Trustmark Corp (TRMK) 2025 Q2 法說會逐字稿

Good morning, ladies and gentlemen, and welcome to Trustmark Corporation's second quarter earnings conference call. (Operator Instructions) As a reminder, this call is being recorded.

女士們、先生們，早安，歡迎參加 Trustmark Corporation 第二季收益電話會議。（操作員指示）提醒一下，此通話正在被錄音。

It is now my pleasure to introduce Mr. Joey Rein, Director of Corporate Strategy at Trustmark.

現在我很高興介紹 Trustmark 企業策略總監 Joey Rein 先生。

Good morning. I'd like to remind everyone that a copy of our second quarter earnings release and the slide presentation that we'll be discussing this morning is available on the Investor Relations section of our website at trustmark.com.

早安.我想提醒大家，我們第二季財報和我們今天早上要討論的幻燈片簡報的副本可以在我們網站 trustmark.com 的投資者關係部分找到。

During our call, management may make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We would like to caution you that these forward-looking statements may differ materially from actual results due to a number of risks and uncertainties, which are outlined in our earnings release and our other filings with the Securities and Exchange Commission.

在電話會議期間，管理階層可能會根據 1995 年《私人證券訴訟改革法案》做出前瞻性陳述。我們想提醒您，由於一些風險和不確定因素，這些前瞻性陳述可能與實際結果有重大差異，這些風險和不確定因素已在我們的收益報告和向美國證券交易委員會提交的其他文件中概述。

This time I'd like to introduce Duane Dewey, President and CEO of Trustmark.

這次我想介紹 Trustmark 總裁兼執行長 Duane Dewey。

Thank you, Joey, and good morning, everyone. Thank you for joining us this morning. With me are Tom Owens, our Chief Financial Officer; Barry Harvey, our Chief Credit and Operations Officer; and Tom Chambers, our Chief Accounting Officer.

謝謝你，喬伊，大家早安。感謝您今天上午加入我們。和我一起的還有我們的財務長湯姆歐文斯 (Tom Owens)、我們的首席信貸和營運官巴里哈維 (Barry Harvey) 以及我們的首席會計官湯姆錢伯斯 (Tom Chambers)。

We continue to build momentum in the second quarter as Trustmark's profitability metrics expanded fueled by loan and deposit growth, solid credit quality, diversified fee income, and disciplined expense management. In our presentation this morning, I will provide a summary of our performance, discuss our forward guidance, and then move to questions. This will reduce the time spent on our comments and allow more time for your questions.

隨著 Trustmark 獲利指標在貸款和存款成長、穩健的信貸品質、多元化的費用收入和嚴格的費用管理的推動下不斷擴大，我們在第二季度繼續保持成長勢頭。在今天上午的演講中，我將總結我們的業績，討論我們的前瞻性指引，然後回答問題。這將減少我們花在評論上的時間，並有更多的時間來回答您的問題。

Now turning to slide 3, the financial highlights. From the balance sheet perspective, loans held for investment increased $223 million or 1.7% linked quarter and $374.8 million or 2.9% year-to-date. Our linked quarter growth is diversified with one to four family mortgage loans, other loans and leases, and commercial and industrial loans leading the way.

現在翻到幻燈片 3，財務亮點。從資產負債表的角度來看，投資貸款季增 2.23 億美元，增幅 1.7%，年初至今增加 3.748 億美元，增幅 2.9%。我們的季度環比成長呈現多樣化，其中一至四戶家庭抵押貸款、其他貸款和租賃以及商業和工業貸款佔據主導地位。

Our deposit base grew $35 million during the quarter as growth in noninterest-bearing deposits was offset in part by a decline in interest bearing deposits. Personal and commercial deposits totalled $13 billion at June 30, an increase of $103.8 million or 0.8% from the prior quarter. Our cost of total deposits in the second quarter was 1.8%, a decline of 3 basis points linked quarter.

本季我們的存款基礎增加了 3,500 萬美元，因為無息存款的成長部分被有息存款的下降所抵消。截至 6 月 30 日，個人和商業存款總額為 130 億美元，較上一季增加 1.038 億美元，增幅 0.8%。我們第二季的總存款成本為1.8%，較上季下降3個基點。

Trustmark reported net income in the second quarter of $55.8 million, representing fully diluted EPS of $0.92 a share, up 4.5% from the prior quarter. This level of earnings resulted in a return on average assets of 1.21% and a return on average tangible equity of 13.13% in the second quarter.

Trustmark 公佈第二季淨收入為 5,580 萬美元，相當於每股攤薄收益 0.92 美元，較上一季成長 4.5%。這一獲利水準導致第二季平均資產回報率達到 1.21%，平均有形權益回報率達到 13.13%。

Net interest income expanded 4.3% to $161.4 million, which produced a net interest margin of 3.81%, an increase of 6 basis points from the prior quarter. Noninterest totalled $39.9 million, excluding the gain on a sale of a bank facility in the first quarter and a net loss on the sale of bank facilities in the second quarter, noninterest income was unchanged length quarter.

淨利息收入成長 4.3% 至 1.614 億美元，淨利差為 3.81%，較上一季增加 6 個基點。非利息收入總計 3,990 萬美元，不包括第一季出售銀行貸款的收益和第二季出售銀行貸款的淨損失，非利息收入本季保持不變。

Disciplined expense management continues to be a priority. Noninterest expense increased $1.1 million or 0.9% linked quarter, which follows a full year decline in 2024, as well as a decline in the first quarter of 2025. Salaries and employee benefits and equipment expenses were lowered linked quarter, while services and fees increased, reflecting higher professional fees.

嚴格的費用管理仍然是首要任務。非利息支出較上季增加 110 萬美元，增幅 0.9%，此前 2024 年全年及 2025 年第一季均出現下降。薪資和員工福利以及設備費用與上一季相比有所下降，而服務和費用則有所增加，反映出專業費用的增加。

Credit quality remains solid with some improvement. Nonperforming assets declined $5 million or 5.3% link quarter. Net charge-offs were $4.1 million including three individually analysed credits totaling $2.7 million, which were reserved for in prior periods. Net charge offs represented 12 basis points of average loans in the second quarter. The net provision for credit losses was $4.7 million and the allowance for credit losses represented 1.25% of loans held for investment. Again, very solid performance.

信貸品質保持穩健並有所改善。不良資產季減 500 萬美元，降幅 5.3%。淨沖銷金額為 410 萬美元，其中包括三項單獨分析的貸項，總額為 270 萬美元，這些貸項是為前期預留的。淨沖銷額佔第二季平均貸款的 12 個基點。信貸損失淨撥備為 470 萬美元，信貸損失準備金佔投資貸款的 1.25%。再次，表現非常穩健。

From a capital management perspective, each of our capital ratios increased during the quarter. The CET1 ratio expanded 7 basis points to 11.7%, while our total risk-based capital ratio increased 5 basis points to 14.15%. During the quarter, we repurchased $11 million of Trustmark common stock. In the first six months of the year, we have repurchased $26 million of common stock. We have a remaining $74 million in repurchase authority for the year. This program continues to be subject to market conditions and management discretion.

從資本管理的角度來看，本季我們各項資本比率均有所增加。普通股權一級資本充足率提高 7 個基點至 11.7%，總風險資本充足率提高 5 個基點至 14.15%。本季度，我們回購了價值 1,100 萬美元的 Trustmark 普通股。今年前六個月，我們回購了價值 2,600 萬美元的普通股。我們今年還擁有 7,400 萬美元的回購權。該計劃繼續受市場條件和管理層判斷的影響。

Tangible book value per share was $28.74 on June 30, up 3.5% linked quarter and 13.9% year over year. The Board also declared a quarterly cash dividend of $0.24 per share payable September 15 to shareholders of record on September 1.

6 月 30 日，每股有形帳面價值為 28.74 美元，季增 3.5%，年增 13.9%。董事會也宣布，將於 9 月 15 日向 9 月 1 日登記在冊的股東派發每股 0.24 美元的季度現金股利。

Now let's focus on our forward-looking guidance for the year which is on page 15 of the deck. As you can see, we are making positive revisions and affirming our previously provided full year 2025 expectations in all other areas. Although we are monitoring the impact of tariffs and other administrative policies on our customer base, interest rates, and credit-related issues, the situation continues to evolve, and we've not seen a significant impact at this point.

現在讓我們專注在本年度的前瞻性指引，它位於第 15 頁。如您所見，我們正在對所有其他領域做出積極的修正，並確認我們先前提供的 2025 年全年預期。儘管我們正在監控關稅和其他行政政策對我們的客戶群、利率和信貸相關問題的影響，但情況仍在不斷發展，目前我們還沒有看到重大影響。

We expect loans held for investment to increase mid-single digits for the full year. This is revised upward from our previous guidance of low-single digit growth. We affirm our guidance of low single-digit growth in deposits excluding brokered deposits for the full year '25. There is no change in guidance regarding securities as they are expected to remain stable as we continue to reinvest cash flows.

我們預計全年投資貸款將成長中等個位數。這比我們之前預測的低個位數成長有所上調。我們確認，25 年全年存款（不包括經紀存款）將實現低個位數成長。關於證券的指導沒有變化，因為隨著我們繼續再投資現金流，預計證券將保持穩定。

We've tightened our anticipated range of net interest margins for a full year 2025. The range is now 3.77% to 3.83% for the full year compared to our prior guidance of 3.75% to 3.85%. We've revised our expectations for net interest income to increase high single digits in 2025. Our previous guidance was an increase of mid to high single digits.

我們已收緊 2025 年全年淨利差預期範圍。目前全年範圍為 3.77% 至 3.83%，而我們先前的預測為 3.75% 至 3.85%。我們已將淨利息收入的預期修改為 2025 年實現高個位數成長。我們之前的預期是成長中高個位數。

From a credit perspective, the provision for credit losses, including unfunded commitments, is expected to continue to trend lower when compared to full year '24. This is a positive revision from our previous guidance for the provision to remain stable. There's no change in our non-interest income and non-interest expense guidance for the full year 2025.

從信貸角度來看，與 24 年全年相比，信貸損失準備金（包括未撥付承諾）預計將繼續呈下降趨勢。這是對我們先前保持準備金穩定的指導的積極修正。我們對 2025 年全年的非利息收入和非利息支出的預期沒有變化。

We will continue our disciplined approach to capital deployment with a preference for organic lung growth, potential market expansion, and M&A or other general corporate purposes depending on market conditions. As noted earlier, we do have remaining availability in our Board authorized share repurchase program that will consider opportunistically.

我們將繼續採取嚴謹的資本配置方式，優先考慮肺部有機成長、潛在市場擴張以及併購或其他一般公司用途，具體取決於市場情況。如前所述，董事會授權的股票回購計畫中確實還有剩餘，我們會適時考慮。

So with that summary and overview, I'd like to open the floor up to questions.

有了上述總結和概述，我想開始回答大家的提問。

(Operator Instructions)

（操作員指示）

Catherine Mealor, KBW.

凱瑟琳·米勒（Catherine Mealor），KBW。

Good morning, everyone. It was nice to see the increase in your growth guide back up to the mid-single digit. Can you talk a little bit about what's driving that? Is it more or less pp that you're seeing less paydowns or better origination growth?

大家早安。很高興看到您的成長指南增幅回升至中個位數。您能否稍微談談推動這現象的原因？您看到的還款減少或發起額成長更好，這是否或多或少與 pp 有關？

Catherine, this is Barry. It's a combination of things. Our production really in Q4 and the first half of this year in non-CRE categories has been very good. And so we're seeing more activity in those non-CRE categories. Within CRE we're seeing good solid production, good solid funding like we have historically.

凱瑟琳，這是巴里。這是多種因素的綜合。我們今年第四季和上半年在非 CRE 類別的產量確實非常好。因此，我們看到非 CRE 類別的活動越來越多。在 CRE 內部，我們看到了良好且穩健的生產和資金，就像我們過去看到的那樣。

And then to your other point, as it relates to delays and payoffs, we looked this quarter at the first half of the year at what was scheduled maturities for our CRE book and about 50%-plus of the scheduled maturities pushed out.

然後關於您的另一點，因為它與延遲和收益有關，我們在本季上半年查看了我們的 CRE 帳簿的預定到期日，發現約有 50％ 以上的預定到期日被推遲。

For the first half of the year, they either pushed out to the second half of this year or they pushed out into ‘26 and ‘27 with extensions. And so we are seeing that occur, and We're pleased to see that because it helps things be able to be smoothed out a little bit, but also I think it's very important to note that in non-CRE categories we are seeing good growth that we may not have always seen previously to the same extent we are now. So that's very encouraging.

對於上半年，他們要么將其推遲到今年下半年，要么將其推遲到 2026 年和 2027 年。我們看到這種情況正在發生，我們很高興看到這種情況，因為它有助於使事情稍微平穩一些，但我認為值得注意的是，在非 CRE 類別中，我們看到了良好的增長，這種增長以前可能並不總是像現在這樣。這非常令人鼓舞。

Great. And maybe just back a bigger picture question. Your profitability has continued to move higher really throughout the past -- over the past 1.5 years, and you're not a 12% ROA, 13% ROTCE. Any thoughts on just, goals or where you think that's going to? It's a lot of that's been just from margin expansion. So maybe that's kind of a margin question, if you think there's more margin expansion within that. But just curious if you think there's still profitability improvement ahead for us? Thanks.

偉大的。也許只是回顧一個更大的問題。在過去的 1.5 年裡，您的獲利能力確實持續走高，而且您的 ROA 和 ROTCE 都不是 12%。對於目標或未來發展方向您有何看法？其中很大一部分只是來自利潤率的擴大。因此，如果您認為其中的利潤率還會進一步擴大，那麼這也許就是一個利潤率問題。但我只是好奇您是否認為我們的獲利能力還有提升的空間？謝謝。

So Catherine, this is Tom Owens. I'll start. I think that yes, there is upside going forward in terms of profitability. I think the combination of continuing to drive operating leverage, growing balance sheet. I think the potential for some continued NIM expansion going forward will continue to drive higher ROA.

凱瑟琳，這是湯姆歐文斯。我先開始。我認為，是的，從獲利能力來看，未來還有上升空間。我認為，繼續推動營運槓桿和不斷增長的資產負債表是兩個因素的結合。我認為未來 NIM 持續擴張的潛力將繼續推動 ROA 上升。

The question in terms of ROTCE, I think it's very much going to be a function of how we manage capital. We've been very pleased with the capital story. Our higher run rate profitability has allowed us to support, pretty solid loan growth at the same time that we're deploying capital via repurchase while simultaneously continuing to drive pretty meaningful linked quarter accretion in our capital ratios.

關於 ROTCE 的問題，我認為它很大程度上取決於我們如何管理資本。我們對資本故事感到非常滿意。我們較高的運行率獲利能力使我們能夠支持相當穩健的貸款成長，同時我們透過回購部署資本，同時繼續推動我們的資本比率在季度內實現相當有意義的成長。

And so I think it's reasonable to assume that we'll continue in this range of $10 million to $15 million a quarter in terms of share repurchase here in '25. I think as those capital ratios continue to accrete as we get into '26 that's sort of a headwind to return on tangible common equity, right, the build in capital.

因此，我認為，我們可以合理地假設，25 年我們的股票回購金額將繼續保持在每季 1,000 萬至 1,500 萬美元的範圍內。我認為，隨著我們進入 26 年，這些資本比率將繼續增加，這對有形普通股權益的回報，即資本的積累，是一種阻力。

And so you know we talk about the strategic optionality that we have now with the very favourable circumstances that we find ourselves in. And so we're going to have some important strategic decisions to make going forward in terms of how we manage capital.

所以你知道，我們談論的是我們現在所處的非常有利的環境下所擁有的戰略選擇性。因此，在如何管理資本方面，我們將做出一些重要的策略決策。

Hey Catherine, and I'll add -- this Duane. And we can't forget back -- looking back 18 months, our Fit to Grow initiatives and all the focus on some restructuring, the focus on expense management and expense control, and you think of a 2024 actual decline in expenses first half looks really solid. We do have some things that are happening in the second quarter merit increases and the like in the second quarter -- or the second half of the year. But the diligent expense focus has been paying dividends as well, so the combination results are pretty telling.

嘿，凱瑟琳，我要補充一下──這是杜安。我們不能忘記——回顧 18 個月，我們的「適合成長」計畫以及對一些重組、對費用管理和費用控制的所有關注，你會想到 2024 年上半年費用的實際下降看起來非常穩固。我們在第二季或下半年確實發生了一些事情，例如加薪等等。但勤勉的開支重點也得到了回報，因此綜合結果非常引人注目。

Yes, for sure. Okay, great, thank you for the color.

是的，當然。好的，太好了，謝謝你的顏色。

Tim Mitchell, Raymond James.

提姆米契爾、雷蒙詹姆斯。

Just wanted to start on the NIM guidance. And it's obviously (inaudible) But just curious --

只是想開始 NIM 指導。顯然（聽不清楚）但只是好奇--

Sorry, you're breaking . You're breaking up, we can't. We could make out your comments.

抱歉，你打破了。你要分手，我們不能分手。我們可以理解您的評論。

I'm sorry, can you hear me now?

抱歉，你現在聽得到我說話嗎？

Yes. Yes.

是的。是的。

Sorry about that. Just on the NIM and the NII outlook. Just curious any rate cut assumptions underlying that? And then within that, there's -- what would take you to the kind of the top end versus the lower end of the NIM range?

很抱歉。僅討論 NIM 和 NII 前景。只是好奇這背後是否有任何降息假設？然後在其中，什麼會將您帶到 NIM 範圍的頂端和底端？

Sure, this is Tom Owens. Thanks for the question. So in our baseline forecast, which reflects market implied forwards, we do have a Fed rate cut in September and December of this year. So the December one won't be so impactful on that interest margin this year. And it remains to be seen obviously whether the Fed does cut in September or not. I mean, last I looked at Mark implied forwards, it's greater than a 50-50 probability, but certainly not a high probability yet at this point.

當然，這是湯姆歐文斯。謝謝你的提問。因此，在我們反映市場隱含遠期預測的基準預測中，Fed確實會在今年 9 月和 12 月降息。因此，12 月的利率對今年的利差影響不會太大。聯準會9月是否會降息顯然還有待觀察。我的意思是，上次我看了馬克暗示的未來走勢，它的機率大於 50%，但目前肯定還不是一個很高的機率。

We are slightly asset sensitive. And so to the extent that the Fed does not cut and you know we've talked on prior calls about the ongoing repricing, the tailwind we have the net interest margin from ongoing repricing of fixed rate loans and securities.

我們對資產稍微敏感一些。因此，在聯準會不降息的範圍內，你知道我們在先前的電話會議上談到了正在進行的重新定價，順風就是固定利率貸款和證券持續重新定價帶來的淨利差。

That is helpful that should continue to drive modest linked quarter increases in net interest margin and to the extent that the Fed does cut, obviously, we'd be reacting with deposit cuts to rates paid on deposits with the objective of defending our net interest margins. So we feel like we're in a good place in terms of the guidance that we've put out there really from the start of the year, and I think we're at 3.78% year-to-date and feel good about the guidance for the remainder of the year.

這很有幫助，應該會繼續推動淨利差與上一季同步溫和​​成長，而且如果聯準會真的降息，我們顯然會透過降低存款利率來應對，以維護我們的淨利差。因此，就我們今年年初發布的指導方針而言，我們感覺我們處於一個很好的位置，我認為今年迄今為止我們的增長率為 3.78%，並且對今年剩餘時間的指導方針感到滿意。

Okay, great. Just as a follow up, just curious your updated thoughts. Obviously, we've seen some more M&A activity here in the past couple of weeks, and a lot of banks talk about hiring and organic growth. Bringing on new lenders and such. So just kind of curious your thoughts on whether you favor one of those strategies or just kind of your thoughts on growing, through those means. Thanks.

好的，太好了。只是作為後續，只是好奇您的最新想法。顯然，過去幾週我們看到了更多的併購活動，許多銀行都在談論招募和有機成長。引入新的貸款人等等。所以我只是有點好奇您是否喜歡其中一種策略，或者只是您對透過這些方式實現成長的想法。謝謝。

This is Duane and I would say on both counts, yes, we are focusing on the growth markets that we serve currently, which we have a number when you look at markets like Houston, Texas, and Birmingham and Atlanta and South Alabama, Panhandle, Florida, and even in our home market of Jackson, Mississippi, we are very actively recruiting.

我是杜安，我想說，是的，我們專注於我們目前服務的成長市場，當你看到休士頓、德州、伯明罕、亞特蘭大、南阿拉巴馬州、佛羅裡達州狹長地帶，甚至在我們的本土市場密西西比州傑克森等市場時，我們有一個數字，我們正在非常積極地招募人才。

And looking for talent across the board. And so that's a key part of our strategic focus and as you know that generates organic growth. And then I would say yes, the M&A activity has increased fairly significantly. There are many, many different options and discussions happening across -- and not just at Trustmark, I assume across the overall industry, and we are interested, and we'll be very focused and conservative, I think, in our approach to M&A, but are very interested in participating.

並全面尋找人才。這是我們策略重點的關鍵部分，正如您所知，它可以實現有機成長。然後我會說是的，併購活動確實顯著增加。我認為，不僅僅是 Trustmark，整個行業都存在著許多不同的選擇和討論，我們對此很感興趣，而且我認為，我們將非常專注和保守地對待併購方式，但我們非常有興趣參與。

Okay, great, thanks for taking my questions.

好的，太好了，感謝您回答我的問題。

(Operator Instructions)

（操作員指示）

Christopher Marinac, Janney.

克里斯多福·馬裡納克，詹妮。

Thanks. Good morning. I want to follow up on the M&A question only from the perspective of as you have other acquisitions like what we saw in Texas last week. Does that change your kind of partner program with the preferred banks you partner with? Could that widen the lens as we see other changes around you?

謝謝。早安.我想從其他收購的角度來跟進併購問題，就像我們上週在德克薩斯州看到的那樣。這會改變您與首選合作銀行的合作計畫嗎？當我們看到周圍的其他變化時，這是否可以擴大我們的視野？

I don't know, Chris. I'm not sure it changes a whole lot. I mean, Texas is a very attractive market. We are active and have a presence in the Texas market. We both bank and have direct banking activities in Houston, but we also have a lot of other credit exposure, et cetera, throughout the state. That's a very attractive market to us and half our time and now probably are in the best position to consider optionality there.

我不知道，克里斯。我不確定它是否會發生很大的變化。我的意思是，德克薩斯州是一個非常有吸引力的市場。我們積極參與並在德克薩斯州市場佔有一席之地。我們在休士頓設有銀行並開展直接銀行業務，但我們在全州範圍內還有很多其他信貸業務等等。對我們來說，這是一個非常有吸引力的市場，我們一半的時間都花在那裡，現在可能處於最佳位置來考慮那裡的選擇權。

But that does not preclude us from looking at other parts of our contiguous markets and markets that are very significant high growth markets that present opportunity for us in all of our different lines of business. So I think across the Board Texas is very interesting, but the rest of our markets are equally interesting as well, so.

但這並不妨礙我們關注鄰近市場的其他部分以及非常重要的高成長市場，這些市場為我們所有不同的業務線提供了機會。所以我認為德州總體上非常有趣，但我們其他的市場也同樣有趣。

Okay, great, that's helpful, Duane. Thank you and just a quick credit question as it pertains to the kind of the positive revision we saw in the guide. Does that have any implications on the reserve or is it more just about the quarterly amounts from the provision expense?

好的，太好了，這很有幫助，杜安。謝謝，我只想問一個簡單的信用問題，因為它與我們在指南中看到的積極修訂類型有關。這對儲備金有什麼影響嗎？或者這僅僅與準備金費用的季度金額有關？

Chris, this is Barry. It was hard to hear your question, but were you asking specifically about the prevention for this quarter versus going forward?

克里斯，這是巴里。很難聽清楚您的問題，但是您具體問的是本季的預防情況還是未來的預防情況？

It was more about how the reserve and do you have changes in the big picture to reserve as a result of this small revision we saw? Is there any relief ahead as you look out to how the reserve is comprised?

這更多的是關於儲備的情況，我們看到的這個小修改是否對儲備的整體情況產生了影響？從您觀察儲備金的組成情況來看，未來是否有任何緩解？

Yeah. The reserve itself, we move -- this quarter we're 1.25% versus the 1.26% we saw in the previous quarter. From the provisioning standpoint, we expect the provisioning as we've guided to continue to be similar to what we've seen in the first half of this year from the standpoint of the reserve levels, we continue to see less in terms of unfunded commitments.

是的。儲備本身，我們調整了——本季為 1.25%，而上一季為 1.26%。從撥備的角度來看，我們預計撥備水準將繼續與今年上半年的水準相似，從儲備水準的角度來看，我們繼續看到未撥備承諾的減少。

That particular unfunded commitments is down for the year by $187 million and so that's reserving that we don't have to do on the contingent liability piece of the equation. We do continue to see meaningful reserves -- meaningful provisioning on the funded side of the provision expense. And so -- but I think what we see going forward from a guide perspective is similar to what we saw in the first half of the year and we're very pleased with that.

今年特定的未撥付承諾減少了 1.87 億美元，因此我們不需要對等式中的或有負債部分進行保留。我們確實繼續看到有意義的儲備——在撥備費用的資助方面有意義的撥備。所以——但我認為，從指導角度來看，我們看到的未來​​情況與我們今年上半年看到的情況類似，我們對此感到非常滿意。

I would say, Chris, as it relates to the provisioning for this quarter, we had good loan growth which required provisioning. We had some weakening economic factors that are baked into our quantitative forward forecasting models, but what really drove the provisioning down for this quarter, unlike previous quarters, was we did see a meaningful reduction in criticized loans, about $71 million. We also saw a meaningful reduction in classified loans, about $40 million.

我想說，克里斯，因為這與本季的撥備有關，我們的貸款成長良好，需要撥備。我們的定量前瞻性預測模型中已經考慮到了一些經濟疲軟的因素，但與前幾季不同，真正導致本季撥備下降的原因是，我們確實看到不良貸款大幅減少，約為 7,100 萬美元。我們也看到分類貸款大幅減少，約 4000 萬美元。

And when you see those reductions, those in and of themselves were very pleased with, but we're also pleased with the fact that we had about $75 million worth of non-pass credits upgraded to pass. And so that's the type of reduction in criticizing classified we'd like to see because, one, we've returned a problem credit back to a past category, but we've kept the outstanding balances, and we've kept good earning assets.

當你看到這些減少時，他們自己都會非常高興，但我們也很高興，因為我們有價值約 7500 萬美元的非通過學分升級為通過學分。這就是我們希望看到的分類批評的減少，因為首先，我們已將問題信貸退回到過去的類別，但我們保留了未償餘額，並且我們保留了良好的盈利資產。

So we're very pleased with reducing, criticizing classifiers however we have to, but our preference -- our strong preference is always to keep those balances and be able to return those credits to the past category. So this quarter, I think was very important for us because during 2024, we -- our criticizing classifieds grew like most banks did, especially those who are in the CRE business like we are due to the 550-basis point increase in interest rates that occurred over about an 18-month period that put a lot of pressure on CRE projects specifically.

因此，我們很高興能夠減少、批評分類器，但是我們必須這樣做，但我們的偏好——我們強烈的偏好始終是保持這些餘額，並能夠將這些信用返回到過去的類別。因此，我認為這個季度對我們來說非常重要，因為在 2024 年，我們的批評分類廣告像大多數銀行一樣成長，特別是那些像我們一樣從事 CRE 業務的銀行，因為在大約 18 個月的時間內利率增加了 550 個基點，這給 CRE 專案帶來了很大壓力。

But then during the first quarter we saw a levelling out of those increases in criticized and classified, and we were flat in those categories. This quarter we saw a meaningful reduction, as I mentioned, $71 million in criticized down $40 million in classified down, but yet able to upgrade $75 million from non-pass to pass and keep those earning assets, and that helps on the long growth side of the equation as well. So we're very pleased with what we saw and the provision is the provisioning and in the numbers the number.

但在第一季度，我們看到批評和分類的數量增長趨於平穩，這些類別的數量持平。本季我們看到了顯著的減少，正如我所提到的，批評性資產減少了 7,100 萬美元，分類資產減少了 4,000 萬美元，但仍能將 7,500 萬美元從未通過的資產升級為通過的資產，並保留這些盈利資產，這也有助於等式的長期增長。因此，我們對所看到的情況感到非常滿意，而且所提供的就是所提供的數字。

Having said that, we're very pleased with the reason why our provisioning was lower this quarter.

話雖如此，我們對本季撥備較低的原因感到非常高興。

Great there. That's really helpful background. Thank you for sharing all that, Tom, just a quick question for you on the tax rate. Is the tax rate still about this level that we saw in the past quarter?

太棒了。這確實是很有幫助的背景資訊。感謝您分享這些，湯姆，我只想問您一個關於稅率的簡單問題。稅率是否仍處於上一季的水平？

This is Tom Chambers. If you're looking at our year-to-date tax rate through the first six months, you're looking at an 18.4% effective tax rate and looking forward, we believe that, that's going to -- our year-end effective tax rate will be in that range of about, I'd say, 18.3% to 18.5%. Of course that's driven by pretax income, forecast pretax income. So I think we'll be in that level of range.

我是湯姆錢伯斯。如果您查看我們今年前六個月的稅率，您會看到實際稅率為 18.4%，展望未來，我們相信，我們的年終實際稅率將在 18.3% 至 18.5% 左右的範圍內。當然，這是由稅前收入和預測稅前收入所推動的。所以我認為我們會處於這個範圍內。

Great, thank you very much and thanks for hosting call this morning.

太好了，非常感謝您，也感謝您今天早上主持電話會議。

Feddie Strickland, Hovde Group.

費迪·斯特里克蘭，霍夫德集團。

Was just hoping you could talk through the drivers of rising nonintrest income. Is it better wealth revenues that's really the driver, potentially better mortgage or sort of all of the above?

只是希望您能談談非利息收入成長的驅動因素。真正的驅動力是更好的財富收入、潛在的更好的抵押貸款，還是以上所有因素？

I think it's -- this Duane. I think it's all the above. They're not dramatic impacts across each of the segments that you mentioned, wealth management, of course, wealth management is driven by the market increase in overall performance in the stock market side of the equation helps assets under management. It's a fee-based business. So that that is a positive.

我認為是－－這個杜安。我認為以上都是。它們不會對您提到的每個部分產生巨大影響，當然，財富管理是由市場整體表現的成長所驅動的，而股票市場方面的表現有助於管理資產。這是一項收費業務。這是積極的。

We have a significant brokerage business that likewise is impacted positively by improving financial markets. The other big change probably for us mortgage continues to show improvement across the Board. So not dramatic. It's not the historic levels at this point, but improvement over the last several quarters. So all of those things end up contributing to our non-interest income categories.

我們擁有重要的經紀業務，也受到金融市場改善的正面影響。對我們來說，另一個重大變化可能是抵押貸款繼續全面改善。所以並不引人注目。目前還沒有達到歷史水平，但比過去幾季有所改善。因此，所有這些最終都會對我們的非利息收入類別做出貢獻。

Understood, thanks for that. And then just go back to the M&A discussion, can you refresh it just on your rough criteria in terms of size, geography, and maybe earn back in terms of what you're looking for?

明白了，謝謝。然後回到併購討論，您能否根據規模、地理位置以及您所尋求的回報來重新審視您的粗略標準？

So historically, so we operate, of course, in the Southeast, Mississippi, Alabama, Panhandle, Florida. We have a loan production office in Atlanta. We have Western Tennessee and Houston, Texas, and so what we have typically guided and talked about is the fact contiguous markets to all of those different areas across the Southeastern US. We jumped Louisiana.

從歷史上看，我們的業務當然在東南部、密西西比州、阿拉巴馬州、狹長地帶和佛羅裡達州。我們在亞特蘭大設有一個貸款生產辦公室。我們有田納西州西部和德克薩斯州休斯頓，因此我們通常指導和談論的是美國東南部所有不同地區的相鄰市場。我們跳過了路易斯安那州。

Louisiana has interest. Arkansas is great market, very fast growing, especially Northern Arkansas. It's a very fast-growing market. Tennessee is a fast-growing market. Texas speaks for itself. Georgia, north part of Florida, all of that is attractive and historically we've talked about those markets as being opportunistic for us.

路易斯安那州對此很感興趣。阿肯色州是一個很大的市場，成長非常快，尤其是阿肯色州北部。這是一個成長非常快速的市場。田納西州是一個快速成長的市場。德州的情況不言而喻。喬治亞州、佛羅裡達州北部，所有這些都很有吸引力，從歷史上看，我們曾說過這些市場對我們來說是機會。

In terms of size, it depends on the opportunity, it seems like the $1billion to $5 billion range would be a good range. We haven't been active in M&A for a period of time and to move back in, it feels like that would be about the right range to consider. But we're also opportunistic on other situations that would be additive and help create shareholder value. And so it's -- and I would echo the comments I said a few minutes ago, it is that the amount of discussion and opportunity seems to be increasing in all of those different -- both geographically and size ranges.

就規模而言，這取決於機會，10 億美元到 50 億美元似乎是一個不錯的範圍。我們已經有一段時間沒有積極地進行併購了，現在重新開始，感覺這是一個值得考慮的正確範圍。但我們也會抓住其他機會，創造附加價值並幫助股東創造價值。因此 — — 我重複幾分鐘前所說的評論，在所有不同地區和規模範圍內，討論的數量和機會似乎都在增加。

Got it, that's helpful. Thanks for taking my questions.

明白了，很有幫助。感謝您回答我的問題。

Alright, thanks.

好的，謝謝。

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

我們的問答環節到此結束。我想將會議交還給 Duane Dewey 並請他做最後發言。

Thank you again for participating in our call this morning, and we look forward to continuing to build momentum here into the coming quarters and look forward to our next call at the end of October. Everybody has a great rest of the week.

再次感謝您參加我們今天上午的電話會議，我們期待在未來幾季繼續保持這一勢頭，並期待我們在 10 月底的下一次電話會議。祝大家本週剩餘時間過得愉快。

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

電話會議現已結束。感謝您參加今天的演講。您現在可以斷開連線。