FNB Corp (FNB) 2026 Q2 法說會逐字稿

Good morning, and welcome to the FNB Corporation second-quarter 2026 earnings call. (Operator Instructions) Please note this event is being recorded.

I would now like to turn the conference over to Lisa Hajdu, Manager of Investor Relations. Please go ahead.

Good morning, and welcome to our earnings call. This conference call of FNB Corporation and the report that files with the Securities and Exchange Commission often contain forward-looking statements and non-GAAP financial measures. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for our reported results prepared in accordance with GAAP.

Reconciliations of GAAP to non-GAAP operating measures to the most directly comparable GAAP financial measures are included in our presentation materials and in our earnings release. Please refer to these non-GAAP and forward-looking statement disclosures contained in our related materials, reports and registration statements filed with the Securities and Exchange Commission and available on our corporate website.

A replay of this call will be available until Friday, July 24, and the webcast link will be posted to the about us, investor relations section of our corporate website.

I will now turn the call over to Vince Delie, Chairman, President and CEO.

Thank you, and welcome to our second-quarter earnings call. Joining me today are Vince Calabrese, our Chief Financial Officer; and Gary Guerrieri, our Chief Credit Officer.

FNB second-quarter earnings per share grew 17% year-over-year to $0.42 with net income of $149 million. Our results included another quarter of record revenue totaling $463 million, driven by net interest income of $366 million and solid non-interest income of $97 million. The solid quarterly performance contributed to pre-provision net revenue increasing 9% from the year-ago quarter and positive operating leverage.

On a year-over-year basis, tangible book value per common share increased 10% to $12.24, demonstrating our strong profitability levels and commitment to peer-leading internal capital generation. FNB repurchased $47 million or 2.7 million shares of common stock at a weighted average share price of $17.46.

FNB's capital levels remained strong with TCE at nearly 9% and with a solid return on average tangible common equity at 14%. Period-end loans increased 7.5% on an annualized linked-quarter basis, with growth led by commercial and industrial, consumer lending and seasonal residential mortgage production.

D&I's 8% annualized linked-quarter growth was driven by lower risk-rated, high-quality commercial borrowers. By leveraging our deep product set in capital markets, we were able to produce double-digit returns for the overall relationship while maintaining our strict credit discipline and originating lower-risk assets in a volatile geopolitical and economic environment.

Our commitment to deepening customer relationships and serving as their primary operating bank was a key driver for 3% annualized growth in total average deposits, with average non-interest-bearing deposit balances growing nearly 5% annualized, despite the competitive environment.

At quarter end, non-interest-bearing deposit balances were over $10 billion for the second consecutive quarter, allowing us to maintain a 26% mix of non-interest-bearing to total deposits for the seventh consecutive quarter.

Our data analytics team has been able to leverage the success of our proprietary e-store and common application to gather additional data points for immediately improved insights on customers' preferences and competitive pricing. This ability enables us to use our significant investments in our data hub and machine learning to analyze the relationships holistically to strategically price deposits.

Our ability to utilize insights to drive pricing decisions contributed to the total cost of deposits, decreasing 3 basis points link quarter and 21 basis points from the year ago quarter. Our Wealth Management revenue is up 8% year-over-year, aided by the utilization of new tools to improve client engagement with advanced financial planning, better portfolio analysis and increased efficiencies.

For example, our brokerage advisors have been able to quickly translate complex financial data into intuitive visuals for our clients. These tools, paired with the key strategic financial advisory hires across our footprint, helped expand client relationships and produce record brokerage fee income this quarter.

We have also achieved solid progress on the development of our new AI-enabled customer aggregation. An insight tool, Insight360. The ultimate goal will provide our clients and bankers with the ability to optimize their banking relations and improve product penetration. Our Insight360 tool is expected to go live by the end of the year with additional enhancements to be introduced over time.

In combination with the Common App, Insight360 will enable FNB to continue to grow our share of wallet and customer primacy based upon positive outcomes for our clients. As we've demonstrated over the past decade, we can successfully introduce innovative digital and data solutions while also achieving a top quartile efficiency ratio.

We will maintain the same disciplined approach toward managing expenses to implement AI through the reallocation of resources, leveraging our current technology investments and analyzing the efficiency gained over the long-term. We believe FNB is one of the best-positioned financial institutions to strategically expand AI and data analytics usage to drive efficiency and accelerate revenue growth.

Our value proposition. Is being a trusted and regulated financial institution with fintech capabilities. These attributes will serve us well as we continue to adapt to a changing competitive landscape.

With that, I will now turn the call over to Gary to discuss our credit results for the quarter. Gary?

Thank you, Vince, and good morning, everyone. We saw improvement in our continued solid asset quality metrics this quarter with both delinquency and NPLs and OREO decreasing 3 basis points compared to the prior quarter, totaling 71 basis points and 31 basis points, respectively. Net charge-offs continued to show solid performance, totaling 19 basis points, up 1 basis points compared to the prior quarter.

Criticized loans declined slightly in the quarter with a 68-basis point reduction compared to the prior year. Total funded provision expense for the quarter stood at $21.3 million, again supporting strong loan growth. Our ending funded reserve now stands at $447 million, an increase of $4.3 million, ending at 1.25%. When including acquired unamortized loan discounts, our reserve stands at 1.3% and our NPL coverage position remains strong at 420%, inclusive of the discounts.

We continue to maintain qualitative overlays for potential supply chain impacts due to the events in the Middle East and ongoing tariff uncertainty. Our consistent underwriting and strong credit risk curriculum allow us to grow high-quality earning assets throughout various economic cycles as shown in our results.

With our focus on less volatile industries and asset classes, we remain optimistic that our diversified customer base will continue to show resilience as it has in the past. Our consumer portfolio is very strong despite continued inflationary pressures. Average origination FICO scores were 784 in the quarter with delinquency of 66 basis points and charge-offs of 6 basis points, both remaining at multi-year lows.

During the quarter, we saw solid C&I loan growth. Including a slight uptick in line utilization, along with higher CRE production. However, our overall CRE exposure declined in the quarter due to planned secondary market activity, ending at 187% of Tier 1 Capital plus allowance. We are continuing to see increasing levels of CRE activity in our desired asset classes throughout our markets.

In closing, despite the continued volatility in the markets, we saw solid loan growth across the portfolios. Our loan book is strong and well diversified, and pipelines continue to remain at solid levels positioning us to achieve our growth targets as we move into the second half of the year.

I will now turn the call over to Vince Calabrese, our Chief Financial Officer, for his remarks.

Thanks, Gary, and good morning. Today, I will review the second quarter's financial results and walk through our third-quarter and full-year guidance. Second-quarter net income totaled $148.7 million. $0.42 per share, a 17% year-over-year increase, driven by total revenues up 5.6% and prudent management of operating expenses, generating a 9% PPNR increase.

Turning to the balance sheet, loan activity was robust, with spot total loans and leases ending the quarter at $35.8 billion, a 7.5% annualized linked-quarter increase. Growth of $547 million in consumer loans and $111 million in commercial loans and leases drove the increase. Spot C&I loans and commercial leases were up over 8% linked quarter annualized or $186 million, driven primarily by the growth in the Mid-Atlantic and Pittsburgh markets.

CRE balances continue to be impacted by payoffs as expected and were down $129 million linked quarter. Seasonal strength in residential mortgages and HELOC growth fueled the rise in consumer loans.

Average total deposits grew at a 3% annualized rate for the first quarter, driven by growth in non-interest-bearing balances, low-cost transaction deposits and time deposits. Of note, spot non-interest-bearing deposits increased $53 million exceeding $10 billion for the second consecutive quarter and remaining stable at 26% of total deposits.

Looking forward, public funds deposits typically build in the second half of the year and the treasury management deposit pipeline was strong at quarter end. The loan-to-deposit ratio ended the quarter at a healthy level of 92.5%. While the second quarter's net interest margin of 3.25% was equal to last quarter's NIM, net interest income increased more than 7% on a linked-quarter annualized basis.

Total yield on earning assets declined only 1 basis point linked quarter at 5.13%, with a 4-basis point decline in loan yields, offset by a 7-basis point increase in investment securities yields. The decline in loan yields reflects the impact of lower one-month SOFR on adjustable-rate loans and tighter spreads on new originations. Reinvestment rates on investment securities remained well above the overall portfolio yield.

Interest-bearing deposit costs declined 4 basis points, driven by lower rates on money market and CD balances, while total borrowing costs improved by 1 basis point. As a result, the total cost of funds decreased 2 basis points to $199. On a year-over-year basis, net interest income increased 5.3% from the year-ago quarter as the NIM expanded 6 basis points and earning assets grew 3%.

Turning to non-interest income and expense, non-interest income totaled $97 million, up 6.5% from the second quarter of 2025. Capital markets income increased 16% to $8 million on solid contributions from debt capital markets, interest rate derivatives and international banking, as well as early contributions from our newer businesses of investment banking and public finance.

Wealth Management revenues increased nearly 8% year-over-year to $22 million with contributions across the geographic footprint. Non-interest expense totaled $253 million, a 2.9% increase from the year-ago quarter. Salaries and employee benefits increased 4.4%, reflecting strategic hiring and normal merit increases.

Occupancy and equipment increased 5.1%, primarily due to technology-related investments and higher occupancy costs. Outside services increased 11.6%, driven by higher third-party legal and consulting costs. Even with these increases, the second quarter efficiency ratio remained solid at 53.7%, down more than 100 basis points from the year-ago quarter, and we continue to manage our expense base in a disciplined manner.

FNB continues to actively manage our capital position to support balance sheet growth and optimize shareholder returns while appropriately managing risk.

Share repurchases totaled $47 million in the second quarter, more than $80 million for the first half of the year, more than 300% increase from the dollar amount repurchased during the first half of 2025. Over $250 million in share repurchase authorization remained at quarter end.

Stepped-up repurchase pace and our recent quarterly common dividend increase reflect our strong financial performance and capital levels, as evidenced by the TC ratio of nearly 9% and the stable CET1 ratio of 11.4% in the quarter.

Let's now look at guidance for the third quarter and full year of 2026. All guidance is based on current expectations, while remaining cognizant of the highly uncertain macroeconomic and geopolitical environments. We are maintaining our full-year balance sheet guidance for spot balances, projecting period-end loans and deposits to grow mid-single-digits on a full-year basis.

Full-year net interest income guidance has been revised to a range of $1.485 billion to $1.515 billion due to a combination of our first half results and our expectation for a continuation of heightened deposit competition within the industry. We are assuming no Fed interest rate actions for 2026.

Third-quarter net interest income is projected between $375 million and $385 million. Non-interest income full-year guide remains $370 million to $390 million. The third-quarter level is expected between $93 million and $98 million. The full-year guidance range for non-interest expense has been tightened $1.01 billion, $1.02 billion, and we expect to be toward the high end of the range.

Third-quarter non-interest expense is expected to be between $255 million and $260 million, continue to expect strong positive operating leverage for full-year 2026. Full-year provision guidance has been revised to a range of $80 million to $95 million, down from $85 million to $105 million previously.

Given our favorable credit performance during the first half of the year, we'll be dependent on net loan growth and charger-up activity for the rest of the year. Lastly, the full-year effective tax rate should be between 21% and 22%, which does not assume any investment tax credit activity that may occur.

With that, I will turn the call back to Vince.

Thank you, Vince. Our results are a testament to the talent, dedication and hard work of our employees, supported by our ongoing investments in AI and data analytics. The culture of FNB is rooted in teamwork and collaboration, where we strive to collectively win together. FNB continues to earn independent recognition for our client's service, financial performance and culture.

This quarter, we were proud to be named as the Lender of the Year by the Export-Import Bank of the United States and a top workplace by Newsweek, as well as earning the Top Financial Innovations in North America Award by Global Finance. These select examples of FNB's third-party recognition highlight the strength of our business model, financial achievements, and quality of our team.

We've been able to recruit a number of highly talented executives in recent months, which adds to the depth of our leadership team and bankers. Earlier this month, Bryant Mitchell retired as Chief Wholesale Banking Officer. Since joining FMB in 2018, he has played a significant role in executing our strategy and was particularly instrumental in the early build-out of our capital markets capabilities.

I would like to thank Bryant and convey our appreciation for his contributions over the past nine years as FNB continues to evolve into an elite commercial bank and a formidable competitor in our markets. I wish him all the best in his retirement.

With that, I will now turn the call over to the operator for questions.

We will now begin the question-and-answer session. (Operator Instructions)

Daniel Tamayo, Raymond James.

Maybe starting just on the reduction in the net interest income guidance. Just curious where you think the biggest change that occurred in the second quarter that drove that was. And then assuming it's on the competition side, I know you talked a little bit about tighter loan spreads, but as well as on the deposit side. Just curious if you think we are nearing the end of the improvement on the deposit cost side?

Yeah, I would say a couple of things, Danny, if you look at where we came in, $366 million, slightly below the guidance range. The two factors you just mentioned are part of it for sure that we commented on in the prepared remarks. And the decline in one-month SOFR, like from peak to trough was 9 basis points during the quarter, kind of bottomed right at the end of May.

So that has a significant impact. We have $13 billion worth of loans that are tied to one-month SOFR. So that really, coming from peak to trough, down 9 basis points during the quarter. The expectation is with the futures market saying that 9 basis points comes back and gets to like [373] on average in the third quarter. So that clearly affected the second quarter quite a bit.

The competitive environment for deposits is there for everybody. We still had an ability to reduce our interest-bearing. The cost by 4 basis points. So that was an accomplishment given the kind of the environment that we were in during the quarter. And then the spreads on higher quality, lower risk loans that are tighter than other loans was definitely a factor too.

But if you go forward to the next quarter, I mean, so the SOFR bounce back, as I mentioned, the normal seasonality in deposits that occurs from July through October, November on the municipal side, we do expect that to come through. And that replaces short-term borrowings, helps to pay and fund for the loans.

I mean, the higher short-term borrowings in the second quarter loan was like an extra $4 million interest expense or reduction in interest income. So that seasonality comes through, continue to have a very strong treasury management deposit pipeline on the commercial side of the house, kind of over $1 billion that we're going after.

And some of those are larger, there's more a longer lead time, but that's still very active and continues to be work. And then the CRE headwind from payoffs, we expect another quarter of that, the third quarter, and then expect that to dissipate some as you get into the fourth quarter. And those are loans that are probably 25 basis points or so higher than other loans. So as those pay down, it definitely has an impact on the overall margin.

And then the reinvestment rates on the security side, we're reinvesting 125 basis points to 150 basis points above the roll-off rate. And for the next 12 months, it's $100 million a month in cash flow, kind of $309 million on average rolling off and picking up 125 basis points to 150 basis points on that.

And I guess the last thing I'll pause then is just the exit margin. So for the month of June was at $327 million. A couple of basis points higher than where the full quarter came in. And there's fees and stuff that fluctuate from month to month, but that's our exit point into the third quarter.

And you hit on this a little bit on my next question on the CRE payoffs remaining elevated in the second quarter. But just taking a step back a little bit here, certainly impacted by the payoffs, but the CRE has really -- the concentration ratio, but also just a percentage of the book has shrunk over the last several quarters, going back for a while now, and mostly replaced by an increase in resi mortgage.

I think you guys talked about coming into the year that was expected to grow at a similar pace to the book has outpaced so far. You've got some seasonality in the second quarter, certainly, that impacts that. But just curious how you think about that mix going forward. If you have a reduction in payoffs and the CRE starts to pick up, do you think your portfolio fewer residential mortgage loans and that mix starts to get back to where it was? Or you're still willing to grow the balance sheet with the resi side even as the CRE starts to pick up?

Yeah, I think the residential -- the contributions to growth from the resi portfolio, and that's largely physician's loans, very high quality, larger mortgage loans coming on the book. We're not trying to rely on that to drive interest income, that's not the case. And we've actually sold portfolios. So we've actually sold some of the stuff that we've originated that doesn't contribute deposits and other things that sits outside of market.

So we packaged up a portfolio and sold it, actually. I don't know when it closed. First quarter, yeah. So the impact of that's going to be in this quarter too. Some of those assets had higher yields on them. I think our goal is to try to drive growth across the portfolio, not to be reliant on one particular asset class.

I think the CRE runoff, that's a train that you can't stop easily. We're financing construction and this stuff's going to the permanent market. And quite frankly, there just isn't enough -- there aren't enough projects driving on demand in that space, but that's starting to change.

So I think, Gary, you could comment on that.

Yeah. During the quarter, Danny, the CRE growth was right at about $284 million, that compared to $190 million in Q1. We are seeing a lot of very solid opportunities in that space. It is competitive, as I think everyone is aware, the industry is really focused on CRE at this point, and there are some nice opportunities that have come through the organization. So we do expect that to continue to ramp up in the asset classes that we want to play in.

In reference to the mortgage that you had mentioned and Vince referenced, the second quarter is an extremely high seasonal quarter for us, because the doctors come out of school in March and they move into their new roles at the hospital organizations that they're joining and they go right into the purchasing home. So the second quarter is our seasonal peak there.

Third quarter is the volume is still good, but generally lower around that doctor's program, and then it really tells off in Q4 and Q1 from that part of the program.

I'll add to that, too. We were talking about this a little earlier, Gary and I. The pipeline is at a record, the total pipeline, which includes CRE is at a record level for us at this point. So again, remember, it lagged for a little bit historically. It had been growing and then we flattened out and it actually declined for a period or two, but now it's back up above the all-time highs.

So the short-term pipeline has contracted because we pushed a lot of volume through. We closed a lot of deals this quarter. So we should see that pick up again because it will pull through, right? From the larger pipeline. At least nearly 10% over where it was last quarter.

So we expect the second half of the year, particularly this quarter coming up, just to see some good activity in C&I and CIRI fundings, right, Gary? And then that will make up the fall-off of the residue mortgage in the consumer growth that we've seen. So we're expecting to have a pretty decent second half of the year from a commercial perspective.

With that, there are a bunch of deposit clients -- treasury management clients that we have in the pipeline that are when we're pulling through. Again, some of the largest clients in our history. So we were able to win business at some pretty sizable entities, and it's going to help us in the second half of the year with deposit growth in addition to the seasonal inflows that we should see.

I don't know if you want to comment, Alfred, on the deposits in general and what's happening to the Consumer Bank.

I mean, it continues to remain competitive. I think what we've had great success with is driving engagement with our existing and new clients. And oftentimes, particularly in the mortgage space, oftentimes that comes with low-cost DBA accounts. And we're being strategic about how we price deposits in some areas. We have opportunities to reduce deposit costs in some areas. We want to be competitive, particularly in some of our new markets.

While I'm never pleased with our cost of funds, I'm always critical of every move that our people make. I think it's part of my job. Alfred, you made a comment earlier. We're monitoring the reporting that's occurred to date. So how do we compare deposit perspective?

And to that point, we're obviously managing to the dual mandates of lowering our deposit cost and growing debt. That's the impossible chore. But this quarter, we were one of the few banks, I think we're tracking something like 15 banks that have reported so far. I think we're one of three that actually had a lower cost of deposit from the prior quarter.

So despite the fact that the rate environment meaningfully changed from the beginning of the quarter to now, it highlights the discipline that we've had in how we price these things?

It's actually two things. It's discipline from a pricing perspective and strategy and the pricing, using the insights that we have to maintain or try to maintain our margin. Plus the investments that we've made to maintain privacy and some of the initiatives that Alfred and his team have launched, particularly the mortgage company with Wingspan, which is a bundling of services that we do.

So you'll see more of that in our Insight360 tool that we mentioned is going to be right in the sweet spot of driving better outcomes from cost of deposit perspective and gaining share in primacy. So I'm very excited about that. I can't wait until you guys get to see it. Really cool. Anyway, hope that was helpful.

David Smith, Truist.

Do you emphasize the impact of the public funds deposit seasonality? Just deposits are down a little bit year-to-date right now, and you're still calling for mid-single digit growth. And it sounds like it's going to be another solid quarter of loan growth for your commentary. So just think about the impact here, and how much of the deposit cost decrease this quarter might have to come back amid the continued competitive backdrop for deposits you cite, particularly if we do end up getting fed hikes.

The Boardman's answers that, I just wanted to make a comment. The municipal business that we have is we're the primary operating bank for the municipalities. We don't just go out and accept deposits to replace one of the high-yielding money market options that they have. So that's not our strategy.

Our strategy is to go in, provide the operating accounts, provide the treasury management services for those entities, disbursements and collections, and then benefit from the excess balances as they flow in. So while there will be a surge in the deposit balances, there is a -- it doesn't significantly change the mix because we'll see should see a lift in demand deposits as well.

Because they use those deposits to cover the cost of services, which is accelerating when the activity, the taxing activity, there's a cost associated with that they offset with demand deposits.

Vince, why don't you answer directly his question?

The volume side of it, I mean, it's historically been about $0.5 billion, plus or minus a couple of $100 million from kind of peak to trough. It used to be the $300 million to $500 million and as we've grown and have larger, more relationships, it's a little bit bigger. But half a billion or so we would expect to surge through as we go through the end of the second quarter through the October, November timeframe.

And to Vince's point, it's a mix. It's clearly a mix of different deposit categories.

Okay, so the public funds are a little bit of the implied increase in deposits for the second half, but it's not the maturity or anything.

And then on expenses, we just take the midpoint of the 3Q and full year guidance implies a decent step down in non-interest expenses in the fourth quarter. Your seasonality has typically been for a small increase quarter on quarter in the fourth quarter, just looking at adjusted deposit trends the last few, excuse me, adjusted expense trends the past few years. I was wondering if you could help us unpack that a little bit, if there's anything unusual either in the third quarter or fourth quarter that's driving that abnormal seasonality.

The fourth quarter typically doesn't have additional expense associated with the tax credit deals. So they're very the the way we look at them, which is important. We end up with this big expense upfront. So that's reflected in the fourth quarter number for at least the last three. So there's going to be a little bit of distortion there.

But Vince, I don't know if you want to comment generally on the total expenses, seasonality, and the expense base in the last two quarters of the year.

Yes, I would, I guess a couple of things, right. So again, for the quarter, we came in right in the middle of our range, deficiency ratio down to 53.7% over 100 basis points year over year, which takes out the seasonality there. As we go forward, I mean, there's things that in the first couple of quarters that have occurred, we had higher fraud losses, we brought that down significantly.

We have a down payment assistance program that's come down meaningfully in dollars second to third quarter and I mean we expect a nice step down second to third quarter and then again into the fourth quarter, I mean that should reduce by $1 million to $1.5 million per quarter. I mean there's a commission component that's tied to revenue largely on the mortgage origination side, so that fluctuates as the activity fluctuates.

And then on the marketing side, there's some seasonality in marketing or more timing of it when we choose to do that. So we expect to see some increase in marketing dollars as you go from the second to the third quarter. So there's a lot of moving parts in there. And with all those normal bank operation items, we continue to invest, as Vince was talking about, in our tech investments between the digital initiatives we have and the AI initiatives. But we're being very disciplined at how we fund that.

Yeah, we also have -- it's also lumpy on the Denodo branch expansion too, because we announced we were opening branches over a five-year period. And the timing when those branches open isn't -- it isn't scheduled out month by month, so it's lumpy. So you'll see some lumpiness in the expense base, particularly in the first half of this year.We opened two branches went online in Charleston, South Carolina. It brought the expense online as well.

And then we also have the investments in Insight360, the tool that I mentioned. So that's reflected in the first half of the year and probably, it will continue to be an expense into the second half, right? Until development's completed and it's launched. So there are some impacts. But I think the important points here are we have positive operating leverage and we're forecasting positive operating leverage.

The expense base, our guide is what? Year over year?

Well, yeah. The efficiency ratio is low 50s by the end of our year.

So the expense base itself and the guide is only little single-digits.

Yeah, the full year to full year.

So we've been able to take cost out. And invest in tools, AI tools.And that's a unique thing because a lot of companies are expending tremendous resources, taking on capital expenditures prior to receiving any benefit from an AI investment.And we're seeing that all over the place, even with that. So it takes time to get the actual benefits.

And we're focusing more on revenue opportunities right now than we are expense takeout. And there's a combination of both, we're more heavily weighted towards generating revenue with our AI investment, which also speaks to the infrastructure that's being built because that requires a much more complex data governance framework within the company.

So I believe we're in a really good position. I said that in my prepared comments to benefit from this, and it should not impact materially our expense base, on a run rate basis (inaudible). (multiple speakers)

Casey Hare, Autonomous.

So Vince, see, question for you following up on the NIM. So the guide does not assume any Fed action, but it does it sounds like you do expect SOFR to bounce back to 373. That's 11 bps higher than where it is today. Just wondering where assuming SOFR holds this level, where does NII track versus within this guide?

What I was referring to, Casey, was if you look at what happened during the quarter, it went from a peak of 367, April 15, down to 358, May 20. And we had a lot of loans reset at the end of the month. Think today, we're at 367. So what the futures market is saying, there's another 6 basis points of pickup in that. So on the $13 billion, if that comes through, it may or may not.

There's a lot of volatility with interest rates, with everything going on in the world. And whether we went from an environment where the Fed was going to cut, an environment where they're going to raise, and it's October, it's December, I mean, it moves around quite a bit. So just based on what we know today, I mean, if 6 basis points up from where we are today on that $13 billion is the math you would do there.

(multiple speakers)

All right. I'll take a look. And then just, I guess, switching to capital, any updated thoughts on what the Basel III proposal does for you guys? I think you didn't quantify it last quarter, you said it was meaningful. And then do you lean into that in terms of buyback? The buyback was very strong this quarter. How do we think about that appetite going forward? Are we going to hold this 11.4% level or is there room to even to push the payout ratio, just thinking about how you guys think about the buyback?

Yeah, I would say, I mean, for the Basel III, and then I'll turn it over to Frank. I mean, based on what we know, you need to get the final rules, right, before you can say with certainty. I mean, it's an 80-basis point to 100-basis point pickup to the capital ratios. And if that does happen at that point, and I don't know if they're talking January 1 of next year, potentially. Once that would happen, we'll definitely step back and take a fresh look at the overall capital allocation approach that we want to use going forward.

I'll turn it to Frank for comment on our buyback philosophy today.

Casey, we think buybacks continue to be attractive here. We transacted them at around [17.50%] on average in the quarter. As we talked about at that point, that was a three-year earnback. Obviously, markets have moved higher, but even at these levels, we're still talking about sort of a four and change year earnback here.

And for buybacks where you don't have things like deal integration risk, obviously, you can be pretty confident in that earnback. I still think that we still think that's a pretty good return. And so good return, good capital management tool. As you pointed out, over the last few quarters, we've reported flattish CET1 ratio at 11.4%, obviously very comfortable with those levels.

And while we don't give quarterly guide on reports, I think holding capital around those current levels is a pretty good sort of expectation or bogey here.

Russell Gunther, DA Davidson.

I appreciate all the color on the margin dynamics this quarter. I was hoping to unpack some of the assumptions or what underbelly is that June $3.27 NIM and really focus on the loan yield. So the $5.52, maybe just give us a sense for where overall new loan production is coming on, if possible, to share where pipeline loan yield stands and perhaps the spot loan yield as of June?

Yeah, the new loans, we look at what happened in the second quarter, Russell, came on at $5.54 for the second quarter. For reference, that was $5.57 in the first quarter, so just a few basis points lower. If you look at on a spot basis, the overall portfolio yield was down eight basis points to $5.53. Again, with no Fed actions, but with the impact of one-month SOFR running through there.

So again, that obviously affects the yiled level. So the portfolio came down that 8 basis points comparison last quarter was down 1 basis point. So it's the new stuff is coming on at $5.54.

And then just the other side of that, please, on the deposit front. So it sounds like you should have some good growth this quarter, bring that loan-to-deposit ratio back into the '90s, perhaps, where you're more comfortable. But could you give us a help in terms of where spot deposit costs were for the quarter or for June?

On the loan-to-deposit ratio, we have been higher than 92% historically. I mean, it's not that we want to I would prefer to be sub-90%, of course, but Alfred can't produce deposits without pricing. So we're being very selective in trying to maintain the margin. But there's a trade-off between that strategy of margin preservation and even though I want everything in the loan-to-deposit ratio.

But typically, as we move into the second half of the year, we do see those seasonal inflows and we do get back to the area that you mentioned as a comfortable spot for us, just to be candid. I mean, that's -- it was somewhat intentional for us to be where we are. We're not uncomfortable where we are. I just want to make sure we said that.

No, I think that strategy was important for us to get it down to 90% so that if you have quarters where loans are growing faster than deposits, we're at 92.5%, 93%. So there's plenty of buffer there to levels in the past where we started to take action was at 96%, 97%. So being at 90% as a reference point, going up two percentage points is fine.

So I think that was an intentional strategy, and I think that's working very well for us. As far as the spot rate, so for the month of June, total deposits, we're at $174. Total interest-bearing deposits, we're at $233.

(multiple speakers)

(multiple speakers) I guess last one for me guys on the fee income side, as you look at the back half of the year, what verticals are the key drivers of growth in 3Q, 4Q? And if you were to kind of come in at the high end, what operating environment and fee verticals get you there?

Yeah, I think clearly, there's opportunity in our investment banking segment, we have a number of deals, both public finance and corporate finance transactions that are in the pipeline. So that should benefit us. Moving into the second half of the year, so there's some benefit there. We're still optimistic about derivatives, our derivatives business has been down because of the interest rate environment.

But we think things are starting to break because of the CapEx spend, right? That requires a need for fixing rates. And as you know, we use derivatives with large, fixed-rate loans on our balance sheet. Typically, we prefer to push it off balance sheet. So those businesses should do particularly well. We have opportunities on the upside to merchants.

As we move into the second half of the year with interchange fees and some of the initiatives we pushed in wealth and brokerage should benefit us. So there's a lot of momentum there. We have record levels of growth in wealth and brokerage. And we continue to add to the team and continue to build out in the Carolinas, which has been very helpful for us. So those are the areas that I would view as being pretty favorable.

And obviously, you also asked about the economic backdrop. Of course, if we were in a different scenario where we were expecting rates to decline, I think you'd see an acceleration in some of those business units, particularly mortgage would continue to contribute probably at a stronger revenue level.

Given where we are, I would expect our mortgage business to be pretty stable in the second half of the year. Not declining because a lot of the production that we do is purchase money production and you tend to see more activity. People buy homes between now and September, right? So we'll see that coming through in the next quarter or so.

The third quarter mortgage bank should step up nice (inaudible) second quarter. (multiple speakers)

We've also seen, as we've talked, some increasing opportunities in the FX space. I mean, they've really continued to ramp those opportunities up, but we're seeing some --.

Yeah, with that CapEx spend for larger entities, we'll see more cross-border activity. And we would really benefit from that our foreign exchange area did particularly well, and they should continue to do well throughout the rest of the year. So all of that combined, and while individually they're not huge numbers, but combined, it gives you a pretty good base moving into the second half of the year.

And the debt capital markets piece too has been performing at a really high level consistently this quarter. (multiple speakers)

I mean, we're back to the level there and that should continue because I mentioned, we have a lot of very large project management customers in the pipeline that are coming online in the second half of this year, which will contribute to fee income because they'll pay fees and not just use balances, so you'll see it, an increase there as well.

Yeah, I think what you're seeing a bit here, Russell, is the building out and the diversity of all these fee income business lines is really taking hold and really providing a good source of fee income that's diverse across the company.

And there's puts and takes throughout the mix. And as you've seen, we've been able to perform different interest rate environments. So it's (inaudible), it's pretty well assembled, and there's a lot of diversification within that base. So we're very optimistic about the fee income categories and the upside here.

Manuel Navas, Piper Sandler.

Can we go back to some of the deposit pipelines? You have those in the treasury management area. You talk about the seasonality in (inaudible). How are retail deposits flowing as well? And as you look at those pipelines, what kind of -- are they coming in above current deposit costs? What is the pipeline rate on the deposits?

Well, I mean, I think that our deposit activity within the Consumer Bank has been pretty favorable. We've begun to grow households at a faster clip. We've got the Penn State initiative that we haven't even really launched yet, it's in its infancy. But those initiatives should contribute, Wingspan, we mentioned in the mortgage business, they're all starting to contribute.

And I would say that our goal when we bring on a consumer depositor, and I'll segment it because there's a difference between a consumer and a small business depositor, but a consumer depositor is coming on with a very low cost, right? Because we typically are striving to be the disbursement bank for the consumer, their operating bank. So they keep balances there and then we get the benefit of excess balances moved into money market products.

So we've priced our money market product to be attractive enough to retain those deposit balances, but we're relying on the free balances. And those accounts average like $4,000, I think, so there's a lot of them. But it's very granular. The business side is a little different. The deposit balances are, I think, averaging what, Alfred, in business bank, like $12,000 per account?

It's been higher, but again, still relatively granular. And to Vincent's point, when we're bringing on any kind of clients, it's always a holistic onboarding process. So it's not just, hey, it's a single service. Our focus is really to drive privacy across multiple products that both on the deposit side and on the lending.

And on the TM side, there's two pieces to it as well. I mean, there's the free balance piece, which we forecast. We can't really predict whether a client will use earnings credits or not. But there's the fee income side and then there's the forecasting that goes on with free balances to compensate for services. So we're feeling pretty good about both the fee income piece and our ability to drive compensating balances by bringing in new clients because we have a pretty strong pipeline.

That's what we're trying to say. I don't know if I answered your question or not. But I would say if you look at our cost of deposits, we've done a pretty good job of bringing clients over and picking up non-interest-bearing deposits, which has really helped us because it's very competitive right now. And we basically are pricing to retain our existing customer base. And then we'll go out, and we'll become a little more aggressive on new opportunities and try to position those opportunities to benefit from the free balances and the compensating balances in the structure.

And the new relationships are designed to go after the whole relationship, working side, the deposit side, the wealth businesses, the entire capital market side of it.

So you can't just look at one pipeline to draw a conclusion about what the direction of the deposits are. So it varies quarter to quarter. But I would say in the second half of the year, we're expecting contributions from both consumer and the treasury management pipeline for deposit growth. That's why we're optimistic guide.

That's really helpful. I just wanted to make sure to pin down where is greater competition expected on those two?

It's all over the place, but I hate to say that. I think we've got a pretty good handle on it and I think we've got some really good opportunities and we're willing to compete, but we can compete with higher yielding competitors, particularly smaller competitors. We may see them more frequently in the consumer space and then you move into the larger depositors in the commercial space.

It's a function of being able to win both, not just go after, we don't want to just go after the high-yielding, low-margin deposit relationships, we want the whole thing. So holistically pursuing those opportunities is the right thing and that tends to bring the cost of those deposits down considerably based on the component, the no-cost component.

The overall cost stability of the relationship expands.

So there's a lot of science associated with it, it's not as simple as just looking at a pipeline report.

Are low yields also structurally going to benefit, I understand the SOFR side, are low yields also going to structurally benefit from resi real estate originations falling off a little bit seasonally and more commercial originations? Is that also part of the go-forward on loan yields?

Yeah, that's also a very complex question, Manuel. No, actually, we should see -- we were talking about that. If you look at the originations that we experienced this quarter, we have some higher yielding growth in the commercial finance segment. Our leasing -- financing arm is seeing a pretty decent margin. It's still under competitive pressure, but better than you would see in the C&I book because the C&I book is a lot of very large middle market and upper middle market transactions that we've seen CapEx spend in.

So higher quality originations with lower yields this quarter, it really impacted the numbers when you look at it, it's fairly sizable impact. Our goal is to bring those in. Typically, if you just went straight credit, extending your balance sheet, pricing to market in that space, you're going to see like a 6% to 9% return, which isn't good enough for us.

So we would have to have some ancillary business, either the depository business or our debt capital markets business or FX business that we look at in our models that takes us north of 12%, 13%, 14% or more in return. So we we want to be way above our cost of capital in terms of bringing these things on. So we have models that the line runs.

But the point of this, is a lot of those originations that occurred this past quarter were larger either syndicated deals or large middle market single names, where they're lower priced, lower risk, you brought those on this quarter. I'd say as we move into the second half of the year, the real estate originations priced higher. So there's a big differential, probably 75 basis points to 100 basis points in spread on those CRE opportunities.

And then, as we gain traction in the traditional middle market in C&I as well, we should see better yields coming in. Still under competitive pressure, but better than what we originated so far this year from a yield perspective. I hope that helps.

There's scary payoffs diminish as we go through the year. (multiple speakers)

You're seeing stuff going out that's $225 to $275 over SOFR and we're originating at $150. That's not a great sustainable environment, but that's an anomaly because you've brought in, you've got the tailwind from the big deals coming in. And then you've got the headwind of the higher margin series, book running off and then lower originations in that space. But we see that turning because the CRE runoff is pretty much done.

And as we move into the second half of the year, the real estate lenders are more optimistic. If you look at the pipeline, they've got some good stuff coming on. That doesn't mean it's not under the higher quality paper is not under pressure. It is, but it's a higher margin than what we've originated to be a better story.

Thank you. (multiple speakers)

It's kind of tough to model. I know you're trying to model it. I hope I helped you.

Brian Martin, Brean Capital.

So just one or two things for me, most of it was just covered there in the last question, but just on the loan pipeline, Vince, I think you commented that the pull-through this quarter. So the short-term is maybe a little bit down, but the long-term is the strongest. Just if you could just frame up just big picture, just either geographically or by segment where that long-term pipeline that's at the peak today, where the strength is there?

We were just -- Gary and I were just talking about it. I mean, Cleveland started to come on pretty strong. The Central Pennsylvania areas, we call it the Central Mountain Capital Region, are both doing really well. And they've got pretty strong pipelines. From a historical perspective, both of them are at an all-time high.

And then South Carolina is at a high or near an all-time high. I mean, they're right at their all-time high. So there was one other quarter back in '24 when they were at a similar level. So that's all looking good.

And then there's Pittsburgh. Pittsburgh is really strong. I don't know if it's an all-time high, but it's at least a high relative to the last three or four years. And it's up meaningfully. It's up big. So there's some really bright spots. The more competitive markets, we're still up in Charlotte and Raleigh, but not at all-time highs.

So there's upside, I see, in some of those markets as we build out those teams because we're still focusing on adding to the teams there.

And then just by segment, like, where is the real strength there?

Yeah, I'd say C&I is the winner. I mean, I don't know, Gary, you're seeing.

It on the C&I side. The CRE pipelines are building, Brian, but the C&I is carrying the --.

Small business has been building this too.

Small business has been building, and it has been a steady increase in the first half of the year.

Equipment finance has been nice.

Yeah, it's been good.

Yeah, equipment finance is all C&I and that's been very strong because of the CapEx spend that's going on and the tax environment, right? With the capital gates treatment.

And that's C&I, it's got to to your point, it's got better yields, it's not all the stuff you put on this quarter that the higher quality. I guess, call it lower risk, there's a mix in there that those yields are better than what you brought on this quarter, that's your point.

Yeah, because we -- it was very lumpy this quarter. There were a lot of large transactions, M&A transactions, refinancing activity going on within the large corporate and upper middle market space. And some of them even, they restructured and went to the bond market, which is why we had strong performance in our debt capital markets group, the broker-dealer that we stood up for debt capital markets.

That was all concentrated. So we saw a lot of concentration in the quarter of lower yielding assets coming on, which are very high-quality. That's why I said in my comments, I don't mind doing that in this environment. I would rather our teams not go out and compete foolishly for assets because it is still very volatile. I know we feel like we're in a great economic environment, but you're seeing cracks here and there.

You've got the war in Iran that could throw us into a weird situation with oil prices rising and interest rates have been more volatile. You saw SOP, as Vince mentioned, there was a little imbalance in SOP for a period of time and it contracted and then expanded for no [apparent reason] not consistent with the rest of the yield curve. So there was a little inflection in supply and demand. And that happens from time to time.

I'd rather see us go out and do higher-quality paper, right? and then stage what we go after in the secon half of the year to bring some higher-yielding assets on that are manageable and we can manage from a risk perspective.

I still think we're one of the best banks in the country in terms of risk management. And we have yet to be tested here for a long time because we performed extraordinarily well through the last downturn, which was a long time ago. I've been in the seat -- I've been at least President of the bank for 20 years, nearly 20 years. So I got to see it last time.

We performed extraordinarily well through that period and Gary is very good and very conservative and our portfolio is extraordinarily well positioned. Our reserves are strong given the risk profile in our portfolio. So I think, the way we go about doing things is the right way because when the floor does fall out, you will see us stand up. I mean, we're going to be a high performer throughout that period.

So based on the quality of the portfolio and the asset classes that we went into. Anyway, Gary, I don't think you feel the same way.

I feel exactly that way. And I think the portfolio is very nicely positioned where we sit today and we're excited for the future opportunities that we have in front of us.

And Gary and I are in lockstep. We don't disagree on many things. I think we're pretty consistent here.

Forever, right?

For a long time, together for a long time.

Thanks for that, and great job, Gary, and your team on the credit side, that's a proven it's a long-term trend for you, and great work. So just the last two from me, just on the just the net just I appreciate all the color on the CRE. I guess bottom line is, if you look at the net growth in CRE, do you expect that to rebound in '27? So I guess the payoffs, it sounds like they're dissipating. So maybe some net growth you'd expect in '27, is that fair?

I think that's a very fair view of it at this point, Brian. Based on what we're seeing here halfway through the year and looking out through the end of the year and into early '27, I would expect that to be the case.

Okay, that's clear enough. And then the last two. Just the funding costs, it sounds like this quarter is being obviously stand out relative to those 16 banks, but maybe this is the bottom-line funding costs. I appreciate all that. I mean, what's going to happen in the second half with the dynamics of the municipal funding, and the treasury deposits you've got coming in. But maybe we're at the bottom here on the funding side, is that especially given a potential outlook for rate hikes?

It really depends on what we bring in. I mean, the new relationships that Vince was talking about that's worthy of operating bank for those clients, then bringing demand deposits and new relationships bringing in kind of the full relationship is what we go after. So obviously, the more DDAs you have, that has a nice positive impact on the overall rate that's there.

The municipal stuff comes in at a mix, like Vince said earlier. The CDs are close to a bottom, like we were -- I think the overall portfolio is like just over three, and we're probably close to a bottom on the CDs. So the new CDs coming in are pretty close to the CDs that are occurring. And that's been like that probably the last quarter or two. So it's really a function of our success bringing in the new relationships.

And then the very last one, sorry, was the -- just appreciate the color on the fee income side. Just what do you see, given all the momentum you have with all the build-out and the broadening out on the fee income side, that where it's at today at 21% of total revenues or core revenues. Do you see that trending up on a relative basis? Is it pretty steady in this range? Or how are you thinking about that just maybe longer-term, given the momentum you have?

Obviously, we would like it to be higher always because it creates more stability for us rather than relying on net interest income solely. So I think we would like to see it higher. I think it's hard for us given the interest rate environment and the impact on revenue to throw a number out there because they don't get higher with lower net interest income. You wouldn't like that as a percentage. So we want to make sure we're growing both. And we would love to see it approaching 25%, someday 30%.

So some of these businesses are very new, and there's a lot of upside in them. So I think we're going to continue to manage this like we have. We grew it, if you remember, back in 2017, you're at about $160 million, $180 million. We're guiding to what this year, it's almost $400 million. It's been a pretty remarkable ride, but I think there's upside as we build out these other business units.

Particularly investment banking, public finance, continuing to invest in debt capital markets, and we're adding team members in large corporates so that we can pursue more. I think derivatives has been flat for several years, and maybe we're getting through the end of some of those fixed-rate cycles. So some of these borrowers are going to have to do something. So we'll probably see that pick up a little bit. (multiple speakers)

Yeah, commercial real estate activity certainly will create it because that's a big driver of derivative fee income. So those are all the benefits. And then we haven't even begun to focus on optimization of interchange. And we're building out payment platforms today that will enable us to do certain things.

Insight360 is an exciting tool that should drive fee income because we're going to give customers the ability to use we're going to use AI looking at an aggregate portfolio of products and then make product recommendations, which includes wealth and insurance products, right? So all of that is exciting. I think there's upside there long-term.

And Brian, that's slide 17 we have in the deck is a key one to summarize it. I mean, we've established or expanded 10 business lines that we started from scratch or started small and really been expanded. And the newer ones, Vince mentioned, investment banking, public finance are brand new. They're starting to contribute this year and there's quite a bit of upside there. And TM, we're at record levels, but what Vince just commented on, there's meaningful upside.

They're still building out a new portal for TM. There's a bunch of things happening on the commercial side, which will be additive moving into '27. I'm excited about that too. So I think TM is definitely an area that we could perform better in the years to come.

And I think the important thing to note here is that all these fee income businesses are being brought on efficiently. It's not a COIR efficiency ratio.

And that's the same with our AI approach. We want to make sure that we're taking cost out to invest in certain businesses that have a higher growth trajectory and produce higher returns for our shareholders. So we basically are very careful about launching these businesses. So we launch them very gradually and then build them over time so that we can sustain profitability and sustain a decent return, which is why the efficiency ratio has generated revenue faster than we're taking in new people -- adding new people and adding expense to those areas. We're gradually building it.

And reallocating resources too.

We constantly look at the allocation of personnel and resources to ensure that we're getting that most optimal deployment of those expenses.

It's all super helpful just with the -- I mean, I guess just worth shining a spotlight on, it's going to grow for the right reason, and that's what you just were talking about there rather than at the expense of NII and just a better ratio. So thank you for --.

And it's not pie in the sky. I mean, you can see the growth over a long period of time. It's not like we're making this up. I mean, there's a historical framework that you can point to, and we're very excited about continuing to grow it.

Yeah. No, it sounds like a lot of opportunities ahead, so especially given the young businesses here. So well, thank you for all the help and all the color today.

Kelly Motta, KBW.

A lot of great things have been covered today. So I think most of mine have been asked and answered at this point, but maybe stepping back at a high level, when I look at FNB through the years, you have generally generated above-average profitability on a [proxy] basis at least. And the peers that they have narrowed that gap here with you guys at 14%.

You clearly have made a lot of investments in the platform and technology and AI. I'm wondering, as you look ahead and you're thinking about a normalized profitability for FNB, if there's still additional room for improvement as you leverage those investments to generate positive operating leverage or at this point, we're (inaudible). This is where we're leveling off here with the reinvestment back in the business. I'm just trying to balance how to think about that. Thank you.

Yeah, i think we -- Alfred and i had a long conversation about that exact topic last night when I called him on my walk for an hour. He basically -- what our conversation was about was our returns, 14% return on tangible common equity. It doesn't sound impressive. But if you look at the capital accumulation, because of our profitability, it is pretty impressive considering that we're near 9%, TCE, CET1 is 11.4%, and we've got a 14% return.

I mean, we don't need to -- because of the risk profile within the portfolio, we are operating with less leverage than our peers. So we have opportunities to drive the returns two ways. One, by continuing to invest in the businesses that produce a higher return on capital. And two, basically repatriating capital, returning capital to the shareholders because of our risk profile.

So both of those things are going to happen because we're not going to sit here and accumulate capital for no reason. Our goal is to drive shareholder value, and to do that, we have to be very judicious about capital deployment. So we're going to continue to focus on ways to leverage that capital and drive returns.

To manage both sides of it.

Yeah, I mean, it's -- but you're spot on. I mean, we were having these conversations last night because I don't want to be in the middle of the pack. It's part of our compensation, right? We get scored on that. The Board's recessed relative to peers. So we need the highest return on tangible common equity in the risk environment, risk profile that we maintain. right?

Which means we can't -- we really shouldn't have excess capital. We should be thinking about managing our capital, returning capital and we are, and Frank answered the question about buybacks.

And our TC ratio, if you compare it to the peer group for us, we're 50 basis points higher, so that's another important element in looking at the overall return on equity there. And as Vince said, we're going to continue to manage the denominator.

Our growth and our capital is not AOC. We're not benefiting, we didn't have big impairments. So we're not getting accretion from AOCI impairments, we're actually earning our way to these higher capital levels and that's a distinction that people fail to take into consideration when you look across the peer group.

Got it, that's helpful. (multiple speakers) Maybe last question for me, I apologize if you've answered it already, but just in terms of your rate sensitivity profile here. If you look at a static balance sheet, you are asset-sensitive, but I am wondering, given the competitive pressures like through your markets. How you feel NIM reacts in response to a rate cut and actin cuts, I think you said the spot is in the high $320s, if there's any further levels or if that's a basis point or potential pressure off of that?

I would say, I mean, we've brought our interest rate position down. I mean, we're pretty near neutral now. We're still slightly asset-sensitive, but as we've gone back toward more like neutral, I mean, the impact of one cut, if we get an increase, let's use that as a reference point in October. I mean, that's worth probably a penny or so for the fourth quarter potentially.

I don't know whether we're going to get it or not. I guess we'll see how the year plays out. But the magnitude of the impact of either a cut or a hike is not as large as it used to be because we intentionally brought it back down towards near neutral. This way, we're not taking a risk either way and let growth in loans and deposits and investments drive the net interest income.

And I guess the last question about NIM, you did take your NII guide down, just wondering if this high $320 margin, if it seems like loan yields are coming in right around where the book is, it's probably limited room on deposits or is some increased pressure if this is. -- it's up relative to the blended quarter and if this is kind of flattish from here absent moves in the rates. Thank you.

Yeah, I would say what's baked in is, I would call it a drifting up from this level, very gradual, not a lot, but there's some movement up. Drifting is a good word.

This concludes our question-and-answer session. I would like to turn the conference back over to Vincent J. Delie for any closing remarks.

I'd just like to thank everybody, thank the employees again for another great quarter. I know a little disappointing on the NIM, but more macroeconomic than effort. And I look forward to a really strong ending to the year, a lot of momentum in a lot of areas. So we're going to keep that momentum up and work really hard for the shareholders.

So thank you. Thank you for the questions, too. They were great questions. I'm glad we had a chance to answer. Take care, everybody. Thank you. Bye.

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.