Dime Community Bancshares - Q3 2023

Transcript

Operator (participant)

Hello everyone, and welcome to the Dime Community Bancshares Third Quarter Earnings Call. Before we begin, the company would like to remind you that discussions during this call contain forward-looking statements made under the safe harbor provision of the U.S. Private Securities Litigation Reform Act of 1995. Such statements are subject to risks, uncertainties, and other factors that may cause actual results to differ materially from those contained in any such statements, including as set forth in today's press release and the company's filings with the U.S. Securities and Exchange Commission, to which we refer you. During this call, references will be made to non-GAAP financial measures as supplemental measures to review and assess operating performance.

These non-GAAP financial measures are not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. For information about these non-GAAP measures and for reconciliation to GAAP, please refer to today's earnings release. I will now hand over to your host, Stuart Lubow, President and CEO, to begin. Stuart, please go ahead when you're ready.

Stuart Lubow (President and CEO)

Good morning. Thank you, Carla, and thank you all for joining us this morning. I will first provide comments on key themes underlying our business. Avi will then provide additional details on the third quarter, and then we will open it up for questions. Dime continues to perform well in a year marked by the failure of three regional banks and unprecedented inverted yield curve and significant interest rate increases by the Fed. In the third quarter, we grew core deposits approximately $200 million. We reduced wholesale funding on our balance sheet, we increased our already strong risk-based capital, and we reduced our non-performing assets by 16%. As we have mentioned on our previous calls, we do not have any concentrations that got the failed banks and others in trouble.

These facts, coupled with our rock-solid bulletproof multifamily portfolio, which represents 38% of our overall loan portfolio, gives us confidence that we will outperform in any potential recessionary environment. For the record, we have no loans on our entire multifamily portfolio that are delinquent greater than 60 days, and the LTV on that portfolio is 58%. We continue to be vigilant and diligent around monitoring all parts of our loan portfolio. Overall, asset quality remains strong, with NPAs and 90 days past due declining to only 17 basis points. As you would expect, we continue to closely monitor our investor office portfolio. As of September thirtieth, we have no delinquencies greater than 60 days in the investor office portfolio.

In fact, we only have one loan over 30 days at 9/30, which was only $1.9 million and had an LTV less than 50%. We provide some additional disclosures on this portfolio as it relates to properties and geography in our recent investor presentation. Our Manhattan investor office portfolio is only $200 million, or less than 1.5% of total assets. The LTV on our Manhattan office portfolio is 50%. We are comfortable with the exposure, and the operators of our office portfolio are very strong. Notably, we do not have significant amount of repricing or maturing office loans for the remainder of 2023 or 2024. Repricing and maturing office loans for the remainder of 2023 is only $20 million, and for 2024, only $39 million.

We are cognizant of the challenging revenue environment and continue to manage expenses prudently. Our focus is on being as efficient as possible. Core expenses, which included a full quarter's impact over private banking group hires, were down on a linked quarter basis. There are a number of projects that we are working on that will result in expense containment for future years. For example, we recently outsourced our data center. Importantly, on a linked quarter basis, our non-interest-bearing deposits increased.

This marks the first increase since the current rate tightening cycle began and portends well for our future earnings potential. Avi will provide more details on the margin in his remarks. Dime has been very active on the hiring front in 2023, and the third quarter was no different. We were able to recruit a high caliber banker to lead our healthcare vertical. We continue to spend a meaningful amount of time on the recruiting front and believe we have the potential to add more talented bankers in the future.

We do believe there will be some more fallout from larger local institutions, as well as an opportunity to bring over individual clients who seek a locally managed, relationship-based bank with access to key decision-makers at all times. That, coupled with our strong technology, makes us very attractive to new customers and new bankers. With respect to our positioning on lending, our strategy is to ensure we continue to support our key clients through any operating environment. We will continue to prudently add franchise-enhancing, full-service business relationships. The addition of the healthcare vertical is consistent with our strategy of growing business loans.

Our loan pipelines, while down from a year ago, given the much higher rate environment, are intentionally heavily weighted toward business loans. Approximately 60% of our loan pipeline is in business loans, with a weighted average rate on the entire loan pipeline of 7.9%. We expect loans to remain relatively stable between now and the end of the year, with growth in business loans offsetting planned declines in our investor CRE and multifamily portfolios. Since my appointment as CEO and in my day-to-day meetings with customers, it's apparent to me that Dime's brand and reputation in the marketplace has never been stronger. Our technology platform is better and more agile than many larger local banks, and our customer service is second to none.

Anecdotally, we are winning back some clients who left for biggest banks during the March Madness, as they realize, as they realize service and personal touch are important. A big client win for our firm in the third quarter was the New York Jets. Dime is now, now the Official Private Bank of the Jets. The partnership is providing us tremendous visibility and has been well received by our clients and employees across the board, and demonstrates that Dime can bank big brand name institutions. As I said on our last earnings call, my focus is on providing customers outstanding service that only locally managed community banks can, can provide, growing our franchise value and delivering our shareholders strong returns.

Managing expenses prudently and being a conservative underwriter of credit have always been hallmarks of Dime and will not stray from these two core guiding principles. I would like to thank all our outstanding employees for staying focused on these goals. With that, I will turn the call over to Avi to provide some more detail on the quarter.

Avinash Reddy (SEVP, COO, and CFO)

Thank you, Stu. Core EPS for the third quarter was $0.56 per share. Our results were marked by prudent non-interest expense management and stable asset quality. We grew core deposits by approximately $200 million on a spot basis, and importantly, non-interest-bearing deposits increased in the third quarter. At 29% of average total deposits, our non-interest-bearing deposit percentage remains a clear differentiator for Dime versus other community banks in our footprint. In a higher for longer environment, the value of these non-interest-bearing deposits will be paramount. The NIM was 2.34% for the third quarter, compared to 2.50% for the prior quarter. As expected, the pace of NIM compression continued to slow in the third quarter. As you know, we don't provide quarterly quantitative NIM guidance.

All else equal, we do expect the NIM to stabilize at the end of this year and see expansion in 2024. We're currently in our budgeting process for 2024, and we'll have more to add on our January earnings call. Given the growth in core deposits, we reduced our wholesale funding position, and our loan-to-deposit ratio ticked down to 102%. Core cash operating expenses for the third quarter was approximately $51 million, and we are on track to beat our full year guidance for core cash operating expenses, even after absorbing the hires we made in the second and third quarters.

We've been able to absorb the cost of these hires into our organization, along with the additions of various corporate staff to support them by rationalizing expenses across the organization, using technology to automate manual processes, and promoting and filling open roles from our talented employee base. Non-interest income for the third quarter was $7.9 million. The decline on a linked quarter basis was due to an expected decline in swap revenue, and additionally, we had a BOLI death claim in the second quarter. We expect fourth quarter results for swap fees to generally be in line with the third quarter, and then to pick up in 2024, as we have more back-to-back swap loans in the pipeline expected to close in the new year. We had a $1.8 million loan loss provision this quarter.

The allowance to NPLs increased to over 300% in the third quarter. I will point out that excluding multifamily, which we view as a risk-free asset class, our reserve to loans would be approximately 1%. We are cognizant of the fact that there's been a lot of scrutiny on CRE concentration. In this regard, Dime's investor CRE concentration, excluding multifamily loans, which are really residential loans for five or more tenants, is only 260% of total capital. As we continue to focus our growth on business loans and building capital, we expect the CRE concentration to decline over time. In light of the overall environment, our posture as it relates to the balance sheet, is to build capital methodically. This will, in turn, support our clients when they need it.

This quarter, our risk-based capital ratios increased by approximately 25 basis points. As a reminder, we have a very short duration AFS portfolio, and the AOCI marks this quarter were fairly modest despite the increase in long rates. With that, I'll turn the call back to Carla for questions.

Operator (participant)

Thank you. If you'd like to ask a question, you may do so by pressing star followed by one on your telephone keypad. When preparing for your question, please ensure your device is unmuted locally. If you wish to revoke your question, please press star followed by two. We will now take our first question, which comes from Steve Moss from Raymond James. Steve, your line is now open. Please go ahead.

Steve Moss (Managing Director)

Good morning.

Stuart Lubow (President and CEO)

Good morning

Steve Moss (Managing Director)

Maybe just starting here, Stu. Good morning, Stu. Maybe just start on the, you know, deposit growth you guys showed this quarter here, particularly non-interest-bearing. I realize that's from the Signature hires. Just curious, do you have any expectations or updated thoughts, looking forward here into the fourth quarter?

Avinash Reddy (SEVP, COO, and CFO)

Yeah. I'll start, Steve. You know, you know, part of the reason for the decline in non-interest-bearing deposits earlier in the year was really, you know, migration out of, you know, some consumer DDA. And, you know, the first half of the year, we were probably losing around $50 million-$100 million of consumer DDA. In the third quarter, we were down to only around $30 million. So that's kind of, you know, you know, stabilizing to some extent. And obviously, the new private banking groups that we have have added significant deposits.

I think overall at the bank, you know, business DDA is up, municipal DDA is, you know, fairly stable. So, you know, when we're doing our projections, you know, it's, it's pretty much stable to up from here on out. Obviously, any particular quarter could go up or down, but I think we've seen the bulk of, you know, declines in DDA at this point. As I mentioned, and as Stu mentioned, you know, having that 29% and north of that in terms of DDA is really gonna be a key driver of NIM expansion in the future.

Steve Moss (Managing Director)

Okay. And then on the expense front here, you know, the good expense controls, you know, Avi previously provided guidance, I think the number is 206-209. Just, you know, looks like you're running below that trend if we kind of hold flat into the fourth quarter. Just any updated thoughts on expenses?

Avinash Reddy (SEVP, COO, and CFO)

Yeah, typically we don't, you know, re-guide on expenses. I think my comment was we're just going to beat the full year number. We're, you know, we're really focused on keeping expenses as low as possible, and we're going to, you know, use that as a base, you know, into the next year. You know, I think Stu said there's a lot of, you know, opportunity to make new hires and, you know, revenue-generating deposit and, you know, people on the loan side. So I think we'll look at both over time. But, you know, we're pretty comfortable in terms of beating that 206 number, and we'll try to beat it as much as possible in the fourth quarter.

Steve Moss (Managing Director)

Okay. And just one last one for me. Just curious on, you know, where is loan pricing these days for you guys? And, you know, just, you know, it sounds like the business, C&I, business side remains strong for the pipeline, you know, while, you know, obviously some further declines with CRE.

Stuart Lubow (President and CEO)

Yeah. So, you know, basically our pipeline is about $985 million. You know, the weighted average rate on the entire portfolio is 7.90%. But on the C&I side, the pipeline is about $321 million, and the yield or the weighted average rate on those loans is actually 8.97%. So, you know, we have quite a bit in that pipeline, and then there's about $300 million in owner-occupied CRE, which is in the sevens. And, you know, interestingly, we only have $22 million in multifamily in the pipeline. So obviously, our focus is on C&I and owner-occupied CRE.

Steve Moss (Managing Director)

All right, great. Thank you very much.

Avinash Reddy (SEVP, COO, and CFO)

Thanks, Steve.

Operator (participant)

Thank you, Steve. Our next question is from Matthew Breese from Stephens Inc. Matthew, your line is now open. Please go ahead.

Matthew Breese (Managing Director and Senior Equity Research Analyst)

Hey, good morning. You know-

Avinash Reddy (SEVP, COO, and CFO)

Good afternoon.

Matthew Breese (Managing Director and Senior Equity Research Analyst)

I appreciate all the updates on the deposit side, and certainly the inflection point this quarter was a welcomed one. You know, what I'm curious about is on the opposite side of the balance sheet. Movement in loan yields hasn't been as robust, and a lot of it's tied to the longer duration nature of CRE, resi, multifamily. I was curious when you expect to see a bigger pickup in loan yields. You know, provide some expectations around loan beta through the end of the year or early 2024, please.

Avinash Reddy (SEVP, COO, and CFO)

Yeah, sure. So, Matt, you know, we've mentioned in the past, you know, we have a slide in our investor presentation due about the next couple of years in terms of repricings and maturities off the real estate book. We obviously were not big originators back in 2017 and 2018, and typically those come due five years afterwards, right? So it's going to be a steady progression up. I think what's going to make the difference is the originations now are really focused on the owner-occupied and C&I side. This quarter, we had a large construction loan pay off, which was a good thing. The rate on that was, you know, pretty high.

So, you know, I think if you're replacing, you know, loans that are coming off at 5, 5.5 at, you know, 8.5%-9%, you're going to see that uptick over time. Our portfolio is also, you know, gearing more towards floating rate loans going forward. So I think it's going to be a steady build. We have outlined in our investor presentation too, that there's a big slug of multifamily loans that are coming due in 2026 and 2027. Obviously, with current rates where they are, those are probably not going to prepay at this point in time.

However, if you follow the forward curve and rates do drop at some point in 2024 and 2025, you could see some of that come in, and we've outlined, you know, that's around 30 basis points to the margin once all those reprice. So I'd say in the near term, you know, we're following the cash flows, and it's going to be based on yields. In the medium to longer term, it's going to be based on the multifamily coming due.

Stuart Lubow (President and CEO)

Yeah, and I do think, you know, we'll see a pickup in the C&I business. You know, I'm looking, you know, right now, I expect, you know, between $100 million and $150 million of C&I business to close in the quarter. We've got our first two healthcare deals that will either close late in the year or early 2024, and the yields on those are about 9%, 9.5%, and, you know, that's about $50 million. So we're starting to see real traction on the C&I side at this point.

Matthew Breese (Managing Director and Senior Equity Research Analyst)

Got it. Okay. And then, Avi, I know you don't provide, you know, quarterly NIM guidance, but historically, you have kind of discussed for this institution what the appropriate NIM should migrate to over time. And I'm curious, in this kind of yield curve environment, what that migration point, that point of gravity is.

Avinash Reddy (SEVP, COO, and CFO)

Yeah. So I mean, so for example, in terms of the near-term NIM, Matt, I probably didn't mention in my prepared remarks. The spot NIM, you know, in the month of September was around 2.35. So, you know, it kind of stabilized in September. You know, we want to wait and have a couple more months of stability before, you know, officially calling the bottom for sure. So, that was the near-term, you know, thought process around that. Look, when we do our medium to longer-term projections, you know, obviously with the long end being up, that's a good thing for us, right? Because you're going to be repricing into a higher rate environment, as, you know, your deposit costs have stabilized.

So I think, you know, getting back to that, you know, 3%-3.25% area is the right, you know, medium to, you know, longer-term opportunity for us. And if the curve stays as, you know, if it's less inverted as it is now, and if the five-year continues to stay where that, where it is, with 30% DDA, I mean, there's the probability that, you know, we can get higher than 3.25% in, in the long run. In the short term, it's obviously going to be methodical every quarter, you know, expansion in 2024.

Matthew Breese (Managing Director and Senior Equity Research Analyst)

Got it. Okay. Last couple questions. You know, understanding historically, multifamily, particularly rent-regulated multifamily, has been a risk-free asset. But, you know, does the combination of the 2019 rent law change with, you know, the still very tenant-friendly Rent Guidelines Board, higher expenses, higher loan yields, and then the more recent Supreme Court decision, does that change the, the risk-free nature, particularly with the rent-regulated portfolio?

Stuart Lubow (President and CEO)

Yeah, Matt, not really. I mean, we took that into account in terms of our underwriting as we originated from 2019 on. And, you know, at Dime, you know, Legacy Dime, we changed our underwriting guidance to take that into account. You know, you have to remember, we really never did any repositioning multifamily. We underwrite very stringently. We raised our underwriting criteria, and we always had a very low LTV. And so, you know, what we're seeing is that, you know, we haven't had any, you know, pressure in terms of the credit quality on the multifamily at all. And in fact, we had a significant amount repriced this year, where we haven't been asked for modifications.

They just moved into a higher rate, which was obviously a positive. And, you know, so we're not seeing the pressure that others have. But, you know, when you have a 58% average LTV, there's a lot of equity in those buildings and these are generational owners, you know, that we're not looking for quick hits and repositioning of loans. So, you know, I think from our perspective, we still feel very comfortable. And obviously, our delinquency and non-performing numbers bear that out.

Avinash Reddy (SEVP, COO, and CFO)

Yeah, Matt, the only other thing I'd add is we really weren't in the multifamily market in 2017 and 2018. If you remember, that's when Stu got to Dime, and we pivoted our balance sheet. So, for example, we only have $100 million of multifamily loans that were made in 2018. So, you know, a lot of our production is post-2019, and taking this into account already.

Matthew Breese (Managing Director and Senior Equity Research Analyst)

Got it. Okay. I mean, just, just industry sources are starting to point to, you know, new transaction values down, showing valuations down 30%-45% in this asset class. And it gets you close to kind of your average LTV of 58%. I guess that's my, my bottom line point. And then I guess I'd be curious, obviously, multifamily can bucket both the market rate and the rent-regulated. How much rent-regulated multifamily exposure do you have today?

Avinash Reddy (SEVP, COO, and CFO)

Yeah, it's around a third, Matt, of our portfolio. Free market's around 2/3. The rent-regulated is around a third, basically. Look, I mean, at the end of the day, we can only tell you what we're seeing in our portfolio. We're really not seeing any signs at this point in time, so we'll leave it at that.

Matthew Breese (Managing Director and Senior Equity Research Analyst)

Totally understood. Okay. Thank you for taking my questions. I'll leave it there. Appreciate it.

Stuart Lubow (President and CEO)

Thanks, Matt.

Operator (participant)

Thank you, Matt. Our next question comes from Mark Fitzgibbon from Piper Sandler. Mark, your line is now open. Please go ahead.

Mark Fitzgibbon (Managing Director and Head of FSG Research)

Hey, guys. Good morning. I guess I was curious, first, what does the pipeline and new private client teams look like today? And of the private client teams you've hired recently, can you give us a sense for how much they've already brought in in terms of deposits and loans?

Stuart Lubow (President and CEO)

You know, they've opened up about 2,000 accounts at this point and, you know, about 1,000 separate customers. Not all of that has funded yet. I'd say there's probably, you know, 500-600 accounts that haven't funded yet. I mean, at this point, they've brought in about $250 million, and about 50% of that is DDA.

Mark Fitzgibbon (Managing Director and Head of FSG Research)

Okay. The pipeline of teams, Stu, would you say still quite a few out there?

Stuart Lubow (President and CEO)

Yeah. I mean, it's growing, you know, really steadily, you know, every week. We get reports twice a week, and basically, we're seeing steady growth, you know, every week.

Mark Fitzgibbon (Managing Director and Head of FSG Research)

Okay. And then, Avi, I wonder if you could share us, with us your thoughts on maybe restructuring some of the available-for-sale securities book, given, as you said, that, you know, it's relatively short in duration and, you know, rates may be stuck up here for a little bit. Is that something you're contemplating?

Avinash Reddy (SEVP, COO, and CFO)

Yeah, I think at this point, probably not, in all honesty, Mark. I think, you know, just having a little more stability in the banking industry in general is important. You know, I think we're focused on, you know, building capital optically. You know, we're doing that, you know, 10-20 basis points every quarter. So it's pretty sharp, it's going to run off here pretty quickly. So I'd say in the near-to-medium term, probably not, but, you know, it's something we evaluate and, you know, update our analysis constantly.

Mark Fitzgibbon (Managing Director and Head of FSG Research)

Okay. Then lastly, what are your thoughts around share buybacks, you know, given the depressed level of the stock price? You know, are capital levels, you know, an impediment to doing buybacks here?

Avinash Reddy (SEVP, COO, and CFO)

Not, not really, Mark. You know, I think, you know, from a corporate finance perspective, it's screaming out to do buybacks. I think that said, in the current operating environment, you know, I think clients value, you know, banks with capital and strong liquidity, and, you know, you don't know how long the Fed's gonna stay at these levels. Don't know, you know, what's gonna happen, you know, if they raise rates more. So I think at this point, we're, we're keeping the capital to support our clients.

There'll come a time and place, you know, for our buybacks and, you know, you know us, we've been very active on that front, since the merger and, you know, when the time is right, we'll do it. But, you know, like a lot of our peers, I think right now we're, you know, waiting and watching to see what happens over the course of the next, you know, three months or so... Thank you.

Operator (participant)

Thank you, Mark. Our next question comes from Chris O'Connell from KBW. Chris, your line is now open. Please go ahead.

Christopher O'Connell (Director of Equity Research)

Hey, good morning. Yeah, to start off, on, on the credit, for this quarter, you know, I noticed the reserve, you know, came down a little bit, and net charge-offs were a bit higher, you know, but NPAs came down. Just any, any commentary around the movement this quarter and, and whether there was something charge-off that was maybe fully reserved for?

Avinash Reddy (SEVP, COO, and CFO)

Yeah, that's, that's exactly right, Chris. So, you know, we had a-- we had a loan that was, you know, fully resolved. You know, we, we took a charge on that, but, I mean, again, at 18 basis points, you know, it's pretty, pretty minimal overall. Our pool resolve, you know, it stayed pretty constant. So within our 70-odd million of resolves, there's around $53 million in, you know, for the general pool, and that really didn't change much. So, so the overall pool stayed consistent.

Christopher O'Connell (Director of Equity Research)

Got it. And any, and any color you could provide on, you know, the type of credit, and, and, any details around the one that was charged off?

Stuart Lubow (President and CEO)

Yeah, it was a line of credit to an individual who was heavily involved in the hotel industry and never really recovered from the COVID pandemic, and been working with him for a while. We did get a significant pay down, but, you know, we thought at this point, we do have a judgment and, you know, we expect recovery, but at this point, we thought it was prudent to take the charge and any funds we get in return, we take as recovery.

Christopher O'Connell (Director of Equity Research)

Great. And just regarding your commentary about, you know, the expenses going forward and, you know, the potential to drive, you know, some efficiencies and, and things that you're looking at, on a go-forward basis, just any color around, you know, where you guys are looking at, you know, to drive those efficiencies and, and what the potential, you know, magnitude, of, of, of those, efficiencies could be as we get into 2024?

Stuart Lubow (President and CEO)

Yeah. I mean, look, we're—we've been pretty active in looking at efficiency throughout the year. We had a reduction of force in June. You know, you know, it's a constant state of affairs in terms of trying to, you know, to look at opportunities across the board. Obviously, I mentioned we just outsourced our data center. That's going to save, you know, personnel costs and equipment costs and whatnot. You know, and that's going to register in the fourth quarter. And, you know, we're looking—you know, we're in our budget process now, so we're looking across the board in terms of opportunities to become more efficient.

On the other hand, you know, we want to take advantage of opportunities, and we've done that so far in terms of hiring the Signature teams and, and you know, our recent hire in terms of a healthcare vertical. You know, I think it's important that, you know, we don't want to just play defense, we want to play offense and, and to take advantage of the opportunities that are out there. And I think we've been able to do that. We're one of the few banks that were able to hire significant amount of teams from Signature, and obviously it's paid dividends to us already.

And we've been able to do that while keeping our expenses, you know, below our guidance. So, you know, we're going to continue to explore a number of opportunities. We are looking at certain areas that I think there's more expense savings available. But, you know, again, we've been doing that on a fairly regular basis and, you know, I don't think we're going to do any significant major initiatives. I think it's going to be, you know, very granular in terms of how we manage our expenses.

Christopher O'Connell (Director of Equity Research)

Got it. Just on, you know, on the loan growth, appreciate all, you know, the color around the pipeline and the rates there. As you're looking to the fourth quarter here, in the amount of, you know, CRE and multifamily, you know, that might pay down or run off, how are you thinking about kind of net overall loan growth for next quarter?

Avinash Reddy (SEVP, COO, and CFO)

Yeah, I think, Chris, in our prepared remarks, we said the balance sheet should be pretty stable, runoff in multifamily and CRE, offset by C&I and owner-occupied.

Operator (participant)

Thank you, Chris. As a reminder, if you'd like to ask a question, please press star followed by one on your telephone keypad. Our next question is from Manuel Navas from D.A. Davidson. Your line is now open. Please go ahead.

Manuel Navas (SVP and Equity Research Analyst)

Hey, good morning. On for Manuel here. Most of my questions have been asked, but, could you talk about your loan-to-deposit ratio, and how it's going to settle in by the end of the year? Just some color on that would be great.

Avinash Reddy (SEVP, COO, and CFO)

Yeah, we're obviously down this quarter to 102. Obviously, you know, if we keep loans flat and we grow deposits, it's going to continue to go further down. I think at the start of the year, you know, we had said we'd set a hard line and said, you know, we don't want to go above 107.5, and that was when, you know, there was a banking crisis and deposits were in flux. I mean, at this point in time, we'd like to get to 100% as quickly as possible and then, you know, continue to move that ratio down, you know, as deposits keep coming in.

Manuel Navas (SVP and Equity Research Analyst)

Great. Just have one more. In terms of the technology rollouts that you did last quarter, could you just provide some color on what the progress is in terms of the new business-focused accounts? And sorry if I missed that, but just some color on that would be great.

Stuart Lubow (President and CEO)

Yeah. So, you know, we rolled out our online banking, you know, digital online account opening process for retail. We're rolling out the digital online for commercial as we speak. And, you know, we're very happy with that. It kind of completes the package in terms of our digital capabilities. And, you know, and our new bankers, our new private bankers and whatnot are using that. We're certainly gonna continue to enhance that. Our online, our new escrow management system has been very successful, and we're very happy with that. And, so, you know, we're pleased with all the changes we made and, you know, it just adds to the suite of products for our customers.

Manuel Navas (SVP and Equity Research Analyst)

All right. Fantastic. Thanks for taking my questions.

Operator (participant)

Thank you, Manuel. As a reminder, to ask a question, you may do so by pressing star followed by one on your telephone keypad. We have no further questions registered today. With that, I will hand back to your host, Stuart Lubow, for final remarks.

Stuart Lubow (President and CEO)

Thank you, Carla. Again, I would like to thank all of our employees for their diligence and hard work, as well as our shareholders for all their support, and we look forward to speaking to you all again at the end of January.

Operator (participant)

This concludes today's call. Thank you for your participation. You may now disconnect your line. Have a great day.