Company Overview - National Bank Holdings (NBH) Corporation has completed the acquisition of Vista Bank for $377 million, enhancing its presence in high-growth markets such as Austin, Palm Beach, and Dallas-Ft. Worth [2][3] - The merger will result in the immediate adoption of the Vista Bank brand in Texas, with a full integration planned for later in the year, excluding the Bank of Jackson Hole [2] Leadership and Strategy - Tim Laney, chairman and CEO of NBHC, expressed optimism about the merger, highlighting the strong leadership team of Vista Bank and the robust balance sheet of NBH, which will allow for expanded banking services to commercial and business clients [3] Industry Context - The acquisition is part of a broader trend of banking mergers, with recent approvals indicating a surge in consolidation within the industry [4] - The merger momentum is influenced by regulatory changes, as comments from Fed Vice Chair Michelle Bowman suggest lighter oversight for smaller banks, potentially facilitating faster consolidation [5] - The previous year saw the fastest rate of banking mergers approved in over three decades, with the average time to finalize a deal dropping to four months, the shortest since at least 1990 [5]

Core Viewpoint - National Bank Holdings Corporation (NBHC) has successfully completed the acquisition of Vista Bancshares, enhancing its position as a premier regional bank and expanding its market presence in high-growth areas [1][3]. Financial Summary - Post-acquisition, NBHC's pro forma assets are approximately $12.6 billion and pro forma deposits are about $10.7 billion based on financials from September 30, 2025 [2]. - The total transaction value of the acquisition is approximately $377.4 million, based on NBHC's closing price on January 6, 2026 [4]. Strategic Implications - The acquisition allows NBHC to integrate its product capabilities with Vista Bank's relationship-banking model, which is expected to enhance long-term growth strategies [3]. - Vista shareholders will receive approximately $84.8 million in cash consideration and will own about 16% of NBHC shares on a fully diluted basis following the merger [4]. Brand and Integration Plans - Following the merger, NBHC will adopt the Vista Bank brand in Texas and plans to incorporate it across the entire enterprise later in the year, with systems integration scheduled for the third quarter of 2026 [2][3]. Leadership Statements - Tim Laney, Chairman and CEO of NBHC, expressed optimism about the merger, highlighting the combined strength of both organizations to offer expanded banking services [4]. - John Steinmetz, Executive Vice Chairman of NBH Bank, emphasized the strategic vision for making the combined organization a more powerful regional bank [4]. Advisory and Legal Support - Keefe, Bruyette & Woods served as financial advisor to NBHC, while Jefferies LLC acted as exclusive financial advisor to Vista [5].

Core Viewpoint - National Bank Holdings Corporation (NBHC) has received all necessary regulatory approvals for the merger with Vista Bancshares, Inc. and its subsidiary Vista Bank, with the transaction expected to close on January 7, 2026 [1][2]. Group 1: Merger Details - The merger will add approximately $2.5 billion in assets to NBHC, including $1.9 billion in loans and $2.2 billion in deposits as of September 30, 2025 [3]. - Upon completion, the combined entity will have pro forma assets of approximately $12.6 billion and pro forma deposits of $10.7 billion as of September 30, 2025 [3]. - Vista received shareholder approval for the merger on December 19, 2025 [1]. Group 2: Integration and Planning - NBHC and Vista have been engaged in integration planning since the announcement of the merger [2]. - The systems conversion is scheduled for the third quarter of 2026 [2]. Group 3: Company Overview - National Bank Holdings Corporation operates a network of over 90 banking centers across several states, serving a diverse clientele including individual consumers and businesses [4]. - The company is focused on building a leading community bank franchise and delivering high-quality client service [4].

Group 1 - There are few publicly-traded U.S. banks headquartered in Colorado, and they do not attract significant investor attention [1] - Ian Bezek, a former hedge fund analyst, specializes in high-quality compounders and growth stocks at reasonable prices in the U.S. and developed markets [2] - Ian leads an investing group called Ian's Insider Corner, which offers features like a Weekend Digest, trade alerts, and direct access to him [2]

Core Insights - There are limited publicly-traded U.S. banks headquartered in Colorado, and they do not attract significant investor attention [1] Group 1: Company Overview - The article highlights the scarcity of publicly-traded banks in Colorado, indicating a niche market that may present unique investment opportunities [1] Group 2: Analyst Background - Ian Bezek, a former hedge fund analyst, has extensive experience in Latin American markets and specializes in high-quality compounders and growth stocks [2]

Financial Performance - Net income for the three months ended September 30, 2025, was $35.285 million, up from $33.105 million in the same period of 2024, reflecting a year-over-year increase of 6.6%[19] - For the nine months ended September 30, 2025, net income increased to $93,538,000 compared to $90,631,000 for the same period in 2024, reflecting a growth of 2.1%[27] - Earnings per share (basic) for the three months ended September 30, 2025, was $0.92, compared to $0.86 for the same period in 2024, representing a growth of 7.0%[19] - Comprehensive income for the three months ended September 30, 2025, was $40.226 million, down from $51.045 million in the same period of 2024, a decrease of 21.2%[21] - Total non-interest income for the three months ended September 30, 2025, was $20.691 billion, an increase of 12.6% compared to $18.389 billion for the same period in 2024[105] Asset and Liability Management - Total assets increased to $10,152.686 million as of September 30, 2025, compared to $9,807.693 million on December 31, 2024, representing a growth of 3.5%[17] - Total liabilities increased to $8,777.757 million as of September 30, 2025, from $8,502.618 million on December 31, 2024, indicating a growth of 3.2%[17] - Total deposits rose to $8,471.680 million as of September 30, 2025, from $8,237.893 million on December 31, 2024, marking an increase of 2.8%[17] - Cash and cash equivalents at the end of the period increased to $555,560,000 as of September 30, 2025, compared to $180,796,000 at the same time in 2024[27] Credit Quality and Loan Performance - The allowance for credit losses decreased to $88.280 million as of September 30, 2025, from $94.455 million on December 31, 2024, showing a reduction of 6.9%[17] - The provision for credit loss expense for the nine months ended September 30, 2025, was $8,700,000, up from $4,776,000 in 2024, indicating a significant increase of 82.5%[27] - The total past due loans increased from $74,098 million on December 31, 2024, to $53,123 million on September 30, 2025, indicating a reduction in delinquency[60] - The total non-accrual loans as of September 30, 2025, were $26,715 million, with $16,495 million having a related allowance for credit loss[59] - The company’s internal risk rating system categorizes loans into grades such as "Pass," "Special mention," "Substandard," and "Doubtful," reflecting the credit quality assessment[61] Investment Securities - The company's investment securities portfolio totaled $1.3 billion as of September 30, 2025, an increase from $1.0 billion at December 31, 2024[36] - Available-for-sale securities amounted to $612.7 million as of September 30, 2025, with unrealized losses of $69.0 million[37] - Held-to-maturity investment securities totaled $630.8 million as of September 30, 2025, with unrealized losses of $61.2 million[44] - The total fair value of held-to-maturity investment securities was $356.5 million with unrealized losses of $61.2 million as of September 30, 2025, compared to a total fair value of $448.1 million with unrealized losses of $81.8 million at December 31, 2024[45] Shareholder Returns and Stock Activity - The company reported a common stock dividend of $0.30 for the three months ended September 30, 2025, compared to $0.28 in the same period of 2024, an increase of 7.1%[19] - The Company repurchased 240,000 shares during the period, resulting in a treasury stock reduction of $8,804,000[27] - The remaining authorization under the stock repurchase program as of September 30, 2025, was $37.0 million[117] Capital and Regulatory Compliance - The Company met all capital requirements under Basel III, with a consolidated total risk-based capital ratio of 16.6% as of September 30, 2025, exceeding the required 10.5% for well-capitalized institutions[97] - The Company had loans pledged as collateral for FHLB advances amounting to $2.5 billion as of September 30, 2025[90] Derivatives and Hedging Activities - The Company reported interest rate swaps designated as fair value hedges with a notional amount of $352.1 million as of September 30, 2025, compared to $348.5 million as of December 31, 2024[126] - The cumulative amount of fair value hedge adjustments included in the carrying amount of hedged assets was $(17.5) million as of September 30, 2025, down from $(28.7) million as of December 31, 2024[127] - For the three months ended September 30, 2025, the Company recognized a total loss of $(901) thousand on derivatives in hedging relationships, compared to a loss of $(12,000) thousand for the same period in 2024[133] Miscellaneous - The company operates over 90 banking centers primarily located in Colorado and the greater Kansas City region, with services also available through online and mobile banking[28] - Goodwill as of September 30, 2025, was $306.0 million, with no impairment recorded during the three or nine months ended September 30, 2025[77] - The fair value of total assets measured at fair value as of September 30, 2025, was $667,309, compared to $591,337 as of December 31, 2024, representing an increase of approximately 12.8%[157]

Core Points - National Bank Holdings Corporation announced a quarterly cash dividend increase of 3.3%, from $0.30 to $0.31 per share, payable on December 15, 2025 [1] - The increase in the dividend reflects the company's commitment to delivering attractive shareholder returns and aligns with its strategic acquisition of Vista Bancshares, Inc. [2] Company Overview - National Bank Holdings Corporation is a bank holding company focused on building a leading community bank franchise, providing high-quality client service and committed to stakeholder results [3] - The company operates over 90 banking centers across Colorado, the greater Kansas City region, Utah, Wyoming, Texas, New Mexico, and Idaho, serving a diverse clientele including individual consumers, businesses, and government entities [3] - Its banking operations include various brand names under NBH Bank, such as Community Banks of Colorado, Bank Midwest, and Hillcrest Bank, among others [3]

Financial Data and Key Metrics Changes - The company reported net income of $35.3 million or $0.92 of earnings per diluted share for the third quarter, with adjusted net income increasing 30% annualized over the prior quarter to $36.6 million or $0.96 per diluted share [8][9] - The return on tangible common equity was 14.72%, and the adjusted return on average tangible common equity was 14.7% [5][9] - The fully taxable equivalent net interest margin expanded three basis points during the third quarter to 3.98%, with an annualized growth of 11 basis points compared to the same quarter last year [10][9] Business Line Data and Key Metrics Changes - Loan fundings for the quarter totaled $421 million, bringing total year-to-date loan fundings to $1 billion, with quarterly loan fundings increasing each quarter of 2023 [9][14] - Non-interest income for the third quarter totaled $20.7 million, which is 21% higher than the second quarter and 13% higher than the third quarter of last year [11] - Non-interest expense totaled $67.2 million, including $1.7 million of acquisition expenses and $6.2 million of 2UniFi expenses [12] Market Data and Key Metrics Changes - Total deposits ended the quarter $202 million higher than the prior quarter, with average deposits holding steady at $8.2 billion [11] - The cost of deposits totaled 2.08%, and the total cost of funds was 2.1% [11] - Credit quality improved with a 20% reduction in non-performing loans, now standing at $27 million, and the non-performing loan ratio improved to 36 basis points [10][11] Company Strategy and Development Direction - The company announced a merger with Vista Bancshares, which is expected to close in the first quarter, and management is optimistic about the strategic value of this transaction [6][14] - The company is focused on maintaining pricing discipline and managing loan and deposit pricing to achieve solid margin expansion [9][10] - The launch of 2UniFi is seen as a significant step forward, with plans to provide revenue guidance in the next quarterly earnings call [12][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the quality of new loan production and the strength of new relationships despite headwinds from loan payoffs in the commercial real estate (CRE) portfolio [5][6] - The company anticipates a strong fourth quarter with positive credit quality trends and additional productivity initiatives in place [6][9] - Management noted the competitive landscape in private credit, particularly in the CRE sector, and emphasized the importance of maintaining a disciplined approach to lending [35][56] Other Important Information - The company repurchased 240,000 shares during the quarter, totaling $8.9 million, with a tangible book value per share growing 12% annualized to $27.45 [13] - The company holds $18 million of marks against its acquired loan portfolio, which adds additional loan loss coverage [10] Q&A Session Summary Question: Can you elaborate on the margin and expected impact of rate cuts? - Management indicated that the third quarter's margin was positively impacted by interest and fees recovered, and they are prepared to adjust deposit rates in line with potential Fed rate cuts [22][24] Question: What is the outlook for loan growth given recent paydowns? - Management clarified that the reduction in loan volume was primarily due to heavy payoffs rather than directive paydowns, and they are optimistic about the loan pipeline for the fourth quarter [35][37] Question: How much 2UniFi expenses were incurred in Q3 and what is expected for Q4? - The company incurred $6.2 million in 2UniFi expenses in Q3, with expectations of $7 million-$9 million in Q4 due to increased marketing and variable costs [39][41] Question: What are the opportunities from the Vista acquisition? - Management expressed excitement about the caliber of leadership from Vista and the potential for growth in treasury management and wealth services, emphasizing the integration of best practices [64][66]

Financial Data and Key Metrics Changes - The company reported net income of $35.3 million or $0.92 of earnings per diluted share for the third quarter, with adjusted net income increasing 30% annualized over the prior quarter to $36.6 million or $0.96 per diluted share [8][9] - The return on tangible common equity was 14.72%, and the adjusted return on average tangible common equity was 14.7% [5][9] - The fully taxable equivalent net interest margin expanded three basis points during the third quarter to 3.98%, with an annualized growth of 11 basis points compared to the same quarter last year [10] Business Line Data and Key Metrics Changes - Loan fundings for the quarter totaled $421 million, bringing total year-to-date loan fundings to $1 billion, with quarterly loan fundings increasing each quarter of 2023 [9][19] - Non-interest income for the third quarter totaled $20.7 million, which is 21% higher than the second quarter and 13% higher than the third quarter of last year [11] - Non-interest expense totaled $67.2 million, including $1.7 million of acquisition expenses and $6.2 million of 2Unify expenses [12] Market Data and Key Metrics Changes - Total deposits increased by $202 million compared to the prior quarter, with average deposits holding steady at $8.2 billion [11] - The cost of deposits was 2.08%, and the total cost of funds was 2.1% [11] - Credit quality improved with a 20% reduction in non-performing loans, now standing at $27 million, and the non-performing loan ratio improved to 36 basis points [10][11] Company Strategy and Development Direction - The company announced a merger with Vista Bankshares, expected to close in the first quarter, which is anticipated to enhance the company's market position and capabilities [6][8] - The company is focused on maintaining pricing discipline and managing loan and deposit pricing to achieve solid margin expansion [9][10] - The launch of 2Unify is seen as a strategic initiative, with plans to provide revenue guidance in the next quarterly earnings call [12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about new loan production and the quality of new relationships, despite headwinds from payoffs in the commercial real estate portfolio [5][6] - The company expects to maintain a mid-three nines net interest margin for the remainder of 2023, not accounting for future Fed interest rate changes [10] - Management highlighted the importance of proactive measures to resolve problem loans, resulting in net recoveries during the quarter [10] Other Important Information - The company repurchased 240,000 shares during the quarter, totaling $8.9 million, with a total of 359,000 shares repurchased year-to-date [13] - The tangible book value per share grew 12% annualized to $27.45 [13] - The company continues to hold $18 million of marks against its acquired loan portfolio, providing additional loan loss coverage [10] Q&A Session Summary Question: Can you elaborate on the margin and expected impacts of rate cuts? - Management indicated that the third quarter's margin was positively impacted by interest and fees recovered, and they are prepared to adjust deposit rates in line with potential Fed rate cuts [23][25] Question: What are the expectations for 2Unify expenses moving forward? - Management expects 2Unify expenses to be in the range of $7 million to $9 million for Q4, accounting for increased marketing and variable costs [41] Question: How is the company positioned regarding loan growth and paydowns? - Management clarified that the reduction in loan volume was due to heavy payoffs rather than directive paydowns, and they are optimistic about the loan pipeline for Q4 [35][37] Question: What are the company's thoughts on private credit competition? - Management noted that competition from private credit is primarily seen in the commercial real estate sector, with pricing and credit terms being challenging [55] Question: What opportunities does the Vista acquisition present? - Management expressed excitement about the caliber of leadership from Vista Bankshares and the potential for growth in treasury management and wealth services [64][68]

Financial Data and Key Metrics Changes - The company reported net income of $35.3 million or $0.92 of earnings per diluted share for the third quarter, with adjusted net income increasing 30% annualized over the prior quarter to $36.6 million or $0.96 per diluted share [6][7] - The return on tangible common equity was 14.72%, achieved while maintaining a high level of capital [4] - The fully taxable equivalent net interest margin expanded three basis points during the third quarter to 3.98%, with an annualized growth of 11 basis points compared to the same quarter last year [9] Business Line Data and Key Metrics Changes - Loan fundings for the quarter totaled $421 million, bringing total year-to-date loan fundings to $1 billion, with quarterly loan fundings increasing each quarter of 2023 [7][8] - Non-interest income for the third quarter totaled $20.7 million, which is 21% higher than the second quarter and 13% higher than the third quarter of last year [10] - Non-interest expense totaled $67.2 million, including $1.7 million of acquisition expenses and $6.2 million of 2Unify expenses [11] Market Data and Key Metrics Changes - Total deposits ended the quarter $202 million higher than the prior quarter, with average deposits holding steady at $8.2 billion [10] - The cost of deposits totaled 2.08%, while the total cost of funds was 2.1% [10] Company Strategy and Development Direction - The company announced a merger with Vista Bankshares, which is expected to close in the first quarter, and management is optimistic about the strategic value of this transaction [5][13] - The company is focused on maintaining pricing discipline, which has resulted in solid margin expansion [8] - The launch of 2Unify is seen as a significant step forward, with plans to provide revenue guidance in the next quarterly earnings call [11][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the quality of new loan production and the strength of new relationships, despite headwinds from loan payoffs in the commercial real estate (CRE) portfolio [4][5] - Credit quality improved during the quarter, with a 20% reduction in non-performing loans [9] - Management is prepared to adjust deposit rates in response to potential Fed rate cuts, indicating a proactive approach to managing interest margins [22][23] Other Important Information - The company ended the quarter with a strong tangible common equity (TCE) ratio of 10.6% and a common equity Tier 1 ratio of 14.7% [12] - The tangible book value per share grew 12% annualized to $27.45 [12] Q&A Session Summary Question: Can you elaborate on the margin and expected impacts of rate cuts? - Management indicated that the third quarter's margin was positively impacted by recoveries and that they are prepared to adjust deposit rates in line with Fed actions [21][22] Question: What are the expectations for loan growth in Q4? - Management noted that the reduction in loan volume was not driven by directive paydowns and expressed optimism about the loan pipeline for Q4 [32][34] Question: How much are 2Unify expenses expected to be in Q4? - Expected 2Unify expenses for Q4 are in the range of $7 million to $9 million, accounting for increased marketing and variable costs [37] Question: What are the opportunities from the Vista acquisition? - Management highlighted the potential for growth in treasury management and wealth management services, leveraging the strengths of both organizations [55][56]