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President & COO Len Devaisher detailed that the C&I growth was broad-based across the company's footprint, including Denver and the Twin Cities, with contributions from various industries like manufacturing. CEO Charles Reeves added that he expects the NIM to continue to "grind higher," driven by new loan originations, back-book repricing, and lower costs on time deposits.

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CEO Charles Reeves addressed the outlook, noting positive Q2 loan pipeline momentum but also customer caution for the second half of the year. President and COO Len Devaisher explained that wealth management growth is a mix of net new assets and fee initiatives, with market volatility being a headwind. Executive Barry Ray projected that the non-loan earning asset base, particularly securities, would likely trend down.

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CFO Barry Ray outlined the capital deployment waterfall, starting with supporting growth, followed by dividends, share repurchases, and M&A, noting the company is approaching its 11% CET1 target. Regarding the margin, Ray stated there is "more left in the tank," citing a higher core margin in December than the Q4 average. CEO Charles Reeves added that the repricing of the back-book loan portfolio will also contribute to future margin expansion.

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EVP and CFO Barry Ray explained that the balance sheet is now slightly more asset-sensitive following the repositioning and that a steepening yield curve would be beneficial for margin expansion. President and COO Len Devaisher attributed the wealth management fee variance to episodic revenue from the trust business and lumpy income from annuity sales. Devaisher also stated that both the Denver and Twin Cities markets present robust opportunities, with recent growth being driven by C&I lending in both locations.

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CFO Ian Whinnem projected the Q3 margin to be in the low-to-mid 3.50s (around 3.52-3.53%), expanding further in Q4, driven by repricing loans and paying down borrowings with new capital. EVP & Chief Lending Officer Charles Parcher noted that the competitive landscape is intensifying, with regional banks becoming more aggressive in the market.

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CEO Dennis Shaffer acknowledged the lighter-than-expected fee income, attributing it to typical first-quarter seasonality in mortgage and some choppiness in leasing, but expressed confidence in a Q2 rebound for both. CFO Ian Whinnem added that wealth management fees were impacted by market volatility affecting assets under management (AUM). Whinnem provided a specific breakdown: of the $600k gain on sale, 55% ($330k) was from mortgage ($19M volume) and 45% ($270k) was from leasing ($7.6M volume), noting a softer gain-on-sale margin for mortgages compared to the prior year.

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CEO Dennis Shaffer expressed optimism for leasing and wealth management fees, noting the latter is benefiting from over $800 million in assets under management. He identified residential mortgage gain-on-sale income as the primary variable for 2025. CFO Ian Whinnem provided the Q4 gain-on-sale breakdown, stating it was approximately 60% mortgage ($750,000) and 40% leasing ($510,000), with sold volumes of roughly $40 million and $12 million, respectively.

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President and CEO Dennis Shaffer explained that the $100 million in state deposits from the Ohio Homebuyer Plus program is the maximum amount and can remain for up to five years, though funds are returned as participants buy homes. SVP and Chief Lending Officer Chuck Parcher noted the favorable trade of paying a premium on ~$11 million in customer deposits to receive $100 million at just 89 basis points. Regarding expenses, SVP and CFO Ian Whinnem projected a relatively flat expense base for Q4, with normal merit increases and technology investments planned for 2025, while Dennis Shaffer suggested a budget around $28.4 million for Q4 is a reasonable estimate.

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CEO Thomas Prame explained that strong capital generation provides more optionality, including potential buybacks, and noted the company has improved its position organically without dilutive actions seen elsewhere. Chief Commercial Banking Officer Lynn Kerber described the lending environment as competitive on pricing, with the team successfully managing spreads and remaining focused on fundamental underwriting.

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Executive Thomas Prame stated that while the company has multiple options for capital deployment, including dividends and M&A, share buybacks are currently viewed as attractive given the stock's price-to-book value. EVP & CFO John Stewart clarified that the average earning asset base would likely be slightly lower than the end-of-period assets and down from the previous year's average of $7.3 billion due to deleveraging activities.

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Lynn Kerber, EVP and Chief Commercial Banking Officer, explained that the company will maintain its mid-to-high single-digit growth cadence in core commercial lending, bolstered by the equipment finance division established in 2024. Executive Thomas Prame added that growth is supported by thriving markets in Indiana and Michigan and strong local talent. Regarding capital, John Stewart, EVP and CFO, confirmed that building capital offers more flexibility and that stock buybacks are a key option, noting a current authorization for 1.1 million shares.

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John Stewart, EVP and CFO, outlined several factors that will favorably impact the 2025 NIM, including continued earning asset mix changes, modest benefits from anticipated rate cuts, and the redeployment of cash from recent security sales. He also noted a mathematical lift to the margin in Q2 2025 from the paydown of FHLB borrowings. Mr. Stewart did not have the HTM portfolio's fair value figure immediately available.

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EVP Joel Rahn described the economies in West Michigan and Metro Detroit as stable, with manufacturing holding up well. He noted that market share gains continue to come from larger banks, particularly in commercial real estate where competitors are more cautious. President & CEO William Kessel added that organic growth remains the primary focus, but the bank is open to 'intelligent acquired growth' that aligns with its culture, geography, and financial criteria.

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EVP and CFO Gavin Mohr indicated that the provision for credit losses offers the most potential for outperformance and noted the bank's income statement is well-insulated from interest rate changes. Regarding mortgages, Mohr stated the team is targeting a 2.50% gain on sale margin, but overall production remains constrained by housing supply. CEO William Kessel added that the balance sheet is positioned to perform consistently whether the Fed holds rates or cuts them multiple times.

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President and CEO William Kessel and EVP, Head of Commercial Banking Joel Rahn confirmed a continued focus on recruiting experienced bankers, leveraging market disruption to add a 'handful' of new talent in 2025. EVP and CFO Gavin Mohr stated that margin expansion is expected to be 'ratable' throughout the year, targeting a 20-25 basis point increase over 2024. He clarified that in a no-rate-cut scenario, the margin would be 3-5 basis points lower than the current forecast.

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EVP and CFO Gavin Mohr stated that while mortgage margins are expected to remain stable, production volume may face headwinds from seasonality and limited housing supply. President and CEO William Kessel added context on customer rate expectations. Regarding the balance sheet, Mr. Mohr anticipates continued net interest margin expansion, driven by asset repricing and liability management, noting the bank's forward-looking model already projects a higher margin.

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EVP & CFO Lynn Hopkins stated that the stock is attractive and the modest buyback is manageable alongside credit workout efforts, given sufficient capital and liquidity. EVP & Chief Credit Officer Jeffrey Yeh explained that special mention downgrades were part of an enhanced credit control process for bridge loans that remain current. President & CEO Johnny Lee affirmed the bank can sustain its dual path of managing nonperforming loans while pursuing healthy, selective loan growth.

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Lynn Hopkins acknowledged that a share buyback is a favorable use of capital and the company hopes to announce a plan soon. She clarified that the FHLB repricing was fully reflected in the March net interest margin and quantified the potential income gain from resolving nonaccrual loans, noting that returning $20 million to accrual status could add approximately $1.2 million in annual interest income.

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EVP & CFO Lynn Hopkins explained that the C&D loan project is over 50% complete and that the bank has taken a $4.5 million specific reserve against it. She also confirmed RBB's interest in a new stock buyback program in 2025 after addressing the immediate credit concerns.

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Executive Lynn Hopkins explained that as a liability-sensitive bank, RBB's NIM expansion will be driven by the repricing of its CD portfolio, with $800 million at an average rate just under 5% set to reprice next quarter. She suggested the quarter-end deposit spot rate of 3.53% is a good indicator of the minimum potential improvement. Regarding loan sales, Lynn Hopkins and executive Johnny Lee noted that SBA loan premiums have been stable at 8-9%, but margins on mortgage banking products remain thin due to competition.

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EVP & CFO David Stoehr confirmed this interpretation, explaining that the 'macro uncertainty' overlay, which includes factors like market volatility, decreased from approximately $36 million to the low $20 million range. This was largely offset by a slight worsening in the baseline macroeconomic forecast, resulting in a relatively stable provision.

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Executive Timothy Crane and CFO David Dykstra explained the new swaps were to maintain a total hedge position of around $6 billion to stabilize the margin against a potential down-rate environment in 2026 and 2027. Executive Richard Murphy attributed the P&C loss increase to a timing issue with two problematic loans and expects a recovery. Management added that blended new loan yields for the business are in the high 6s.

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President and CEO Raymond Reitsma explained the loan growth forecast was adjusted because the commercial pipeline, while large, has shifted more toward discussions rather than committed deals due to economic uncertainty. EVP and CFO Charles Christmas added that while share buybacks are considered, the primary focus is on preserving capital for future asset growth and navigating potential economic slowdowns.

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President and CEO Raymond Reitsma attributed the deposit growth to a focused strategy on new client acquisition and tapping into deposit-rich opportunities, especially in business banking. EVP and CFO Chuck Christmas added that the rise in noninterest-bearing deposits was largely due to seasonal factors, with businesses building cash for year-end payments. He confirmed that deposit pricing for money market and CD products promptly decreased by about 50 basis points, in line with the market. Regarding excess funds, Christmas stated the bank aims to reduce wholesale borrowings as they mature, though some are kept for match-funding fixed-rate loans.

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Tyler Wilcox, President, responded that while Q1 is traditionally a softer quarter, the Q2 pipeline looks strong. He acknowledged the uncertainty from tariffs but highlighted continued optimism in their core small business market. Mr. Wilcox noted that despite low national consumer confidence, they saw record indirect lending production in March. He also mentioned that adding new talent is a tailwind for loan growth, leading them to reiterate their 4% to 6% guidance for the year.

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Executive Tyler Wilcox attributed the loan growth variance to strong December production timing. CFO Kathryn Bailey stated the company is proactively managing deposit costs ahead of anticipated Fed rate cuts. Tyler Wilcox confirmed that asset quality outside of leasing remains strong, with low commercial charge-offs and improving trends in the consumer indirect portfolio.

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CFO Kathryn Bailey clarified that expense growth is anticipated to be in the 2-4% range, with revenue growth driven by loan balances and meaningful fee income growth from mortgage, wealth management, and insurance. Executive Tyler Wilcox added that M&A conversations have 'significantly increased' and the bank's strategy has sharpened its focus towards patiently seeking a single, larger deal to cross the $10 billion asset threshold.

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An executive, likely Mark Sander, explained that production pipelines remain strong and that a return to normal paydown levels would be sufficient to achieve the 4% to 6% growth target. Another executive, likely John Moran, stated that non-loan earning assets are expected to be 'pretty flat,' with no plans to actively grow the securities book.

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CFO John Moran stated that the NIM is likely bottoming in Q3/Q4 2024 and has an upward bias for 2025, aided by a deinverting yield curve. Chairman and CEO James Ryan addressed credit, stating the higher charge-offs represent a 'normalization of credit' and remain well within the company's full-year guidance.

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