Financial Data and Key Metrics Changes - Earnings for the fourth quarter were $262 million, up 19% from the prior quarter and 31% year-over-year, driven by stronger revenues and lower provision for credit losses [4] - Net interest margin expanded for the eighth consecutive quarter to 3.31%, benefiting from an improved funding mix [4][9] - Annualized average loans were flat compared to the last quarter, but period-end balances increased by $615 million [4][16] - Tangible book value per share increased by 21% year-over-year, marking the third consecutive year of growth over 20% [7][22] - Diluted earnings per share rose to $1.76 from $1.48 last quarter and $1.34 a year ago [7] Business Line Data and Key Metrics Changes - Net interest income increased by $56 million or 9% compared to the fourth quarter of 2024 [9] - Customer-related noninterest income was $177 million for the quarter, up from $163 million in the prior period [11] - Adjusted customer-related noninterest income, excluding net CVA, was a record $175 million for the quarter [12] - Capital markets fees, excluding net CVA, increased by 25% compared to the full year 2024 [13] Market Data and Key Metrics Changes - Average non-interest-bearing deposits grew by $1.7 billion or 6% compared to the prior quarter [17] - Period-end deposit balances grew by $766 million versus the prior quarter [19] - The cost of total deposits declined by 11 basis points sequentially to 1.56% [18] Company Strategy and Development Direction - The company aims to increase capital distributions while continuing to strengthen capital [7][22] - Focus on small business lending is central to growth strategy, with a near doubling of SBA 7 loans and a 53% increase in dollars produced [42] - Increased marketing and business development expenses are part of a strategy to revamp products and drive growth [30][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of performance despite industry disruptions from the pandemic and regional bank crisis [6] - The outlook for net interest income for 2026 is moderately increasing, supported by favorable earning asset and interest-bearing liability remix [10] - Management is cautious about potential economic impacts on credit quality but remains optimistic about growth in commercial loans [49][81] Other Important Information - The company reported a $6 million provision for credit losses, which, combined with net charge-offs, reduced the allowance for credit losses by $1 million [20] - The allowance for credit losses as a percentage of loans declined to 1% [21] Q&A Session Summary Question: Clarification on expense guidance - The base for the moderately increasing guide should exclude the charitable contribution for this quarter [25][26] Question: Increased competition in markets - Management acknowledged ongoing competition but emphasized that increased marketing spend is driven by internal product revamps rather than new entrants [28][30] Question: NII outlook for 2026 - Management indicated potential for a remix on both sides of the balance sheet contributing to NII outcomes, with a focus on granular deposit growth [34][35] Question: Loan growth dynamics - Management highlighted strong growth in small business lending and a focus on C&I and owner-occupied loans [42][45] Question: Timing of share buybacks - Management indicated that they are nearing a position to start accelerating capital returns, but no specific timing was provided [51][52] Question: Source of deposit growth - Management expects growth across both non-interest-bearing and interest-bearing deposits, driven by strategic initiatives [57] Question: Non-interest-bearing deposits growth - Management reported growth from new customer acquisitions and expects this trend to continue [60][62] Question: Fixed rate asset repricing - Management noted that current fixed loan repricing impacts are around one basis point, with expectations of potential erosion from future rate cuts [64]

Financial Data and Key Metrics Changes - Earnings for the fourth quarter were $262 million, up 19% from the prior quarter and 31% year-over-year, driven by stronger revenues and lower provision for credit losses [5] - Net interest margin expanded for the eighth consecutive quarter to 3.31%, benefiting from an improved funding mix [5][9] - Annualized average loans were flat compared to the last quarter, but period-end balances increased by $615 million [5][16] - Tangible book value per share increased by 21% year-over-year, marking the third consecutive year of growth over 20% [7][22] Business Line Data and Key Metrics Changes - Adjusted PPNR for the quarter was $331 million, down 6% sequentially but up 6% year-over-year [7] - Customer-related noninterest income reached $177 million, a record for the company, up from $163 million in the prior period [12] - Capital markets fees, excluding net CVA, increased by 25% compared to the full year 2024, driven by higher customer swaps and investment banking revenues [13] Market Data and Key Metrics Changes - Average deposits increased by 2.3% compared to the prior quarter, with average non-interest-bearing deposits growing by $1.7 billion or 6% [16][17] - Period-end deposit balances grew by $766 million versus the prior quarter, allowing for a reduction in higher-cost short-term borrowings [18] Company Strategy and Development Direction - The company aims to increase capital distributions while continuing to strengthen capital [6][22] - Focus on small business lending is central to growth strategy, with a near doubling of SBA 7(a) loans and a 53% increase in dollars produced [44] - Increased marketing and business development expenses are part of a strategy to revamp products and drive growth [31][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of performance despite industry disruptions, particularly in credit quality [6][22] - The outlook for net interest income for 2026 is moderately increasing, supported by favorable earning asset and interest-bearing liability remix [10] - Management is cautious about potential rate cuts and their impact on asset sensitivity, indicating a balanced approach to growth and risk management [39][102] Other Important Information - The company made a $15 million donation to its charitable foundation, which will be spent over the next three years [6] - The allowance for credit losses as a percentage of loans declined to 1%, with net charge-offs at 5 basis points [20] Q&A Session Summary Question: Clarification on expense guidance - The base for the moderately increasing guide should exclude the charitable contribution for the quarter [25][26] Question: Increased competition in markets - Management acknowledged ongoing competition but emphasized that increased marketing spend is driven by internal product revamps rather than new entrants [29][31] Question: NII outlook for 2026 - Management indicated potential for remixing on both sides of the balance sheet contributing to NII outcomes, with a focus on granular deposit growth [34][36] Question: Loan growth dynamics - Management highlighted strong growth in small business lending and a focus on C&I and owner-occupied loans, with expectations for continued growth in these areas [43][46] Question: Capital return timing - Management indicated that they are nearing a position to consider capital returns, with expectations for acceleration in the second half of the year [51][52] Question: Non-interest-bearing deposits growth - Management reported growth in new customer acquisitions and emphasized the importance of building a solid base of granular accounts [61][63]

Financial Data and Key Metrics Changes - Earnings for Q4 2025 were $262 million, up 19% from the prior quarter and 31% year-over-year, driven by stronger revenues and lower provision for credit losses [4] - Net interest margin expanded for the eighth consecutive quarter to 3.31%, benefiting from an improved funding mix [4] - Tangible book value per share increased by 21% year-over-year, marking the third consecutive year of growth greater than 20% [6][22] - Diluted earnings per share rose to $1.76, up from $1.48 in the previous quarter and $1.34 a year ago [6] Business Line Data and Key Metrics Changes - Net interest income increased by $56 million or 9% compared to Q4 2024 and by $11 million from the prior quarter [10] - Customer-related noninterest income was $177 million for the quarter, up from $163 million in the prior period and $176 million year-over-year [12] - Adjusted noninterest expense was $548 million, up 5% from the prior quarter and 8% year-over-year, including a $15 million charitable donation [15] Market Data and Key Metrics Changes - Average loans were flat compared to the previous quarter but increased by 2.5% year-over-year, with period-end loans rising by $615 million sequentially [11][16] - Average non-interest-bearing deposits grew by $1.7 billion or 6% compared to the prior quarter [17] - The cost of total deposits declined by 11 basis points sequentially to 1.56% [18] Company Strategy and Development Direction - The company aims to increase capital distributions while continuing to strengthen capital [6][22] - Focus on small business lending is central to growth strategy, with a near doubling of SBA 7 loans and a 53% increase in dollars produced [54] - Increased marketing and business development expenses are part of a strategy to revamp products and drive growth [33][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of performance despite past industry disruptions, highlighting stability in credit outcomes [5] - The outlook for net interest income for 2026 is moderately increasing relative to 2025, supported by favorable asset and liability remix [10] - Management anticipates continued growth in commercial loans, particularly in C&I and owner-occupied subcategories [17] Other Important Information - The company reported a $6 million provision for credit losses, which, combined with net charge-offs, reduced the allowance for credit losses by $1 million [20] - The allowance for credit losses as a percentage of loans declined to 1% [21] - The Common Equity Tier 1 ratio for the quarter was 11.5%, indicating a strong capital position [22] Q&A Session Summary Question: Clarification on expense guidance - Management clarified that the base for expense guidance should exclude the charitable contribution for the quarter [25][26] Question: Increased competition in markets - Management acknowledged ongoing competition but emphasized that increased marketing spend is driven by internal product revamps rather than new entrants [29][33] Question: NII outlook for 2026 - Management indicated that funding for loan growth will come from deposit growth and potential remixing from securities [39][44] Question: Loan growth dynamics - Management highlighted a focus on small business lending and noted strong growth in SBA loans, with expectations for continued growth in this area [54][56] Question: Timing of share buybacks - Management suggested that they are nearing a position to consider capital returns, potentially in the second half of the year [65][66] Question: Non-interest-bearing deposits growth - Management reported growth in new customer acquisitions and emphasized the importance of building a solid base of granular accounts [84][89]

Financial Data and Key Metrics Changes - The company reported net earnings of $243 million for the second quarter, reflecting a 28% improvement year-over-year and a 44% increase compared to the first quarter [6][9] - The efficiency ratio improved to 62.2%, and the net interest margin increased for the sixth consecutive quarter to 3.17% [10][12] - Average customer deposits increased by 0.5% year-over-year but decreased by 1.4% on a linked quarter basis [10][18] - Average loans grew by 5.6% on an annualized linked quarter basis and 3.7% year-over-year [10][17] Business Line Data and Key Metrics Changes - The company experienced a 91% increase in the number of loans booked through the SBA program in the first nine months of the fiscal year compared to the previous year [8] - Customer-related non-interest income was $164 million, a 4% increase on a linked quarter basis and a 7% increase year-over-year [14] - Adjusted non-interest expenses decreased by $12 million compared to the prior year, reflecting lower technology costs [15] Market Data and Key Metrics Changes - The company noted a decline in average broker deposits by 8% and a decrease in total average deposits by 0.9% due to seasonal customer deposit outflows [18] - Non-performing assets remained low at 0.51% of loans and other real estate owned [21][23] Company Strategy and Development Direction - The company is focusing on growing customer relationships, particularly in small business banking, and has launched a consumer gold account offering aimed at the mass affluent market [7][8] - The management is optimistic about the potential for growth, citing reduced tariff-related risks and a more favorable economic outlook [6][29] - The company is exploring opportunities in capital markets, including M&A advisory work and launching an oil and gas derivatives business [108] Management's Comments on Operating Environment and Future Outlook - Management expressed a more positive outlook compared to the previous quarter, attributing it to reduced uncertainty in the macro environment and a more flexible administration regarding tariffs [29][31] - The company expects continued growth in net interest income and customer-related fee income, supported by increased customer activity and new client acquisition [13][15] Other Important Information - The company recorded a negative provision for credit losses of $1 million, reducing the allowance for credit losses by $11 million relative to the prior quarter [22] - The common equity Tier one ratio was reported at 11%, indicating strong capital levels [25] Q&A Session Summary Question: What are you hearing from clients in the small business and middle market side? - Management noted that while some businesses are being hurt by tariffs, others see opportunities, leading to a more optimistic outlook compared to the previous quarter [29][31] Question: Are you seeing any elevated competition on the deposit side? - Management acknowledged a competitive market for deposits but emphasized a focus on maintaining margin while growing the deposit base [32][34] Question: Can you provide color on the increase in loan growth? - Loan growth was solid, primarily driven by commercial and industrial loans, with increased utilization and new originations contributing significantly [40][41] Question: Can you discuss the potential benefits of deregulation for the company? - Management highlighted the potential benefits of tiering in regulatory requirements, which could positively impact the company's operations and M&A strategy [45][47] Question: What is the outlook for your capital markets business? - The capital markets business is growing nicely, with expectations to double in size over the next few years, driven by loan syndications and new service offerings [106][108]

Financial Data and Key Metrics Changes - The company reported second quarter net earnings of $243 million, reflecting a 28% improvement over the prior year period and a 44% increase compared to the first quarter [5][7] - The efficiency ratio improved to 62.2%, and the net interest margin increased for the sixth consecutive quarter to 3.17% due to lower funding costs and an improved earning asset mix [8][12] - Average customer deposits increased by 0.5% year-over-year but decreased by 1.4% on a linked quarter basis [9] - Average loans grew by 5.6% on an annualized linked quarter basis and 3.7% year-over-year [10][17] Business Line Data and Key Metrics Changes - The company experienced a 91% increase in the number of deals booked through the SBA seven program in the first nine months of the fiscal year compared to the same period last year [6] - Customer-related non-interest income was $164 million for the quarter, a 4% increase on a linked quarter basis and a 7% increase year-over-year [13] - Adjusted non-interest expenses decreased by $12 million compared to the prior year, reflecting lower technology costs [14][15] Market Data and Key Metrics Changes - The company noted stability in non-interest bearing deposits at 34% of total deposits [9] - Average non-interest bearing deposits grew approximately $480 million or 2% compared to the prior quarter [18] Company Strategy and Development Direction - The company is focusing on growing customer relationships, particularly in small business banking, and has launched a consumer gold account offering in the Nevada market [6][7] - The management is optimistic about the potential for growth in the outlook, citing reduced tariff-related risks and a more favorable economic environment [5][31] Management's Comments on Operating Environment and Future Outlook - Management expressed a more positive outlook compared to the previous quarter, noting that the economy is weathering challenges better than anticipated [32] - The company expects continued growth in net interest income and customer-related fee income for 2026, supported by increased customer activity and new client acquisition [12][14] Other Important Information - The allowance for credit losses as a percentage of loans and leases declined to 1.2%, with non-performing assets remaining low at 0.51% [21][24] - The common equity Tier one ratio was reported at 11%, indicating strong capital levels [24] Q&A Session Summary Question: What are you hearing from clients in the small business and middle market side? - Management noted a more positive sentiment among clients due to reduced uncertainty in the macro environment and some businesses seeing opportunities despite challenges [30][31] Question: Are you seeing any elevated competition on the deposit side? - Management acknowledged a competitive market for deposits but emphasized a focus on maintaining margin while growing the deposit base [33][34] Question: Can you provide color on the increase in loan growth? - Loan growth was solid, primarily driven by commercial and industrial loans, with increased utilization and new originations contributing significantly [41][42] Question: Can you discuss the potential benefits of deregulation for the company? - Management highlighted the potential benefits of tiering in regulatory requirements and expressed a strategic approach to M&A, focusing on organic growth [46][49] Question: What is the outlook for capital markets business? - The capital markets business is growing nicely, with expectations to double in size over a four to five-year period, driven by various segments including loan syndications and M&A advisory work [110][111]