Core Viewpoint - Old North State Trust has completely divested its holdings in First Bancorp, indicating a strategic shift away from smaller regional banks towards larger growth companies [2][12]. Company Overview - First Bancorp is a regional financial services provider with a diverse product suite, including deposit accounts, loans, investment and insurance products, and digital banking services [6][9]. - The company operates primarily in North Carolina and northeastern South Carolina, focusing on community banking and tailored financial solutions [6][9]. Financial Performance - For the trailing twelve months (TTM), First Bancorp reported revenue of $543.12 million and net income of $111.05 million [4]. - The company has a dividend yield of 1.68% and its stock price was $54.18 as of March 23, 2026, reflecting a 33.1% increase over the past year, outperforming the S&P 500 by 20.25 percentage points [4][8]. Recent Developments - First Bancorp's net interest income reached approximately $106 million in the fourth quarter, with margins improving to 3.58% and loan balances increasing to about $8.7 billion [10]. - Despite these positive indicators, the bank faced a significant securities loss that impacted reported profits, resulting in a quarterly net income of $15.7 million [11]. Investment Implications - The divestment by Old North State Trust suggests a broader trend of moving away from smaller regional banks, which may be more susceptible to interest rate fluctuations and rising deposit costs [12].

Financial Data and Key Metrics Changes - The company reported strong loan growth, solid organic deposit growth, and significant loan fee income, indicating robust performance in 2025 [3][4] - The provision for loan losses was not increased significantly despite the growth, reflecting improved asset quality [4] Business Line Data and Key Metrics Changes - Loan growth was particularly strong in Oklahoma and Texas, with expectations of $25 million in monthly payoffs and a need for $35-$45 million in new fundings to sustain growth [10] - The company achieved better results on the deposit side compared to the loan side, showcasing effective market capture [10] Market Data and Key Metrics Changes - The company experienced a slight compression in net interest margin (NIM) due to rate cuts, but it remains within historical ranges [12][14] - The current cost of funds decreased to 2.40%, influenced by balance sheet growth and new deposits [21] Company Strategy and Development Direction - The company is focused on maintaining discipline in loan pricing and capturing market share in key regions [11][33] - There is a cautious approach towards M&A, with a focus on high-quality deposit franchises and maintaining capital for future opportunities [32][33] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's position for continued high performance and acknowledged the challenges posed by market conditions [4][26] - The company is prepared for potential fluctuations in net income due to oil and gas revenue, but views it as a minor factor in overall performance [39] Other Important Information - The company highlighted the importance of controlling expenses and maintaining a strong operational framework [37][40] - Management noted that the return on equity may decline due to accumulating capital, but this is viewed as a "high-class problem" [33] Q&A Session Summary Question: Loan growth expectations and payoff activity - Management noted that while payoffs were lighter in Q4, they expect continued strong loan growth, albeit with some pricing pressure [10][11] Question: Net interest margin trends - Management indicated that NIM may see slight declines but remains confident in maintaining a strong margin within historical ranges [14][16] Question: Deposit costs and competition - Management acknowledged challenges in deposit pricing competition, noting that recent rate cuts did not significantly impact deposit betas [23][24] Question: Capital management and stock performance - Management emphasized a focus on producing strong results rather than share buybacks, with confidence that the market will recognize the company's performance over time [26][27] Question: M&A opportunities and market conditions - Management discussed ongoing challenges in M&A due to high seller expectations but remains disciplined in pursuing quality opportunities [32][33] Question: Non-interest-bearing deposits and seasonality - Management explained the decline in non-interest-bearing accounts as a response to changing customer awareness regarding interest rates [34][35]