Q2 2021 Bank of Marin Bancorp Earnings Call
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Yeah.
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Good morning, and thank you for joining bank of Marin Bancorp earnings call for the second quarter ended June 30 of 'twenty 'twenty, 1 I'm Andrea Henderson director of marketing for bank of Marin Marin.
During the presentation, all participants will be in a listen only mode. After the call. We will conduct a question and answer session.
At that time, if you have questions. Please press 1 followed by 4 on your telephone.
At any time during the conference call you need to reach an operator. Please press Star Zero. This conference call is being reported on July 19th 'twenty 'twenty 1.
Joining us on the call today are Russ Colombo, CEO, Tim Myers, President and Chief operating Officer, Tani, Girton Executive President and Chief Financial Officer, and Best of Eigner Executive Vice President Chief Credit Officer.
Our earnings press release, which we issued this morning can be found on our Investor Relations page at bank of Marin Dotcom.
Where this call is also being webcast.
Before we get started I want to emphasize that the discussion on this call is based on information we know as of Friday July 16th 'twenty 'twenty, 1 and may contain forward looking statements that involve risks and uncertainties.
Actual results may differ materially from those set forth in such statements.
For a discussion of these risks and uncertainties. Please review of the forward looking statements disclosures in our earnings press release as well as our SEC filings.
Following our prepared remarks, Russ and Tani, Tim and Beth will be available to answer your questions and now I'd like to turn the call over to Russ Colombo.
Thank you Andrew.
Good morning, everyone.
Bank of Marin continues to generate momentum and strong earnings growth in the second quarter.
We reported net income of $9.3 million up from $8.9 million in the first quarter and $7.4 million in the second quarter of 2020.
We continue to prioritize disciplined expense management and underwriting and consistently sound credit quality as we have across our various <unk>.
Canonic cycles over our 31 year history.
Along with our proven relationship banking model. This gives us 1 of the strongest deposit bases in the country.
Importantly.
We also have a well designed plan in place to extend our model to greater Sacramento in Amador County.
With our acquisition of American River Bank.
The acquisition is on track to close in the third quarter as planned.
As I have said before this is a combination of 2 exceptional institutions the share of complementary values and disciplined fundamentals.
Our teams of diligently worked together to bring the merger towards closing.
We've been thrilled with the spirit of partnership.
Dedication.
And tell us that the American River team brings to the table.
We are confident that.
And we will expand our community banking franchise on a regional scale, bringing new products and services to American River customers.
We will also benefit greatly from local expertise and proven talent that our new teammates bring for bank of Marin.
Upon closing bank of Marin will be of wealth will be well positioned.
Pre eminent business bank, serving northern California.
With approximately $4 billion in combined assets.
Gaining scale across the greater Bay area, the greater Sacramento region in Amador County will allow us to develop new revenue opportunities and further increase efficiency offsetting the challenges of of low interest rate environment.
Our 2 organizations share of commitment to exceptional customer service and dedication to our local communities that we are all excited to magnify at the regional level.
While the pandemic still pose a significant risk I am encouraged because vaccination rates are above the national rate average in our footprint.
And we have begun to reach a new normal.
This sets the stage for a stronger economic activity ahead.
Our bank of Marin team is back on the office actively engaging with customers.
Now I'll turn to our to the key highlights of our second quarter results.
We generated diluted earnings per share of 71 cents.
Total loans decreased to 2 billion from $2.1 billion in the prior quarter, primarily as a result of PPP loan forgiveness.
As of June 30th the small business administration had forgiven and paid off $189 million of our total PPP loans.
Our commercial bankers are working to understand and meet the needs of their customers evolving credit needs and they are also identifying new opportunities across our markets.
We expect these efforts will help us grow our portfolio overtime.
Credit quality remains strong.
Non accrual loans decreased slightly in the second quarter to $9.2 million or 4.6% of total loans.
Phosphide loans increased by $4.4 million from the prior quarter to $30.8 million.
Total deposits grew $27 million to $2.7 billion, primarily driven by our customers' depositing PPP funds into their accounts and new account openings.
The average cost of deposits was just 7 basis points from the second quarter, reflecting the low rate environment and our relationship banking model.
Non interest bearing deposits represented 54 per cent of total deposits.
Given our strong capital and liquidity on July 16th the board of directors approved of new share repurchase program under which we may repurchase up to $25 million of our outstanding common stock.
Also on July 16th due to our continued profitability.
Word of directors declared a cash dividend of 24 per share an increase of 1.7 per share from the prior quarter.
This represents a 34% payout ratio in the 65th consecutive quarterly dividend paid by bank of Marin Bancorp.
Now I'd like to recognize an important change to our leadership team.
Jim Meyers Chief operating officer was promoted from executive Vice President of do President in May.
He is now responsible for the management of commercial banking retail banking centralized operations and technology wealth management and trust.
And marketing.
C of O. He proved his ability to lead in an ever changing environment. In this new role is a natural progression of that success.
Now, let me turn it over to Tim to provide more detail on our lending activity and our expansion into the greater Sacramento region.
Thank you Ross, excluding PPP loans, our total portfolio held steady at $1.8 billion.
New loan originations in the second quarter totaled $44 million with interest rates low and deleveraging trends continuing however.
Loan payoffs of $61 million or influencing that growth.
Payoffs consisted largely of HELOC tenant in common loans and commercial loans on which underlying assets were sold or paid off with cash.
While optimistic about new opportunities, we remain disciplined and patient we are focused on prudent durable growth not growth for growth's sake.
We remained in active PPP lender until the program's funds were exhausted in early may of this year and our second round of PPP funding totaled 1063 loans for $136 million, we did us of support our customers and communities and to help ensure a strong recovery for small businesses as we all of them.
Emerge from the pandemic.
PPP loans outstanding were 248 million as of June 30th versus 365 million at March 31, and 299 million at June 30, a year ago.
We expect the remainder of the portfolio of the steadily decline in the second half of this year as loans continue to be forgiven and paid off by the SBA.
As of July 13th of total of 1395 loans amounting to $202 million had been approved for forgiveness by the SBA debt.
On the loans remaining 70% of 1072 loans totaling $46 million on 150000 or less and have access of streamlined SBA forgiveness processing.
With respect of the banks payment relief program at the close of the second quarter. We had just 6 borrowing relationships with 9 loans totaling $43 million that we're benefiting from loan deferrals are similar payment relief tied to the pandemic.
We are working with these clients closely and expect the majority of the resume payments.
As we look ahead, we are optimistic about new growth opportunities across our San Francisco Bay area of footprint. In addition to our expansion into greater Sacramento and Amador.
The Bay area of economy is among the most vibrant and prosperous in the country.
Sentiment among our commercial clients is upbeat and steadily improving the.
The economy here is open and new opportunities are emerging.
At the same time Sacramento is growing in population household income and new business formations has been more than $6 billion invested in new projects in the region over the past 5 years and more is underway.
The greater scale and broader footprint positions bank of Marin is exceptionally well as the economy gains momentum and our clients make plans to expand.
I'll now turn the call over to Tani to dig deeper into our financial results.
Thank you Tim.
As Russ noted, we reported net income of $9.3 million from the second quarter as 2021.
Diluted earnings per share of <unk> 71 cents compares to 66 cents in the prior quarter and 55 cents in the second quarter last year.
Net interest income totaled $24.5 million in the second quarter of compared to $22 million in the prior quarter and $24.4 million a year ago.
Notable trends and drivers of net interest income includes significantly lower interest rate year over year.
Interest and fee income from PPP loans.
And the early subordinated debt redemption in the first quarter of 2021.
Year to date, the bank has recognized $4.3 million in fees net of deferred costs on PPP loans.
As of June 30th there were $6.5 million outstanding and yet to be recognized into income.
The tax equivalent net interest margin was 328% in the first 6 months of 2021 compared to 3.7% last year.
SBA PPP loans contributed 5 basis points to tax equivalent net interest margin year to date and 12 basis points in the second quarter.
The early redemption of subordinated debt reduce tax equivalent net interest margin by approximately 18 basis points in the first quarter.
In the second quarter, we recorded a reversal of the provision for credit losses on loans of 920000 and of reversal of the provision for losses on unfunded commitments of 612000.
Both reversals were due primarily to improvements in economic forecasts.
Noninterest income totaled $2 million in the second quarter of 2021 compared to $1.8 million in the prior quarter and second quarter of year ago.
The increases were mostly attributable to debit card interchange fees from increased levels of activity.
And higher wealth management and trust services income from new accounts and favorable market performance.
Additionally, the discontinuation of pandemic related fee waivers is supporting noninterest income.
Noninterest expense increased 144000 from the first quarter to $15.6 million.
Increases in charitable contributions and acquisition related costs were mostly offset by lower expenses related to stock based compensation and 401 K reset in the first quarter.
Year to date noninterest expense increased 1.7 million to $31 million compared to the first 6 months of 2020.
Salaries and related benefits were higher by 755000 over half of which was related to fewer deferred SBA PPP loan origination costs.
Professional services expense increased year over year due to some pandemic related delays in 2020 activities posted in the first quarter.
335000 and acquisition related expenses recorded in the second quarter.
Total acquisition related expenses in the second quarter and year to date were 351000.
The efficiency ratio was 58, 6% in the second quarter down from 64, 6% in the prior quarter and up from 53% in the second quarter of 2020.
Efficiency ratio for all prior periods have been adjusted to reflect the reclassification of provisions for losses on unfunded commitments.
From non interest expense to a separate line item under net interest income on the income statement.
Return on average assets and return on average equity were 1.2% and 10, 7% respectively for the second quarter.
Our total risk based capital ratio at the end of the quarter was $15.5 per cent compared to 15, 7% at March 31, and 15, 8% a year ago.
All considerably above well capitalized regulatory requirements.
The share repurchase program approved in January 2020 was completed in May 2021.
3 of the program, we repurchased 298000 shares totaling $11 million in the second quarter of 2021 with cumulative repurchases of 692000 shares totaling $25 million.
The bank continues to build a sound balance sheet manage risk and deliver consistent and solid profitability.
We are well positioned to respond to different interest rate environments.
The American Bank acquisition, along with our relationship banking model and capital management initiatives all serve to reinforce the long term success of bank of Marin.
Now rest of would like to share some closing comments with you.
Thank you Tony.
Bank of Marin produced strong results for our shareholders growing both net interest income and non interest revenue in the second quarter, while managing expenses closely and maintaining pristine credit quality.
We are in an excellent position to close of our acquisition of American River Bank next month.
We will waste no time, capitalizing on our larger more diverse footprint and greater scale to drive new efficiencies and growth.
We have successfully executed 3 previous acquisitions, and we are drawing on that expertise and working closely with our American River.
All of <unk> to ensure a smooth integration.
As always I am proud of the discipline of dedication to excellence.
That has long been the pillars of bank of Marin success, our core values remain firmly in place as we grow and pursue new opportunities.
I want to thank you for your time. This morning, now we will open it up to your questions.
Yes.
Yeah.
Thank you.
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1 moment please for the first question.
Yeah.
Yeah.
Yeah.
Right.
Yes.
Do we have any questions.
Can't hear anything here.
Our first question comes from Jeff a ruler from with D. A Davidson. Please proceed.
Thanks, Good morning.
Good morning margin.
Alright.
Yes.
If we exclude the PPP impact.
For the.
Redemption in the first quarter.
Core margin is under some pressure.
Kind of in the mid 300 <unk>.
Maybe any thoughts on I guess, if we look forward.
Excluding further PTP.
Adjustments.
American River Bank.
On the thoughts on the core margin kind.
Of led by.
Loans, what are your thoughts on on that front.
Well I'll start and then I'll actually ask Tim Anthony of the jump in.
Yes margins are under pressure as you know because the interest rate so low.
Right.
There's not a lot 1 can do when it comes to interest rate or the interest rate. They are what they are and we compete with are.
Competition in.
Why there's been such pressure on rate can you can you can see I'll ask Tim to kind of give you a little bit more.
Clarity in terms of the most recent.
To me is that we've had.
Yes, Thanks, Jeff.
Certainly Brian of competitive pressure like everyone else on the bank.
Yields on the new loans were funding we also have to prevent runoff.
The other side so you know.
That's always going to put some pressure everywhere and that pays off.
He replaced by alone.
At a lower rate than that.
Of the economy right now thats the rate environment, we're certainly doing our best.
We certainly take advantage of our relationship banking model.
We work as hard as we can to get the best we can on each loans Theres no question on aggregate those trends are putting pressure on the loan yields.
Yeah, I don't have anything to add to that I think you effectively got to the core margin. So.
Yeah.
Okay.
Got it.
The buyback announcement.
I think that signals from.
Some confidence through the even with the American River deal pending as that.
Is that safe to say you will continue to consider buybacks, even up until the close of of that transaction.
Yes.
We have a lot of confidence in.
Number 1 in our.
The bank in total.
This is.
We have where we have it well managed expenses are under control and we have we have the teams coming back of I'll come back to work out.
Interacting directly with clients that to me is very encouraging and you should see volume to increase because of that so.
When you put all of those.
Things together.
Hum.
Pretty encouraging and so far in American River Act.
Acquisition, we've seen nothing but positive things, we're very very encouraged by.
On the bank.
Loan portfolio of the people that were coming over from the American River. This is Ben.
On the cultures, which match.
So well together and a lot of these things can can work or they can't work. If the cultures are not not of match, but we've seen nothing but positive things out of the American River staff. So we're we're very encouraged about what we can do in Sacramento and.
And as we move forward and bring our per some of our products like we don't they don't offer HELOC product at all we will bring that over to them.
Because of our size, we'll be able to up tier of lot of relationships.
It's Mike.
On my mind this acquisition is.
Is perfect timing and it's also a perfect fit the 2 organizations and we've we've done nothing to dissuade us from exactly that as we've as we've gotten into air to work.
Thank you.
Quick last 1 brush.
The fires.
And the state.
It looks like mostly east of the footprint of uneven east of of American members, but just wanted to confirm it did that.
As of now.
Seeing any impact on us.
And haven't seen any impact at this point they are pretty far east of where we are.
Okay.
Obviously, we keep our eye on this as fire season in California, and it's been.
It allows for the last few years have been pretty rough.
We're keeping our fingers crossed on so far nothing in our footprint.
Got it okay. Thank you.
Okay.
Our next question comes from Matthew Clark with Piper Sandler.
Please proceed.
Hey, good morning.
What do you think.
Just getting back to the core margin can you give us a sense for where new money yields are coming on.
Both loans and securities from the latest quarter.
I don't have that new loan yields for the quarter number in front of me Matthew but we can get it to.
So I can tell you this that the bank trends on a little bit on the new loans, not including T. P. P are roughly in the same area, where the portfolio stands with with the exception of HELOC, because I think we lowered our rate on on.
On those but otherwise that's pretty stable.
The investment side, that's that's pretty tricky I mean, you have to go out quite far if they get yields on.
On over 1 and a quarter when youre looking at a solid credit quality.
We're just doing our best to purchase Opportunistically there and.
We did have a couple of opportunities over the quarter and we continue to keep our eyes open for those on.
But to.
To the extent that we can.
Extend our duration, a little bit not too much and still achieve more than we can get at the fed which is not.
Not much.
We are doing that.
Yeah.
Okay, and then just shifting gears to the pipe volume of loan pipeline.
Any commentary there as it relates to <unk>.
Growth year over year linked quarter.
Yes, we're certainly seeing the pipeline as Russ mentioned, where our bankers are out and calling in person and we are seeing it on an almost immediate impact of that on the pipeline now the probabilities on the timing of of those things moving from stage to stage in closing as always in question, which is why were always reluctant to comment on.
On that too heavily but we are seeing very encouraging trends and that direct customer at client calling activity, resulting in opportunities to look at.
Matthew I'd add 1 thing the.
The way we operate our bank is really relationship based model and.
It's so important to have face to face interaction with our clients and with our with our prospects.
And then on the pandemic, we all made it through based on you know a lot of people work from home a lot of remote working but.
Now that we're back in the offices and actually.
Are you able to go out and visit clients.
I am I expect it to be.
A real impact on our results going forward.
It's encouraging to see what we're seeing from our lenders out of no of course bank.
Okay and then.
As it relates to the reserve what are your updated thoughts on where that.
Ratio could start to stabilize I mean for you in the camp that believes deal kind of stabilize around pre pandemic levels or do you feel like you could dip below that based on.
Better macro factors under seafood.
Yeah.
So I think that.
The forecast.
I think that the reduction in the forecast or the improvement in our forecast this quarter was not as dramatic as last quarter.
It is.
The model is very much based on on the quantitative results.
On the forecast so it's really difficult to.
On to predict what you know what the what the levels will be going forward.
But.
Based on where the forecast stand right now.
On it you know we.
That's what the current their current reversals reflect and like I said I I'm.
I'm not.
I don't have a lot of confidence in projecting where those forecasts are going to go but they probably won't go down as much as they did.
Won't improve as much as they did this quarter versus last quarter.
Okay, and then just last 1 from me on expenses.
If you adjust for the merger charges that.
That of $15.2 million run rate. It looked like you were a little.
Heavy in terms of charitable contributions this quarter, how do you think about that kind of stand alone run rate for.
For the back half of the year, Excluding American River.
Yeah, the charitable contributions of what we did with we expense them all on the first quarter for the year.
And so that's going to be.
Of those dollars are going to be distributed out over the year. So that's why they are heavy in the first quarter.
2 quarters.
2 quarters sorry.
Got it.
And then just the overall run rate kind of Tony.
Okay.
Yes, I think the overall run rate is.
<unk> stable by of course, we've got the acquisition in there and we're just starting to see the acquisition cost so on.
That's going to have a big impact on on expenses on over the next couple of quarters here.
Yes.
Okay. Thank you.
Mhm.
Our next question comes from Jackie Bohlen with K B W. Please proceed.
Hey, good morning, everyone.
1 of Yankee fan.
I think too expensive for taking a little bit of a different card. When you look at your head count for legacy Bank of Marin.
You stand today versus full of deployment I'm just curious if you if you have any open positions presently.
We do have a from physicians I think we're I think were about 9% below full employment at the bank right now.
So there are there are positions open then.
On the certainly the pandemic has something to do with that during that time on tough.
Tough to hire during that time, but.
I'd say the majority of the other positions or not in leadership roles, there, they're primarily lower levels of the bank.
Okay.
So while it's 9% scale full employment, it's not 9% to overall compensation.
No that's correct, it's gonna be loans lower cost improve return.
Okay.
So honestly, we never run full employment.
As always we always have a certain number of positions open so.
You know you can't kind of interpret there to get to that number very easily okay.
Okay.
And I know in the past you've talked about on.
The potential of work from home of eye opening up new recruiting doors for you and now that where we're starting to get back to normal just wondering what your updated thoughts are on that.
We're still we're still looking at that we tried to separate pandemic working from home from.
From working from home in the future.
We did we did the work work from home to work remote during the pandemic out of a necessity as opposed to what jobs could be specifically run to outside of the door locations, but.
But we have 3 of a strategy in place, we're looking at that and.
We anticipate we will have a number of a number of physicians that will have either full or part time away from the bank.
Oriented growth, even more locations because there are some jobs that don't necessarily need to be here that being said again.
Our primary focus is really as per the relationship bank is really in person.
Not only in person because of clients, but in person because of the interaction with others.
There's a lot of.
Theres a lot kit that can be gained from just the discussions that happened with <unk> with people who are working together sitting next to each other and questions that come up and being able to interact in that day.
It's hard to measure the value, but its very valuable in my mind.
Okay, Yeah, I would agree with that on collaborations.
And then do you have either an estimate on update on when you might look to do that conversion given that that transaction. It sounds like if youre looking to close that next month.
Yeah, we're looking to close next month with the conversion doesn't happen until the spring.
And the reason for that is really because I say spring actually late late winter.
Because we have been given a date by our of core processor F. I S and that's the day.
And then the problem is that because of this occurred.
Risk.
Close is going to create on August.
As of this kind of a blackout period by S. I S..4 for about 3 months November December January they wouldn't they wouldn't allow integrations to happen during that time, so they get everything got pushed back until we're back in March.
So that's 1 of its going to happen but.
We're working towards that day.
Okay.
Okay, great. Thank you for taking my question.
Sure. Thank you Jackie.
Yeah.
Our next question comes from Tim Coffey with Janney. Please proceed.
Great. Thank you good morning, everybody.
Good morning from them.
Origination activity on the loan side was really strong this quarter and I'm wondering if you can provide a little more color on where you're seeing the best win rate.
Okay.
Yes. Thank you it's actually fairly there's first I mean as historically been the case, we are getting most of our new volume out of our end markets.
Markets with the most of the relationships the largest portfolios to build on.
B.
Biggest increases on the commercial side as opposed to HELOC or 10 income in loans on a day.
This is a year to date.
Because of year to date numbers I'm, giving you, but the biggest increases on the commercial side.
It includes our construction lending group, which has also been very positive.
Certainly our.
Payoffs on the retail consumer loan side have been down.
That activity just as restaurants on talking about it being out meeting with our relationship banking client that does tend to be more commercial and construction of oriented in that area.
By loan type of where we saw the biggest drop year to date.
Okay.
And then in terms of.
From the perspective of legacy bank of Marin.
What are you seeing on deposit growth do you still expect that to be strong going into the back half of this year.
I would I would say.
Yes.
It's.
There's an awful lot of liquidity on the market and we better we have of banks in general benefit from it we certainly do ease of relationship deposits that we have.
But I think that will continue through the year, but.
Beyond that it's hard it's hard to judge us as projects and reinvesting and businesses start you'll start to see the deposits run off and it's hard to judge exactly when that happens, but you now through the end of this year. Beginning next year is really I think I'd look more towards 22 at a time when youll smart seat might see some of those day.
That's part of it.
Not grow as quickly put it that way okay.
No. It's very helpful. Thank you those of my questions I appreciate your time.
Thank you Tim.
Yeah.
Our next question comes from David Feaster with Raymond James. Please proceed.
Hey, good morning, everybody.
My name is David.
I just wanted to kind of follow up on that question and touch on liquidity. I mean, you guys have been done a great job deploying liquidity somewhat.
Balance sheet investment Securities just curious what your plans are for that $257 million of cash and some of that just built up ahead of the deal and to help improve the margin.
Deposit base, maybe run off some of the non core stuff I mean, you've touched on some opportunistic securities purchases just curious your thoughts.
Thoughts on deploying that liquidity is there even any opportunity to move some more off balance sheet or is that even adventures just curious on on that front.
Well 1 question.
The other briefly I'll turn it over to tiny but none.
Not a lot of non core.
Positives are.
Almost entirely relationship base.
And we don't we don't have CD specials and things like that so all of the money sitting on our bank is really customer relationship.
Relationship based deposits, so and we're at 7 basis points I'm not sure how much you can unless we start charging people to keep their money I'm not sure how much we can run off at this point, but maybe Tony on some thoughts about the liquidity of sites.
In terms of deploying off balance sheet of lot of the deposit network because there has been so much liquidity in the system has actually frozen their ability to take more off balance sheet deposits. So we were we.
We were in really good shape because we.
Got are sold early and we Havent no. We havent brought those back yet and we continue to try to redeploy what we kind of on the balance sheet, which is debt you know $250 million plus debt that you mentioned David.
And again on that we're really working to deploy that in investments.
When we have the opportunities and I'm.
Trying to balance moving it out of cash where you know not stressing the portfolio yields too much but also.
Between those between us to balance is the on balance sheet any off balance sheet cash we have available.
Making sure that we're ready when the loan volume pick up 2 to fund that so.
We're in good shape.
Got it and then I just.
Wanted to touch on the fee waivers just curious if you had an estimate of how much forgone fees you may be add and then just maybe how much incremental fees you you might expect now that those are reinstated.
Okay.
That's a that is a really difficult number to put our fingers on because it's so much of it is.
Transaction oriented and balance oriented put together because some of our accounts are analyzed and so there are offsets to fees based on the balances that they hold.
And not only that but because behavior has changed over the course of the pandemic, it's really difficult to pin.
Pinpoint.
How much lift we might get out of that but you know.
That said, we are we are starting to see some lift but we only saw we only saw that for you know.
Half of May and in June So, we don't even have a full quarter of activity too.
And based on the analysis off of yet.
Okay.
That's fair.
And then just curious on the wine lending front and the expansion into Noma I believe you guys hired a new lender of last year have you continued to add to that team and then just curious how how growth has been in that business, what you're hearing from clients.
Just trends in the in the wind industry.
Yes. Thank you this is Tim.
Of the individuals that we put in charge of the commercial banking options of Santa Rosa was 1 of our wind on the experts so that that office in Sonoma County wasn't new but he did make a hire of some of them with wine industry background that in part was part of the team covering the central coast wine industry, calling activity and so what we're trying to do is bring the actress <unk>.
We had of Napa to both Sonoma County on the Central coast, they've been very active certainly with the of the world opening up with pandemic restrictions being relaxed that activity is really picking up that is going to take some time as well, but to build that pipeline, but they've been very active and we've been very excited about some of the opportunities that we've had with <unk>.
To look at and we've been able to get out with our customers and prospects.
Oh, yes.
Thank you everybody.
Thank you David.
We have a follow up question from Jackie Bohlen with <unk>. Please proceed.
Great. Thank you just just 1 last 1 for you on yeah, we're kind of approaching the 2 year anniversary of when you originally announced that you were looking to retire and then yeah.
Pandemic happened you, obviously put that on hold guide of the bank successfully through so I just wanted to see if you had any updated thoughts to share on that front.
It hasn't been 2 years, Jackie well, let's see.
Yes, [laughter] spinoff 2 years, well you know circumstances dictated what happened on you know on.
We started search and then the pandemic hit and I committed to this day through the pandemic.
And.
Where we're coming out of the pandemic, but we we have.
And how long of time, we've been able to do it.
The increase the responsibility for Tim and now promoted to president so he's taken a lot more responsibility.
Which is which is great and.
We don't have a definitive timeline at this point, but but we're making progress.
Oh.
It's a really good way of saying I do not have an answer for you.
It's not kind of making progress when they can break it up into reported at this point.
Okay. That's all I was looking for no update of filling update so thank you very much of that.
Okay.
Yeah.
There are no further questions on the phone at this time.
We are we do have 1 question, which was which came from a shareholder and of <unk>.
Question on this since completing the acquisition of.
<unk> be in April of bank of Marin share price has fallen 20 per cent. This represents a $100 million reduction in the market value of via of ours.
See from 500 of 400.
Are you still confident of the deal is good for shareholders I am actually way more confident today than I was the day, we announced the deal this though as we've gotten into this into this project.
We found incredible cooperation.
From the people and talent and to me.
Bank is only as good as of talent that you have in the bank of America wherever people are silke.
So cooperative so eager to help and to make this work that it's.
It's made it's made our decision to acquire them, even I am more confident today than I was.
We're bidding on this end.
And.
I will say that.
The market has also dropped so not all of 20% of revenue as a result of debt 1 of the other things that we heard was Oh youre going on in Sacramento you have on you know reservations about that but if you go on to Richard you go on to Sacramento as it de Novo you don't know the market and then Theres some issues.
We're going in and we're getting a bank that's been there for many years with a lot of talent and a lot of knowledge and a lot of good custom.
Customer great customer relationships. So you know what we projected in our in our.
Presentation. When we first did the deal with a 14% accretion the first of all year and I am I'm very confident that we will easily achieve that number this.
This acquisition is going to be extremely successful and so I am I am.
Not only confident but extremely confident of our success going forward on that.
That's that question.
I don't think there are any other questions.
1 of the thank everyone for listening today and for.
For for asking your questions I look forward to speaking with all of them. We all look forward to speaking with you again next quarter do you have any follow ups. Please feel free to call us.
For the time this morning.
Okay.
Okay.
[music].
Okay.
[music] day.