Financial Data and Key Metrics Changes - The company reported record earnings for 2025 at over $412 million, with diluted EPS hitting $6 per share, a 15% increase year-over-year [5][10] - The PPNR ROA was consistently above 2% for the year, with a full-year ROA of 1.54%, up from 1.38% in the previous year [6][10] - Tangible book value increased by $5.59 per share, or 14.5%, for the full year [11] Business Line Data and Key Metrics Changes - Net interest income increased by $7.3 million in the fourth quarter, or 12.2% annualized, with a full-year increase of $87.7 million, or 10.3% from 2024 [11][12] - Adjusted non-interest income decreased by $10.5 million in the fourth quarter, primarily due to seasonal declines in mortgage [15] - Total non-interest expense decreased by $11.5 million in the fourth quarter, driven by lower compensation costs [15] Market Data and Key Metrics Changes - The company experienced almost 6% growth in earning assets during the fourth quarter, with loans growing nearly 5% despite elevated payoffs in the CRE portfolio [7][8] - Non-interest bearing deposits represented 29% of total deposits, indicating strong core deposit growth [9][17] Company Strategy and Development Direction - The company is focused on capital returns and accretive growth to enhance shareholder value, with a strong emphasis on organic growth strategies [4][9] - The management highlighted the importance of maintaining a simple common stock capital structure and being opportunistic in share repurchases [7][41] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth potential in 2026, citing strong pipelines and healthy economic indicators [8][20] - The company anticipates some margin compression due to deposit cost pressures but remains focused on core profitability and organic growth [12][31] Other Important Information - The company paid off all subordinated debt during 2025, simplifying its capital structure [6] - The efficiency ratio improved to 50% for the year, down from 53.2% the previous year [15] Q&A Session Summary Question: Insights on loan production and future payoffs - Management noted that elevated payoffs were typical for the fourth quarter and expect moderation in the first half of the year [20][22] Question: Impact of interest rates on loan production - Management believes that changes in interest rates could accelerate opportunities for loan production rather than causing significant payoffs [23] Question: Hiring strategy and talent management - The company is focused on upgrading talent without significantly increasing headcount, having hired 21 lenders but only netting an increase of 3 [25][26] Question: Margin expectations for the upcoming year - Management anticipates a potential margin decline of 5-10 basis points over the next few quarters due to deposit cost pressures [31] Question: Deposit trends and growth outlook - Management confirmed that while there was a decline in non-interest bearing deposits, they have seen a recovery and continue to focus on core deposit growth [46][48] Question: Provision build and unfunded commitments - The company is building reserves for unfunded commitments, which is seen as a positive signal for future loan growth [52][54]