Third Coast Bancshares Inc (TCBX) 2025 Q3 法說會逐字稿

Greetings and welcome to the Third Coast Bankshar's 3rd quarter earnings conference call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation.

If anyone should require operator assistance during the conference, please press 0 on your telephone keypad. Please note this conference is being recorded.

I would now like to turn the conference over to your host, Ms. Natalie Hairston. Please go ahead.

Thank you, operator, and good morning, everyone. We appreciate you joining us for Third Coast Banksharre's conference call and webcast to review our 3rd quarter 2025 results. With me today is Bart Carraway, founder, Chairman, President, and Chief Executive Officer, John Mc Mhorter, Chief Financial Officer, and Audrey Spaulding, Chief Officer. First, a few housekeeping items. There will be a replay of today's call, and it will be available by webcast on the investors section of our website at ir.3rdcoast.bank. There will also be a telephonic replay available until October 30th, and more information on how to access these replay features was included in yesterday's earnings release.

Please note that the information reported on this call speaks only as of today, October 23, 2025, and therefore you are advised that time sensitive information may no longer be accurate as of the time of any replay listening or transcript reading.

In addition, the comments made by management during this conference call may contain forward-looking statements within the meaning of the United States federal securities laws. These forward-looking statements reflect the current views of management. However, various risks, uncertainties, and contingencies could cause actual results, performance, or achievements to differ materially from those expressed in the statements made by management.

The listener or reader is encouraged to read the annual report on Form 10-k that was filed on March 5, 2025 to better understand those risks, uncertainties, and contingencies. The comments made today will also include certain non-GAAP financial measures. Additional details and reconciliation to the most directly comparable GAAP financial measures were included in yesterday's earnings release, which can be found on the Third Coast website.

Now I will turn the call over to Third Coast's founder, Chairman, President, and CEO, Mr. Bart Carraway. Bart.

Good morning everyone, and thank you, Natalie. I'll begin by sharing the highlights from the company's performance this quarter. After my remarks, John will discuss the financials and Audrey will give a review of credit quality.

Finally, I'll cover our merger announcement and share management's outlook for the remainder of 2025.

The 3rd quarter was particularly impressive for Third Coast as the company reached several key milestone achievements in growth, innovation, and shareholder value. First, the recent listing of TCBX on both the New York Stock Exchange and the NYSE Texas marked a strategic shift aimed at enhancing market visibility and providing shareholders with greater liquidity.

Second, We experience notable growth in the third quarter, creating substantial asset value.

For the first time in the company's history, we surpassed 5 billion threshold in total assets with a compound annual growth rate of 19.3% since our IPO in November 2021.

Our relationship banking model has remained effective.

Evidenced by the consistent quarter over quarter growth in both deposits and loans. Additionally, we set new records in book value and tangible book value, reaching $32.25 and $30.91 respectively.

Our return on average assets also hit a new high, reaching an annualized 1.41% for the third quarter of 2025. These accomplishments not only demonstrate our growth strategy, but also underscored our commitment to creating lasting franchise value for our stakeholders.

Third, The successful completion of the bank's 1 and second securitization transactions mentioned during our Q2 earnings call received international recognition, winning the SCI Risk sharing Award for North American Transaction of the Year at a recent ceremony in London.

These transactions demonstrated that what we once thought impossible is now within reach, and Third Coast is immensely proud to have set new standards for a bank our size while redefining risk management for real estate development loan portfolios among our peers.

Lastly, our ongoing efforts to optimize operating leverage led to improvements in efficiency, profitability, and opportunity.

Our efficiency ratio improved to 53.05% for the third quarter.

Net income rose, driven by enhancements in interest and non-interest-bearing income while keeping expenses stable, resulting in a total of 18.1 million for the quarter.

Collectively The 3rd quarter quarter results position us as a strong performer and create a solid foundation for potential M&A opportunities ahead, including the definitive agreement with Keystone that was announced yesterday, and I will discuss more in detail later in the call.

In summary, the 3rd quarter not only exceeded expectations but also set several new records for the company, and overall, we remain committed to delivering on our strategic priorities and providing sustained value for our shareholders. With that, I'll turn the call over to John for the company's financial update. John.

Thank you, Bart. Good morning, everyone. We provided the detailed financial tables in yesterday's earnings release. So today I'll provide some additional color around select balance sheet and profitability metrics from the 3rd quarter.

We reported third quarter net income of 16.9 million, up 8.3% versus the second quarter of 2025. This resulted in an ROA of 141 and a 15.1% return on equity.

Net interest income was up 15 million or 3% from the second quarter. This increase was primarily due to a better than expected net interest margin and growth in average earning assets of $229 million.

Non-interest expenses were essentially flat in the 3rd quarter where salary and employee benefits were up, but legal and professional expenses were down.

If you recall last quarter we noted relatively high legal fees associated with the securitizations.

Investment securities were up 21 million to $583 million and quarterly average balances were up 117 million. Yield on the portfolio at September 30th was 6.07%, and AOCI improved slightly with a gain to 10.9 million.

Deposits increased $92 million for the quarter, resulting in a loan to deposit ratio of 95%, and our cost of funds declined slightly.

Net interest margin declined to 4.10% but was still higher than expected due to relatively high loan fees.

In fact, speaking of loan fees, despite higher than expected accretion, capitalized loan fees at 930 were a record 19.9 million.

But with that said, we're forecasting a margin of between 3.90 and 3.95 for the fourth quarter.

Third quarter average loans were up 158 million versus the second quarter of this year.

Period in loans, however, were up 85.4 million.

Loan demand remains strong with loans already at 50 million in October.

We've recently hired several new employees that we believe will be significant contributors to both loan growth and deposit growth in future quarters.

That completes the financial review. At this point, I'll pass the call to Audrey for our credit quality review.

Thank you, John, and good morning everyone. The third quarter highlighted the stability of our credit quality, a result of our disciplined risk management practices and underwriting standards. Non-accrual loans declined for the second consecutive quarter, improving by 2.6 million in the third quarter.

Quarter over quarter, non-performing loans increased by 1.6 million. However, they are 2.3 million.

Lower than the same period a year ago. Similarly, the non-performing loans to total loans ratio rose by 3 basis points, quarter over quarter, but still improved by 10 basis points compared to the same period last year.

The 4 basis point increase in provision expense was attributable to growth in gross loans outstanding, and the company recorded net recoveries of $17,000 for the quarter.

Our loan portfolio remains well diversified and similar to the previous quarter's allocations. Commercial and industrial loans were 43% of total loans, while construction, development, and land loans were 20%, owner-occupied CRE was 10.

And non-owner occupied CRE was 16% of total loans. Our office and medical office portfolio exposure was not materially different than previous quarters, and our multi-family exposure has declined slightly.

Overall, the stability of our loan portfolio combined with our team's discipline allows us to maintain strong performance as we navigate market fluctuations strategically. This blend of conservative credit underwriting and careful risk management not only propels our growth but also delivers long-term value to our stakeholders. With that, I'll turn the call back to Bart Bart.

Thank you, Audrey. Looking ahead, we are excited to capitalize on the positive momentum generated in the 3rd quarter as we continue to implement strategic initiatives that will drive our company forward.

As announced yesterday, Third Coast has entered into a definitive merger agreement with Keystone Bank Shares Inc. Once completed, the combined entity is expected to have a pro forma total assets in excess of $6 billion. We are targeting to close the transaction in the first quarter of 2026.

Keystone Bank is headquartered in Austin, Texas, a region known for dynamic economic growth and a vibrant community, making it an ideal location for continued expansion.

Keystone currently operates two branches within the Austin market alongside a branch in Ballinger, Texas, and a loan production office in Bastrop, Texas. This partnership presents a compelling opportunity to merge two culturally aligned community banks, allowing us to leverage our shared commitment to relationship banking and customer service. By combining our resources and expertise, Third Coast will significantly strengthen its position in that corner of the Texas Triangle.

Turning to our outlook, management expects the remainder of 2025 to be consistent with prior quarters. Our loan pipelines show even more demand over the robust figures of the third quarter, reinforcing our confidence in meeting our loan growth targets of 50 million to 100 million in the fourth quarter. This aligns with our annualized growth rate of approximately 8%. And as always, we remain disciplined in our underwriting and portfolio management practices to ensure high-quality growth.

In closing, I'd like to restate how proud I am of the Third Coast team. We consistently exceed industry expectations, achieving growth rates that surpass that of our peers.

Thanks to the dedication of our bankers and the strategic positioning in Texas' most attractive markets, we have built a strong franchise characterized by desirable banking model, sustained growth and profitability and long-term value creation for our shareholders. With that, I'd now like to turn the call back over to the operator to begin the question-and-answer session, operator.

Thank you. We will now be conducting a question-and-answer session. If you would like to ask a question, please press 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue.

You may press 2 if you would like to remove your question from the queue.

For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star key.

And again that is one to ask a question?

And our first question comes from Bernard von Gzicki with Deutsche Bank.

Morning.

Hey guys, good morning. Just curious on the merger of Keystone, the deal closes or expected to close by 1,226, just any expectations of how long the integration process, may take, I know you know in the decades that it should be straightforward integration given some operational compatibility, just any color you can share you on similar systems, anything you can, break out there.

Yeah, fortunately we've coordinated very well with them, so we're looking at a very early second quarter core conversion with them. Fortunately, their contracts tied to our benefit and expires at, basically in May. Plus a lot of what they do business wise is similar to us, so it's pretty easy to map over and their cultural aspects are very much aligned with ours. So we do expect the integration to be fairly straightforward.

You understood. And then maybe just following up on the loan growth, expected for 4Q.

I know John, you mentioned the 50 million already in October, and Bart you mentioned, the expectations are still the 50 to 100 million, that seems to be maybe conservative just wondering any expectations that November, December might be maybe a little bit slower, just any thoughts on, the pipelines and any color you can provide there.

Bernie, last quarter I said basically the same thing that July loans were up $50 million when we had our earnings call, and they ended up going up as much as $150 and then we had a bunch of big payoffs towards the end of the quarter. So, we're still kind of comfortable with that $50 to $100 million dollar number. We we certainly always want to outperform, but we are up $50. I mean that that's going to be good for the averages for the quarter, but what happens later in the quarter as far as paydowns, it's just harder to predict.

Yeah, I echoed the same thing, again, I just TRY to keep the long vision as we're very consistent in year after year. Whenever you sum it all up at the end of the year where we kind of meet what our projections are, but the volatility, gets very lumpy for us on it. So it's just hard to tell year in, it could even make a difference whether some loans get, pushed into this year versus next year. Just everything happening with the noise and the economy, it's just really hard to predict. But what I will say is I feel really good about the loan pipelines and the quality of customers that we're seeing and a lot of disruption that's happening in our markets we're benefiting from. We're just able to start seeing some of these clients that are Really good quality clients. We always talk about punching above our weight class and that we're getting to see and you know we remain a talent magnet and so even, this last few months we've picked up a couple of bankers that are really people we're proud of that we didn't think we'd be able to get and they're going to offer. He, with that funding part of it and the client acquisition. So I just think we're poised in a great position. I don't want to overpromise and overcommit, and there's going to be some prizes where sometimes we may be more than what we think on a quarter, but then there's times where we're going to have some paydowns and be a little less. But overall we feel like we're right on target with where we're trying to go.

Great, thanks for taking my questions.

Thank you.

Our next question comes from Woody Ley with KBW.

Hey, good morning guys Morning Woody.

Wanted to start on the expected EPS accretion of the deal. I is that based on consensus estimates or internal projections because I mean just based on the quarter it would seem like consensus is a little low.

Yeah, Woody, it is based on consensus. I mean, we've talked about that a lot internally. I mean, the hard thing is to know exactly what number to use. I mean, certainly we think that number is going to change over the next week or so as people saw our current earnings and. You know that that will reduce the accretion a little bit, but we don't think it's going to be material.

And further, if I can add on to this, the reason why we feel like it's going to be more accretive than even what we we announced it because we didn't include any synergies. We're being so conservative on this.

There are a lot of things, just to give you an example of a few where we think, are going to fall to our benefit. For instance, we have one branch that overlaps with theirs, and eventually that one of those branches is going to get, eliminated and we're going to get some cost saved for that. They view us as a platform to where they can do more with what they have. So as John and I were talking about send some emails around this morning is we have, more than our fair share of derivative income, and they don't do derivatives at all. So we're giving them tools on the treasury side, on the loan side that we didn't bank in as far as synergies into this deal that are going to be pretty meaningful with this, so. No matter what the numbers are, whenever we talk about, the the accretion side, there's a lot that we feel very comfortable, of a buffer or padding that we have on the expense side or the increase in revenue that we're going to be able to get from this transaction to where hands down, we think this is going to be very good for us, and not just because of that, because we think the market. Is a very attractive market that's going to enhance our footprint and our value in the overall franchise.

Alright, I appreciate the color there, maybe just given, you're going to be busy with the integration over the next couple quarters. How do you think about the near term securitization strategy and then longer-term just with a bigger balance sheet does this open the door for additional flexibility on the securitization front?

Yeah, it does. What a good question. I checked with the team earlier this morning and we are looking at a 3rd securitization. It's probably not going to be a this year transaction and, as always, these tend to be customer dependent, but we do think at this point it'll be likely that that we would do a similar securitization in the 1st quarter next year.

Got it, and then just last for me, you're now at, pro forma, you'll be at 6 billion, but you, you're continue to be a strong, organic grower just with, 10 billion, that threshold, do you see any expense investments that need to be made as you sort of approach the 10 billion mark?

Well, to be H1st with you, I think it's kind of already baked in. I mean, I think our the examiners know that we've grown fast and they're kind of expect us to incrementally, build on all of our controls and you know what we're trying to do is be smart about it and and build a lot more systems and controls instead of just adding people as we continue to grow. I think we're a long way away from 10 billion, but the expectations are always is that you start, putting that in place, and I think that's just normal. Management and normal processes for us to think about that and continue and I think it's healthy for the bank to be in a position where, we have strong controls and reporting in place, period.

So I don't think it's going to be a factor where on the P&L that we're going to see some sort of impact as we continue to grow because I think we're doing it along the way.

Got it well I appreciate you answering my questions and congrats on the deal.

Thank you very much.

We'll go next to Michael Rose with Raymond James.

Hey, good morning, guys. Thanks for taking my questions. Wanted to just start on the fee side. Another really good quarter you guys have had some really good momentum here, but I was the service charge line up, fairly meaningfully quarter on quarter. I assume some of it's seasonal just given what we saw last quarter, but we just love any updated thoughts on fee income.

Basically, and some of the ongoing efforts that you've talked about, Bert over the past year or two, thanks.

Yeah, fees have certainly been a bright spot. Remember, we converted to FIS back in, I guess it was June, and you know there's better, bigger products. I mean it gives us more opportunity to sell things that we weren't before, so we think on both the Treasury side and the loan side that.

Well, I know for this quarter, I mean that that's where a lot of it came from, but going forward, I mean.

We're not going to see the same kind of growth quarter over quarter. I mean this was a particularly good quarter, but we're pretty confident that that our our fee income initiatives will, continue working out and, better treasury products and, happier customers and it's it's just all turning out well.

But probably safe to assume we see a little bit of a step down in the 4th quarter just given some of the seasonal aspects. Is that fair?

Correct, flat to down a little bit, yes.

Okay perfect and then you know as you guys talked about the long the long growth story continues to be very strong, what, what's the hiring effort look like at this point to kind of support that high single-digit growth aspect? It seems like every bank, that I talked to out there is looking to hire, folks and just wanted to see, what your guys' plans are and and what the expense bill could be, kind of related to that. Thanks.

Yeah, I think it's the same story we've talked about for like after we went public, obviously we went on a hiring spree and then I started talking about the fact that we're going to be very surgical.

And once again, I mean, it's it's continued down the same path where I think we have become a talent magnet that and that we get a lot look at a lot of the talent that's in the market that's out there and certainly disruptions in the market do help us, but we sort of have our pipeline of people that we want, and I think it's going to be basically what we call this one-offs or surgical that we get, and these people are going to be highly productive, they probably come with just a small support team. And they're going to generate a lot of productivity for us. And so that's probably from what John talk, I talked about deploying resources and making sure we control the P&L. We're just getting the highest and best talent that's out there, so we get a return faster and indeed some of the people. To come on board. I mean, they may be profitable, after their first deal or two.

So I feel real good about where we are. We're not on a massive hiring spree like we did in the past, but we are start, we are still hiring, some bankers selectively. And they're just best in class folks and me and Audrey both are like, we want to make sure not only do they check, the bucket that or the box that they are good quality, but they're going to bring the right kind of credits that we want. And so we vet them very thoroughly and Man, this year's been exceptional. We've made a couple few hires that I'm just in 2026 are going to make a big impact for us.

That's great to hear and kudos to the success and ongoing momentum as we move forward. Maybe just one final one for me, I didn't necessarily think that a deal was was in the cards for you guys. I know the currency is a little bit depressed, but, glad to see the transaction, maybe, now for a form of 66 billion. If you can describe kind of, what additional deals at some point beyond this one makes sense and and specifically what would you kind of look for? I assume it look something like this in terms of size, but we just love, kind of a schematic of how we should think about M&A, for you guys. Thanks.

Yeah, I think it's the same thing we've been talking about, the first deal we did with Heritage, we called it the Unicorn because it was just such a great thing for us. It put us over a billion. It certainly helped us scale and efficiencies. It helped us with, our market presence. It doubled our branches, and the people that were there, a lot of them have become very valuable members for us in in leadership roles, and I viewed the same thing that's. Going to happen with with Keystone and that, Jeff, my counterpart there is a great banker, and they have, they're loaded with talent at that bank and quite frankly, they even surprised me at kind of the level of their customer base. I mean, in some ways they're kind of punching above their weight class too. And because of the cultural fit with it, I think we're going to get a lot of positives, even more than what I think, out of this merger. And but it sets the bar very high, right? So it's got to be financially rewarding for us, but it also has to be a great cultural fit. It's got to be the right, it's got to check a lot of boxes, and those deals are really hard to come by. So what I would say is that the bar for another deal is going to be pretty high. It's got to, it's going to make sense for us, and there's a lot of other things that has to happen. So we're going to continue to execute on. Organic story that we've been telling y'all about and we're opportunists. We'll look at a lot of deals and we'll see where we're at. I mean, John and I talked about, we looked at the deal earlier this year and we came in 3rd out of 3 on a bid process with it and we're okay with that. We're just going to be very disciplined about what we do next, with stuff and so, I think it's just more of the same.

Appreciate the call Bart. Thanks for taking my question guys.

Thank you.

And as a reminder, if you would like to ask a question, please press one on your telephone keypad.

And we'll go next to Matt Olney with Stevens.

Hey, thanks. Good morning. First question for John around the margin, you gave us the margin expectations for the 4th quarter.

Any more details you can provide as far as kind of what's what's behind that? I just assume it's more of a a normalized level of loan fees that you mentioned were elevated this quarter. Anything beyond that and then just other assumptions behind that with respect to. Interest rates and additional fed cuts and and just remind us where you are as far as your rates sensitivity. Thanks.

Yeah, if you look back at our margin over over time, we were kind of in the 370 to 380 range and and really jumped up when we did those securitizations and you know those were one time fees that you know we're we're obviously not forecasting going forward this quarter, I mean.

It it wasn't directly tied to those securitizations, but kind of the same concept of, loans paying off.

We booked a lot of loans this year that had a lot of fees that we capitalize. I think I said in my comments that our capitalized fees are now a record $19 million. So maybe I'm being a little conservative and saying $390 to $395 but that's That's still a pretty big jump from where we were just back in the first quarter. Now when I look at the margin on a monthly basis after the Fed cut rates, our margin did go up 1 basis point. So our cu is going to show that we're slightly asset sensitive, but I think we're going to outperform our assumptions. We pretty aggressively cut rates on all the deposit accounts that we could. And I think we have more to give if that makes sense, having a relatively low non-interest-bearing balance means that we can cut rates on a higher percentage of our total deposits. That's certainly what happened when when the Fed cut rates the first time. It's what happened when they cut rates last year. It's what I think will happen when they cut rates this next time and We've probably become a little bit less asset sensitive just because of the securities that that we've been purchasing. Our securities book is much bigger than it was a year ago, and I think that'll help in the rates down that we had pretty good timing on our investment purchases that our yield on that portfolio is 6%, and I think it's going to going to throw off a lot of income next year.

Okay, that's helpful, John. And then what you mentioned that curious portfolio. What remind us what portion of that's going to be, variable that we should consider with with down rates.

Yeah, so I guess it's close to 600 million. There's about 200 million of that that's a variable. Now one thing that's maybe a little hard to predict is we have had a lot of securities called recently, but we don't expect big changes in the in the portfolio.

Okay.

But basically what we haven't held the maturity mat so the the 206 million we haven't held the maturity, that's all floating rate and pretty much everything else is fixed.

Okay.

Thanks for thanks for that.

And and then you touched on some deposit, pricing competition, in your markets, anything else to add there and then same thing for loan pricing competition just appreciate anything that you're still in the market, more recently, thanks.

Yeah, we're.

We're feeling more confident about deposit growth than we have in quite some time, and this is going to be good core deposit growth where I think we're going to be able to start paying down some of our broker deposits and improve the cost of funds there a little bit and it.

We may not be talking about huge numbers, but saving 10 basis points on, 10s or hundreds of millions of dollars. I mean it can add up in a hurry, but that's kind of what I envision over the next couple of quarters. Remember in recent years we have one particular seasonal customer and seems like every year they send us more and more in deposits and.

Those funds we're kind of already seeing them out there on the horizon talking to the customer that that those will be coming and I think we'll let some of our brokerage roll off and replace it with those and again they're not cheap deposits, but they'll be a little less expensive than what we currently have. So that'll that'll be a little bit of a tail end of the margin.

Okay, well that's all for me congrats on the acquisition thanks guys.

And moving next to Dave Storms with Stonegate.

Morning and thank you for taking my money.

Just wanted to kind of ask too maybe around the merger, could you maybe talk a little bit more about your comfortability with your geographical footprint, and maybe get back to the last question, are there any MSAs that you would target to expand into now that you've really shored up your presence in Austin?

That's a really good question and something we think about as well. I think our our primary goal is to continue to build around the Texas triangle with that. And Austin, if you look at the market, if I'm correct, if you look at independent community banks, there was really only 2. Independent community banks over 500 million in assets. So we talk about scarcity value a lot with it. And in Austin is a prime example of that. It's, we're so lucky with Keystone to be able to get that because it gives us a foothold in that Austin market and gives us some assets there, which I think the markets that's growing that is, has a lot of opportunity for to go get some of these different customers from community to middle market side of it, especially as the other banks get bigger and there's more consolidation.

So that was kind of a rare opportunity that that worked. We would certainly look at our other markets, but we talked a little bit about being a talent magnet, and I think the market, finally seen that we're able to, acquire bankers that are just exceptional, that are working for much larger banks and, being that talent magnet certainly affords us to be able to grow organically, but I kind of think we're almost like a platform magnet for some of these other banks now. We give certain Banks the opportunity if they want to take it to the next step, we have the infrastructure, the technology, now the systems in place that if they're looking for a partnership with it, we offer a platform for them to continue to do what they want to do and grow a certain market. So some of this is about cultural fit and and about, a partnership that would make a difference for us and I hope we can continue in that Texas triangle with with all of it, but it could be adjacent to that or we're opportunists and look at things that add shareholder value. I mean, ultimately the way we look at it is what are we going to do that's going to, make this franchise more valuable so I don't know if you were. There, Dave, with it, there's a really good question that I think it's, I think we're proving up that we can be a very good partner for for other banks, and I'm not so sure that with the Keystone merger that that's not going to open up more phone calls to me about, banks that are have now have another, avenue.

Yeah, that's a great call.

Thank you for that. One more for me if I could just looking at some of, the view of the Keystone, credit profile, it looks like they do have, really high-quality credit profile, strong asset quality. Is there anything that they're doing that you can see that they're doing now, kind of before you get your hands on it, that you think could be mapped over to Third Coast and improve your underwriting, improve your asset quality, even further. Yeah, so what I would tell you is we really have a good customer base there that we're happy with, and Audrey and I are talking about we want to, we looked at the loans, we felt comfortable, but we also engaged Gateway to do a loan review and it came out really well, right, Audrey? I mean.

Gateway looked at 80% of their commercial loan portfolio and the results were very favorable, but you're correct, they have very strong asset quality.

So I think what it is again we layer the tools on top of what they're doing and I think we can get, more wallet share out of some of their large customers, give them some more products to go out there and compete with some of the bigger banks now, so I'm pretty excited about to see what they're able to do with our additional tools.

Perfect thanks for taking my questions.

Thank you I appreciate it.

This now concludes our question-and-answer session. I would like to turn the floor back to Bart Carraway for closing comments.

Thank you, Kerry, I appreciate that and thanks everybody for your interest in Third Coast Bank shares and we look forward to talking to you next quarter. Thank You.

Ladies and gentlemen, thank you for your participation. This does conclude today's teleconference. You may disconnect your lines and have a wonderful day.