Financial Data and Key Metrics Changes - Core FFO including net promote income was $1.46 per share, and excluding net promotes was $1.47 per share, both ahead of forecasts [8] - Occupancy ended the quarter at 95.1%, down just 10 basis points sequentially, widening outperformance to the market by 290 basis points [8] - Net effective same store growth was strong, with rent change across the global portfolio monetizing an additional $75 million of NOI, reflecting a 53% net effective basis and 35% cash [8][9] Business Line Data and Key Metrics Changes - The company started over $900 million in new development, with nearly 65% being build-to-suit activity across seven projects in the U.S. and Europe [9] - Build-to-suit starts for the first half totaled $1.1 billion, marking the largest start to a year [10] - The build-to-suit pipeline remains full with over 30 projects representing more than 25 million square feet in active dialogue [15] Market Data and Key Metrics Changes - In the U.S., net absorption was subdued at 28 million square feet, with market vacancy ticking up 10 basis points to 7.4% [14] - Market rents declined approximately 1.4% during the quarter, while values remained flat [13] - The leasing pipeline reached historically high levels at 130 million square feet, reflecting significant interest and need for space [15] Company Strategy and Development Direction - The company remains committed to serving customers at the center of consumption, focusing on logistics real estate as a strategic asset [19][20] - The strategy includes expanding the distributed energy platform and increasing development starts, particularly in data centers [11][17] - The company is excited about broader global potential and sees meaningful opportunities in the U.S. market [12][19] Management's Comments on Operating Environment and Future Outlook - Management noted that while conditions remain choppy, the underlying activity reflects a market that is active and moving forward [19] - There is confidence in the long-term trends driving the business, despite short-term uncertainties [19][41] - The company expects to see improved clarity in policy and trade arrangements, which will be key determinants of net absorption pace [16] Other Important Information - The company closed on $5.8 billion in financing activity, contributing to over $7 billion of liquidity held at quarter end [12] - Strategic capital business saw net outflows of approximately $300 million during the quarter [13] - The company is making steady progress toward its goal of one gigawatt of solar production and storage by year-end [11] Q&A Session Summary Question: Can you provide more details on the leasing pipeline and its impact? - The leasing pipeline is promising, up 19% year on year, with good balance across different deal stages and types [24][25] Question: What is the cadence of leasing activity from Q1 to Q2? - Leasing activity accelerated through May and June, ending the quarter only down about 10% from normal [31] Question: Can you elaborate on the guidance and factors driving it? - The environment has calmed significantly since April, leading to improved visibility and confidence in guidance [36] Question: How do you see the timing of the growing pipeline translating to signed leases? - Decision-making remains deliberate, with clarity on the macro front being crucial for converting the pipeline into signed leases [40] Question: What are the expectations for occupancy in specific regions? - Occupancy is expected to improve, particularly in Asia, while other regions may experience volatility [103]

Financial Data and Key Metrics Changes - Core FFO including net promote income was $1.46 per share and excluding net promotes was $1.47 per share, both ahead of forecasts [7] - Occupancy ended the quarter at 95.1%, down just 10 basis points sequentially, outperforming the market by 290 basis points [7] - Net effective same store growth was strong, with rent change across the global portfolio monetizing an additional $75 million of NOI, reflecting a 53% net effective basis and 35% cash [7][8] Business Line Data and Key Metrics Changes - Build to suit activity saw significant growth, with $1.1 billion in starts for the first half, the largest start to a year ever [9] - The company signed agreements for an additional three build to suits post quarter end, indicating strong demand from major customers [9] - The leasing pipeline reached historically high levels, up 19% year on year, with a good balance across different deal stages and types [24][25] Market Data and Key Metrics Changes - In the U.S., net absorption was subdued at 28 million square feet, with market vacancy ticking up 10 basis points to 7.4% [13] - Market rents declined approximately 1.4% during the quarter, while values remained essentially flat [12] - The leasing pipeline stands at 130 million square feet, reflecting significant interest and need for space [14] Company Strategy and Development Direction - The company remains committed to its strategy of serving customers at the center of consumption, focusing on logistics real estate as a strategic asset [18][19] - There is a strong emphasis on expanding the distributed energy platform, with a goal of one gigawatt of solar production and storage by year-end [10] - The company is increasing development starts to a new range of $2.25 billion to $2.75 billion, reflecting improved visibility in logistics starts [16][17] Management's Comments on Operating Environment and Future Outlook - Management noted that while conditions remain choppy, the market is holding up reasonably well, with expectations for improved demand as clarity on policy emerges [15][18] - The company expressed confidence in long-term trends driving the business, despite short-term uncertainties [18] - Management highlighted that the current environment has calmed significantly since April, providing improved visibility for guidance [35] Other Important Information - The company closed on $5.8 billion in financing activity, contributing to over $7 billion of liquidity held at quarter end [11] - Strategic capital business saw net outflows of approximately $300 million during the quarter, with teams developing new offerings [12] - Bad debt trends were better than expected, with expectations of around 40 basis points for the balance of the year [71] Q&A Session Summary Question: Impact of Liberation Day on Leasing Pipeline - The leasing pipeline is promising, up 19% year on year, with good balance across different deal stages and types [24][25] Question: Cadence of Leasing Activity - Leasing activity accelerated through May and June, with the quarter ending only down about 10% from normal [31] Question: Guidance Details - The increase in guidance is due to improved visibility and outperformance in the quarter, with confidence in landing at the stronger end of the range [36] Question: Timing of Growing Pipelines to Signed Leases - Decision-making remains deliberate, with clarity on the macro front needed to convert the pipeline into signed leases [39] Question: Bad Debt Trends - Bad debt is trending better than expectations, with elevated levels around 35-40 basis points [71] Question: Geographic Market Dynamics - Strong long-term fundamentals in certain markets like Southern California could lead to a quick recovery as demand increases [78][79]

Financial Data and Key Metrics Changes - The diluted GAAP earnings per share increased to $4.24 from $3.32 in the prior quarter, while net income was $116 million compared to $584 million in the linked quarter [8][10] - The return on assets (ROA) and return on common equity (ROCE) were reported at 1.37% and 10.39%, respectively [8] - The common equity tier 1 (CET1) ratio at the end of the second quarter was estimated at 10.98%, down from 11.5% at the end of the first quarter [21] Business Line Data and Key Metrics Changes - Average residential mortgage and consumer loans grew by $1.1 billion, reflecting a diversified business model [7] - Noninterest income increased to $683 million from $611 million in the linked quarter, with notable growth in mortgage banking and trust income [17] - The efficiency ratio improved to 55.2% from 60.5% in the prior quarter, indicating better expense management [19] Market Data and Key Metrics Changes - Average total deposits rose by $2.2 billion or 1% to $163.4 billion, with growth across most segments [12] - The yield on investment securities decreased by 19 basis points to 3.81%, primarily due to premium amortization [15] - Commercial real estate (CRE) loans declined by 4% to $25.3 billion, reflecting continued payoffs and paydowns [13] Company Strategy and Development Direction - The company remains focused on growing its New England and Long Island markets while optimizing resources through simplification and enhancing risk management capabilities [27] - The management emphasized a disciplined approach to acquisitions, indicating a preference for cultural fit and credit quality in potential targets [77] - The company aims to maintain a strong capital position while being opportunistic with share repurchases [26] Management's Comments on Operating Environment and Future Outlook - The management acknowledged potential economic slowing and risks related to tariffs and geopolitical conditions, but expressed optimism about the company's strong liquidity and capital generation [23] - The outlook for taxable equivalent net interest income is projected to be between $7 billion and $7.15 billion, reflecting continued softness in commercial and CRE loan growth [24] - The management expects net charge-offs for the full year to be less than 40 basis points, with criticized loans anticipated to continue declining [26] Other Important Information - The company executed $1.1 billion in share repurchases during the second quarter, contributing to a 1% growth in tangible book value per share [6] - The net interest margin was reported at 3.62%, a decrease of four basis points from the prior quarter, primarily due to higher costs of interest-bearing deposits [12] Q&A Session Summary Question: Loan dynamics and CRE portfolio outlook - The management indicated that the CRE pipeline continues to build, with over $5 billion currently in the pipeline, suggesting a positive outlook for growth later in the year [32] Question: Capital management and buyback strategy - The management stated that the target CET1 ratio is around 10%, but given current market uncertainties, operating in the range of 10.75% to 11% is deemed appropriate [36] Question: Fee income growth and trust business performance - The trust business has shown strong growth, driven by investments in Europe and increased demand for corporate trust services [38] Question: Consumer loan growth sustainability - The management noted that recent consumer loan growth was driven by preemptive buying ahead of price increases, but expressed optimism for continued growth in the RV and auto sectors [68] Question: Deposit competition and strategy - The management emphasized the importance of attracting operating accounts and maintaining competitive rates to grow deposits sustainably [106]

Financial Data and Key Metrics Changes - The diluted GAAP earnings per share increased to $4.24 from $3.32 in the prior quarter, while net income was $116 million compared to $584 million in the linked quarter [10] - The return on assets (ROA) and return on common equity (ROCE) were reported at 1.37% and 10.39% respectively [10] - The common equity tier 1 (CET1) ratio decreased to an estimated 10.98% from 11.5% at the end of the first quarter [22] Business Line Data and Key Metrics Changes - Average residential mortgage and consumer loans grew by $1.5 billion, reflecting a 3% sequential increase, while commercial loans remained unchanged at $61 billion [15][14] - Noninterest income rose to $683 million from $611 million in the linked quarter, with notable increases in mortgage banking and trust income [18] - Noninterest expenses decreased by $79 million to $1.34 billion, resulting in an efficiency ratio of 55.2%, down from 60.5% in the prior quarter [20] Market Data and Key Metrics Changes - Average total deposits increased by $2.2 billion or 1% to $163.4 billion, with growth across most segments [17] - The yield on investment securities decreased by 19 basis points to 3.81%, primarily due to premium amortization [16] - The net interest margin was reported at 3.62%, a decrease of four basis points from the prior quarter [13] Company Strategy and Development Direction - The company remains focused on growing its New England and Long Island markets, optimizing resources, and enhancing risk management capabilities [29] - The management emphasized a disciplined approach to acquisitions, indicating a preference for smaller, culturally aligned targets [79] - The company aims to maintain a strong capital position while being opportunistic with share repurchases [28] Management's Comments on Operating Environment and Future Outlook - The management acknowledged potential economic slowing and risks related to tariffs and geopolitical conditions, but expressed optimism about the company's positioning [24][25] - The outlook for net interest income is projected to be between $7 billion and $7.15 billion, with a net interest margin expected to average in the mid to high 360s [26] - The management expects net charge-offs for the full year to be less than 40 basis points, with criticized loans anticipated to continue declining [28] Other Important Information - The company executed $1.1 billion in share repurchases during the second quarter, while tangible book value per share grew by 1% [8] - The company reported a $1 billion or 11% reduction in commercial criticized balances, indicating improved asset quality [9] Q&A Session Summary Question: Loan dynamics and CRE portfolio - The management indicated that the CRE pipeline is building, with over $5 billion currently in the pipeline, and expressed optimism for growth towards the end of the year [32][34] Question: Capital management and buyback strategy - The management stated that the current capital range of 10.75% to 11% is appropriate given market uncertainties, and they are actively managing criticized loans [36] Question: Fee income growth and trust business - The management highlighted strong growth in the trust business, driven by new operations in Europe and increased treasury management revenues [40][41] Question: Consumer loan growth outlook - The management noted that recent consumer loan growth was driven by preemptive buying ahead of price increases, but expressed optimism for continued growth in RV and auto loans [70] Question: Deposit competition and funding costs - The management emphasized the importance of core deposits and competitive rates to attract new customers, while managing funding costs effectively [108][109]

Financial Data and Key Metrics Changes - The company reported net income of $1.6 billion or $3.85 per diluted share, with a 4% increase in revenue and a 10% growth in PPNR [6][16][22] - Loans grew by 2%, reflecting strong commercial loan growth, while non-interest expenses remained stable, resulting in positive operating leverage [6][10][12] - The tangible book value increased to approximately $104 per common share, a 4% increase linked quarter and a 17% increase year-over-year [11][12] Business Line Data and Key Metrics Changes - In Capital Markets and Investment Banking (C&IB), strong growth in loans and commitments was noted, with credit trends remaining positive [7][8] - Retail banking saw a 2% year-over-year growth in consumer checking accounts, with a notable 6% growth in the Southwest region [8][12] - Asset management experienced positive net flows and a 16% increase in new client acquisition linked quarter [8] Market Data and Key Metrics Changes - The company maintained a regulatory minimum stress capital buffer of 2.5%, with a start to trough capital depletion of 80 basis points, the lowest in its peer group [7][12] - Average deposits increased by $2 billion, driven by growth in CDs, while non-interest bearing balances remained stable at 22% of total deposits [15][92] Company Strategy and Development Direction - The company continues to execute its national growth strategy, focusing on new customer acquisition and deepening relationships with existing customers [5][9] - A $1.5 billion branch investment plan is underway, with plans to open more than 200 branches in expansion markets [8][9] - The management emphasized the importance of scale and market presence to compete effectively against larger banks [76][78] Management's Comments on Operating Environment and Future Outlook - The management expects continued economic growth in the second half of the year, with real GDP growth projected at approximately 1.5% in 2025 [22][23] - The company anticipates a Fed rate cut in December 2025, which may impact net interest income positively [23] - Despite economic uncertainties, the management remains optimistic about the company's growth potential and market positioning [9][22] Other Important Information - The company returned approximately $1 billion of capital to shareholders, including $640 million in common dividends and $335 million in share repurchases [11][12] - The effective tax rate for the quarter was 18.8%, with a provision of $254 million reflecting macroeconomic changes [16][22] Q&A Session Summary Question: Loan growth sustainability - The management indicated that loan growth was driven by increased utilization and new production, particularly in growth markets, but does not expect the same level of growth to repeat in the second half of the year [26][28] Question: Net interest income trajectory - The management raised guidance for net interest income growth to approximately 7% for the full year, expecting sustained momentum into 2026 [30][31] Question: Fee income outlook - The management noted a slight downward revision in fee income guidance due to heightened economic uncertainty, despite solid performance in capital markets [41][43] Question: Competitive pressure on loan pricing - The management stated that while competition remains rational, there has been no significant contraction in spreads, and yields have remained stable [46][47] Question: Capital levels and regulatory changes - The management expressed confidence in their current capital levels, indicating they are well-positioned relative to regulatory requirements and have flexibility for growth [63][65] Question: Loan growth from new markets - The management confirmed that loan growth is primarily driven by share gains in new markets, with a focus on organic growth [73][120] Question: Impact of stablecoins on deposits - The management does not foresee stablecoins draining deposits from the system and is exploring opportunities to integrate crypto into their payment technology [140][141]

Financial Data and Key Metrics Changes - The company reported net income of $1.6 billion or $3.85 per diluted share, with a 4% increase in revenue and a 10% growth in PPNR [7][17][23] - Loans grew by 2% to $323 billion, reflecting strong commercial loan growth, while non-interest expenses remained stable [11][13][17] - The tangible book value increased to approximately $104 per common share, a 4% increase linked quarter and a 17% increase year-over-year [12] Business Line Data and Key Metrics Changes - In Capital Markets and Investment Banking (C&IB), strong growth in loans and commitments was noted, with credit trends remaining positive [8][9] - Retail banking saw a 2% year-over-year growth in consumer checking accounts, with a notable 6% growth in the Southwest region [9] - Asset management experienced positive net flows and a 16% increase in new client acquisition linked quarter [9] Market Data and Key Metrics Changes - The company maintained a regulatory minimum stress capital buffer of 2.5%, with the lowest capital depletion in its peer group [8] - Average deposits increased by $2 billion, driven by growth in CDs, while non-interest bearing balances remained stable at 22% of total deposits [16] Company Strategy and Development Direction - The company is focused on a national growth strategy, emphasizing customer acquisition and deepening relationships with existing clients [6][10] - Plans to open more than 200 branches in expansion markets with a $1.5 billion investment were highlighted [9] - The management expressed optimism about future growth potential, driven by new markets and client acquisition [10] Management's Comments on Operating Environment and Future Outlook - The management expects continued economic growth in the second half of the year, with real GDP growth projected at approximately 1.5% [22] - The company anticipates a Fed rate cut in December 2025, which may impact net interest income [23] - The outlook for loan growth was adjusted to approximately 1% for the full year, up from previous guidance of stable [23] Other Important Information - The company returned approximately $1 billion of capital to shareholders, including $640 million in common dividends and $335 million in share repurchases [12] - The effective tax rate for the quarter was reported at 18.8% [17] Q&A Session Summary Question: Loan growth sustainability - Management indicated that loan growth was driven by increased utilization and new production, particularly in growth markets, but does not expect the same level of growth to repeat [28][29] Question: Net interest income trajectory - The company raised its guidance for net interest income growth to approximately 7% for the full year, expecting sustained momentum into 2026 [30][31] Question: Fee income outlook - Fee income guidance was nudged lower due to heightened economic uncertainty, despite solid performance in capital markets and asset management [44][45] Question: Loan pricing competition - Management noted that while competition exists, spreads have remained stable, and there has not been significant contraction impacting yields [49] Question: Capital levels and regulatory changes - The company feels well-capitalized with a CET1 ratio of 10.5% and plans to continue share repurchases while maintaining flexibility for loan growth [66][68] Question: Impact of AI on efficiency - AI is being utilized to enhance efficiency, particularly in fraud prevention and back-office operations, with ongoing efforts to automate processes [88][90]

Financial Data and Key Metrics Changes - Operating earnings reached $100.6 million or $0.55 per share, marking a 3% increase linked quarter and a record for the company [6][14] - Total revenue increased due to growth in net interest income and fee income, with a quarterly efficiency ratio of 57.1% [7][8] - Operating return on average assets rose to 1.3%, and operating return on average tangible common equity increased to 16.26% [8] Business Line Data and Key Metrics Changes - Total loans grew by $150 million or 2.5%, primarily in residential mortgage and home equity portfolios, despite strategic runoff in indirect auto and certain commercial loans [9][15] - Non-interest income for the quarter was $69.1 million, with all categories showing linked quarter growth, including record highs in Wealth Management and Commercial Banking fees [10][11][19] Market Data and Key Metrics Changes - Deposits declined by $191 million or 2.9%, influenced by seasonal trends, with a loan to deposit ratio ending at 92% [15][16] - Non-interest bearing balances constituted 20% of total deposits, with expectations for municipal balance inflows in the third quarter [15] Company Strategy and Development Direction - The company continues to focus on its Community Banking strategy, aiming to attract and retain valuable customers while reinvesting in communities [5] - The M&A strategy remains focused on community banks in the $1 billion to $5 billion range, with a disciplined approach to metrics and strategy [46] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding loan growth, with an increase in the loan pipeline but a pull-through rate below historical norms due to economic uncertainties [42][43] - The company updated its 2025 operating guidance, including an increase in net interest income expectations and a decrease in provision expense [22][23] Other Important Information - The company repurchased 522,000 shares at a weighted average price of $16.9, contributing to a tangible book value per share growth of 9.5% on a linked quarter annualized basis [8][22] - The allowance for credit losses to total loans ratio ended at 1.57%, with a coverage ratio of 177% for non-performing loans [21] Q&A Session Summary Question: Expense guidance and timing for the back half of the year - Management indicated that the expense range for the back half of the year is expected to be below the midpoint due to timing and merit increases in the second quarter [27][31] Question: Fee income guidance and potential headwinds - Management expressed confidence in fee income growth, stating that consistent performance across categories could lead to trending towards the top end of the guidance range [34][35] Question: Status of the loan pipeline and impact of economic uncertainty - Management noted an increase in the loan pipeline but highlighted that customers remain cautious about new projects due to economic uncertainties [41][42] Question: Appetite for M&A and geographic focus - The company reiterated its focus on community banks within the specified size range, maintaining a disciplined approach to potential acquisitions [46] Question: Outlook for deposits and NIM - Management acknowledged competitive pressures on deposit costs but expressed a desire to fund future loan growth with customer deposits [53][54] Question: Trends in credit quality and non-performing loans - Management reported stable credit metrics but remained cautious due to economic factors, noting that the uptick in non-performing loans was related to a specific project [84]

Fulton Financial (FULT) Q2 2025 Earnings Call July 16, 2025 10:00 AM ET Speaker0Welcome to the Fulton Financial Second Quarter twenty twenty five Results Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Matt Jozwak, Director of Investor Relations.Please go ahead.Speaker1Good mo ...

Financial Data and Key Metrics Changes - In fiscal 2024, the company reported over $40 million in revenue and $15 million in EBITDA, with expectations for higher numbers in the current year as operations transition to higher-grade ore [6][7] - For Q3, the company produced just under 4,700 ounces, with revenues of $12.5 million, gross profit of approximately $4.5 million (35% margin), and adjusted EBITDA of $4 million, all showing improvement compared to previous periods [23][24] - The cash cost per ounce in the study was reported at $1,000, with an all-in sustaining cost (AISC) of around $1,200, although Q3 cash costs were higher due to the grade profile processed [8][24] Business Line Data and Key Metrics Changes - The company is currently processing at a capacity of 2,000 tonnes per day, with plans to expand to 3,000 tonnes per day as part of the PEA roadmap [8][12] - The production mix for the quarter was 25% oxide and 75% sulfide, with expectations to transition to 100% sulfide in the future [80] Market Data and Key Metrics Changes - The company realized gold prices of over $3,100 per ounce, with sales reaching over $3,300 in recent transactions, benefiting from high gold prices [23][24] - The company entered negotiations with the Bank of Tanzania to sell a minimum of 20% of local gold production, which will reduce the royalty rate from 7.3% to 4% for domestic sales [26][29] Company Strategy and Development Direction - The company aims to self-fund growth through cash flow generated from operations, with a focus on expanding the plant and developing underground mining [17][49] - The PEA outlines a straightforward business plan that includes expanding the plant, developing the underground mine, and continuing exploration [14][66] - The management team emphasizes the importance of optimizing working capital ratios to align with market comparables and improve financial metrics [32][70] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate the current operating environment, highlighting the potential for increased production and profitability as higher-grade ore becomes accessible [16][21] - The company is focused on addressing working capital issues and improving liquidity to support ongoing operations and expansion plans [31][34] Other Important Information - The company has successfully expanded its processing capacity three times in three years, currently operating at 2,000 tonnes per day [37] - The management team is actively working on optimizing the plant to improve recovery rates and reduce costs [41][47] Q&A Session Summary Question: What is the expected trend for throughput in the coming quarters? - Management indicated that the installation of a pre-leach thickener is expected to transition the plant to 100% sulfide, improving head grades [80][82] Question: What is the timeline for recovery improvements? - Recovery improvements are expected to be seen in the next few quarters, with significant enhancements anticipated within 12 to 15 months [85][86] Question: How does the company plan to handle surface material and oxide versus sulfide mining? - Management noted that while there is potential to process oxide material, the focus will remain on higher-grade sulfide material once plant optimizations are complete [102][104] Question: What are the main bottlenecks for increasing production beyond the projected 62,000 ounces per year? - The main bottlenecks include mill capacity and the need for additional underground infrastructure, which will require careful engineering and planning [112][116]

Financial Data and Key Metrics Changes - The company reported an adjusted EPS of $0.45 per share, reflecting a $0.03 increase from the prior quarter [8] - Pre-provision net revenue (PPNR) grew by $4 million from the first quarter, primarily driven by a $10 million increase in net interest income [8][9] - Total expenses, excluding deferred compensation, increased by only $4 million from the last quarter [16] Business Line Data and Key Metrics Changes - The loan portfolio increased by 2% quarter over quarter, with significant growth in loans to mortgage companies, which rose by $689 million [13] - Fee income decreased by $3 million from the prior quarter, with fixed income performance declining slightly [14] - Non-interest bearing deposits increased by $57 million, supported by successful seasonal marketing promotions [12] Market Data and Key Metrics Changes - Period end balances for both loans and deposits finished 2% higher quarter over quarter [10] - The average rate paid on interest-bearing deposits increased to 2.76%, up from 2.72% in the first quarter [12] - The charge-off ratio remained stable at 22 basis points, in line with expectations [17] Company Strategy and Development Direction - The company aims to achieve a 15% plus return on tangible common equity (ROTCE) over the next two to three years [20] - Focus remains on organic loan growth and enhancing client relationships to drive profitability [20][22] - The company is committed to maintaining capital levels in line with a near-term target of 11% CET1 [18] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the economic fundamentals in their southern footprint, expecting stability through 2025 and into 2026 [7] - There is a recognition of increased deposit pressure and competition, but the company remains focused on expense and pricing discipline [8] - Management noted that borrowers are showing resilience and optimism, with expectations for improved activity in the latter half of the year [28] Other Important Information - The company retained approximately 95% of balances associated with clients who had a repricing event in the quarter [12] - The company has a strong credit culture, with years of disciplined underwriting providing stability across economic cycles [17] - The company is exploring opportunities to grow PPNR by $100 million or more through synergies and deepening client relationships [20][78] Q&A Session Summary Question: Client health and loan growth outlook - Management noted that borrowers are resilient and optimistic, with expectations for improved activity as tariff questions settle [28] Question: CET1 target and buyback appetite - Management indicated that they are comfortable with the current CET1 target and will evaluate capital levels based on growth opportunities [30][32] Question: Deposit repricing opportunities - Management acknowledged potential deposit repricing opportunities but noted that competition is heating up, leading to a zigzag pattern in deposit pricing [38] Question: Signs of stress in credit sectors - Management highlighted consumer-facing industries like trucking and auto finance as areas to watch closely for stress [42] Question: Expectations for mortgage warehouse balances - Management expects mortgage warehouse balances to remain stable or increase, depending on the mortgage industry's trends [48] Question: Fee income trends and expense guidance - Management indicated that fee income is under pressure, but they do not expect expenses to exceed a 2% increase [66] Question: Regulatory developments and capital deployment - Management is optimistic about regulatory changes that may allow for greater capital flexibility in the future [100] Question: Trends in loan repricing and spread compression - Management noted increased competition on both deposit and lending sides, with expectations for continued competitive pressures [106]