Q1 2021 Financial Institutions Inc Earnings Call
Good day and welcome to the financial institutions, Inc. First quarter 2021 and earnings conference call. All participants will be in a listen only mode should you need assistance. Please signal a conference specialist by pressing Star then zero. After today's presentation, there will be and opportunity to ask questions to ask a question.
And you May Press Star then one on a touchtone phone to withdraw your question Press Star then two please note. This event is being recorded I would now like to turn the conference over to Shelly Doran Director of Investor Relations. Please go ahead.
Thank you for joining us for today's call, providing prepared comments will be president and CEO, Marty Birmingham, and CFO, Jack plants cheap community banking officer, Justin and began and director of financial planning and analysis, Mike Grubhub will join us for Q&A.
Today's prepared comments and Q&A will include forward looking statements actual results may differ materially from forward looking statements due to a variety of risks uncertainties and other factors. We refer you to yesterday's earnings release and historical SEC filings available on our Investor Relations website.
And our safe Harbor description and a detailed discussion of the risk factors relating to forward looking statements.
We will also discuss certain non-GAAP financial measures intended to supplement and not substitute for comparable GAAP measures.
Reconciliations of these measures to GAAP financial measures were provided on the earnings release, which was filed as an exhibit to a form 8-K.
Please note that this call includes information that is accurate as of today's date April 29, 2021, I'll now turn the call over to Marty.
Thank you Shelly.
Good morning, everyone and welcome to our first quarter 2021 earnings call.
It was another compelling quarter for our company we.
We generated record high net income of $20 7 million or $1.27 per diluted share as compared to 13.8, bad or 84 cents per share and the fourth quarter of 2020, and 1.1 bad or five cents per share and the first quarter of 2020.
Pretax pre provision net income for the quarter was also the highest in company history at $24. One bad on $3 1 million increase from the fourth quarter of 2020, and an $8 7 billion increase from the first quarter of 2020.
It was a strong quarter for net interest income and non interest income as we continue to experience cost savings from our enterprise standardization program.
All of these factors contributed to a significant decrease and the efficiency ratio to 52, 5% for the quarter.
We started to buy back shares under our stock repurchase program during the quarter and repurchased about 238000 shares at a cost of $24 30 per share roughly 103% of tangible book value.
No shares have been purchased since quarter end.
On February <unk>, we completed the acquisition of Rochester based insurance brokerage firm Landmark group.
Landmark was acquired by our Este and insurance agency subsidiary and their principles remain with S T and to lead our Rochester insurance operations.
We believe this acquisition.
Well expand our insurance business, and Rochester, and the finger Lakes region.
As we stated last quarter. This this is a bolt on transaction expected to negatively impact the TCE ratio by less than two basis points.
P. S dilution is projected at only about a penny per share and the first year with EPS accretion generated shortly thereafter.
We also announced a new organizational structure during the quarter, one develop to meet evolving customer needs, while aligning in house talent with leadership roles that position them and our company for long term success.
And several members of management demonstrated strong leadership and contributions and 2020, which combined with their exemplary experience and industry knowledge resulted and their promotion within the new structure.
The press release issued on February nine available on our Investor Relations website provides additional details.
The reorganization directly impacted two of my teammates on the call today.
Adjusted Begum was named Chief Community Banking officer, assuming leadership of the newly established community banking area.
Community banking is designed to advance and strength and five stars customer journey and success across all major customer facing functions with a focus on digital experience and data and analytics.
Jos and his experience as our CFO and his prior experience with two larger bags, including retail and small business product management responsibilities positioned well for this new role.
Jack plants was named CFO and Treasurer, and he now leads financial planning and analysis accounting tax investor and external relations and Treasury.
Jack joined our organization and 2019 as treasurer with more than 14 years of experience and bank finance.
And it really involves and last year's capital market activities and balance sheet strategies, demonstrating his readiness to assume the role of CFO.
With that said I'll now turn the call over to Jack So he can provide additional details on our results and guidance.
Okay.
Thank you Marty good morning, and.
I'm very pleased to be speaking with you regarding our first quarter results. During my first earnings call as CFO and financial institutions incorporated.
I'd like to begin by providing comments on several key areas with comparisons to the fourth quarter of 2020.
Net interest income for the quarter was $37 $9 million.
And increase of $1 7 million from the linked quarter.
The increase was primarily the result of P. P P loan activity.
Which included accelerated the amortization of fees on loans paid off through the forgiveness process.
Total deferred fee amortization was $2 9 million and the first quarter of 2021.
As compared to $1 2 million and the fourth quarter of 2020.
Approximately $87 million and $17 million of Triple P loans, more forgiving and the first quarter of 2021, and the fourth quarter of 2020 respectively.
Net interest margin was 3.29% 16 basis points higher than the linked quarter.
Primarily due to the impact of the triple Peel on forgiveness.
Excluding all impacts of these loans and then for the quarter was $3 one 5%.
Up one basis point from fourth quarter 2020, NIM of three one and 4%.
While NIM improved one basis point over the prior quarter.
The overall environment continues to provide challenges.
Excess liquidity, coupled with a low interest rate environment and made it difficult pivotal and deploy cash and investment alternatives with attractive duration adjusted yields.
We did experience a large inflow of liquidity from our public deposit portfolio late in the quarter.
The balance is higher than the seasonal inflows, we typically experience.
And the inflows were very late in Q1 the.
And the impact on average balances was muted.
Which is also why our period and the cash was higher than normal.
One of the benefits we have is that the seasonality of the public portfolio will have predictable outflows and Jill.
So we view the heightened liquidity and shorter term in nature, because we won't be able to deploy liquidity through anticipated deposit outflows.
Provision for credit losses was a benefit of 2 million on the quarter compared to a provision of $5 $5 million on a linked quarter.
And what was disclosed in our earnings press release, the first quarter benefit was due to continued improvement and national unemployment.
Which is the primary loss driver far seasonal model.
Coupled with positive trends and qualitative factors, resulting in a release of loan loss reserves.
Charge offs were low at 887000 and the quarter.
Down from last quarter's $2 $4 million.
Accordingly, our allowance for credit losses decreased by $2 $6 million and the quarter to $49 8 million.
And as we discussed last quarter, we've analyzed and unique characteristics of our commercial customers and at risk industries.
We then identified the specific customers and industries, we believe to be most at risk because of the pandemic.
These customers represent a very small pool of loans about 20.
And with balances of approximately $127 million.
During the fourth quarter of 2020. We moved this population of loans to criticize assets and set aside a specific reserve of $4 $7 million for certain assets and the pool consistent with our seats on methodology.
During the first quarter of 2021, we added $2 4 million on specific reserves on this pool.
To be transparent one 9 million of the increase is related to one credit relationship with a payment delinquency that was subsequently resolved.
We remain cautiously optimistic that these credits will normalize post pandemic.
Although we have seen improvement and performance indicators of several of these credits we do not plan to release specific reserves until the credits returned to normal paying status.
The allowance for credit losses on loans to total loans was 1.36% a quarter and down 10 basis points from December 31st.
If you exclude triple P loans, the ratio increases to 1.47% as compared to 1.57% at year at.
Credit metrics remained strong with a total nonperforming loans to total loan ratio of 27 basis points at March 31, 2020 one and.
Our ratio of allowance for credit losses for loans to non performing loans of 514%.
Noninterest income was $1.6 million higher than the fourth quarter of 2020.
Key drivers were income from derivative instruments, which was up $971000 and it was based upon the number of interest rate swap transactions combined with the impact of changes and a fair market value of borrower facing trades.
Which were positively impacted by the recent increases and longer term interest rates.
Income from limited partnerships was up 615000.
Based on the performance on the underlying investments.
Insurance income was 518000 higher.
Timing of contingent revenue and the February acquisition of Landmark group.
Yeah.
These increases were partially offset by lower gains on the sale of loans down 519000.
Due to the seasonal impact of lower residential real estate loan volume.
Noninterest expense was $26 $7 million and an increase of 206000 and from the linked quarter.
Largest increase and expenses with professional services expense.
543000, higher due to the timing and level of consulting fees.
Including improvement initiatives.
And audit fees, which are typically highest and the first quarter due to the timing of yearend audit procedures.
Income tax expense was $5 3 million and the quarter, representing an effective tax rate of 25%.
Our effective tax rate was higher than we originally guided due to the significantly higher level of pretax earnings.
Moving on to the balance sheet.
Growth and total loans was $59 million or one 6% from year on 2020.
Commercial business increased two 9%.
Commercial mortgage was up one 8%.
Residential loans increased 0.3% and consumer indirect was up two 1%.
Triple P loans are included in the commercial business loans.
Excluding these loans commercial business loans increased two 8% from December 31, 2020.
Total deposits at March 31, 2021 were $438 million higher on December 31, 2020, due to a seasonal increase and public deposits combined with growth in non public and reciprocal deposit portfolios.
Our excess liquidity position continues to pressure the net interest margin through both our access federal reserve balance and additions to the securities portfolio.
During the first quarter, we increased our investment portfolio balance by approximately $110 million and efforts and grow interest income by deploying excess liquidity into and investment classes have a risk adjusted yield profile that exceeds the interest on excess reserves. However.
However, investment yields remain low and reflective of the current market conditions.
We also observed a notable increase and our federal reserve balance, which increased 253 million as compared to year on.
The increase largely occurred during the latter half of March due to the aforementioned seasonal inflows of public deposits.
Moving on to the equity portion of our balance sheet. We did experience a couple of events and the first quarter, but mitigated organic growth and common equity due to our strong earnings.
First was the impact of approximately $6 million of share repurchases.
Second was the impact of accumulated other comprehensive losses of about $13 million, primarily due to the impact of and an increase and longer term interest rates on our available for sale securities portfolio.
We also experienced a decline and our TCE ratio during the quarter.
7.1, and 3% from seven 8% year on.
The decline was primarily driven by growth and total assets.
Given the excess liquidity previously described.
Our overnight cash and investment securities position increased approximately $360 million and the first quarter, explaining most of the increase in tangible assets while.
And while the tangible equity was down slightly compared a year and as I just mentioned.
We remain very comfortable with our capital position given that much of the asset growth. We've experienced in the past year is shorter term when you consider triple P loans and excess liquidity due to the current economic and interest rate environments.
It is also important to note that our asset growth has been concentrated and very low risk weighted assets. So our regulatory capital ratios have remained comfortably above the well capitalized regulatory minimums.
I'd now like to spend the next few minutes updating our outlook for 2020 one in key areas.
Although we are encouraged by better than expected loan growth and the first quarter of 2021, and C&I and small business.
Despite the recent round of Triple T activity.
We continue to expect mid single digit growth and our total loan portfolio, excluding the impact of the Triple P loans.
All loan categories are expected to contribute to the increase.
Our original P. P. P assumptions included approximately $125 million to $175 million of 2020, one and originations and we now expect to be at the lower end of that range.
We originated approximately $96 million of loans and the first quarter and continue to process applications remaining and the pipeline.
We experienced approximately $17 million and $87 million of forgiveness on.
These loans and Q4, 2020, and Q1 2021 respectively.
We continue to estimate 90% of the first wave of loans will be forgiven in 2020, one with a heavier weighting of forgiveness and the first half of the year.
We have not included any forgiveness on the second wave of loans and our assumptions because we believe that most of this forgiveness will occur very late in 2020, one and into 2020 two.
We are reducing our expectations for non public deposit growth and mid single digits.
While deposit balances remain elevated and the low interest rate environment, we have seen growth moderate and the first quarter.
Largely due to a change and the deposit behavior of Triple T customers.
This guidance includes the previously announced two new five Star Bank branches that we expect to open and Buffalo midyear 2021.
We experienced stronger than expected growth and the first quarter for bolt reciprocal and public deposits and are now projecting double digit growth and these categories for the year.
We maintain our full year NIM guidance of 310 to 315 basis points.
Excluding the impacts of Triple T.
We continue to expect compression from excess liquidity carrying higher balances and investment securities and earning lower yields on earning assets as loans and securities reprice.
And this will be partly offset by lower deposit funding costs.
There will be noise, and our NIM relative to triple P forgiveness, and new origination throughout the year. So we were guiding them excluding the impact of this activity.
As a reminder, our NIM fluctuate from quarter to quarter due to the seasonality of public deposits and its impact on both our earning asset and funding mix and.
Quarters, where our average public deposit balances are higher due to seasonal inflows and the second and fourth quarters.
Our earning asset yields are lower given the short term duration of the deposits and limited opportunities to invest the funds.
Yeah.
Our NIM guidance remains highly dependent on the overall rate environment.
We had a strong first quarter for noninterest income and are increasing our full year guidance to mid single digit growth excluding gains on investment securities.
And as we've stated before 2020 was a unique year from a fee income perspective.
We waive service charges for a portion of the year as part of our COVID-19 relief package.
But that was more than offset by strong results for derivative instruments or interest rate swaps and <unk>.
Banking activity.
We are not expecting to waive fees and expect fees from both interest rate swaps and mortgage banking to moderate and 2021 even though the first quarter was a strong quarter in both areas.
We continue to anticipate and increase in noninterest expense and the low to mid single digit range for 2021.
Noninterest expenses expected to range from $27 million to $29 million per quarter.
We are maintaining our 2020, one efficiency ratio guidance of 57 to 58 per side for the full year.
But when considering the first quarter results, we have a bias towards the lower end of the range.
With better than expected earnings performance in Q1, we now expect that the effective tax rate for 2020, one will be within a range of 20% to 21%, which includes the impact of the amortization of tax credit investments placed in service and recent years.
We will continue to evaluate tax credit opportunities and our effective tax rate would be positively impacted by taking advantage of further investment opportunities.
Given our low level of net charge offs and Q1, we are revising full year guidance to a range of 30 to 40 basis points, which is a five basis point reduction to the low end up the range previously provided.
As we sat and January our overall focus and improve profitability and operating leverage.
We believe that achieving results in line with the guidance provided will drive these outcomes.
That concludes my prepared comments I'll now turn the call back and Marty for closing remarks.
Thank you Jack.
The company's 2020 annual report and it's now available on our Investor Relations website.
Within this report we document our many accomplishments of 2020 and provide significant discussion about our commitment to corporate responsibility and sustainability through.
Through corporate citizenship, our commitment to a strong corporate culture.
Advancing inclusion and diversity and a strong culture of ethical behavior supporting our communities environmental sustainability.
Strategy and enterprise risk management, and strong corporate governance and.
Courage you to take a few minutes to review this important update on our company.
Today infection rates are declining and our footprint vaccination rates are increasing and we are seeing signs of and expanded reopening on the economy.
The pace for us is not slowing and we are active on many fronts.
We remain focused on helping customers obtain forgiveness of existing triple P loans as well as new Triple P loans funded and 2021.
We are in the process of bringing a portion of staffing back to corporate offices and developing long term plans department by Department for working and the office working from home and a hybrid work approach.
Progress continues toward completion of two new five star Bank branches and the city of Buffalo. These.
These branches were initially expected to open by February of 'twenty or 'twenty, one but were delayed due to the pandemic we.
We currently expect them both to open early this summer.
These new branches and 'twenty to 'twenty, two Seneca Street, and $4 51 elbowed out.
Will help us expand and the important buffalo growth market and make us more accessible to existing and new consumer and commercial customers. They.
And they are located and vibrant commercial corridor and will extend the reach of our distribution system, while reinforcing strong commitment and community engagement.
We are starting to experience fewer restrictions on events and our footprint, which is very encouraging and we were able to renew and important community sponsorship.
Gotcha stir Lilac festival.
This is the largest free festival of its kind and North America, and an important event for our local and regional and community.
Perhaps more important than ever this year after year of isolation due to the pandemic.
Through this modest action, we are reinforcing our commitment to a return to normalcy by providing an opportunity for folks to get outside and get together.
Especially at this point in time this event personifies, the economic vitality and Michelle.
And quality of life of the communities we serve.
The rate of change for the financial services industry was accelerated by the pandemic.
We experienced this firsthand with a very strong positive response to our digital banking launch in 2020. The effective use of technology and data is essential for our success and it remains a critical focus for our organization.
While many uncertainties remain I believe that we are stronger than ever and remain well positioned to take care of our customers and communities.
Operator. This concludes our prepared comments and we are ready to open the call for questions.
We will now begin the question and answer session to ask a question Press Star then one on a touchtone phone if you're using a speaker phone. Please pick up your handset before pressing the keys Inc.
Anytime you question has been addressed and you would like to withdraw your question Press Star then two.
At this time, we will pause momentarily to assemble our roster.
Okay.
And the first question comes from Alex toward all with Piper Sandler. Please go ahead.
Hey, good morning, all.
Good morning, Alex.
First off just wanted to.
Follow up on your commentary on on loan growth outlook for 2021, and I think you said mid single digits. All categories. I was hoping maybe you could sort of comment on the state of the pipelines as you look at them. Today do you think that that growth is going to is going to kind of come evenly across the year and the pipeline is kind of need to rebuild and the back half of the year as.
And the dynamics around P P P and and whatnot play to the the economy.
Yeah.
So we've continued Alex through the pandemic to continue to try to maintain as much discipline as we can around customer engagement as well as you know managing and driving our pipeline process. So you know our performance and this quarter represented a pipeline that converted.
Significant pipeline that converted.
That existed at the end of the year and.
And I think for the remainder of this year. It if it will continue to will continue to experience a smooth conversion as we move out and the next three quarters.
Yeah. Alex This is Jack I'll, just add that we had.
Very good quarter for originations on the commercial side, we noticed that there are some headwinds from supply chain.
Challenges both on indirect and on commercial that we're that we're facing and our customers are facing but as we've stated before excluding PPP. We continue to expect mid single digit growth for the total loan portfolio for the remainder of the year.
Awesome and.
And then as you think about you know the uses of of liquidity you bought some securities during the first quarter could you comment a little bit on and on the strategy for <unk>.
Deploying more liquidity into the securities portfolio, you kind of done at this point.
Or or is there more liquidity that you think you'll put to work just and securities and the and the next couple of quarters.
Sure Alex this is Jack.
We noted on the call we added about $110 million on the securities portfolio. During the first quarter, however, purchase and starting to slow towards the latter half of March as spreads really tightened on mortgage backed securities and we're really mindful of the duration adjusted risk it.
Or sorry, the duration and risk adjusted return, we're getting on our liquidity deployment. So at this point and time I think we've got an appropriate balance between invested cash and what we have and deployed and the securities portfolio, particularly when considering the anticipated deposit outflows will see and the public portfolio as we approach the end of the quarter.
Okay, and then it sounded to me like when you when the the NIM guide, which is down a little bit for them and of the year, which makes sense [noise] coupled with the balance sheet.
And are only growing from here, obviously, there's some seasonality around deposits share.
Imply that excluding P. P. P that the net NII could be flat to slightly higher over the coming quarters does that logic makes sense.
Yeah, I think that we'll see a you know a little bit of growth and NII is the balance sheet growth throughout the year, but you know the as you mentioned before the the NIM guidance to 310, and 315 basis point range, which is in line with what we guided at the and during the January call Inc.
It includes a bit of margin compression just as loans reprice re price.
Got it and then just final question for me on the buyback and they had some opportunities early in the year are glad to see you took advantage of those with the stock trading a little bit higher today relative to book value and just looking at your TCE ratio the buybacks make less sense at this point or do you think that'll be a continuous part of the strategy over the course.
The year.
And if something we want to keep and the forefront of our.
Thought process and discussion with our board we want to remain disciplined around the investment of capital. It was very straightforward, obviously, where our stock price was versus where it is today, but we are mindful of making those investments that ultimately drive acceptable dilution accretion and earn back period for us.
Perfect. Thank you for taking my questions.
Thanks, Alex.
The next question comes from Bryce Rowe with Husky. Please go ahead.
Thanks, Good morning, everyone.
Hi, Bryce.
Hi.
Let's say, let's start I wanted to start with the with the allowance if that's if that's okay. You've provided some good and.
Information and the slide deck around the breakout of the allowance specific to.
Two the criticized and classified and I. Appreciate the commentary you gave earlier in the prepared remarks about the.
The classified piece so so Jack maybe you could help me understand that.
And I'm not sure I saw the specifics around the criticized.
Specific reserve for last quarter. So if you could if you could comment on how that might have changed quarter over quarter that would be helpful.
Sure so on the on.
On the criticized pool the.
Total pool increased by.
And $2.3 million for the specific and that was just based on the specific reserve that was aligned to that pool. So we didnt move any additional loans into the total pool itself, but we did take an additional reserve of $1 $9 million on one credit which drove the majority of that increase and it was really due to a credit that.
It was.
Experiencing a 30 day payment delinquency that since came current but it was due to a capital injection, which we deem to not be the primary source of repayment. So we thought it was prudent on our part to take a specific there as we move forward.
Okay, and so is that with with that.
I guess payment status heading then.
Having having come come come a concurrent does that does that kind of mean, we'll see a we'll see it.
A reserve release and tied to that specific one nine or.
We're now given the given the debt I guess, the capital infusion that being counted as a primary source.
So we remain cautiously optimistic about the about the stability of the credits and that pool, we really arent planning to release reserves there until they come off their COVID-19 deferral status and returned to a normal payment status. So at this point and time.
Again, we're cautiously optimistic.
Okay.
And then any any kind of commentary around debt deferrals.
The deferrals and and and what what's your what's your thinking in terms of timing around them.
When windows credits come off of deferrals, and then and I know a lot of it is.
And I too sensitive areas.
Or could that sensitive areas and you know maybe some maybe some commentary around kind of early signs in terms of how those how those IND.
Industries look or how those low those borrowers look and as we as we approach spring and as and as limitations on our.
Coming off.
So you know price I think as Jack and use the phrase cautious optimism and we're optimistic.
I think the economic data out today relative to GDP is showing very strong.
Indications of recovery and we are seeing a bright spots of that as well and the COVID-19 impacted our credit exposures that we have you know the.
For example, the flag branded.
Health portfolio lower service portfolio of hotels.
Are seeing I think a pickup in there and <unk>.
Activity.
In terms of occupancy and utilization.
We've also heard from these borrowers as an example that flow through the COVID-19 pandemic, they've learned some waves to be much more aggressive and managing their their labor and their mix of labor, while still driving is a satisfactory customer experience. So we are seeing a positive indications, but our approach.
We spent a lot of time on this and our last call and tried to communicate and be as transparent as we possibly can to our key constituencies has been to look at these credits on an individual basis make a determination if they're sustainable post the conclusion of the pandemic and then provide them with the.
The accommodation under the cares Act, which we've done in most cases out through the end of 'twenty 'twenty. One. So we're closely we continue to closely monitor it that's why we are downgraded.
And the credits that we did at the end of the year and we will continue to keep the market apprised of our progress.
Okay, that's great great color Marty appreciate it one more question for Jack.
Can you can you provide us with the breakdown of the on.
And on accretive or unamortized P. P. P fees at this point between the 2020 originations and the 'twenty one originations.
Okay.
As of the core ended the quarter, we had $6 $5 million and unamortized fees associated with PPP loans.
That was largely on the.
First round of originations.
Yeah. This is Mike Rover director of F. P and a I would say about 20% of that total relates to the side and the second vintage. So it's about an 80 20 split 80% relates to the first vintage 20 to the second.
Okay, and and and you expect the second vintage kind of T. C status to grow as you continue to process.
The new launch new PPP loans.
That's correct.
Right. Okay. Thanks, a lot I think our I think that's it for me at this point.
Thank you Brian.
Okay.
As a reminder, if you have a question press Star then one to be joined into the queue. The next question comes from Marla Backer with Sidoti. Please go ahead.
So I was hoping you'd give us a little bit more color on and then.
Management structure of you mentioned in your prepared for Mark somebody you know.
Changes you made really.
How do you see this fitting into your community outreach strategy and if it tested and why.
Do you see it you know meshing with some of the goals you have for market share gains. Thank you.
Thanks, So much for the question, where I'm very enthused I think our executive team is very enthused with the alignment of our organizational structure and the execution of our plans that support community engagement like you just talked about as well as achieving the financial results sustained.
Financial performance that drive long term shareholder value. So we talked about Justin as the leader of our community Bank.
We have a strong leadership across all the customer facing functions and those functions that support our customer interaction and customer experience and customer journey under a very strong.
And capable and experienced leader, we feel great about Jack's capabilities and experience to assume the CFO and treasurer responsibilities and the functions that I described we also have a leader for all of our commercial activities and we have a chief administrative office.
Or who is focused on.
And it has been providing leadership. It for example on our I T Technology program, our enterprise Standardization program, but in addition is working with our team on our digital transformation and data analytics and a ramp so I feel great about our ability to engage with the market. It's one of our.
Fundamental reasons for being as a community bank and make sure we're taking care of the needs of the market both in.
<unk> of our products and services, but as well as a corporate citizen and.
And and in addition, the execution against our strategic and risk plans that support long term shareholder value.
Okay. Thank you.
With regard to the new branch openings and Buffalo, you said mid 2021 and then I think and you know.
Sometimes this summer.
Is there anything that might delay that timeline or all the permits already in place.
Do you have all of the.
People on board to make that happen can you just give us a sense of where that stands.
Thank you for the question and I'm going to ask just and as our chief community banks and golf sort of answer that.
And thanks for the question.
We don't see any delays at this point and I think literally mid year is about the timing for these and that's our expectation and we don't anticipate any further delays those projects are green.
If you think about the red Red yellow Green approach to project management their green and I have every expectation that there'll be on time.
Okay and then my last question and it is good landmark so.
Where are you on the process.
Granting landmark and.
In terms of the overall branding strategy would there be any value to maintaining landmark.
As a standalone brand, but as a subsidiary of <unk>.
Thank you.
Hey, moralist shops and again.
We have consolidated landmark and SDN.
It is now SDN is the name of our insurance agency for our entire footprint.
And.
And honestly based on the assessment that we did around that.
From our perspective, that's what made the most sense.
SDN has a very significant.
Brand here in Buffalo and.
And is a much much larger agency and it and it made sense to us to brand and the entire thing is SD and insurance agency and adjusted I, just would add that I think the principles were and.
Two is yes, and supportive of that decision as they continue to help us execute on insurance initiatives and the Rochester finger Lakes region.
Thank you Marty.
Thank you.
This.
A question and answer session I would now like to turn the conference back over to Marty Birmingham for any closing remarks.
And thanks, everyone for their participation on the call. This morning, we appreciate the opportunity to review and discuss our first quarter performance and we look forward to doing it again later this summer for the second quarter.
The conference has now concluded.
Thank you for attending today's presentation you may now disconnect.
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