Kyle Gierman

Kyle Gierman from Hovde Group asked for an update on the company's stance on share buybacks and the near-term outlook for repurchases. He also inquired about the yields achieved on recent securities purchases (CMOs and MBS) and the overall goals for the investment portfolio moving forward.

Answer

Neelesh Kalani, CFO, stated that the company continuously evaluates share buyback opportunities, with tangible book value being a key factor, but recent stock price levels haven't triggered repurchases. He confirmed that shares are still available for purchase and the company remains open to various capital allocation methods. Regarding securities purchases, Mr. Kalani reported an average yield of 4.92% on the CMOs and MBS. He emphasized that the investment portfolio serves as a liquidity source, a liquidity management tool, and a strong generator of earnings with efficient capital utilization, expecting continued benefits and stability at current levels.

Kyle Gierman with Hovde Group inquired about the company's current stance on share buybacks and the near-term outlook for repurchases, as well as the yields achieved on recent securities purchases (CMOs and MBS) and the overall goals for the investment portfolio.

Answer

CFO Neelesh Kalani stated that the company continuously evaluates share buyback opportunities, with tangible book value being a significant factor. He noted that the recent stock price hasn't positioned them for buybacks, but they are monitoring the situation and remain open to all capital allocation methods. Regarding the investment portfolio, Mr. Kalani reported an average yield of 4.92% on the recent CMO and MBS purchases. He reiterated that the investment portfolio serves as a liquidity source, a liquidity management tool, a strong generator of earnings, and utilizes capital efficiently, expecting continued activity and benefits from the portfolio going forward.

Kyle Gierman asked Northwest Bancshares for insights into the segments and geographic areas driving strong loan growth in Q4, and how the loan pipeline appears heading into the new year. He also requested information on the payoff and prepayment trends observed during the quarter.

Answer

CFO Doug Schosser indicated that the loan pipeline is very strong, with broad-based growth expected across national verticals and the bank's four-state footprint. He mentioned that tax changes, such as equipment expensing, are beneficial for the equipment finance business. Regarding payoffs and prepayments, Mr. Schosser stated that a significant source of paydowns came from managing criticized and classified assets, and that falling interest rates are leading some clients to refinance, but there were no particular unusual trends beyond normal business flows. He added that the bank's renewed focus post-merger will be helpful for business operations.

Kyle Gierman asked for an update on the company's current exposure levels to Non-Depository Financial Institutions (NDFIs) and their perspective on this sector, given recent scrutiny.

Answer

Curt Myers, CEO and Chairman, stated that the company has very low, de minimis levels of NDFI exposure. He clarified that the primary component within their NDFI disclosures consists of loans to non-rated community bank holding companies, structured as tier two sub-debt notes.

Kyle Gierman asked for an update on Fulton Financial's current exposure levels to Non-Bank Financial Institutions (NDFIs) and the company's perspective on this sector.

Answer

Curt Myers, CEO and Chairman, stated that the company has very low, de minimis levels of NDFI exposure. He clarified that the primary component within their NDFI disclosures consists of loans to community bank holding companies structured as non-rated debt issuances.

Kyle Gierman asked for more color on United Community Banks' core fee income and expectations for the next quarter.

Answer

EVP and CFO Jefferson Harralson explained that after excluding non-recurring items like a $1.5 million bulk gain, an $800,000 MSR write-up, and volatile unrealized equity gains, the remaining fee income represents a good core run rate for the bank.

Kyle Gierman asked for more color on the core fee income and expectations for the next quarter.

Answer

Jefferson Harralson, EVP and CFO, advised that to determine a good fee income run rate, one should exclude the $1.5 million bulk gain, the $800,000 MSR write-up, and the volatile unrealized equity gains mentioned on the fee page.