Global Asset Prices - Global bond market yields generally declined, with the 10-year U.S. Treasury yield down by 3 basis points[7] - Major global stock indices showed mixed results, with the S&P 500, Dow Jones, and Nasdaq increasing by 1.7%, 1.6%, and 2.1% respectively[7] - WTI crude oil and Brent crude oil prices fell by 7.3% and 6.4% respectively, while London gold prices rose by 5.8%[7] Central Bank Monetary Policy - The Federal Reserve is considering halting its balance sheet reduction, citing sufficient reserves and stable economic growth[9] - ECB President Lagarde indicated that the monetary policy is in good shape but does not rule out further rate cuts if necessary[9] U.S. Economic Dynamics - The U.S. government remains shut down, with the Senate rejecting a temporary funding bill for the tenth time, impacting federal operations[12] - The NFIB small business optimism index fell by 2 points to 98.8, marking a three-month low due to declining economic outlook and inventory concerns[13] - The October Beige Book reported stable economic activity, but increased layoffs and natural attrition were noted due to weak demand and ongoing economic uncertainty[13] Other Regional Economic Dynamics - The IMF raised its global growth forecasts for 2025 and 2026 to 3.2% and 3.1% respectively, but these remain below pre-tariff levels[25] - Eurozone industrial production fell by 1.2% month-on-month in August, with capital goods being a major drag[25] - Japan's industrial output contracted by 1.5% in August, marking the second consecutive month of decline due to trade policy uncertainties and weak demand[25] Upcoming Focus - Key upcoming data includes the U.S. September CPI and the October S&P Global PMI, which will be closely monitored for economic indicators[29]

Financial Data and Key Metrics Changes - Net interest income increased by more than 12% from the fourth quarter and 17% year over year, with net interest margin expanding by 44 and 57 basis points respectively [4] - Non-interest income was $10,400,000, supported by enhancements to the company-owned life insurance portfolio and increased investment advisory income [5] - Net income for the first quarter was $16,900,000, with diluted EPS at $0.81, driven by improved net interest income and effective non-interest expense management [16] - The efficiency ratio was 59%, consistent with the full-year target of below 60% [5] Business Line Data and Key Metrics Changes - Total loans increased by 1.7% during the quarter, driven by both commercial and industrial (C&I) and commercial real estate (CRE) lending [7] - Commercial business loans rose by 6.6% during the quarter, while commercial mortgage loans increased by 1.3% [8] - Consumer indirect balances were up just shy of 1% from December 31, but down 7% year over year [10] - Residential lending decreased by 1% from both the linked and year-ago quarters due to high competition and tight housing inventory [12] Market Data and Key Metrics Changes - Deposits increased by 5.3% from year-end 2024, driven by seasonally higher public deposit balances and an increase in brokered deposits [12] - Cash-related deposits totaled approximately $55,000,000 as of March 31, 2025, with expectations for a portion to remain on the balance sheet into the third quarter [13] Company Strategy and Development Direction - The company is focused on driving internal efficiency, controlling credit extension, and maintaining a disciplined approach to management [6] - The strategic focus includes sustainable customer growth and service excellence across its retail network and banking locations [25] - The company plans to continue evaluating options for subordinated debt facilities moving forward [14] Management's Comments on Operating Environment and Future Outlook - Management expressed a cautious outlook for the industry due to uncertainties in the political and macroeconomic environments [6] - The company remains committed to a low single-digit growth guidance for 2025, reflecting a conservative approach amid economic volatility [8] - Management reiterated confidence in maintaining profitability and credit discipline despite the uncertain economic landscape [24] Other Important Information - The company welcomed a new executive with extensive experience in consumer banking, expected to contribute to strategic objectives [25] - The company filed its 2025 proxy statement, with new directors nominated to enhance corporate governance [26] Q&A Session Summary Question: Loan growth outlook for the year - Management is comfortable with their guidance, noting that uncertainty has led customers to pause anticipated investments [30][31] Question: NIM guidance and levers for improvement - Key levers include cash flow from the portfolio and deposit repricing, with about $500,000,000 of CDs maturing in the next nine months [33][34] Question: Expected COLI income over the next quarters - COLI income is expected to be elevated in the second quarter before normalizing, with a significant increase in yield due to restructuring [41][42] Question: Provision outlook for credit - The guided ACL to average loans ratio is expected to hover around 107 to 108 basis points for the rest of the year [45]