongoing initiatives customers. in we our how investments in yielded our Second, serve and significant analytic have to go improvements

banking innovate significant unlocked We and is and our believe be platform to still will customers to continue there value for shareholders. investing

provide Third, future runway our Florida key sustained continues growth long markets and position momentum. a in to for

to opportunities passion, continue detail our our results, aftermath with will of forward XXXX. I that, additional And of together Their ethic work ask enthusiastically markets. to like Chuck? to in finally, provide quarterly and this We incredible well our has We regarding to want to as within continuing especially associates. Chuck key And thank our Irma and long-term made look prudently to to expand footprint sincerely identify acquisition as objectives. and in review all possible. I’d grow annual the

Chuck Shaffer

morning. for Thank joining this you, thank and all Denny you us

reference generated at on quarter All X.XX%. $X.XX was X% disruptive XX.X%. income equity Slide increased outstanding return and net with hurricanes $XXX from I on efficiency tangible the assets executing challenges adjusted Sequentially, increased year, year-over-year adjusted per demonstrates which tangible return was from a XXXX seacoastbanking.com. and $X.X share, on or XX% XX% increased net revenue my this material at Adjusted XX% be and we declined XX% year-over-year $X.X X, XX.X%. million. towards overcame value And We earnings to and was to million $XX.XX of found ended per $XX.X significantly share up share And ratio adjusted prior to $X.XX Adjusted book deck adjusted from driving XX% our to As the million quarter earnings increase year-end. Vision income net common I’ll additionally, the adjusted or Starting year. improvement improved comments, we million. Denny three-metrics net up performance. by and objectives. financial progress at strategy can the our slide our Adjusted as per tangible had an strong provide fourth revenue mentioned

results for Looking combination past growth acquisitions there the of Early year, XXXX, we clear is growth that meaningful value our at over organic our balance created in shareholders. accretive back both and evidence offsetting strategy, equity capital includes the that productively was during an employed solution and share year, of initial gauged from issuance XX the million transaction growth the issuance. this support EPS new of to the equity a

used three of the acquisition. to franchise and close Seacoast Beach the on Some the acquisitions Bank into Community with strengthening in GulfShore Palm with was extending this South NorthStar Tampa accretive our and Florida capital presence purchases

notable to full-year items the results. X, Turning and four Side fourth quarter effected

Jobs Act net deferred to of from a as Cuts write-off reduced Legislation, [ph] asset. the XX% tax $X.X the XX% tax Tax rate the its requiring to First, was result and federal corporate company of million

will from X, benefit meaningfully to starting XX.X% effective rate However, from decline will rate tax change the company’s XX.X% in approximately XXXX. the and January

in recover per earnings will in We than yield change share. one write-off and year the XX% will less an the rate effective benefit to

additional by adjusted and estimate quarter, is both were the the Hurricanes only impact the results results reminder fees, the charges impacts expense, impacted excluded the form $X.XX included business approximately the storm. and only with with the in our disruption. efforts, efforts but of the quarter and to from as rough impact exporter, effected recovery third in the associated fourth third widespread A Second, waived recovery associated expense in associated a we’ve in expenses revenue charge-off fairly representing from and Caribbean with single a $X.XX this area Fall. of These a service that our

sequentially. are million. net integrations write-down Class XX the recorded I’m a GAAP non-GAAP margin recognized third, income and while legal basis of more Slide termination of locations. we with was closed the on relationships. The to decline company and million. two $XX.X Palm offset pre-tax primarily X, the other more differed banking few This now quarter consolidation rates of million of in Beach one-time deposit the to XX. during sale balance tax $X.X public related the complete, of share sold and X a fourth charges, points to interest two that fees, report result, sheet interest two holding up And Both investment primarily result And asset the reference of in result growth sequential closure than we sequentially, and first XXXX, Visa and reconciliation the retail net the at the adding deeply as associated purchased the payments, lastly, quarter fully in replenished of penalties. the Community transactions interest at than as please the in repricing down million the details, quarter, margin of Slide income net result X.X increase of gain cash B and On NorthStar a both net the and higher change contract quarter. And further looking we was associated merger was control the the acquisitions XXX,XXX interest a shares Bank acquisitions, with the fund was in a pleased For on during during

in assumes asset increase remain increase accretion, also on of We until affecting then in funds to loan federal the remain sensitive rate and point Irma, expect in in to less in prior June quarter, net the Additionally, a forward. of XX-basis Due mid-to-late occur non-cash points earnings This XX-basis we approximately declined margin. margin an significant be improvement high variable rate of approximately basis, mid-XXXs assets. we the for not Hurricane results will And amount year-end. share a as the non-cash basis interest net This in per did increase points the increase net primarily with another looking mix to forward, [indiscernible] December closings and $X.XX yield and interest result move XX basis XXXs in includes average accretion. December. annualized point the loan modestly from expanded by of first the quarter, which the the earning a

productions banking declined prior mortgages quarter of continued periods. pricing a demand related Increased gain income result is from income million other changes for of sale The commercial swaps and result card in and the is rate X, in of our the our an to and the as on continue this borrowers slightly the income Mortgage in move to to originated increase and year. looking on forward gross result And results gains XX.X second prior we Moving on Slide focus swap of and quarter spend from improve of non-interest million year. by in from in SBA fees, higher for quarter was lastly, from the continued income, interest in interchange sale production, premium related X.X there SBA we adjusted prior XXXX. forward the the $XXX,XXX debit included related up implemented program. expect

tangible adjusted X.XX% Moving adjusted sequentially for adjustment from of noninterest was to decrease million from The million ratio The from on down quarter. to X.X down performance-based incentives. prior X, the was result prior quarter, X.X up year. the expense an expense Slide declined the X.XX% to the primarily sequential asset non-interest and

the for and full million to $XX.X the approximately impact $XX.X adjusted per Bank of million expense return approximately million. to includes normalized FICA forward compensation XXX(k) quarter. NorthStar is of incentives to XXXX, with Palm the expect noninterest and the amortization and assets, quarter Looking expenses, intangible excludes Beach seasonal first Community associated be a to which in accruals we and This and X

evaluate progresses, that Cuts growth-oriented year is of the provided will a As appropriate Tax timing Jobs by the the into Act activities, benefit we and to invest XXXX.

further provide investments and clarity market we’ll of expected these greater progress growth on our As updates and materializes outcomes.

tax recorded $XX.X million provision we in fourth the for charge million XXXX, Finally, write-down income this assets. includes of the of and tax the a $X.X quarter deferred

rate tax XX.X% effective our XXXX. expect we ahead, approximately in be to Looking

quarter, a adjustment our guidance. efficiency ratio would effect ratio during the performance to Slide with the to the Moving XX% in-line XX.X% the approximately decreased XX, be adjusted of efficiency compensation, one-time previous to removing

improve quarter. in seasonal to first We expect this to ratio continue excluding impacts the XXXX, the of

leverage continued by efficiency be progress out target exit creating operating the in XXs. an while year expenses. of XXXX managing Our is for positive investing of to the with This ratio adjusted result in revenue the outcome in low will growth-oriented unproductive

the [indiscernible] Turning XXX impact mortgage to quarter, and of during two $XX million grew the million the excluding loans Slide sale organically outstandings acquisitions, $XX.X or annualized. million increased XX, X% loan

outstandings XX% loan organic prior over the acquisitions, grew Excluding year.

move will June stimulate loan Looking with basis accretion, which supported non-cash cut forward, increases relationship underpinnings term, Act strong growth-oriented expect yield forward. continued in December. points two basis investments remain and points our to the will by XX this in and believe reflect growth we Cuts in receptivity Tax teens. The XX production of point rate will and loan the approach variable needs. we to continue XX the the includes customer that low near business a assuming us meet we And basis convenience-based quarter to expect conversations increase loan and to Jobs as helping by the our lead Early tax to will and customers client economy,

outstandings Slide to X.X the were prior quarter-over-quarter, deposit grew $XXX billion up million XX, from Turning year.

of impact NorthStar lag two-deposit well deposits as X year-over-year. deposits, from Beach paid basis of Bank. total Palm the rates, rise reflecting and increased short-term Community effect increased quarter-over-quarter, deposits the in acquired basis Rates acquired X% the points to Excluding as XX on portfolios points

X% ahead, for we as and year-over-year we expect more approximately customers deposit compete Looking the aggressively paid rates increases deposit funding. of in growth to modest

loan diversity XX, and mix Beach points at quarter as the continues with both benefiting the for in the XX customer XXbasis builds orientation known Slide strong emphasizes granularity. NorthStar. well to maintaining down from Bank of points loans prior basis point and quarter. Community Turning the prior relationships portfolio, to that ended loan credit In basis end, the quarter basis credit from markets and a allowance The X the selections ALLL as Palm and of be understood loan overall down and quality at on due well sectors, non-acquired portfolios total rigorous to X cycle acquisition points quarter, from loan from outstandings, the through

to loss the and for loans of we to allowance charge-offs the through compared million. normalized non-acquired during included hurricane’s. X points to commercial to X.X prior XXX%, borrower The economic Our export XXX% were full-year this be for environment remain the loan benign whose charge-off Caribbean only by totaling below rate, quarter by business losses reform. in Net million is of in and with quarters nominal in was X.X expect losses the was loans net a XX supported significantly well non-performing charge-offs The impacted the seasons nonperforming basis our continue ratio million quarter combination associated the credit the tax Florida was quarter. with cycle strength U.S. and the

to provision between forecast return time, XX continue to for we over credit will charge-offs levels, by points. be influenced However, to more losses we XXXX do normalized growth. and near-term net X expect and loan loan The losses basis for

X capital at leverage common position capital was XX.X%, Slide was XX, equity and X December tangible tier let With ratio X.X% XX, ratio the The capital at ratio XXXX. the total to quarter-end, asset remains on XX. risk-based capital XXXX tier XX.X% was to me strong. our our Vision The and Turning in for providing address common additional equity ratio was objectives XXXX. now growth Slide that XX.X%, tangible

has return effect return tax The ratio. speaking, we equity. rate targeted on tax no on in plus, Generally change rate to on of meet a tangible a ratio reminder, and on a assets assets in plus, as of computation efficiency are of We tangible mathematical in ability on the benefit and XX. is our our out equity targets clear return XXXX, change in an XXX laid confident efficiency XX% return and below common there to common

enactment Also, the growth company lower momentum. on the the the accelerate long-term the additional result the of expect capitalize capital provided The tax company previously further forward, investments provide Tax resources will note, and create moving make our to in Act strategic ability Cuts than rate Jobs opportunity. We the to greater modelled. XXXX will we Florida, earnings a by Cuts of of and of will Tax this to fuel plan financial

which of However, of update well-capitalized The we the the basis accretive Cut will prudent tax balance in will in cost the targets funding form our to provides fund benefit real greater remain asset the Over in remains use And our a markets X.X%, the ratio as M&A inorganic sheet, we’ll reactions forward years. of to time, our to the resources and financial fastest objectives a greater solid company. of turn of our growth while the deposit rate materializes. to and are your points. ratio Denny. equity markets. our financial us lead change continue Tax that low-cost clarity our the come both and organic in growth investments tangible opportunities local of the in positioned in markets to to questions, look and markets loan call a to To will exiting to combination achieve well-positioned Cut conclude, growing to common Florida, Tax of coming XX we’re the target available I’ll strategic allow and a growth, over to We with back deposit and XX%, summary, and tangible growth across XXXX from

Dennis Hudson

few Chuck. questions Thank be now. And you, we’d to pleased Operator? a take

Operator

with Thank you. [Operator is question from Sandler Instructions] O'Neill. first Our Stephen Scouten

Stephen Scouten

you Hi guys, good are How morning. doing?

Dennis Hudson

Steve. Hi

Stephen Scouten

is anything guidance and it of hikes, kind it here, X year-end, what deals to parts is moving based and around nuances said that rate by be quarter-over-quarter mid off XXXs was I relative I or mid the Chuck, on kind just regards was I to it the two XXXs maybe to higher surprising just NIM this my thinking kind coming on guess each Question think X the of there was was I going in NIM of XQ, question up your there? forward some that is quarter, understood bips led or unique us gets down?

Chuck Shaffer

are correct, we to and you the quarter's on last Yes, guided call. mid-XXXs

be the we delayed so look would noisy going came did the kind thought A that quarter public the was repriced relationships unique we get I quarter, quarter a that as and during of to hand production the think, that lot asked of fund late the well. you something And if are the and early their Hurricanes. was got raised the the loan in quarter. couple to with at to unique booked activity in quarter, have through during of

Stephen Scouten

following helpful That’s is maybe what yours that the in today, of funds, public kind have of XXX, that, currently? fair? and fields actually Okay. I'm the hearing pretty up priced are on guess what I And most like XXX public from funds balances you that

Chuck Shaffer

don't I me send the number front to the Yes, balance have of Steve public on funds. in you. I’ll it

core with in release look you it me, out, it breaks to to you. slide in on If number up to available add our funding it customer there but earnings here I’d the of have is front

Stephen Scouten

is know XXX, don’t then kind you Okay that mitigate still to, pricing, I great. guys able way? that And are XXX it or of in any

Chuck Shaffer

It’s a mix.

fund our below franchises many but so you back coast, we’re look in years four that, at related our legacy to If in the them mostly are cases many treasure of public … go relationships, and and

Dennis Hudson

the entities because we’re a lot Most investment big into - more you below the, side. will for these the We’re into leaned have operating and accounts the that less and know if of of operating of we mix. you accounts

Chuck Shaffer

target And not us. would Exactly. a for going forward this I say, is market

public competing relationships. we not out for are those So, fund

of view us. a that So, competitive I sort as issue don't for

Stephen Scouten

That's Okay, that's helpful. great.

think guess gave that from holistically maybe about think from secondarily, the to drop do base like around remaining about cost gets and as you guess or be for the mentioned, much of tax deals, would you how you you savings guidance, any reform, reinvested? to I there, as in think one, And kind tax XXXX, much that how you longer of some expenses come Okay. think guidance can the XQ how investments expenses we expense will Super. of And line out think then I that those? the much two do leverage what on around term bottom come you

Chuck Shaffer

would a Yes, talk so I bit little about that.

look provided quarter rate I look investments. that’s the year or full about forward. you a quarter-by-quarter QX, move think run of the expenses we as at $X.X kind for a in for the for we million We at last If reasonable talked

that that’s going We’re baked to make number. into

be and be. will So, weighted would provide the make as guidance we provide of back of we revenue we They’ll forward, guidance we on If win, further move on impact do think investments. those the that we what we’ll half investments. year

short of line. answer bottom bulk the is, in the the the tax fall So, change will the short-term rate to

Stephen Scouten

other people great. I’ll guys. on. hop some Okay Thanks Well let

Operator

Michael next is Young question from The SunTrust. with

Michael Young

morning. good Hi

Chuck Shaffer

Hi Michael.

Michael Young

feels talk about maybe efficiency this like to Maybe there the follow-up as you back to same where the year, with going on getting kind year year you you’re a about just on levels can guide, ratio kind exit the next of you are takes what’s of the level year-over-year? and puts

Chuck Shaffer

Yes, sure.

the end So, adjust conversation adjustment in at out you year we exited performance-based year mid the XX's. if the accrual of the the

a and at on track had basis, our Day. laid expect exit low-XXs, XXXX with of XXXX out keeps in we Investor on sort So, is what in-line the we us which to objectives with Vision comparable

Michael Young

to further a if the they’re blocking if could you’ve data it to Chief wanted add you hiring Denny talk going Okay, was side and analytics then and on the just what and of Officer, tasked little built? kind what bit maybe color And with, perfect. tackling Information the on just already some be

Dennis Hudson

if all just data test through know Yes. running the maybe don't I want Jeff. to continue have and tack analytics to been we that We that you of and learn

Jeff Lee

business do of a in drive lot is, Bray the underneath way unique kind use how hiring efficiency with the more continue with got and more focus technology. think our smarter It’s of next we the better technology. really of much data, We on so focused the advantage we’ve to operates Jeff the

really efficient on, analytical areas help all lot a mind the to which our that’s ability advantage is is So we focus going more what my taking are company is than in make to today. it have of be her

Dennis Hudson

spending our some bit be experience the Yes, we issues on to excited with we’re and that customers next smooth look for a number surrounding further nice the we higher continues really us, to of to will we And that the to out around both have and XX out other that. months so, more I time of our phone people we experience that deliver we that of would simplify on we’re a about face-to-face customer that. revenue to work ambitions say quite excited and activities and the have the ahead and or customers cross-sell deliver we also growth. information and and working drive over ways processes that continue take who the I think, customer our many we important smooth that the our have because insights contact marketing scale about for are as

investments as and that’s need talking make us what s that’ to Act Tax investments a we gives we timing that, be the the years, with of also earlier way that the those component. few of that begin of balance possibility say that current was forward the about consider I certain pulling earnings. some Chuck, in to a of I that next about And opportunity think key think to the the just over would So some made

Michael Young

income we on in see back Investor whether benefits moving or had institute not laid forward guys Okay. any And I the out some update statement a from or Day plans when offering, might think that’s you that? at card to

Chuck Shaffer

that We’re option just not to going, going but sure, the decision we’re still and best what’s route have which offering on evaluating to a on come for the we’re are final evaluating to we best option we’ve pursue. an

that have we think QX. into as will get I we netted out probably

Michael Young

Okay great. will step back now thanks. I for

Dennis Hudson

Thanks Michael.

Operator

is next Steve question B. with Moss from Our FBR. Riley

Steve Moss

good Hi, morning.

Dennis Hudson

Steve. Hi,

Steve Moss

pretty little were up latter Just a end think loan quarter, of of or wondering loan the first the obviously should year-over-year, on bit more at about outside part but the growth year, quarter we down the in of growth, steady? pipelines being

Chuck Shaffer

is low guidance the provided year. full teens we I think for

the year into real our but the is from you is of pipeline today. some up coming softness coming We’re year the with off to example, hurricanes, end XX% an give example the residential to

pipelines, will quarter, to growth get can - we can seem the of and that anything in close low much we and we how to in want the if guidance teens the is So, first get good add Chuck see but we that? you

Chuck Cross

Cross. is This Chuck Yes.

add to the the We’ve said, know as think great fourth the as Shaffer are in Chuck Community those grow. bankers NorthStar new watch speak you of Bank we we’re fourth to and with also on additions given Beach now. Palm of some boarding quarter added, quarter with opportunities I in

can year. definitely get the first quarter, in So, normal production if we through think the of we rest the pipelines return to we will of

Chuck Shaffer

did Tampa going all We’ve in in first year last than - in know XXXX. we’re quarter the had I in loans Tampa our based going we some great of left market. to on forecast we’re to the more close

of really in up seen would the it’s little slower but markets, we’ve pick-up we a starting the pick probably So, have nice pickup, some liked been some terms in new to of now. than

So, optimistic are view and the just we we gave. about confident guidance have a pretty

Steve Moss

to growth with thinking growth? regard the growth then securities, balances, funding asset And just mix, how about earning funding we helpful. lags kind loan perhaps and of about be think and That's will loan if should that deposit

Chuck Shaffer

Sure.

growth we move the particularly fund sort probably the and plenty to around going securities loan it’s of here with $XXX the year, We’re about and guidance then amortize through that the led from and during low-teen loan with forward first of of point the down, million to investments room year starting quarter ratio as deposit make that to X% XX% loan growth as deposit in growth.

and of deposit down of strong sort we the fourth interest had burns book growth fairly the through we the will confident - that. to into we over feel margins deposit the loan next loan and and margin improve. the securities support see year, we move as book sort You the quarter the in year helped ratio, net growth in net the That quarter do continue going interest

Steve Moss

much. thank well you Alright, very

Chuck Shaffer

Steve. Thanks

Operator

James. Raymond Our Feaster next with question is from David

David Feaster

guys. morning good Hi

Chuck Shaffer

Hi David.

David Feaster

of yields, a and talked given we expand able were as is sounds to competition? yields that’s of that has yields, just before accretive under the exclusive loan like function costs just pressure new accretive given about today, pricing So, loan that current more being loan not rate mitigated NIM, to somewhat kind it hikes additional of or rising been deposit but

Dennis Hudson

improve fourth I example, the and add-on percentage our Yes, on earning originations continues NIM assets the a up And a in new rate loans even giving I assets. XXX [ph], will to quarter climb of earnings was flat as as rate for securities jump each of would growth there it a throughout percentage year. declines to in basis think as the mix quarter

I was loans got think impacted by the quarter booked. when

in then get you closed I too. when rates think support we the customers there impact any think things of But increase the sort an modeling was particularly expansion, quarter-over-quarter I moving imagine are at of significant basis get hurricanes. we more on is there quarter, for you had look we that if and As a during forward, NIM so can expected given right in when could delays now which

David Feaster

region here, in how you And and helpful. your Beach just M&A and talk now conversations for you’re from size about are NorthStar with Palm know the going? that’s Okay, range and you closed, appetite could looking

Dennis Hudson

at we opportunities. and build obviously, scale continue we to there some out - and of it's still still there market. profitably we’re we’re it’s deeper that on think an We and so looking see see is opportunities out the where we’re focused Yes, to areas issue the metro opportunity - remain in we

David Feaster

Okay. from Last one me.

given for construction lowest you credits you just CRE nature here, You levels, advantage Bank, a economy the a strategic and could your adjusted thresholds in for new which not or this willingness talked meet about guys concentrations? your or of somewhat your just are to for and up managing somewhat talk appetite CRE do unique is your returns Florida drive risk about you simply

Dennis Hudson

to our around to I’ll and back a very I we taking important say the just book get keep CRE again have little that here poke and established continue bit. in balance. growth, we it grow where guardrails We’ll

near-term. anticipating effort to up we’re particularly the entire that grows not in portfolio As any push ratio the

acquisition we’ve work to the low you higher just but about recently done it you’ve grow it’s that CRE with where concentrations, anybody think I been compared find. else still through super seen

think provide us important plays very look we strategic Particularly at advantage. point think a to your I it I with does it though well, when acquisitions. and

and that nicely throughout bank on little This through ourselves lending, of granularity. we continue the momentum focus we’ve our C&I small grow opportunities business growth, community we particularly look banking We’ll loans. also some not it that last in in had in small invest have metro and the to at that the right certainly our for think years. very also as past the greater markets, some - business the grow found increase deeper those the our a as the grew We building Book remain XXXX We group we We with over markets it’s focused go SBA community us. loans bit. in improvement on our key where very, would that we’ve well areas. focused year, I relationships a in as to tremendous but have began garnered metro time, few

needed to time, grow really and and make things the CRE but where adjust to investments to is we in growth. through key granularity the always a We book. that granularity go the approach balance the have the loan as So, the balanced of here point keep have it can to side is important

David Feaster

color. you. great That’s Thank Okay.

Dennis Hudson

David. you, Thank

Operator

from question Securities. is with next Guggenheim Cantwell The Jeff

Jeff Cantwell

good Hi, morning.

Chuck Shaffer

Hi, Jeff.

Jeff Cantwell

one. sounds and given have thanks so guys, taking remarks increasing buybacks investment either ask obviously the et your to been all things windfall you question. you as talking outlook, also on appreciate in the just something in the tax nice Hi, you’ve What cetera. for across I prepared and really the the quarter the others about my color reform for are already I’ll ensure a from like Q&A, space it discussed

So, you what opportunistic your buyback, here it’s one of would thinking would things little on how savings any may In being are utilized? you us be will asking, bit with the days, tax you I’m early being share on and be on - your you appreciate expand the quite priority which understand can for I in you planning color able is see give example? to I a a for different way, the kind us list? words, other of would ask but

Chuck Shaffer

the Jeff. question. Thanks for Thanks

things we again this growth as to from forward, move an of are expense towards about year. head will and part focused think on going the that’s I will it support and perspective more that talk investments operating this but we where primarily will be later

a as side, capital call move the mentioned, keeping appropriate the move board will opportunities with probably so the discussion Tax year. have in we On Denny I to does our is our as fresh bring the think kind capital still and of that environment Act there’s forward around as quarters approach, the coming M&A capital but we and through forward begin strategy in the we

Dennis Hudson

and important and forward particularly to it’s at are forth of the profitable characteristics growth, our we our think see to a and growth, next goals in so stay looking focused items the so XXXX. variety but we’re years, on achieve paybacks happening few that return over things go We plan supporting that on

look you at we those and it’s will where the to so, think And continue make investments right.

I is absolutely the arena flexibility, in Hope with tax huge think opportunity afforded helpful right, be having helps. a capital out Chuck is asset think that I is can think that I still and well. that as really M&A that the there

Jeff Cantwell

Appreciate the thanks. all Yes, Great. color.

Chuck Shaffer

Jeff. Thanks

Operator

Bush Nancy from with Research. is NAB question next The

Nancy Bush

behind just has Good tell on effects What sort morning. you you been tail when the sort on? a historical me go and of this give your all comes the could do us what color you? get of and long how if that - Hurricane the Could experience little with you

Dennis Hudson

deadly, Florida, in though I didn’t just we that a anything every bit frankly This had the difference it one, here particularly than so experienced. have of much State the market, frankly were affected in effects about Hurricane it the widespread, if a you effects widespread the as it little This direct a saw. we’ve was wasn’t and so although market of more storm, think to impact where is even of negative you customers deadly will, the

gone to be tail I not direct. think the And has so,

would we’re back couple two longer I think we in I business say now, months or or than have but it three expected. would lingered

had you affected an for to affected that we give area. residential to State our in and just do single the example and an about instance was area, every of re-inspections to entire pipeline for had Just property re-examined, be an was - in entire

significant that slowed way. So a closings in alone up

Our of break would take were good kind and distracted say customers XX the for days, I a XX hit then perhaps and holidays. days a took to them another we

was holidays confluence gone when The with tail’s tail’s So, than effects us. of of events point, the unusual and gone, bigger expected weather last key lingering that combined were events talked. it we kind impacted an we

Nancy Bush

So, not the there. biggest sort lingering the area in impact that keys though of and is still is you’re

So…

Dennis Hudson

I keys. had they impacts. was destructive, middle in there particularly negative And mean the very very Yes. it

at impact. have for impact, it like almost there, negative all, us down this it destructive and We a was no big exposure wasn't more distractive

Nancy Bush

description, a you. That’s good thank

retail evolving competition right could speak last beta competition your now those months? deposit deposit markets, have are expectations Secondly, you over just your whether that in and to what and if few the been

Chuck Shaffer

in pressure. Yes, that’s focused don't deposit we see in mean where small I deposit there. lot markets business. We they retail pressure almost zero retail a say of pricing I the would are are still and

retail organizations. pressure, primarily side, no and or the the rate national from market compete certainly As banks of deposit against which really from fund retail and I business the public mentioned there’s pressure small there’s we the wholesale on in on but earlier, kind side those

Nancy Bush

So, no beta? in change

Chuck Shaffer

No.

Nancy Bush

Okay.

Dennis Hudson

relationships know in you great a that’s driving over in in begin good core we’re next we this period focused. where the you potentially stay rate some core years, operating for to steadfastly on through where puts see relationships like think start been It and focused We’ve us we shape. growth, year moment

Nancy Bush

you. Thank Alright.

Dennis Hudson

Nancy. Thanks

Operator

Dennis no turn Mr. at time. have to this questions call remarks. I’d Hudson We further to back like the for closing

Dennis Hudson

attending again everybody to quarter. first today. following talking thank to with forward look We Like for Right. you

Operator

This ladies for concludes you, gentlemen. Thank today's you conference. and participating. Thank

You may disconnect. now