CVB Financial Corp (CVBF) 2024 Q2 法說會逐字稿

Good morning, ladies and gentlemen, and welcome to the Second Quarter of 2024 CVB Financial Corporation and its subsidiary Citizens Business Bank Earnings Conference Call. My name is Sherry, and I’m your operator for today. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. Please note this call is being recorded.

早安，女士們、先生們，歡迎參加 2024 年第二季 CVB 金融公司及其子公司公民商業銀行收益電話會議。我叫雪莉，是今天的接線生。此時，所有參與者都處於只聽模式。隨後，我們將進行問答環節。請注意，此通話正在錄音。

I would now like to turn the presentation over to your host for today’s call, Allen Nicholson, Executive Vice President and Chief Financial Officer. You may proceed.

現在我想將簡報交給今天電話會議的主持人、執行副總裁兼財務長艾倫·尼科爾森 (Allen Nicholson)。您可以繼續。

Thank you, Sherry, and good morning, everyone. Thank you for joining us today to review our financial results for the second quarter of 2024.

謝謝你，雪莉，大家早安。感謝您今天加入我們，回顧我們 2024 年第二季的財務表現。

Joining me this morning is Dave Brager, President and Chief Executive Officer. Our comments today will refer to the financial information that was included in the earnings announcement released yesterday. To obtain a copy, please visit our website at www.cbbank.com and click on the Investors tab.

今天早上與我一起出席的是總裁兼執行長 Dave Brager。我們今天的評論將參考昨天發布的收益公告中包含的財務資訊。要取得副本，請造訪我們的網站 www.cbbank.com 並點擊「投資者」標籤。

The speakers on this call claim the protection of the Safe Harbor provisions contained in the Private Securities Litigation Reform Act of 1995. For a more complete discussion of the risks and uncertainties that may cause actual results to differ materially from our forward-looking statements, please see the Company’s annual report on Form 10-K for the year ended December 31, 2023, and in particular, information set forth in item 1A Risk Factors therein.

本次電話會議的發言者聲稱受到 1995 年《私人證券訴訟改革法案》中所包含的安全港條款的保護。有關可能導致實際結果與我們的前瞻性陳述存在重大差異的風險和不確定性的更完整討論，請參閱公司截至 2023 年 12 月 31 日止年度的 10-K 表格年度報告，以及特別是其中第1A 項風險因素中所列的資訊。

For a more complete version of the Company’s Safe Harbor disclosure, please see the Company’s earnings release issued in connection with this call. I will now turn the call over to Dave Brager. Dave?

有關公司安全港揭露的更完整版本，請參閱本公司與本次電話會議相關的收益報告。我現在將把電話轉給戴夫·布雷格。戴夫？

Thank you, Allen. Good morning, everyone. For the second quarter of 2024, we reported net earnings of $50 million, or $0.36 per share, representing our 189th consecutive quarter of profitability.

謝謝你，艾倫。大家早安。2024 年第二季度，我們報告淨利潤為 5,000 萬美元，即每股 0.36 美元，這是我們連續 189 個季度實現盈利。

We previously declared a $0.20 per share dividend for the second quarter of 2024, representing our 139th consecutive quarter of paying a cash dividend to our shareholders. We produced a return on average tangible common equity of 15.51% and a return on average assets of 1.24% for the second quarter of 2024.

我們先前宣布 2024 年第二季每股股息 0.20 美元，這是我們連續 139 個季度向股東支付現金股息。2024 年第二季度，我們的平均有形普通股報酬率為 15.51%，平均資產報酬率為 1.24%。

Our net earnings of $50 million were $0.36 per share, compared with $48.6 million for the first quarter of 2024, or $0.35 per share and $55.8 million or $0.40 per share for the prior year quarter. The $1.4 million increase in earnings compared to the first quarter of 2024 was primarily due to a $3.3 million decrease in non-interest expense. Non-interest expense was impacted by the change in the estimated cost for the FDIC special assessment. Compared to the first quarter of 2024, non-interest expense related to the special assessment declined by $3 million.

我們的淨利潤為5,000 萬美元，每股收益0.36 美元，而2024 年第一季的淨利潤為4,860 萬美元，即每股收益0.35 美元；去年同期的淨利為5,580 萬美元，即每股收益0.40 美元。與 2024 年第一季相比，收益增加 140 萬美元，主要是由於非利息費用減少 330 萬美元。非利息支出受到 FDIC 特別評估估計成本變化的影響。與2024年第一季相比，與特別評估相關的非利息支出減少了300萬美元。

Net interest income declined by $1.6 million when compared to the first quarter of 2024. This decrease resulted from a five basis point decline in our net interest margin from 3.10% in the first quarter to 3.05% in the second quarter of 2024. Our earning assets remained stable compared to the first quarter of 2024. Interest income grew by $1.4 million over the prior quarter. Earnings asset yields improved by three basis points compared to the prior quarter, as investment yields increased by seven basis points and we had a positive shift in asset mix with our average balance of funds on deposit at the Federal Reserve growing from 3% of earning assets in the prior quarter to 5% for the second quarter.

與 2024 年第一季相比，淨利息收入下降了 160 萬美元。這一下降是由於我們的淨利差從第一季的 3.10% 下降到 2024 年第二季的 3.05%，下降了 5 個基點。與 2024 年第一季相比，我們的獲利資產保持穩定。利息收入較上一季成長 140 萬美元。與上一季相比，收益資產收益率提高了3 個基點，投資收益率增加了7 個基點，而且我們的資產結構發生了積極轉變，存放在美聯儲的平均資金餘額從佔收益資產的3%成長上季成長至第二季的 5%。

Interest expense increased by $3 million over the prior quarter, reflecting a seven basis point increase in our cost of funds. The increase in our cost of funds was primarily due to the 13 basis point increase in cost of interest-bearing liabilities. As noninterest-bearing deposits continue to be greater than 60% of total deposits for the second quarter of 2024. This 13 basis point quarter-over-quarter increase was due to the increased interest expense associated with wholesale funds and a 14 basis point increase in the cost of interest-bearing non-maturity deposits, which increased from 1.86% in the prior quarter to 2% in the second quarter of 2024.

利息支出比上一季增加了 300 萬美元，反映出我們的資金成本增加了 7 個基點。資金成本增加主要是因為有息負債成本增加13個基點。2024年第二季無利息存款繼續佔存款總額的60%以上。季增13個基點是由於批發基金相關利息支出增加以及計息非到期存款成本增加14個基點，從上一季的1.86%上升至2個基點。

In terms of wholesale funds, second quarter borrowing costs decreased as average borrowings declined by $142 million. However, a $300 million increase in average broker deposits drove a 79 basis point increase in the cost of our time deposits. Average total deposits for the second quarter increased by approximately $245 million compared to the first quarter of 2024. Non-maturity deposits declined modestly by $40 million including a $29 million decrease in noninterest-bearing deposits. On average, noninterest-bearing deposits continue to be greater than 60% of our average total deposits for the second quarter of 2024.

就批發資金而言，第二季借款成本下降，平均借款減少了 1.42 億美元。然而，經紀人平均存款增加了 3 億美元，導致我們的定期存款成本增加了 79 個基點。與 2024 年第一季相比，第二季平均存款總額增加約 2.45 億美元。非到期存款小幅下降 4,000 萬美元，其中無息存款減少 2,900 萬美元。平均而言，2024 年第二季無息存款繼續占我們平均存款總額的 60% 以上。

At June 30, 2024, our total deposits and customer repurchase agreements totaled $12.1 billion a $111 million decrease from March 31, 2024 and a $354 million increase from December 31, 2023. The increase in total deposits and customer repos from the end of 2023 includes the addition of $400 million in brokered time deposits. For the first six months of 2024, approximately $170 million of deposits were moved to Citizens Trust, including $100 million during the second quarter. These funds were invested in higher yielding liquid assets such as treasury notes. This compares to $800 million that was transferred during 2023.

截至2024年6月30日，我們的存款和客戶回購協議總額為121億美元，比2024年3月31日減少1.11億美元，比2023年12月31日增加3.54億美元。自 2023 年底起，存款總額和客戶回購協議的增加包括增加 4 億美元的經紀定期存款。2024 年前六個月，約 1.7 億美元的存款轉移至公民信託，其中第二季的 1 億美元。這些資金投資於收益率較高的流動資產，例如國債。相比之下，2023 年轉移的金額為 8 億美元。

Our cost of deposits was 88 basis points on average for the second quarter of 2024, which compares to 74 basis points for the first quarter of 2024. Our cost of non-maturity deposits has grown from 60 basis points in December of 2023 to 74 basis points in June of 2024, while our cost of time deposits has grown from 1.84% in December of 2023 to 3.44% in June of 2024. From the first quarter of 2022 through the second quarter of 2024, our cost of deposits has increased by 85 basis points, representing a deposit beta of 16% compared to the 525 basis point increase in the Fed funds rate during the Federal Reserve’s current tightening cycle.

2024 年第二季我們的平均存款成本為 88 個基點，而 2024 年第一季為 74 個基點。我們的非到期存款成本已從2023年12月的60個基點增長至2024年6月的74個基點，而定期存款成本則從2023年12月的1.84%增長至2024年6月的3.44% 。從 2022 年第一季到 2024 年第二季度，我們的存款成本增加了 85 個基點，與聯準會執政期間聯邦基金利率上漲 525 個基點相比，存款貝塔值為 16%當前的緊縮週期。

Now, let’s discuss loans. Total loans at June 30, 2024 were $8.7 billion, an $89 million or 1% decrease from the end of the first quarter and a $223 million decline from December 31, 2023. The quarter-over-quarter decrease was led by a $56 million decline in commercial real estate loans. All other loan categories declined modestly from the end of the first quarter of 2024. The decrease in loans from the end of 2023 included a $71 million decrease in dairy and livestock loans. Dairy and livestock loans see higher line utilization at year-end, which is reflected in the 80% utilization rate at the end of the fourth quarter compared to the 74% utilization rate at June 30, 2024.

現在，我們來討論一下貸款。截至2024年6月30日的貸款總額為87億美元，比第一季末減少8,900萬美元，即1%，比2023年12月31日減少2.23億美元。環比下降的主要原因是商業房地產貸款減少了 5,600 萬美元。自 2024 年第一季末以來，所有其他貸款類別均略有下降。自 2023 年底以來，貸款減少包括乳製品和牲畜貸款減少 7,100 萬美元。乳製品和牲畜貸款年底的貸款利用率較高，這反映在第四季度末的利用率為 80%，而截至 2024 年 6 月 30 日的利用率為 74%。

Commercial real estate loans declined by $120 million from December 31, 2023. As commercial real estate loan demand is weakened, our CRE loan production for the first six months of 2024 has lagged the same period in 2023 by more than 50%. Construction loans declined by $15 million over the same period as we have experienced minimal borrowings from newly originated construction loans.

自 2023 年 12 月 31 日起，商業房地產貸款減少了 1.2 億美元。由於商業房地產貸款需求減弱，我們2024年前六個月的商業房地產貸款產出比2023年同期落後50%以上。同期建築貸款減少了 1500 萬美元，因為我們從新發放的建築貸款中獲得的借款很少。

C&I loans declined by $14 million when comparing to June 30, 2024 period in balance to December 31, 2023, even though we have generally seen higher average loan balances over the first two quarters of 2024. This generally reflects the growth in new relationships as C&I line utilization continues to be at a rate of less than 30%.

與 2024 年 6 月 30 日至 2023 年 12 月 31 日的餘額相比，工商業貸款減少了 1,400 萬美元，儘管我們普遍認為 2024 年前兩個季度的平均貸款餘額較高。這通常反映了新關係的成長，因為 C&I 線路利用率持續低於 30%。

We compete on loans very selectively, which can impact new loan production. Even considering the high credit quality of our new loan originations, yields on new loans in 2024 have been greater than 7.25%. Our continued focus on banking the best small-to-medium sized businesses and their owners, providing them our full array of products has resulted in a higher percentage of new loans in 2024 that are either owner occupied or C&I loans.

我們非常有選擇性地競爭貸款，這可能會影響新貸款的產生。即使考慮到我們新增貸款的高信用質量，2024 年新增貸款的收益率仍高於 7.25%。我們繼續專注於為最好的中小型企業及其所有者提供銀行服務，為他們提供全套產品，這使得 2024 年新增貸款中業主自用或工商業貸款的比例更高。

Non-owner occupied loan originations in 2024 have been less than 20% of the total loan originations, which compares to 35% for the same six month period in 2023. Although loan demands continues to be slower than past years, we continue to be optimistic about growth and future line utilization from our pipeline of C&I loans. We believe our asset quality remains strong, even though we have experienced an increase in non-performing and classified loans.

2024 年非業主自用貸款發放量佔貸款發放總量的比例不到 20%，而 2023 年同期的 6 個月這一比例為 35%。儘管貸款需求持續低於過去幾年，但我們仍然對工商業貸款管道的成長和未來的貸款利用率持樂觀態度。我們相信，儘管不良貸款和分類貸款有所增加，但我們的資產品質依然強勁。

Our allowance for credit losses totaled approximately $83 million at June 30, the same as March 31, 2024. Net charge-offs in the second quarter were $31,000 compared to $4 million in the first quarter of this year. At quarter end, non-performing assets defined as non-accrual loans plus other real estate owned were $25.6 million or 16 basis points of total assets. The $25.6 million in non-performing loans compares with $14.5 million for the prior quarter.

截至 6 月 30 日，我們的信貸損失準備金總額約為 8,300 萬美元，與 2024 年 3 月 31 日相同。第二季的淨沖銷額為 31,000 美元，而今年第一季的淨沖銷額為 400 萬美元。截至季末，不良資產（定義為非應計貸款加上其他擁有的房地產）為 2,560 萬美元，佔總資產的 16 個基點。不良貸款為 2,560 萬美元，而上一季為 1,450 萬美元。

Classified loans for the second quarter were $125 million compared with $103 million for the prior quarter. Classified loans as a percentage of total loans was 1.44% at quarter-end. Much of the growth in classified loans has been associated with agricultural lending. The dairy industry suffered a deep downturn in 2023, primarily resulting from the combined impact of lower milk prices and high feed costs.

第二季分類貸款為 1.25 億美元，上一季為 1.03 億美元。季末分類貸款佔貸款總額的比例為1.44%。分類貸款的成長大部分與農業貸款有關。2023年，乳製品產業遭遇深度低迷，主要是奶價下跌和飼料成本上漲的綜合影響。

Widespread losses for our customers in 2023 resulted in recent downgrades in the bank’s dairy lending portfolio, but a recovery in the industry appears to be underway in 2024 with feed costs down by 25% and milk prices rising due to falling supplies. Additionally, production Ag has been experiencing losses due to lower prices from higher supplies of commodities, such as almonds and pistachios. Land appraisals are also beginning to reflect lower market value of farmland.

2023 年，我們的客戶普遍遭受損失，導致銀行最近下調了乳製品貸款組合的評級，但該行業似乎將在 2024 年開始復甦，飼料成本下降 25%，牛奶價格因供應下降而上漲。此外，由於杏仁和開心果等大宗商品供應增加導致價格下跌，農業生產一直在遭受損失。土地評估也開始反映出農地市場價值的下降。

I will now turn the call over to Allen, to discuss additional aspects of our balance sheet. Allen?

我現在將把電話轉給艾倫，討論我們資產負債表的其他方面。艾倫？

Thanks, Dave. Good morning, again, everyone. As of June 30, 2024, the $82.8 million allowance for credit losses was equal to the ACL as of March 31, 2024. At the end of the second quarter, our ACL was 0.95% of total loans compared to 0.94% on March 31, 2024. Our ACL at December 31, 2023 was $86.8 million including $5.9 million of reserves for specifically identified non-performing loans.

謝謝，戴夫。大家早安。截至 2024 年 6 月 30 日，8,280 萬美元的信貸損失準備金等於截至 2024 年 3 月 31 日的 ACL。截至第二季末，我們的 ACL 佔貸款總額的 0.95%，而 2024 年 3 月 31 日為 0.94%。截至 2023 年 12 月 31 日，我們的 ACL 為 8,680 萬美元，其中包括 590 萬美元的專門不良貸款準備金。

Our reserves for specific loans have been zero since the end of the first quarter. We did not record a provision in the first quarter or second quarter of 2024. Our economic forecast continues to be a blend of multiple forecasts produced by Moody’s.

自第一季末以來，我們的專案貸款準備金一直為零。我們沒有在 2024 年第一季或第二季記錄撥備。我們的經濟預測仍綜合了穆迪的多項預測。

We continue to have the largest individual scenario waiting on Moody’s baseline forecast with downside risks weighted among multiple forecasts. The resulting economic forecast resulted in real GDP declining slightly in the second half of 2024 and continuing to be negative in the first quarter of 2025. GDP growth is forecasted to be less than 1% for all of 2025 before rebounding to 1.9% in 2026, and then returning to higher growth of 2.78% for 2027.

我們仍有最大的個別情境等待穆迪的基線預測，並在多項預測中加權下行風險。由此產生的經濟預測導致實際GDP在2024年下半年小幅下降，並在2025年第一季繼續負值。預計 2025 年全年 GDP 成長率將低於 1%，然後在 2026 年反彈至 1.9%，然後在 2027 年恢復到 2.78% 的較高成長率。

Our total investment portfolio declined by $116 million from the end of the first quarter of 2024, and by $245 million from December 31, 2023, as cash flows generated from the portfolio have not been reinvested during this year.

我們的投資組合總額較 2024 年第一季末減少了 1.16 億美元，較 2023 年 12 月 31 日減少了 2.45 億美元，因為今年投資組合產生的現金流量尚未再投資。

Investment securities held-to-maturity or HTM securities totaled approximately $2.43 billion at June 30, 2024. The HTM portfolio declined by approximately $25 million from March 31, 2024. Investment securities available-for-sale or AFS securities totaled approximately $2.75 billion at June 30, 2024. The AFS portfolio declined by approximately $91 million from March 31, 2024, including the impact of the unrealized loss in AFS securities increasing by $2.3 million from the prior quarter-end.

截至 2024 年 6 月 30 日，持有至到期投資證券或 HTM 證券總額約 24.3 億美元。自 2024 年 3 月 31 日起，HTM 投資組合減少了約 2,500 萬美元。截至 2024 年 6 月 30 日，可供出售的投資證券或 AFS 證券總額約為 27.5 億美元。自 2024 年 3 月 31 日起，AFS 投資組合減少了約 9,100 萬美元，其中包括 AFS 證券未實現損失較上一季末增加 230 萬美元的影響。

The tax equivalent yield on the entire investment portfolio was 2.71% for the second quarter of 2024 compared to 2.64% for the prior quarter. We continue to have positive carry on the fair value hedges we executed in late June of 2023. We received daily SOFR on these pay fixed swaps, which have a weighted average fixed rate of approximately 3.8%. We recorded $4.1 million of interest income in the second quarter related to these swaps, which was $400,000 higher than the first quarter of this year. Our fair value hedges combined with our cash flow hedges had a market value of $15.3 million as of June 30, 2024, which reflects a $3.6 million increase from the end of the prior quarter.

2024 年第二季整個投資組合的稅當量報酬率為 2.71%，而上一季為 2.64%。我們於 2023 年 6 月下旬執行的公允價值避險持續維持正值。我們每天收到這些支付固定掉期的 SOFR，其加權平均固定利率約為 3.8%。第二季我們記錄了與這些掉期相關的利息收入 410 萬美元，比今年第一季高出 40 萬美元。截至 2024 年 6 月 30 日，我們的公允價值對沖加上現金流對沖的市值為 1,530 萬美元，比上一季末增加了 360 萬美元。

Cash and cash equivalents declined by approximately $105 million from $950 million at March 31, 2024 to $844 million at June 30. Approximately $700 million of BTFP borrowings matured in May, while we added FHLB advances totaling $500 million during the second quarter. These FHLB advances include $300 million at an average cost of 4.73% maturing in May of 2026 and $200 million at a cost of 4.27% maturing in May of 2027.

現金和現金等價物從2024年3月31日的9.5億美元減少約1.05億美元至6月30日的8.44億美元。大約 7 億美元的 BTFP 借款於 5 月到期，而我們在第二季增加了總計 5 億美元的 FHLB 預付款。這些 FHLB 預付款包括 3 億美元，平均成本為 4.73%，將於 2026 年 5 月到期；2 億美元，平均成本為 4.27%，將於 2027 年 5 月到期。

Borrowings from the Bank Term Funding program at the end of the second quarter totaled $1.3 billion with a borrowing rate at 4.75%. These advances mature in January of 2025. We anticipate that the Bank Term Funding program borrowings will be repaid through a combination of our existing cash, future principal and interest payments from our security portfolio, core deposit growth and additional wholesale funding sources, which may consist of new borrowings and/or additional broker deposits.

截至第二季末，銀行定期融資計畫借款總額為 13 億美元，借款利率為 4.75%。這些進展將於 2025 年 1 月成熟。我們預計銀行定期融資計畫借款將透過我們現有的現金、來自我們的證券投資組合的未來本金和利息支付、核心存款成長和額外的批發融資來源（可能包括新借款和/或額外的經紀人）的組合來償還存款。

Another source of funds to pay off the BTFP borrowings is the possibility of targeted sale leasebacks of certain buildings we own combined with the sale of our investment, a portion of our investment portfolio. We have started a marketing process to potentially execute a handful of targeted sale leasebacks to unlock value from certain buildings we own.

償還 BTFP 借款的另一個資金來源是我們可能對我們擁有的某些建築物進行有針對性的售後回租，同時出售我們的投資（我們投資組合的一部分）。我們已經啟動了行銷流程，可能會執行一些有針對性的售後回租，以釋放我們擁有的某些建築物的價值。

We expect to utilize gains from these sales to offset losses from selling some securities within our AFS portfolio. The first of these sale leaseback transactions closed a few days ago, resulting in a gain of greater than $3 million. We are not expecting material gains from sale leasebacks in the third quarter of 2024 or material levels of AFS security sales.

我們預計將利用這些銷售的收益來抵銷出售 AFS 投資組合中某些證券的損失。第一筆售後回租交易已於幾天前結束，收益超過 300 萬美元。我們預計 2024 年第三季的售後回租或 AFS 證券銷售不會帶來實質收益。

Now, turning to the capital position. At June 30, 2024, our shareholders’ equity increased from the fourth quarter of 2023 by $34.5 million to $2.11 billion. The Company’s tangible common equity ratio at June 30, 2024 was 8.7% compared with 8.3% at March 31, 2024 and 8.5% at December 31, 2023. Our regulatory capital ratios continue to grow and are among the highest in the industry. At June 30, 2024, our common equity Tier 1 capital ratio was 15.3% and our total risk-based capital ratio was 16.1%.

現在，轉向資本狀況。截至 2024 年 6 月 30 日，我們的股東權益較 2023 年第四季增加 3,450 萬美元，達到 21.1 億美元。截至2024年6月30日，該公司的有形普通股比率為8.7%，而2024年3月31日為8.3%，2023年12月31日為8.5%。我們的監管資本比率持續成長，處於行業最高水準。截至2024年6月30日，我們的普通股一級資本率為15.3%，總風險資本率為16.1%。

I’ll now turn the call back to Dave for further discussion of our second quarter earnings.

現在我將把電話轉回戴夫，進一步討論我們第二季的收益。

Thank you, Allen. Moving on to non-interest income. Our non-interest income was $14.4 million for the Q2 of 2024 compared with $14.1 million for the prior quarter. Our customer related banking fees, including deposit services, international and merchant bank card increased by approximately $230,000 when compared to the prior quarter. In addition, our trust and wealth management fees increased by approximately $200 million compared to the prior quarter.

謝謝你，艾倫。轉向非利息收入。2024 年第二季我們的非利息收入為 1,440 萬美元，而上一季為 1,410 萬美元。與上一季相比，我們的客戶相關銀行費用（包括存款服務、國際和商業銀行卡）增加了約 23 萬美元。此外，我們的信託和財富管理費用較上一季增加了約 2 億美元。

Second quarter BOLI income decreased by $650,000 quarter-over-quarter, primarily due to the receipt of $530,000 in death benefits that exceeded the cash surrender value in the first quarter. Conversely, we had miscellaneous income in the second quarter related to previously acquired charged off loans and a building sale more than a decade ago that totaled more than $500,000.

第二季 BOLI 營收季減 65 萬美元，主要是因為第一季收到的死亡撫卹金超過了現金退保價值 53 萬美元。相反，我們第二季的雜項收入與先前獲得的沖銷貸款和十多年前的建築物銷售有關，總計超過 50 萬美元。

Now expenses. Non-interest expense for the second quarter was $56.5 million compared with $59.8 million for the first quarter of 2024 and $54 million for the year ago quarter. The $3.3 million quarter-over-quarter decrease was primarily due to the expense associated with the FDIC special assessment.

現在費用。第二季的非利息支出為 5,650 萬美元，而 2024 年第一季的非利息支出為 5,980 萬美元，去年同期的非利息支出為 5,400 萬美元。環比減少 330 萬美元主要是由於 FDIC 特別評估相關費用。

In total, regulatory assessment expense was $1.4 million in the second quarter of 2024, a $3 million decrease from the prior quarter. We initially accrued $9.2 million in the fourth quarter of 2023 for the special assessment, which we supplemented with the addition of $2.3 million of accrued expense in the first quarter of 2024.

2024 年第二季監管評估費用總計 140 萬美元，較上一季減少 300 萬美元。我們最初在 2023 年第四季提列了 920 萬美元的特別評估費用，並在 2024 年第一季追加了 230 萬美元的應計費用。

The first quarter increase in the accrual was a result of the FDIC revising upwards its initial estimate of losses from last year’s bank failures by 25%. Based on the FDIC’s assessment received in June of this year, our cost estimate was further revised in the second quarter of 2024, resulting in a $700,000 decrease in this accrual.

第一季應計費用的增加是由於 FDIC 將去年銀行倒閉損失的初步估計上調了 25%。根據今年 6 月收到的 FDIC 評估，我們對 2024 年第二季的成本估算進行了進一步修訂，導致應計費用減少了 70 萬美元。

Salaries and employee benefit costs decreased $975,000 quarter-over-quarter. This decrease included $1.5 million in higher payroll taxes paid in the first quarter as a result of the annual reset of salary caps on payroll taxes and the payment of annual bonuses.

薪資和員工福利成本季減 975,000 美元。這一減少包括由於工資稅工資上限年度重置和年度獎金支付而導致第一季支付的 150 萬美元的工資稅增加。

The decrease in payroll taxes was offset by a $600,000 increase in bonus and profit sharing accruals compared to the first quarter of this year. Expense for professional services increased by $470,000 compared to the prior quarter, primarily due to higher legal expense. Software expense also increased quarter-over-quarter by 12% or more than $400,000 as we continue to invest in data management and technology.

與今年第一季相比，薪資稅的減少被獎金和應計利潤分享增加 60 萬美元所抵消。與上一季相比，專業服務費用增加了 47 萬美元，主要是由於法律費用增加。隨著我們繼續投資數據管理和技術，軟體費用也環比增長 12%，即超過 40 萬美元。

Marketing and promotion expense increased by $326,000 compared to the first quarter of this year, as we increased donations by almost $600,000. The second quarter of 2024 included $500,000 in recapture provision for unfunded loan commitments compared to no provision or recapture in the first quarter of 2024.

與今年第一季相比，行銷和促銷費用增加了 326,000 美元，因為我們增加了近 60 萬美元的捐款。2024 年第二季包括 50 萬美元的無資金貸款承諾收回撥備，而 2024 年第一季沒有撥備或收回。

Non-interest expense totalled 1.4% of average assets for the second quarter of 2024 compared with 1.48% for the prior quarter. Our efficiency ratio was 45.1% for the second quarter of 2024. This compares with 47.22% for the first quarter.

2024 年第二季非利息支出佔平均資產的 1.4%，而上一季為 1.48%。2024 年第二季我們的效率為 45.1%。相比之下，第一季為 47.22%。

This concludes today’s presentation. Now Allen and I will be happy to take any questions you might have.

今天的演講到此結束。現在艾倫和我很樂意回答您可能提出的任何問題。

To ask a question, please press star one one on your telephone and wait for your name to be in To withdraw your question, press star one. Wondering Due to time restraints, we ask that you please limit yourself to one question and one you may then return to the queue. Please standby while we compile it Q&A.

要提出問題，請在電話上按星號一一，然後等待您的名字出現。想知道 由於時間有限，我們要求您只回答一個問題，然後您可以返回佇列。我們正在整理問答，請您稍候。

And our first question will come from the line of Matthew Clark with Piper Sandler. Your line is open.

我們的第一個問題將來自馬修·克拉克和派珀·桑德勒的台詞。您的線路已開通。

Hey, good morning.

嘿，早安。

Good morning.

早安.

Wanted to just get a sense for the margin here and the related outlook. Do you have the average margin in the month of June and the spot rate on deposits at the end of June?

只是想了解這裡的利潤率和相關前景。有6月份的平均保證金和6月底的存款即期利率嗎？

If you look at our IP, you’ll see the cost of interest bearing deposits and repos in June was 2.21%. You can also, Matthew, if you look at the IP further, we have a breakdown by month showing non maturity deposits that were at 74 basis points and time deposits of 3.44%. So, that will give you sort of where we finished at the end of the quarter.

如果您查看我們的 IP，您會發現 6 月的計息存款和回購成本為 2.21%。馬修，如果你進一步查看 IP，我們會按月份進行細分，顯示非到期存款為 74 個基點，定期存款為 3.44%。因此，這將為您提供我們在本季末的完成情況。

Okay. Obviously, didn’t see that. And then just on your loan yields, they were down a few basis points this quarter. Was that interest income reversals? What drove that? Just trying to get a sense for that if there’s anything unusual there going forward?

好的。顯然，沒有看到這一點。然後就貸款收益率而言，本季下降了幾個基點。這是利息收入逆轉嗎？是什麼推動了這一點？只是想了解未來是否有任何異常情況？

Nothing really unusual, Matthew.

沒什麼不尋常的，馬修。

Nothing really unusual, Matthew. I mean, when we look at our what I would call the core loan yield over the six months of the first half of this year, it was up about 10 basis points. There are other things that go into that reported loan yield, prepayment penalties, discount accretion. Those things can loan fees, those can be a little volatile quarter-to-quarter, but nothing significant. So but the underlying core trends have generally been one to two basis point increases per month.

沒什麼不尋常的，馬修。我的意思是，當我們查看今年上半年六個月的核心貸款收益率時，它上升了約 10 個基點。還有其他因素涉及報告的貸款收益率、提前還款罰金、折扣增加。這些東西可以是貸款費用，這些費用可能會按季度略有波動，但沒什麼大不了的。因此，但潛在的核心趨勢通常是每月增加一到兩個基點。

Okay. And then just on some capital updated thoughts on M&A, what you might be seeing of late given the move in bank stocks and whether or not something might be passed, might not you might able to get something done before year end?

好的。然後，關於併購的一些資本更新想法，考慮到銀行股的走勢，您最近可能會看到什麼，以及是否會通過某件事，您可能無法在年底前完成某件事嗎？

Yes. Well, first of all, even if there was something, I don’t think we’d be able to get anything done by year end, but hopefully we’ll be able to announce something by year end. There are still conversations that are going on. I do think that sort of the rebound in the bank stock prices could be a little helpful. But the math still remains a problem, just the unrealized losses and the marks that we have to take.

是的。好吧，首先，即使有什麼事情，我也不認為我們能夠在年底之前完成任何事情，但希望我們能夠在年底之前宣布一些事情。目前仍有對話正在進行。我確實認為銀行股價的反彈可能會有所幫助。但數學仍然是一個問題，只是未實現的損失和我們必須接受的分數。

And so we’re going to be disciplined in how we look at that. So there are conversations that are going on. There are opportunities for us and we continue to evaluate those and talk about those both externally and internally.

因此，我們將嚴格看待這一問題。所以正在進行一些對話。我們有機會，我們會繼續評估這些機會，並在外部和內部討論這些機會。

Obviously, we do have a lot of capital and that’s a good thing. It does give us some flexibility to do different things. So, we’d love to do an M&A deal. There are also other things that we could consider going forward from a capital management perspective. We really kind of wanted our TCE to increase and sort of get past a little bit of the risk of TCE going down.

顯然，我們確實擁有大量資本，這是一件好事。它確實給了我們一些靈活性來做不同的事情。因此，我們很樂意進行併購交易。從資本管理的角度來看，我們也可以考慮推進其他一些事情。我們確實希望我們的 TCE 能夠增加，並且能夠克服 TCE 下降的一些風險。

And we sort of that 8.5% to 9% range is a good spot for us and we ended up there in the third quarter. So, there are definitely things that we’re talking about, but at this point, nothing to announce.

8.5% 到 9% 的範圍對我們來說是一個不錯的選擇，我們在第三季就達到了這個水平。所以，我們確實在談論一些事情，但目前還沒有什麼可宣布的。

Okay, great. Thank you.

好的，太好了。謝謝。

Thank you. One moment for our next question. And that will come from the line of Andrew Terrell with Stephens. Your line is open.

謝謝。請稍等一下我們的下一個問題。這將來自安德魯·特雷爾和史蒂芬斯的血統。您的線路已開通。

Maybe just to start on that last point around capital and kind of what you’re contemplating there. I guess, we get to the sale leasebacks in a minute, but are you interested in kind of buyback in the back half of the year?

也許只是從關於資本的最後一點開始，以及你正在考慮的事情。我想，我們很快就會談到銷售回租，但您對下半年的回購感興趣嗎？

Does the kind of move in valuation potentially preclude you from doing that? Would the preference be incremental securities repositioning? Just maybe a little more thought on the capital discussion there?

這種估值變動是否可能會阻止您這樣做？優先考慮的是增量證券重新定位嗎？也許只是對那裡的資本討論多一點思考？

Andrew, I think over the next two, three, four quarters, our focus is to really reduce the level of borrowings we have on the balance sheet as well as reducing the securities portfolio. And that combined with the fact that we continue to accrete capital every quarter, I think is going to show some pretty strong capital ratios. They’re already pretty strong, but and we’ll be definitely looking at the opportunities from M&A compared to whether we want to be more aggressive in terms of buybacks.

安德魯，我認為在接下來的兩個、三個、四個季度，我們的重點是真正減少資產負債表上的借款水準以及減少證券投資組合。再加上我們每季繼續增加資本的事實，我認為將顯示出一些相當強勁的資本比率。他們已經相當強大，但是我們肯定會專注於併購機會，而不是我們是否想要在回購方面更加積極。

So, we’ll see what the M&A market looks like at that point. But if it’s still a little slow, I think the Board will certainly evaluate whether we want to do some put a 10b5-1 back in place.

因此，我們將看看屆時的併購市場會是什麼樣子。但如果它仍然有點慢，我認為董事會肯定會評估我們是否願意採取一些措施將 10b5-1 恢復到位。

Yes, got it. Okay. And then on the point of the sale leasebacks, I think you’ve mentioned $3 million or so in the third quarter. Can you just maybe frame for us like the timeline in which the sale leaseback transactions can occur? Is that something that is primarily completed in the back half of the year? Is there a longer kind of tail to you guys looking to complete those transactions?

是的，明白了。好的。然後，關於售後回租，我想您已經提到了第三季約 300 萬美元。您能否為我們框架一下售後回租交易發生的時間表？這是下半年主要完成的事嗎？對於想要完成這些交易的你們來說，是否有更長的尾巴？

So we are doing transactions sort of one at a time. These are not a lot of things in the market you’ve seen is they’re selling a bunch of properties simultaneously. We’re focused on maximizing what we can get out of these properties. And if we don’t get the price we want, we won’t sell them. So, there is certainly some unknowns. One sold already.

所以我們一次只進行一筆交易。這些並不是您在市場上看到的很多東西，因為它們同時出售大量房產。我們專注於最大限度地從這些資產中獲得收益。如果我們沒有達到我們想要的價格，我們就不會出售它們。所以，肯定存在一些未知數。已經賣掉一件了

I think there’s possibilities of a couple more this year, but we don’t know. But in total, it’s still going to be a handful at most, but it will depend on whether market conditions really give us the cap rate we want.

我認為今年還有更多的可能性，但我們不知道。但總的來說，最多仍然是少數，但這將取決於市場狀況是否真正為我們帶來了我們想要的資本化率。

Okay, got it. And then if I could sneak one more in just a couple of the CRE like data aggregators put out some data that industrial, commercial real estate in the Inland Empire specifically had seen kind of a pretty nice lift in vacancy rates, to start this year.

好的，明白了。然後，如果我能再偷偷地在一些商業房地產（CRE）中再增加一個數據，例如數據聚合器，就會發布一些數據，從今年開始，內陸帝國的工業、商業房地產的空置率尤其出現了相當不錯的提升。

Curious what you guys are seeing in that market specifically within your portfolio, whether you’ve seen any notable changes in the vacancy rates?

好奇你們在這個市場上看到了什麼，特別是在你們的投資組合中，你們是否看到空置率有任何顯著的變化？

So a couple of things. I think the latest data I saw, when you go from a 1% or 2% vacancy rate to a 6% or 7% vacancy rate, that is a large percentage increase, but it’s still very concentrated at the larger square footage size buildings. And it’s impacted obviously greater when you have a 2 million or 3 million or 4 million square foot building that goes vacant. That’s not the type of deal that we’re lending on.

有幾件事。我認為我看到的最新數據，當你從1% 或2% 的空置率上升到6% 或7% 的空置率時，這是一個很大的百分比增長，但它仍然非常集中在較大的面積上大小建築物。當一棟 200 萬、300 萬或 400 萬平方英尺的建築空置時，影響顯然更大。這不是我們提供貸款的交易類型。

So, we haven’t seen really any changes in the industrial market with our customers. We’ve been very disciplined in how we’ve underwritten it. Half of it is about half of it is owner occupied. We did put a lot more detail in our investor presentation this time around related to all CRE asset classes, whereas historic last few quarters anyway, we’ve only put the office portfolio.

因此，我們的客戶並沒有看到工業市場有任何變化。我們在承保方式上非常嚴格。其中一半左右是業主佔用的。這次我們確實在投資者介紹中提供了與所有商業地產資產類別相關的更多細節，而無論如何，過去幾個季度的歷史性的變化是，我們只關注了辦公室投資組合。

So, there is a lot more detail both from an origination loan to value perspective, the size of the loans that we have in each of our asset classes. So, it does provide a lot more detail I think for you and others to look at. We’re not really experiencing it. The largest cost side loan we have in our industrial portfolio is a 15 year fully advertising loan with less than a 30% loan to value, all payments being made. The operating company lost a little bit of money and so we downgraded it.

因此，從發起貸款到價值角度，我們每個資產類別的貸款規模都有更多細節。因此，我認為它確實提供了更多細節供您和其他人查看。我們並沒有真正經歷它。我們工業投資組合中最大的成本側貸款是 15 年期的完整廣告貸款，貸款價值比不到 30%，所有付款均已支付。營運公司損失了一點錢，所以我們下調了它的評級。

So, I feel very good about the credit quality. I mean obviously things can come up, but we’re not experiencing vacancies in the investor industrial portfolio at any significant level.

所以，我對信用品質感覺非常好。我的意思是，顯然事情可能會發生，但我們在投資者的工業投資組合中並沒有出現任何重大的空缺。

Got it. I appreciate it. Yes, the extra color on the presentation was helpful. Thanks for the questions.

知道了。我很感激。是的，簡報中的額外顏色很有幫助。感謝您的提問。

Yes, you’re welcome.

是的，不客氣。

Thank you. One moment for our next question. And that will come from the line of Kelly Motta with KBW. Your line is open.

謝謝。請稍等一下我們的下一個問題。這將來自凱利·莫塔 (Kelly Motta) 與 KBW 的血統。您的線路已開通。

Hi. Good morning. Thanks for the question. I was hoping to dig in a little bit more about the sale leasebacks and the potential offsetting securities repositioning. Just wondering, it sounds like that proceeds will be used to potentially pay down some of the higher cost borrowings. Wondering, if there’s a particular size of the securities portfolio we should be managing to or how you’re thinking about what an optimized size of a securities portfolio looks for you at this stage as we are thinking about kind of shifting around the balance sheet? Thanks.

你好。早安.謝謝你的提問。我希望更多地了解銷售回租和潛在的抵消證券重新定位。只是想知道，聽起來收益將用於償還一些成本較高的借款。想知道我們是否應該管理特定的證券投資組合規模，或者您在現階段如何考慮證券投資組合的最佳化規模，因為我們正在考慮圍繞資產負債表？謝謝。

We don’t have, I’d say, a near-term target per se. I think more importantly, our focus is more paying down the debt more than anything. And so obviously other aspects of the balance sheet come into play. I think long-term, many years out, obviously our objective here is to shift the asset mix to a higher percentage of loans. Obviously, as we shift away from wholesale funds on the other side of the balance sheet. So, that is the long term strategy, of course.

我想說，我們本身沒有近期目標。我認為更重要的是，我們的重點是償還債務，這比什麼都重要。顯然，資產負債表的其他方面也發揮了作用。我認為從長遠來看，多年後，我們的目標顯然是將資產組合轉向更高比例的貸款。顯然，隨著我們從資產負債表另一端的批發基金轉向。所以，這當然是長期戰略。

But near-term, I think the investment portfolio, we want to accelerate it maybe with some of these targeted sale leasebacks. But in general, it’s not we’re not targeting a number per se, Kelly.

但從短期來看，我認為投資組合可能會透過其中一些有針對性的售後回租來加速。但總的來說，我們並不是沒有瞄準一個數字本身，凱利。

Okay, that’s helpful. And then as a follow-up with the, broker CDs you put on, wondering how you’re weighing that versus other wholesale costs and if, you’re looking to potentially add to that wholesale CD position or if the security sales and the cash flows off that support what you need at this point?

好的，這很有幫助。然後，作為您投放的經紀商 CD 的後續行動，想知道您如何權衡其他批發成本，以及您是否希望潛在地增加批發 CD 頭寸，或者證券銷售和現金流可以支持您目前的需求嗎？

The wholesale side is a combination of a couple of things, Kelly. 1, depending on how the rest of the balance sheet plays out, do we need more funding? That will depend if that’s the case, we will look to in some ways what’s the least expensive, whether it be brokered, whether it be borrowings. But we also are managing those numbers a little bit to the extent of how we want to position our interest rate risk. So, what we select on the wholesale side is one of the ways we try to manage. And we are a little bit asset sensitive right now, particularly because of those pay fixed swaps we put on and that is one way to mitigate it, among others is to put on some fixed debt.

批發方面是多種因素的結合，凱利。 1.根據資產負債表其餘部分的表現，我們是否需要更多資金？這將取決於情況是否如此，我們將在某些方面尋找最便宜的方式，是否透過中介，是否是藉款。但我們也在根據我們想要如何定位利率風險的程度來管理這些數字。所以，我們在批發方面的選擇是我們嘗試管理的方式之一。我們現在對資產有點敏感，特別是因為我們支付了固定掉期費用，這是緩解這種情況的一種方法，其中之一就是增加一些固定債務。

Got it. Thank you so much.

知道了。太感謝了。

Thank you. One moment for our next question. And that will come from the line of Ahmad Hasan with D. A. Davidson. Your line is open.

謝謝。請稍等一下我們的下一個問題。這將來自艾哈邁德·哈桑 (Ahmad Hasan) 和 D. A. 戴維森 (D. A. Davidson) 的血統。您的線路已開通。

Good morning, guys. I’m Ahmad Hasan on for Gary Tenner. I would like to touch on the loan pipeline. I know you mentioned, the C&I line utilization. And just how should we be thinking about the back half of the year in terms of loan pipelines and loan growth and all?

早安，夥計們。我是加里·坦納的艾哈邁德·哈桑。我想談談貸款管道。我知道您提到過 C&I 線路利用率。我們應該如何看待下半年的貸款管道和貸款成長等？

Yes. I mean, the loan pipelines are definitely slower. We are seeing great opportunities. When we do a C&I loan, we’ve funded a large amount of commitments this year. There just hasn’t been a large amount of borrowings on those commitments. And so that obviously is different than doing commercial real estate whether owner or investor. But I still believe that we can grow loans through the end of the year. That’s been a struggle.

是的。我的意思是，貸款管道肯定會更慢。我們看到了巨大的機會。當我們提供工商業貸款時，我們今年已經承諾提供大量資金。只是這些承諾並沒有大量借款。因此，無論是業主還是投資者，這顯然與商業房地產不同。但我仍然相信我們可以在年底前增加貸款。這是一場鬥爭。

The first six months is evidenced by some of our prepared comments. But I do believe that we can grow loans. And I think there are some people sitting on the sidelines. I don’t think the rate thing is as big of an impediment to doing loans. But if things break a little bit more or things improve a little bit more, that should be a catalyst to start seeing some more activity there.

我們準備的一些評論證明了前六個月的效果。但我確實相信我們可以增加貸款。我認為有些人坐在場邊。我不認為利率問題對貸款有那麼大的障礙。但如果情況出現更多的變化或情況有所改善，這應該會成為開始看到更多活動的催化劑。

And we’re going to err on the side of credit quality always. We’ve had a lot of opportunities to look at deals that we have passed on, because there’s either other lenders aren’t doing it or other lenders are doing things a little more aggressively than we would do.

我們總是會在信用品質方面犯錯。我們有很多機會審視我們已經放棄的交易，因為要么其他貸方沒有這樣做，要么其他貸方正在做比我們更積極的事情。

So, I do feel confident sort of in our low single digit growth sort of talk that we had at the beginning of the year, at the end of the first quarter. That is still our goal. We don’t guide specifically, but pipelines are a little bit lower, but they’re solid and we just need to keep executing there.

因此，我確實對我們在今年年初、第一季末進行的低個位數成長的討論充滿信心。這仍然是我們的目標。我們沒有具體指導，但管道要低一些，但它們很堅固，我們只需要在那裡繼續執行。

And the good thing about it is on the C&I loans that we’re doing, we’re getting full relationships enabled to monetize those relationships in many other ways, treasury management, international, bank card, all of the things that we do for an operating company that we wouldn’t really be doing for an investor commercial real estate borrower.

這樣做的好處是我們正在做的商業和工業貸款，我們獲得了充分的關係，可以通過許多其他方式將這些關係貨幣化，財務管理，國際，銀行卡，我們所做的所有事情對於一家運營公司來說，我們實際上不會為商業房地產借款人做這樣的事情。

Thanks for that. I'll step back.

謝謝你。我會退後一步。

Thank you. (Operator Instructions). Our next question will come from the line of David Feaster with Raymond James. Your line is open.

謝謝。（操作員說明）。我們的下一個問題將來自大衛·費斯特（David Feaster）和雷蒙德·詹姆斯（Raymond James）。您的線路已開通。

Good morning, everybody.

大家早安。

Good morning.

早安.

Let’s start with deposits. Obviously, it’s a seasonally challenging quarter. The deposit migration has been a headwind, but the NIB balances is pretty encouraging. I’m just curious if you can help us think through maybe some of the trends in the quarter, on the core deposit front and what you saw especially late into the quarter into early July?

讓我們從存款開始。顯然，這是一個季節性充滿挑戰的季度。存款遷移一直是阻力，但NIB餘額相當令人鼓舞。我只是好奇您能否幫助我們思考本季核心存款的一些趨勢，以及您在本季末至 7 月初看到的情況？

Yes. So I think look, I think overall deposits have been very stable. I’ve been saying this for five or six quarters that our operating model does allow for non-interest bearing deposits to remain high. If they can remain at 60%, I mean, that will continue to be a challenge is if rates stay higher longer, if there’s some rate movement down, it might be easier. But we are bringing on very good deposit relationships, operating companies that do maintain non-interest bearing deposits.

是的。所以我認為看，我認為整體存款非常穩定。我已經說了五、六個季度了，我們的營運模式確實允許無息存款保持在較高水準。我的意思是，如果利率能保持在 60%，這將繼續是一個挑戰，如果利率保持在較高水平的時間更長，如果利率下降，情況可能會更容易。但我們正在建立非常良好的存款關係，營運公司確實維持無利息存款。

So, the deposit pipeline has been solid, but we still are running into the headwinds of the higher for longer. And surprisingly, there are still some people that are saying, oh, maybe I can earn a little bit more. You would have thought most of that would have ran through the system. But that’s still happening to a degree as evidenced by the money that moved to trust. So I feel good about deposits.

因此，存款管道一直很穩固，但我們仍會在更長時間內遇到更高的阻力。令人驚訝的是，仍然有人說，哦，也許我可以賺更多。您可能會認為其中大部分內容都會透過系統運作。但這種情況在某種程度上仍然在發生，轉移到信託的資金就證明了這一點。所以我對存款感覺良好。

Normally in the second quarter, we have grown deposits historically. We were flat. Averages were up. But I do think that if we can execute on the pipeline that we have, that we should start to see that stabilize maybe even a little bit more, notwithstanding obviously any broker deposit acquisition. But I feel generally good about it and we bank operating companies. I mean, so we should maintain a high level of non-interest bearing.

通常在第二季度，我們的存款會出現歷史性成長。我們是平的。平均值上升。但我確實認為，如果我們能夠在現有的管道上執行，我們應該開始看到穩定甚至可能會更加穩定，儘管顯然有任何經紀人存款收購。但我對此整體感覺良好，我們為營運公司提供銀行服務。我的意思是，所以我們應該保持高水準的無息。

Okay. That’s helpful. And then maybe just kind of going back to I’m curious how you think about the size of the balance sheet. It sounds like we’re preparing basically to especially with the BTFP maturity, we’ll probably shrink the balance sheet. You’ve built up some cash in advance of that. But it sounds like probably expect the balance sheet to shrink a bit and to the extent that we have deposit growth, maybe more optimization of your funding mix. Is that kind of the right way to think?

好的。這很有幫助。然後也許只是回到我很好奇你如何看待資產負債表的規模。聽起來我們基本上正在準備，特別是隨著 BTFP 的成熟，我們可能會縮小資產負債表。在此之前您已經累積了一些現金。但聽起來可能預期資產負債表會稍微收縮，並且在存款成長的情況下，也許會進一步優化您的資金組合。這是正確的思考方式嗎？

Yes. I think generally you’re on the right track. And look, we can grow earnings per share without necessarily growing the bank in the short term. Our goal is to grow the bank long term. We want to grow the bank, but the exact circumstance we’re in right now with the BTFP and building the cash, there could be some of that that occurs over the next few quarters.

是的。我認為總體上您走在正確的道路上。看，我們可以增加每股收益，而不必在短期內擴大銀行規模。我們的目標是使銀行實現長期發展。我們希望發展銀行，但就 BTFP 和現金累積情況而言，未來幾季可能會發生一些情況。

But I do think that we can definitely grow EPS, improve ROA, do something with the capital, all of those things should get us to where we want to be ultimately. And with the targeted sale leasebacks, I mean, we’re just we’ve been saying over the last couple of quarters, we’re going to hit some singles and to reduce the amount of the borrowings. And so obviously, all of that sort of impacts the size of the balance sheet. But I do think we can definitely grow EPS, even if we’re not growing the total asset size of the bank in the short run.

但我確實認為我們絕對可以增加每股收益，提高資產回報率，利用資本做一些事情，所有這些事情應該讓我們達到我們最終想要的目標。我的意思是，透過有針對性的售後回租，我們只是在過去幾個季度一直在說，我們將打擊一些單身人士並減少借款金額。顯然，所有這些都會影響資產負債表的規模。但我確實認為，即使短期內我們不會增加銀行的總資產規模，我們也絕對可以增加每股盈餘。

But ultimately, we want to grow the size of the balance sheet as well. So I don’t know, Allen, if you have anything to add to that.

但最終，我們也希望擴大資產負債表的規模。所以我不知道，艾倫，你是否還有什麼要補充的。

Yes. I mean, we want to grow core loans, core deposits, but in terms of other aspects of the balance sheet, as I talked about reducing the borrowing, the balance sheet in total could certainly shrink in the near term and not a bad thing, certainly that will help return on assets and free up additional capital, frankly.

是的。我的意思是，我們希望增加核心貸款、核心存款，但就資產負債表的其他方面而言，正如我談到減少借款一樣，資產負債表總量肯定會在短期內收縮，這並不是一件壞事，坦白說，這當然將有助於資產回報並釋放額外資本。

And David, just to give you an idea, a lot of these sale leaseback transactions that have occurred with the larger private equity firms, these banks have been selling these properties at high 7s at best and low 8s at worst cap rates.

大衛，只是為了給你一個想法，很多售後回租交易都是與大型私募股權公司發生的，這些銀行一直以最高7 的上限利率出售這些房產，以最差的上限利率以低8 的利率出售這些房產。

We’re looking at selling our properties below 6% cap rates. So we’re unlocking more of the value of those properties and how we’re doing it. And if we don’t sell, we don’t sell those properties, but we’re going to if we get the price that we want to get, then we’ll be able to hit another single here or there. So that’s sort of the thought process.

我們正在考慮以低於 6% 的資本化率出售我們的房產。因此，我們正在釋放這些資產的更多價值以及我們的做法。如果我們不出售，我們不會出售這些房產，但是如果我們得到了我們想要的價格，那麼我們將能夠在這裡或那裡打出另一首單曲。這就是思考過程。

Okay. That’s great. And then maybe switching gears just to the churn. I mean, that’s been a huge benefit just as you’ve been able to first clients, maintain relationships and all that. What are some of the underlying trends you’re seeing on the trust side?

好的。那太好了。然後也許只是為了攪拌而切換齒輪。我的意思是，這是一個巨大的好處，就像您能夠獲得第一批客戶、維持關係等等一樣。您在信託方面看到了哪些潛在趨勢？

Well, you broke up a little bit. I just want to make sure I heard you correctly. What are the underlying trends on the Citizens Trust side?

嗯，你們分手了一點。我只是想確保我沒聽錯。公民信託方面的基本趨勢是什麼？

Yes

是的

Yes. So look, I mean, last year for the total year, we had $800 million of deposits go there. The first six months, we had $170 million of deposits go there. So, it’s definitely slowed down, but our customers still I mean, we do have smart customers and they are wanting to earn what they can earn.

是的。所以看，我的意思是，去年全年，我們有 8 億美元的存款流向那裡。前六個月，我們有 1.7 億美元的存款流向那裡。所以，它肯定會放慢速度，但我們的客戶仍然是我的意思，我們確實有聰明的客戶，他們希望賺到他們能賺到的錢。

And so we work with them and we want to keep it in the family. So ultimately those relationships, we’re not losing the relationship. There’s potentially excess deposits that are going there to earn something. And I think that’s the key thing and just keeping it in the family is important. But our trust group has grown to $4.5 billion-ish in assets under administration and management, which is up about $1 billion from last year.

所以我們與他們合作，我們希望將其保留在家庭中。所以最終這些關係，我們並沒有失去這段關係。潛在的超額存款將流向那裡以賺取收益。我認為這是關鍵，將其保留在家庭中就很重要。但我們的信託集團管理和管理的資產已增加至 45 億美元左右，比去年增加了約 10 億美元。

So, we’ll continue to see a little bit of that I think, but that’s definitely slowed down as well. And we’re still working to bring on those new relationships, which includes trust assets in many cases. So, we’ll continue to do that, probably continue to see it, but definitely at a slower pace.

因此，我認為我們將繼續看到一些這樣的情況，但這也肯定會放緩。我們仍在努力建立這些新的關係，其中在許多情況下包括信託資產。因此，我們將繼續這樣做，可能會繼續看到它，但速度肯定會放慢。

Thank you, everybody.

謝謝大家。

Thank you. And we do have a follow-up question. That will come from the line of Kelly Motta with KBW. Your line is open.

謝謝。我們確實有一個後續問題。這將來自凱利·莫塔 (Kelly Motta) 和 KBW 的血統。您的線路已開通。

Hey. Thank you so much for letting me, jump back on. I just was hoping to clarify your point about your outlook for loan growth. I think you reiterated low single or mid-single digits. I was wondering if that is for the balance of the year or how you’re thinking about, net growth in the second half?

嘿。非常感謝你讓我繼續前進。我只是希望澄清您對貸款成長前景的看法。我認為您重申了低個位數或中個位數。我想知道這是否是今年剩餘時間的情況，或者您如何看待下半年的淨增長？

Yes. I definitely didn’t say mid-single digits, so just to clarify. I do think I just think for the balance of the year, I think we can grow loans in that low single digit range from this point. And some of that I mean, we’ve done a couple of larger C&I loans that have about a 5% or 6% utilization on them. I mean, at some point, these people are going to start to utilize this money.

是的。我絕對沒有說中個位數，所以只是為了澄清。我確實認為，在今年餘下的時間裡，我認為我們可以從這一點開始以較低的個位數範圍增加貸款。我的意思是，我們已經發放了幾筆規模較大的 C&I 貸款，利用率約為 5% 或 6%。我的意思是，在某個時候，這些人將開始利用這筆錢。

So, I think combination of what we’ve already put on the books, it hasn’t really been advanced. Plus if there’s any improvement in the pipelines and just our normal sort of and I’m excluding the seasonality in the fourth quarter with there. So excluding that, I do think that we can grow in the low single digits from this point forward.

因此，我認為結合我們已經記錄在案的內容，它還沒有真正取得進展。另外，如果管道有任何改善，而且只是我們正常的情況，我會排除第四季度的季節性因素。因此，排除這一點，我確實認為從現在開始我們可以以較低的個位數成長。

Great. Thanks for the clarification.

偉大的。感謝您的澄清。

You're welcome.

不客氣。

Thank you. I’m showing no further questions in the queue at this time. I would now like to turn the call back over to David Brager for any closing remark.

謝謝。目前，我在隊列中沒有顯示任何其他問題。我現在想將電話轉回給大衛·布雷格（David Brager），請他發表結束語。

Thank you, Sherry. Citizens Business Bank continues to perform consistently in a challenging operating environment. Our solid financial performance is highlighted by our 189 consecutive quarters or more than 47 years of profitability and 139 consecutive quarters of paying cash dividends.

謝謝你，雪莉。公民商業銀行在充滿挑戰的營運環境中持續保持穩定的表現。我們連續 189 個季度或超過 47 年的盈利能力以及連續 139 個季度支付現金股息凸顯了我們穩健的財務業績。

We remain focused on our mission of banking the best small and medium sized businesses and their owners through all economic cycles. I would like to thank our customers and our associates for their commitment and loyalty. Thank you for joining us this quarter. We appreciate your interest and look forward to speaking with you in October for our third quarter 2024 earnings call.

我們仍然專注於我們的使命，在所有經濟週期中為最好的中小企業及其所有者提供銀行服務。我要感謝我們的客戶和同事的承諾和忠誠。感謝您本季加入我們。我們感謝您的關注，並期待在 10 月召開的 2024 年第三季財報電話會議上與您交談。

Please let Allen or I know if you have any additional questions. Have a great day.

如果您還有任何其他問題，請告知艾倫或我。祝你有美好的一天。

This concludes today’s program. Thank you all for participating. You may now disconnect.

今天的節目到此結束。感謝大家的參與。您現在可以斷開連線。