ConnectOne Bancorp Inc (CNOB) 2024 Q2 法說會逐字稿

Thank you for standing by. And at this time, I'd like to welcome everyone to the connect one Bancorp, Inc. second quarter 2024 earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. (Operator Instruction) Thank you.

謝謝你的支持。此時此刻，我謹歡迎大家參加 connect one Bancorp, Inc. 2024 年第二季財報電話會議。所有線路均已靜音，以防止任何背景噪音。演講者發言後，將進行問答環節。（操作員說明）謝謝。

I'd now like to turn the call over to Siya Vansia, Chief Brand and Innovation Officer. Please go ahead.

我現在想將電話轉給首席品牌和創新長 Siya Vansia。請繼續。

Good morning, and welcome to today's conference call to review ConnectOne's results for the second quarter of 2024, and to update you on recent developments. On today's call will be Frank Sorrentino, Chairman and Chief Executive Officer; and Bill Burns, Senior Executive Vice President and Chief Financial Officer.

早安，歡迎參加今天的電話會議，回顧 ConnectOne 2024 年第二季的業績，並向您介紹最新進展。董事長兼執行長 Frank Sorrentino 將出席今天的電話會議；以及高級執行副總裁兼財務長 Bill Burns。

I'd also like to caution you that we may make forward-looking statements during today's conference call that are subject to risks and uncertainties. Factors that may cause actual results to differ materially from expectations are detailed in our SEC filings and the forward looking statements included in this conference call are only made as of the date of this call, and the Company is not obligated to publicly update or revise them.

我還想提醒您，我們可能在今天的電話會議上發表前瞻性聲明，這些聲明有風險和不確定性。可能導致實際結果與預期有重大差異的因素已在我們向SEC 提交的文件中詳細說明，本次電話會議中包含的前瞻性聲明僅截至本次電話會議之日做出，本公司沒有義務公開更新或修改這些聲明。

In addition, certain terms used in this call are non-GAAP financial measures, reconciliations of which are provided in the company's earnings release and accompanying tables or schedules which have been filed today on Form 8-K with the SEC and may also be accessed through the Company's website.

此外，本次電話會議中使用的某些術語是非GAAP 財務指標，其調節表已在公司的收益發布以及隨附的表格或時間表中提供，這些表格或時間表已於今天以8-K 表格的形式向SEC 提交，也可以透過公司網站。

I will now turn the call over to Frank Sorrentino, Frank Please go ahead.

我現在將把電話轉給弗蘭克·索倫蒂諾，弗蘭克，請繼續。

Thank you, Siya. We appreciate everyone joining us this morning navigating through the second quarter of 2024 with our commit with our commitment to playing offense we delivered on our stated objectives.

謝謝你，西婭。我們感謝今天早上與我們一起度過 2024 年第二季的每個人，我們致力於實現我們既定的目標，並致力於進攻。

Supporting our clients remain the top priority for ConnectOne. As I've often reiterated, our relationship banking business model has allowed us to strengthen and expand our client base, enter new markets, and grow across various sectors. This disciplined philosophy also played a role in expediting the exiting of non-relationship business in the first half of this year.

支援客戶仍然是 ConnectOne 的首要任務。正如我經常重申的那樣，我們的關係銀行業務模式使我們能夠加強和擴大我們的客戶群、進入新市場並在各個領域實現成長。這種嚴謹的理念也為今年上半年非關係企業的加速退出發揮了作用。

Reflecting this commitment, ConnectOne's second quarter results were solid and we believe are in the early stages of an upswing. Disposition is further bolstered by the tailwinds forming in our industry which includes the expectation for lower short-term rates combined with improved market liquidity and recent cyclical rotation into regional banking.

ConnectOne 在第二季業績穩健，我們相信其正處於上升的早期階段，這反映了這一承諾。我們產業形成的有利因素進一步支撐了處置，其中包括短期利率下降的預期、市場流動性改善以及近期區域銀行業的週期性輪動。

With that said, let's take a closer look at our recent operating performance. Driven by the efforts of our team and our dedication to the objectives we outlined at the start of the year, we're seeing continued deposit growth from both existing clients as well as through the continued onboarding of new clients across New York, New Jersey, and our Florida markets. And we're optimistic that this trend will continue throughout the remainder of the year.

話雖如此，讓我們仔細看看我們最近的經營業績。在我們團隊的努力和我們對年初制定的目標的奉獻精神的推動下，我們看到現有客戶的存款持續增長，並且透過紐約、新澤西、以及我們的佛羅裡達市場。我們樂觀地認為這種趨勢將在今年剩餘時間內持續下去。

Bill will walk us through some additional details in a few minutes. I'd like to note that while reported deposits remain flat, client deposits increased while brokered deposits decreased. Turning to lending quarterly origination levels are continuing at an annualized run rate in excess of $1 billion, with C&I accounting for nearly half of that production. Notwithstanding the strong origination volume, our loan portfolio decreased sequentially, reflecting higher than usual paydowns and payoffs.

比爾將在幾分鐘內向我們介紹一些其他細節。我想指出的是，雖然報告的存款保持不變，但客戶存款增加，而經紀存款減少。轉向貸款季度發放水平，年化運行率繼續超過 10 億美元，其中 C&I 佔其中的近一半。儘管發放量強勁，但我們的貸款組合連續下降，反映出高於平常的還款和還款。

This was driven by our strategy to actively manage non-relationship loans off our balance sheet and is intended to not only improve our loan to deposit ratio, but also enhance our loan mix. Our credit metrics remain healthy and for the quarter, nonaccrual loans declined while our criticized and classified loans as well as our delinquencies remained quite low.

這是由我們積極管理資產負債表外非關係型貸款的策略所推動的，旨在不僅提高我們的存貸比，而且還增強我們的貸款結構。我們的信貸指標保持健康，本季非應計貸款有所下降，而我們的批評和分類貸款以及拖欠率仍然相當低。

Next, during the quarter, we saw an increase in our net interest margin, which widened by 8 basis points sequentially. And looking ahead, we expect continued net interest margin expansion. And Bill, of course, will cover this in more detail, continued momentum in driving sources of noninterest income and seeing improvements in a number of areas, including blocked both lie in our SBA platform. In addition, we also foresee potential future fee income opportunities through our lending platform. We expect this momentum to continue as we invest in each of these areas.

接下來，在本季度，我們的淨利差有所增加，較上季擴大了 8 個基點。展望未來，我們預期淨利差將持續擴大。當然，比爾將更詳細地介紹這一點，推動非利息收入來源的持續勢頭，並看到許多領域的改進，包括我們的 SBA 平台中的阻礙。此外，我們也預見未來透過我們的借貸平台潛在的費用收入機會。我們預計，隨著我們在這些領域的投資，這種勢頭將持續下去。

As of June 30, 2024, our capital and our tangible book, value per share increased once again continuing to build capital flexibility along with the fortified balance sheet. Additionally, we declared a cash, a quarterly cash dividend of $0.18 a share that will be paid in early September. And with a common dividend payout ratio currently below 40%. We believe ConnectOne's dividend remains well positioned.

截至 2024 年 6 月 30 日，我們的資本和有形帳面價值再次增加，持續增強資本彈性並強化資產負債表。此外，我們還宣布了每股 0.18 美元的季度現金股息，將於 9 月初支付。目前普遍股利支付率低於40%。我們相信 ConnectOne 的股息仍處於有利地位。

So in summary, we remain deliberate and methodical in our approach to navigating through challenging times, all while remaining committed to our clients. Our discipline is paying off and we believe we are just beginning to see those benefits.

總而言之，我們在度過充滿挑戰的時期時仍然深思熟慮、有條不紊，同時仍然致力於為客戶服務。我們的紀律正在得到回報，我們相信我們才剛開始看到這些好處。

I'll now turn it over to Bill who will give us a little more depth and some color on our results.

現在我將把它交給比爾，他將為我們的結果提供更多的深度和色彩。

Great. Thanks, Frank, and good morning to everyone on the call. As Frank just mentioned, we believe we are in the beginning stages of return to our historical profitability levels and metrics. You may remember on last year's call, I made several opening statements. I'm happy to report that all of them are on track.

偉大的。謝謝弗蘭克，祝所有參加電話會議的人早安。正如弗蘭克剛才提到的，我們相信我們正處於恢復歷史獲利水準和指標的開始階段。您可能還記得在去年的電話會議上，我做了幾個開場演講。我很高興地向大家報告，所有這些都已步入正​​軌。

First item I stated last quarter was that the margin had stabilized and that we projected a wider net interest margin going forward. And that turned out to be true a margin improved by 8 basis points.

我上季所說的第一件事是利潤率已經穩定，我們預期未來淨利差將擴大。事實證明，利潤率提高了 8 個基點。

Second, we emphasized a balance sheet focus on relationship business relationship based business. We executed on that in the current quarter, helping to improve the net interest margin, lower loan to deposit ratio, which declined to less than 108% from 111% at year end, and it also improves our CRE concentration ratio.

其次，我們強調資產負債表關注基於關係業務的業務。我們在本季就做到了這一點，幫助提高了淨利差，降低了貸存比，貸存比從年底的111%下降到了108%以下，同時也提高了我們的商業地產集中度。

Third, we focused on capital and asset quality, our capital ratios and tangible book value per share increased. Once again, non-accruals declined reserve coverage increase and other credit quality measures remained in historically strong positions.

第三是注重資本和資產質量，資本比率和每股有形帳面價值有所提高。非應計項目再次下降，準備金覆蓋率增加，其他信貸品質指標仍處於歷史強勢地位。

And fourth and I will emphasize again that although we are just below the $10 billion asset threshold, we have already crossed that bridge from a regulatory oversight perspective, the actual crossing over $10 billion in assets, which we forecast to happen middle of next year will have little impact on the bank.

第四，我要再次強調，雖然我們的資產剛剛低於100 億美元的門檻，但從監管角度來看，我們已經跨過了那座橋，我們預計資產的實際跨越100 億美元將在明年中發生。

Let me now dive a little deeper into the margin performance and outlook. Let's start with liability side of the equation, average non-interest bearing demand averaged non-interest bearing demand deposits were roughly flat while the additional liquidity provided by client deposit growth on a lower loan portfolio was used to pay down upwards of $175 million of Federal Home Loan Bank borrowings.

現在讓我更深入地探討一下利潤率表現和前景。讓我們從等式的負債方面開始，平均無息需求 平均無息活期存款大致持平，而較低貸款組合上的客戶存款增長提供的額外流動性被用來償還超過 1.75 億美元的聯邦貸款住房貸款銀行借款。

Those actions reduced our cost of non-deposit funding by approximately 50 basis points. So although we did experience some increase in our total cost of deposits, that increase was offset by the benefit realized from the wholesale paydowns, resulting in flat funding costs versus the second quarter and further with the strong client deposit growth, we lowered our deposit broker deposits outstanding by about $70 million.

這些行動將我們的非存款融資成本降低了約 50 個基點。因此，儘管我們的總存款成本確實有所增加，但這種增加被批發付款所實現的收益所抵消，導致融資成本與第二季度持平，而且隨著客戶存款的強勁增長，我們降低了存款經紀人的規模未償還存款約7000萬美元。

Meanwhile, on the asset side, the rate earned on our loans increased by 9 basis points. Now about half that increase resulted from the collection of back interest in yield related fees, but our loan portfolio yield continues to increase.

同時，在資產方面，我們的貸款利率上升了9個基點。現在，大約一半的成長是由於收取與收益率相關的費用的利息，但我們的貸款組合收益率仍在繼續增長。

Let's turn to the outlook for our net interest margin going forward and without any consideration whatsoever to Fed rate cuts, we project a similar trajectory to this quarter with a net interest margin widening a few basis points per quarter and that that's because the portfolio yield will tend to increase faster than our deposit costs.

讓我們轉向未來淨利差的前景，在不考慮聯準會降息的情況下，我們預計與本季類似的軌跡，淨利差每季擴大幾個基點，這是因為投資組合收益率將往往比我們的存款成本成長得更快。

On top of that, as we've guided before, this should probably be another 5 basis points of improvement for each Fed rate cut, the first of which is expected in September. So taking those numbers, those projections out to the end of 2025, our margin could easily surpass 3% are probably on a core basis in the high 2.68, 2.69 and would likely result in pretax pre-provision return on assets ranging near or above 1.5% and returns on tangible common equity back into double digits.

最重要的是，正如我們之前所指導的那樣，聯準會每次降息可能會再提高 5 個基點，第一次降息預計在 9 月。因此，根據這些數字，到 2025 年底的預測，我們的利潤率可能很容易超過 3%，核心基礎可能是 2.68、2.69，並且很可能導致稅前撥備前資產回報率接近或高於 1.5 % 和有形普通股回報率回到兩位數。

Switching now to loan portfolio value on the bond portfolio was down a little bit this quarter, but our estimate for the rest of '24 calls for a slow portfolio growth, I'd say in the 1% to 2% range. And that reflects about a $1 billion or more of annualized originations offset by payoffs and paydowns. Going forward, the level of loan paydowns are likely to normalize from the elevated level we experienced in the second quarter, the net result being slight gain and saw growth in the loan portfolio.

現在轉向貸款投資組合，本季債券投資組合價值略有下降，但我們對 24 年剩餘時間的估計要求投資組合增長緩慢，我想說在 1% 至 2% 的範圍內。這反映了約 10 億美元或更多的年度發起額被支出和支出所抵消。展望未來，貸款償還水準可能會從第二季度的高水準恢復正常，最終結果是小幅增長，貸款組合有所增長。

Turning to non-interest income. It was a strong quarter, that was buoyed by a gain on the sale of one large non-relationship loan. So for the quarter, gains on sale were a bit elevated, but we still see growth in our SBA lending platform. And BoeFly has been building momentum on its core fee income as well as being a feeder for the SBA gains on sale.

轉向非利息收入。這是一個強勁的季度，得益於出售一筆大型非關係貸款的收益。因此，本季的銷售收益略有上升，但我們仍然看到 SBA 貸款平台的成長。BoeFly 一直在增強其核心費用收入的勢頭，並成為 SBA 出售收益的來源。

In terms of operating expense we did guide on the last call to being up about 1.5%. We were up 1.4% sequentially. And that continues to be the run rate. We're currently experiencing and expecting.

就營運費用而言，我們在上次電話會議中確實預計將成長約 1.5%。我們季增 1.4%。這仍然是運行率。我們現在正在經歷，也正在期待。

Capital ratios, they increased across the board, led by the holding company tangible common equity ratio that increased by 21 basis points to 9.46% reflecting retained earnings and effective management and hedging of our securities portfolio. Meanwhile the bank leverage ratio increased to 11.3%, very, very strong in our view.

資本比率全面上升，其中控股公司有形普通股比率上升 21 個基點至 9.46%，反映了留存收益以及我們證券投資組合的有效管理和對沖。同時，銀行槓桿率升至 11.3%，我們認為非常非常高。

Stock repurchases for the quarter were subdued, but we expect to complete our current share repurchase program of approximately 640,000 shares by the end of this year. And even with the higher current market pricing, we believe it to be attractive to continue the stock repurchase program.

本季的股票回購活動較少，但我們預計將在今年年底前完成目前約 64 萬股的股票回購計畫。即使當前市場定價較高，我們仍然認為繼續股票回購計畫具有吸引力。

Asset quality remains sound. Nonaccrual loans loans declined from the third consecutive quarter, while allowance coverage increased, albeit slightly. Our CECL provisioning for the quarter took into account several items, including charge-offs for decline in loan balances, improving Moody's economic forecast and lastly, I would say an increase in qualitative factors to take into account some increased risks that are not inherent in our in the CECL model, and that facilitated an increase in overall risk reserve coverage.

資產品質保持良好。非應計貸款連續第三個季度下降，而準備金覆蓋率略有上升。我們本季的 CECL 撥備考慮了幾個項目，包括貸款餘額下降的沖銷、改善穆迪的經濟預測，最後，我想說的是定性因素的增加，以考慮到一些並非我們固有的風險增加。在CECL模型中，這促進了整體風險準備金覆蓋率的提高。

We continue to track and monitor repricing stress on the portfolio. The credit quality there remains sound. There certainly could be select credits that come under stress from time to time, not to be unexpected, but our team has done a stellar job managing the portfolio and we don't expect any significant issues. The effective tax rate was just a tad under 26% for the quarter. That rate could increase slightly, especially if we see strong momentum in pretax revenue growth.

我們繼續追蹤和監控投資組合的重新定價壓力。那裡的信用品質依然良好。當然，某些信貸有時會面臨壓力，這並不意外，但我們的團隊在管理投資組合方面做得非常出色，我們預計不會有任何重大問題。本季的有效稅率略低於 26%。該比率可能會略有上升，特別是如果我們看到稅前收入成長勢頭強勁的話。

In summary, we're pleased with the quarter's results. We see improved performance ahead resulting from a number of factors. First, margin improvement, slow and prudent relationship-based loan growth, non-interest income growth and continued operating efficiencies as we leverage our platform. We will also continue our focus on increasing client deposits and lower loans of deposit ratio and a continued trend towards lower CRE concentration.

總之，我們對本季的業績感到滿意。我們認為，由於多種因素，未來的業績將會有所改善。首先，隨著我們利用我們的平台，利潤率提高，基於關係的貸款成長緩慢而審慎，非利息收入成長以及持續的營運效率。我們也將持續關注增加客戶存款、降低貸存比以及持續降低商業房地產集中度的趨勢。

So I'm going to turn it back over to Frank for closing comments. And we will be happy to open up the lines for questions. Frank?

因此，我將把它轉回給弗蘭克以供結束評論。我們很樂意開放提問專線。坦率？

Thanks, Bill. In summary, I'm pleased with ConnectOne's performance over the second quarter. We started the year committed to a few key objectives. First, to focus on core relationships, second, expand our C&I initiatives, and third, invest in opportunities to drive noninterest income. I'm proud of our team for remaining dedicated to these objectives and that disciplined approach positions us to capitalize on the upswing. We believe this upswing will continue as we look ahead and will be further bolstered by the changing interest rate environment, the investments we've made in new markets, including expansion in Long Island as well as the continued momentum of team members we've onboarded over the past few quarters.

謝謝，比爾。總之，我對 ConnectOne 第二季的表現感到滿意。今年伊始，我們就致力於實現一些關鍵目標。首先，專注於核心關係，其次，擴大我們的商業與工業計劃，第三，投資於推動非利息收入的機會。我為我們的團隊繼續致力於這些目標而感到自豪，這種嚴格的方法使我們能夠利用經濟的成長。我們相信，展望未來，這種上升勢頭將持續下去，並將受到不斷變化的利率環境、我們在新市場的投資（包括在長島的擴張）以及我們已加入的團隊成員的持續發展勢頭的進一步推動。

We're moving into the second half of the year, well positioned and prepared to consistently execute on our long-term objectives. As always, we appreciate your interest and ConnectOne, and thanks again for joining us today.

我們即將進入下半年，已做好充分準備並持續執行我們的長期目標。一如既往，我們感謝您的關注和 ConnectOne，並再次感謝您今天加入我們。

Operator, would you now open the line for questions?

接線員，現在可以撥打電話提問嗎？

At this time, I'd like to remind everyone to ask a question,(Operator Instructions)

這時我想提醒大家要一個問題，（操作說明）

Tim Switzer served KT.

蒂姆·斯威策 (Tim Switzer) 為 KT 效力。

Excuse me, KBW.

對不起，KBW。

Hey Good Morning. Thank you for taking my questions. Yes, I was wondering if you guys had an opportunity yet you maybe discuss this a little bit last quarter, but kind of selectively lowered deposit rates in certain categories or certain markets or promo rates, what's the customer response you've seen on that?

嘿早安。感謝您回答我的問題。是的，我想知道你們是否有機會，但你們可能在上個季度討論過這個問題，但是有選擇地降低了某些類別或某些市場的存款利率或促銷利率，您看到的客戶對此有何反應？

Well, it's a great question. And we certainly are thinking anticipating the ability to lower rates and that will help us as it will help other banks. We are going to be careful as we always have before and manage client expectations and maintain our strong client base. So just continue to work in progress, but we are paying a lot of focus towards that.

嗯，這是一個很好的問題。我們當然正在考慮降低利率的能力，這將有助於我們，也將有助於其他銀行。我們將一如既往地小心謹慎，管理客戶的期望並維持我們強大的客戶群。因此，請繼續進行工作，但我們對此給予了很多關注。

Okay. Great. and I appreciate all the forward.

好的。偉大的。我感謝所有的轉發。

Tim, let me just add when rates are actually cut, obviously, there will be a greater opportunity to lower rates.

提姆，讓我補充一下，當利率實際降低時，顯然，降低利率的機會會更大。

Right, right .Okay. And I appreciate all the forward commentary you guys had on the margin and revenue outlook. What about on the expense side? You know, are there level levers you're going to pull if say we don't get the rate cuts? We're expecting revenue doesn't improve quite as much. And then vice versa, are there like some investments you guys would like to make our earnings begins to improve here?

對對對。我感謝你們對利潤率和收入前景的所有前瞻性評論。費用方面呢？你知道，如果我們沒有降息，你會使用什麼水平槓桿？我們預計收入不會有太大改善。反之亦然，你們是否希望進行一些投資來使我們的收入開始改善？

Well, there are certain investments. We're making. And when those investments are put into place, those expenses start growing. And so we have some of that going forward. And therefore, that's part of my projection for increased expenses as we as we've put new investments into service, if you will. And certainly we can make adjustments on the level of staff and on obviously incentive compensation accruals. So there is some flexibility into the expenses we report depending on revenue growth. And we've said this in the past that does it does the amount of revenue growth does influence the amount of expenses. And I think that's a good thing keeps us as an efficient company for reporting basis.

嗯，有一定的投資。我們正在做。當這些投資到位時，這些費用就開始成長。所以我們有一些進展。因此，這是我對支出增加的預測的一部分，因為我們已經將新的投資投入到服務中，如果你願意的話。當然，我們可以對員工水準和明顯激勵性的應計薪酬進行調整。因此，我們根據收入成長報告的費用有一定的彈性。我們過去說過，收入成長量確實會影響支出金額。我認為這是一件好事，使我們能夠成為一家高效的報告基礎公司。

Awesome. That's all for me. Thank you.

驚人的。這就是我的全部。謝謝。

Yes.

是的。

Frank Schiraldi with Piper Sandler.

弗蘭克·席拉爾迪和派珀·桑德勒。

Good Morning. I wonder if you could just talk a little bit bill about, you know, strong customer deposit growth in the quarter and the and so any any guardrails in terms of expectations around positive growth in the back half of the year? Is it is it just that you expect it to exceed loan growth and therefore move loan to deposit ratio on the right direction or any sort of guardrails you can give around expectations there?

早安.我想知道您是否可以談談本季強勁的客戶存款成長以及對今年下半年正成長的預期是否有任何防護措施？難道只是您期望它超過貸款成長，從而將存貸比調整到正確的方向，或者您可以圍繞預期提供任何形式的護欄嗎？

Well, the trend is looking good. You know, over the past more than one quarter or two or three quarters. I think we've outpaced the market in terms of deposit growth. And I think the Fed has eased up a little bit on liquidity as well. So everyone's should be seeing some types of deposit growth. So our projections include that level of deposit growth which is in excess of the guidance that I gave you on loan growth. So things could change, of course, but right now, we're expecting more client deposits than loan growth leading to lower loan to deposit ratios.

嗯，趨勢看起來不錯。要知道，過去不只一個季度或兩個或三個季度。我認為我們在存款成長方面已經超過了市場。我認為聯準會也稍微放鬆了流動性。因此，每個人都應該看到某些類型的存款成長。因此，我們的預測包括超出我為您提供的貸款成長指引的存款成長水準。因此，情況當然可能會發生變化，但目前，我們預期客戶存款將多於貸款成長，導致貸存比下降。

Okay. And then I guess the cost of funds maybe looked like it bottomed in the order. I mean, a downside. Are you still got some pressure on deposit costs, I would imagine. So could you there yet another time, your expectation, just regarding setting aside a potential rate cut of either what the blended rate of deposits coming out in the quarter was or just what you anticipate maybe in terms of basis points you could raise on that deposit cost side?

好的。然後我猜資金成本可能看起來已經觸底了。我的意思是，有一個缺點。我想，您是否仍面臨存款成本的壓力？那麼，您是否可以再一次考慮一下您的期望，只是考慮考慮本季度存款的混合利率的潛在降息，或者只是您預計可以提高該存款的基點成本方面？

Well, yeah, on the non-deposit funding, we obviously had a dramatic improvement there. I would expect some more of that, but not the same magnitude. Same token on the increase in deposit side that's slowing down, but I'm just being conservative here. And I don't want to say for sure right now that deposit costs will not go up, but it is slight. So so overall, you know, I feel confident that the rate on our assets will improve at a greater rate than the cost of total funding.

嗯，是的，在非存款融資方面，我們顯然有了顯著的進步。我預計會有更多，但幅度不會相同。同樣的道理，存款方面的成長正在放緩，但我只是在這裡持保守態度。我現在不想肯定地說存款成本不會上升，但幅度很小。因此，總的來說，我相信我們的資產利率將以比總融資成本更高的速度提高。

And then if I could just lastly, on the 1% to 2% loan growth. I guess that's why I can't give provides room for for continued paydowns and payoffs and continued reduction in inquiry balances. I guess in the near term, any sort of specifics on fund goals or expectations of where the concentration levels could trend to over the next several quarters.

最後，我想談談 1% 到 2% 的貸款成長。我想這就是為什麼我不能為繼續支付和支付以及繼續減少查詢餘額提供空間。我想在短期內，有關基金目標的任何具體細節或對未來幾季集中度水準的預期可能會出現。

Listen, we see it for a declining trend, but not a seismic shift overnight, but we do believe it's prudent to continue to show on lower levels of CRE concentration.

聽著，我們認為這是一種下降趨勢，但不是一夜之間發生地震性轉變，但我們確實認為繼續保持較低水平的商業地產集中度是謹慎的做法。

The business model just provides for that.

商業模式正好滿足了這一點。

It provides that right.

它提供了這種權利。

Our emphasis on C&I lending and the types of businesses that we're looking at is both being reflected in that increase in deposits as well as that trend. And there's no hard line in the sand that we feel we have to get to. But we just believe over time having a lower CRE concentration is just healthy for the bank and provides for the types of business that provide the types of deposits we want and the client relationships we want. So the it all sort of works hand-in-hand.

我們對工商業貸款和我們正在關注的業務類型的重視都反映在存款的成長以及這一趨勢上。我們覺得沒有什麼必須克服的硬線。但我們只是相信，隨著時間的推移，較低的商業房地產集中度對銀行來說是健康的，並提供了能夠提供我們想要的存款類型和我們想要的客戶關係的業務類型。所以這一切都是齊頭並進的。

It's sort of been a focus, right? Investor community feels is a focus from from regulatory agencies to force lower CRE and kind of CRE concentration. We've always had a high CRE concentration. We're not feeling a ton of that pressure, but we recognize that the investor community looks at it that way. So, you know, in general, we like to see a directionally a change in that ratio that being lower.

這一直是個焦點，對吧？投資者群體認為，監管機構的重點是迫使降低商業房地產和商業房地產集中度。我們的 CRE 濃度一直都很高。我們並沒有感受到太大的壓力，但我們意識到投資者界是這樣看待它的。所以，你知道，總的來說，我們希望看到該比率發生方向性變化，降低。

Okay, great. Thanks for all the color.

好的，太好了。感謝所有的顏色。

Thanks Frank

謝謝弗蘭克

(Operator Instructions) Daniel Tamayo with Raymond James.

（操作員說明）丹尼爾·塔馬約（Daniel Tamayo）和雷蒙德·詹姆斯（Raymond James）。

Thank you. Good morning, guys. So just not to beat a dead horse here, but just a clarification on the on the NIM. guidance. Are you assuming further wholesale reductions like kind of a rotation from FHLB into deposits in that guidance? Or is that you depend on loan growth?

謝謝。早安，夥計們。所以這裡不是要死馬當活馬醫，而只是對 NIM 澄清。指導。您是否假設進一步大規模減少，例如在該指導中將 FHLB 輪換為存款？或者你依賴貸款成長嗎？

Like how do you think that plays out in terms of Bowne's Onyx well,

就像你認為 Bowne's Onyx 的效果如何，

Well, a little bit more. There was some significant there was some significant declines in the Federal Home Loan Bank borrowing lines keep in mind that upon there are some timing issues here, we may have excess liquidity, but those federal home loan banks have not matured quite yet. So in the short term, it's hard to say exactly what the benefits going to be. But over the longer term, we'd like to see more deposits on more wholesale, more client deposits, less brokeres and less wholesale funding, having a slow loan growth on having solid loan growth in the 1% to 2% range helps in regard to those items.

嗯，再多一點。聯邦住房貸款銀行的借款額度出現了一些顯著下降，請記住，由於存在一些時間問題，我們可能會出現流動性過剩，但這些聯邦住房貸款銀行尚未成熟。因此，在短期內，很難確切地說出具體的好處是什麼。但從長遠來看，我們希望看到更多的批發存款、更多的客戶存款、更少的經紀商和更少的批發融資，貸款增長緩慢，貸款增長穩定在1% 到2% 範圍內，這有助於以下方面到那些項目。

Okay. So maybe a longer term trend of reducing it, but not anything near term that would be.

好的。因此，減少它可能是長期趨勢，但短期內不會出現這種情況。

One part of me is extremely optimistic when you look at our balance sheet there's a lot of reasons to believe we're going to have expanding margins. But I want to be conservative here because we just don't know how competition is going to react and at the end of the day, our clients come first. So we're going to make sure that we use whatever flexibility we have to maintain client relationships.

當你查看我們的資產負債表時，我內心的一部分是非常樂觀的，有很多理由相信我們的利潤率將會擴大。但我想在這裡保持保守，因為我們只是不知道競爭將如何反應，而且歸根結底，我們的客戶是第一位的。因此，我們將確保利用我們所擁有的靈活性來維持客戶關係。

Understood. And then I guess on capital. So you talked about continuing buybacks in the back half of the year. You've got the authorization there. But how should we think about what the right level of capital is for you. Obviously, the TCE is strong. The total risk base is strong. But I mean is there is there a ratio that is the most important to you? Is that is that changing that people are talking more about the total amount? How should we think about what the right level of as capital is into the future? As you know, as capital grows.

明白了。然後我猜是資本。所以你談到下半年繼續回購。你已經獲得了那裡的授權。但我們應該如何考慮適合您的資本水準。顯然，TCE 很強。整體風險基礎強勁。但我的意思是有一個比例對你來說是最重要的嗎？這是否意味著人們更多地談論總量？我們該如何思考未來資本的正確水準是多少？如您所知，隨著資本的增長。

And yeah, I tried to avoid on giving specific guidance as to what the right capital level is. I do First off, I'm a big believer in, you know, tangible common equity is the most important of all the company has the most important capital ratio look at. However, there's lots of other ones with with guidance limits, well-capitalized levels, capital questions. And we tried to manage that stack in such a way that they all have similar cushions. So but going forward, we feel really comfortable in the position we're in. And if need be if we need to leverage our capital, we have the ability to do so in a moderate way. I don't see our 9.5% TCE ratio going down to 8.5% very soon. But if it dropped 20 basis points or 30 basis points because of some opportunity or some potentially some acquisitions that would be that would be a good thing and that would be fine.

是的，我試圖避免就正確的資本水準給予具體指引。我首先，我堅信，有形普通股是所有公司中最重要的，也是最重要的資本比率。然而，還有很多其他的公司存在指導限制、資本充足水準和資本問題。我們嘗試以這樣的方式管理該堆疊，使它們都具有相似的緩衝墊。因此，展望未來，我們對目前所處的位置感到非常舒適。如果需要的話，如果我們需要利用我們的資本，我們有能力以適度的方式做到這一點。我認為我們 9.5% 的 TCE 比率不會很快下降到 8.5%。但如果因為一些機會或一些潛在的收購而下跌 20 個基點或 30 個基點，那將是一件好事，那也沒什麼。

Got it. All right. And then maybe just switching gears here that there was a little bit of an increase in classified loans, it looks like up to 150 bps of loans. Just curious if you could provide any detail on what Dhruv.

知道了。好的。然後也許只是在這裡換個方向，分類貸款略有增加，看起來貸款增加了 150 個基點。只是好奇您能否提供有關 Dhruv 的任何詳細信息。

Yes, you know, got to keep in mind that 150 is a historically low level. It just was at like at the best level ever beforehand. So don't view it as on that specific change did not lead to the real potential for additional charges. Okay. It's still not it's still a low level.

是的，你知道，必須記住 150 是歷史最低水準。它就像是之前最好的水平。因此，不要將其視為特定的變更並不會導致真正的額外費用潛力。好的。仍然不是，仍然是一個低水平。

Okay. So it's still kind of normalization happening?

好的。那麼正常化仍在發生嗎？

Yes, I would say so.

是的，我會這麼說。

All right. Thanks for all the color. Appreciate it.

好的。感謝所有的顏色。欣賞它。

Matt Breese with Stephens.

馬特·布里斯和史蒂芬斯。

Okay not last. Last but not least.

好吧，不是最後。最後但並非最不重要的。

Good Morning, I'll take the compliment. I was hoping to dive into NIM a little bit. Bill, could you provide what the percentage of pure floating rate loans today are on the balance sheet ? What's the yield on those? And I'm trying to get a sense for on the asset side, what fixed rate looks like and what kind of rate loan yields are?

早上好，我會接受讚美。我希望能深入了解 NIM 一點點。比爾，您能提供一下今天純浮動利率貸款在資產負債表上所佔的百分比嗎？？這些的收益率是多少？我試著了解資產方面的情況，固定利率是什麼樣的，貸款利率是多少？

Yes, I hope like I know you're trying to figure out what our margin is going forward. It's relatively low. The pure floating at 20% of the loans and it has a handle right now of about 9%. We'll also have, you know, adjustable rate loans and those will continue to price upward over time. It's something like another 10% in the next year or so followed by 10 plus percent more and '26 and '27. So we're a liability sensitive company and will benefit from lower rates as our as our lots of our deposits and funding will decline in value. And over time, we will see some even with rate cuts. We should see increases in our yield on our loan portfolio. So if you look out and everything looks perfect, we could be in a really good spot in a 1.5 years, 2 years. 3.50 above in margin. I'd temper that in that we don't know for sure what the rate curve is going to look like. We don't know for sure what competition's going to be like, but we're going to stick to what we do best. And that is disciplined approach to loan originations. You know, the pricing must be pricing must be on relevant must must surpass our risk-adjusted return hurdles and banks that have banks that that put on loans at low spreads get burnt. And that's not us

是的，我希望我知道您正在努力弄清楚我們未來的利潤率是多少。這是相對較低的。貸款的純浮動利率為 20%，目前的利率約為 9%。你知道，我們還將擁有可調整利率貸款，隨著時間的推移，這些貸款的價格將繼續上漲。大約在明年左右再增加 10%，然後是 10% 以上，然後是 26 年和 27 年。因此，我們是一家對責任敏感的公司，並將受益於較低的利率，因為我們的大量存款和資金將貶值。隨著時間的推移，我們甚至會看到一些降息。我們應該會看到貸款組合的收益率增加。因此，如果你仔細觀察，一切看起來都很完美，那麼我們可能會在 1.5 年、2 年內處於一個非常好的位置。保證金高於 3.50。我想說的是，我們不確定利率曲線會是什麼樣子。我們不確定競爭會是什麼樣，但我們會堅持我們最擅長的事。這是貸款發放的嚴格方法。你知道，定價必須相關，必須超過我們的風險調整回報障礙，而那些以低利差發放貸款的銀行會被燒毀。那不是我們

Understood. And where you are putting on commercial real estate loans? what are new loan yields versus what's rolling off and ?

明白了。您在哪裡發放商業房地產貸款？新貸款收益率與滾存貸款收益率是多少？？

An 8%,7%. what would you say steve? 7% to 8% .It fluctuates depending on what we'll but deals we do

一個8%，7%。史蒂夫你會說什麼？7% 至 8%.它會根據我們要做的事情而波動，但我們所做的交易

And roll off in the low 5s and 4s?

然後在低 5 秒和 4 秒內滾動？

Yes, about that. Now there's less there's less turnover than there was a couple of years ago. So it hasn't it has an effect but a lower effect than it once did.

是的，關於那個。現在，與幾年前相比，數量減少了，營業額也減少了。所以它沒有效果，但效果比以前低。

Okay. And then I guess the same set of questions on the on the liability side, what is the duration of borrowings and CDs at this point? And are you starting to price CDs a little bit lower and where they were at their peak?

好的。然後我猜想在負債方面也會有同樣的問題，此時借款和存款證的期限是多少？你們是否開始將 CD 的定價降低一點，以及它們的最高價格？

We're just in the beginning stages of being more aggressive on CD repricing from the benefit is slight because right that a lot of the rates that are on our books now are already on a high level but we're starting to, I would say, play around with lowering rates on being careful not to lose deposit balances on, but it's worked in our favor before to be ahead of the curve. If rates if rates are going to be cut in September, we don't really need to wait till that date. We can we can implement that a month before which is, coming out pretty soon.

我們正處於對 CD 重新定價更加積極的開始階段，因為收益很小，因為我們帳上的許多利率現在已經處於高水平，但我想說，我們正在開始這樣做，嘗試降低利率，小心不要損失存款餘額，但它之前對我們有利，可以領先一步。如果利率要在 9 月降息，我們實際上不需要等到那個日期。我們可以在一個月前實施，很快就會推出。

Okay. Two other quick ones. One is just the income picked up quite a bit this quarter, especially in the other income areas. What drove that how sustainable is it?

好的。另外兩個很快的。一是本季營收大幅回升，尤其是在其他收入領域。是什麼推動了它的永續性？

Right. So like I mentioned in the call, we did have, there was one fairly large loan that was a non-relationship loan that we're able to sell for a gain and we made the decision it was a good idea to get off the balance sheet and book that gain. So the gains on sale were elevated for the quarter. But having said that, underlying in the SBA piece on, I'm looking for $500,000 or more next quarter and continue to build that. Part of that build comes from boots on the ground, but also BoeFly, which can add another $200,000 to $300,000 per quarter in gains.

正確的。正如我在電話中提到的，我們確實有一筆相當大的貸款，是一筆非關係貸款，我們可以出售它以獲得收益，我們決定擺脫餘額是個好主意獲得的表格和書籍。因此，本季的銷售收益有所上升。但話雖如此，在 SBA 的基礎上，我希望在下個季度獲得 50 萬美元或更多資金，並繼續實現這一目標。這一成長的一部分來自於實際行動，還有 BoeFly，它可以每季再增加 20 萬美元至 30 萬美元的收益。

So would it be fair to run other income and call it $1 million range per quarter?

那麼，將其他收入稱為每季 100 萬美元範圍是否公平？

I am looking at our financial statements, what was the total quarterly net non-interest income? This quarter?

我正在查看我們的財務報表，季度非利息淨收入總額是多少？這個季度？

Total was $4,399 and other income was $1.277 million.

總計為 4,399 美元，其他收入為 127.7 萬美元。

Right. Yeah, I would say, the net gain on sale of loan -- sales should be a little bit lower going forward, but the deposit loan and other income could be up a little as well as the BOLI as we are in the process of restructuring some of that. So probably a little bit down from the June quarter, but up from the quarter before.

正確的。是的，我想說，出售貸款的淨收益——未來的銷售額應該會稍微低一些，但存款貸款和其他收入可能會像 BOLI 一樣有所上升，因為我們正在重組其中一些。因此，可能比六月季度略有下降，但比之前的季度有所上升。

Okay. And then you have $75 million of sub-debt reaching its call date next year. The step-up is going to be pretty significant in cost. I just want to be curious what your plans for that are? Is there going to be a kind of a preemptive sub-debt raise? Or are you going to just let it roll into its floating period?

好的。然後還有 7,500 萬美元的次級債務將於明年到期。成本的提高將是相當可觀的。我只是想知道你的計劃是什麼？是否會出現某種先發制人的次級債務籌集？還是你打算讓它進入浮動期？

We're thinking about it. We're watching it and we'll have to figure out what is the best thing to do when the times comes.

我們正在考慮。我們正在觀察它，我們必須找出時機到來時最好的做法。

Okay I will leave it there. Thank you for taking all my questions.

好吧，我會把它留在那裡。感謝您回答我所有的問題。

Okay. Thanks, Matt.

好的。謝謝，馬特。

Thank you. I'll now turn the call back over to management for closing remarks call.

謝謝。現在，我將把電話轉回給管理層，以進行結束語電話會議。

Thank you, everyone. We thank you again for your time today, and we look forward to speaking with you again during the third quarter conference call In a few months. Everybody enjoy your summer and have a great day.

謝謝大家。我們再次感謝您今天抽出時間，我們期待在幾個月後的第三季電話會議上再次與您交談。每個人都享受夏天並度過美好的一天。

Thank you. Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.

謝謝。女士們、先生們，今天的電話會議到此結束。感謝大家的加入。您現在可以斷開連線。