Q2 2024 Camden National Corp Earnings Call
Good day and welcome to Camden National Corporation's second quarter 2024 earnings conference call. My name is Lydia and I'll be your operator for today's call.
Unknown Executive: 2nd quarter 2024 earnings conference call.
Operator: Quarter 2024 Earnings Conference Call. My name is Lydia, and I'll be your operator for today's call. All participants will be in a lesson only mode during today's presentation. Following the presentation, we'll conduct a question and answer session. If you require operator assistance at any time during the call, please press star then zero. I'll now turn the ball over to Renee Smith, Executive Vice President, Chief Experience and Marketing Officer.
Lydia: My name is Lydia, and I'll be your operator for today's call. All participants will be in a listen-only mode during today's presentation.
Speaker Change: All participants will be in a listen-only mode during today's presentation. Following the presentation, we'll conduct a question and answer session.
Lydia: Following the presentation, we'll conduct a question-and-answer session. If you require operator assistance at any time during the call, please press star, then zero.
Rene Smyth: I'll now turn the call over to Rene Smyth, Executive Vice President, Chief Experience and Marketing Officer.
Rene Smyth: Thank you, Lydia. Good afternoon and welcome to Camden National Corporation's conference call for the 2nd quarter of 2024. Joining us this afternoon are members of Camden National Corporation's executive team, Simon Griffiths, President and Chief Executive Officer, and Mike Archer, Executive Vice President, Chief Financial Officer.
Renee Smith: Thank you, Lydia. Good afternoon, and welcome to Camden National Corporation's conference call for the second quarter of 2024. Joining us this afternoon are members of Camden National Corporation's executive team, Simon Griffiths, President and Chief Executive Officer, and Mike Archer, Executive Vice President, Chief Financial Officer. Please note that today's presentation contains forward-looking statements, and actual results could differ materially from what is discussed on today's call. Cautionary language regarding these forward-looking statements is contained in our second quarter 2024 earnings release issued this morning and in other reports we file with the SEC.
Rene Smyth: Please note that today's presentation contains forward-looking statements, and actual results could differ materially from what is discussed on today's call. Cautionary language regarding these forward-looking statements is contained in our 2nd quarter 2024 earnings release issued this morning and in other reports we file with the SEC. All of these materials and public filings are available on our Investor Relations website at CamdenNational.bank. Camden National Corporation trades on the NASDAQ under the symbol CAC.
Speaker Change: Please note that today's presentation contains forward looking statements and actual results could differ materially from what is discussed on today's call cautionary language regarding these forward looking statements is contained in our second quarter 2024 earnings release issued this morning and in other reports we file with the SEC.
Renee Smith: All of these materials and public filings are available on our Investor Relations website at camdennational.bank, which trades on the NASDAQ under the symbol CAC. In addition, today's presentation includes discussions of non-GAAP financial measures. Any references to non-GAAP financial measures are intended to provide meaningful insights and are reconciled with GAAP in our earnings release, which is also available on our IRB-Vector Relations website. I am pleased to introduce Camden National Corporation's host, President, and Chief Executive Officer, Simon Griffiths.
Speaker Change: All of these materials in public filings are available on our Investor Relations website at Camden National Bank Camden National Corporation trades on the NASDAQ under the symbol C. A Z. In addition, today's presentation includes discussions of non-GAAP financial measures any references to non-GAAP financial measures.
Rene Smyth: In addition, today's presentation includes discussions of non-GAAP financial measures. Any references to non-GAAP financial measures are intended to provide meaningful insights in a reconciled with GAAP in our earnings release, which is also available on our investor relations website.
Speaker Change: Are intended to provide meaningful insights and are reconciled with GAAP in our earnings release, which is also available on our Investor Relations website.
Simon Griffiths: I am pleased to introduce Camden National Corporation's host, President and Chief Executive Officer Simon Griffiths.
Simon R. Griffiths: I am pleased to introduce Camden National Corporation's host, President and Chief Executive Officer, Simon Griffith.
Simon Griffiths: Thank you, Rene, and good afternoon everyone. We appreciate you joining our call today. I will provide a few comments on our most recent quarter, and then I'll turn it over to Mike to dive into our 2nd quarter financial performance, and then we'll open up for our Q&A. I'm pleased to report, as we mark the halfway point through 2024, we continue to execute well in the uncertain environment. Despite macroeconomic headwinds, we remain committed to executing a long-term strategy of optimizing our balance sheet and deepening customer relationships through advice-based conversations and exceptional customer experience. Our team is building momentum and leveraging process automation and innovative solutions to deliver stellar advice to our loyal customer base.
Simon R. Griffiths: Thank you Renee and good.
Simon R. Griffiths: Thank you, Renee, and good afternoon, everyone. We appreciate you joining us on our call today. I will provide a few comments on our most recent quarter, and then I'll turn it over to Mike to dive into our second quarter financial performance, and then we'll open up for Q&A. I'm pleased to report that, as we mark the halfway point through 2024, we continue to execute well in the uncertain environment. Despite macroeconomic headwinds, we remain committed to executing our long-term strategy of optimizing our balance sheet and deepening customer relationships through advice-based conversations and exceptional customer experiences.
Speaker Change: Good afternoon, everyone. We.
Simon R. Griffiths: Our team is building momentum and leveraging process automation and innovative solutions to deliver stellar advice to our loyal customer base. Earlier this morning, we reported net income of 12 million, or 81 cents earnings per diluted share, for the second quarter of 2024.
Speaker Change: We appreciate you joining our call today I'll provide a few comments on our most recent quarter and then I'll turn it over to Mike to dive into our second quarter financial performance and then we'll open up for Q&A.
Simon R. Griffiths: Highlights for the second quarter include a six basis point increase in net interest margin over the previous quarter; disciplined execution and expense control, which exceeded our expectations and guidance previously communicated for the second quarter; and continued strong asset quality demonstrated by favorable credit quality metrics which benefit from our disciplined underwriting culture and keen asset management. Our reported net interest margin increase resulted in deposit cost pressure beginning to ease during the back half of the second quarter as we started to benefit from seasonal deposit flows in our market, took decisive action on certain high-cost, non-core deposit relationships, and continued asset allocation remix as we utilize investment cash flows to fund loan growth.
Simon R. Griffiths: Mike will expand on the net interest margin discussion and drivers in a few minutes. Meanwhile, our team continues to focus on driving deposit growth both through new customer acquisition and by deepening relationships with our existing customers, including by leveraging data and analytics to make informed, swift decisions. As Fed rate cuts become increasingly likely, we are ready to quickly act to manage our funding costs. As we saw while interest rates were increasing, we expect the first 25 to 50 basis point rate cut will likely result in a lower beta than subsequent rate cuts as we balance customer needs and markets, and competition.
Simon R. Griffiths: We remain focused on improving our operating leverage. During the second quarter of 2024, revenues increased 3% over the previous quarter, and non-interest expense remained flat. We continue to take disciplined actions to maintain and manage costs in response to net interest margin pressure while also driving opportunities to increase income and diversify our revenue base. Credit continues to perform in line with expectations, and by all measures, our credit measures continue to perform better than pre-pandemic levels.
Speaker Change: I'm pleased to report as we Mark the halfway point through 2024, we continue to execute well and the uncertain environment. Despite macroeconomic headwinds we remain committed to executing our long term strategy of optimizing our balance sheet and deepening customer relationships through advice based conversations and exceptional.
Speaker Change: <unk> customer experience.
Speaker Change: Our team is building momentum and leveraging process automation and innovative solutions to deliver stellar advice to our loyal customer base.
Simon Griffiths: Earlier this morning, we reported net income of 12 million or 81 cents earnings per diluted share for the 2nd quarter of 2024. Highlights for the 2nd quarter and through the 6 basis point increase in net interest margin over the previous quarter. Disciplined execution and expense control, which exceeded our expectations and guidance previously communicated for the 2nd quarter, and continued strong asset quality demonstrated by favorable credit quality metrics, which benefit from our disciplined underwriting culture and keen asset management. Our reported net interest margin increase has resulted to deposit cost pressure beginning to ease during the back half of the 2nd quarter as we started to benefit from seasonal deposit flows in our markets.
Speaker Change: Earlier. This morning, we reported net income of $12 million or <unk> 81.
Speaker Change: <unk> per diluted share for the second quarter of 2024.
Speaker Change: Lights for the second quarter include a six basis point increase in net interest margin over the previous quarter disciplined execution on expense control, which exceeded our expectations and guidance previously communicated for the second quarter and continued strong asset quality demonstrated by favorable credit quality metrics, which benefit from them.
Simon R. Griffiths: We continue to manage credit rigorously, consistent with our disciplined credit culture. For the second quarter, we reported strong asset quality with just a marginal uptick in non-performing assets, which accounted for just 17 basis points of total assets as of June 30, 2024. Our commercial loan portfolio remains well-balanced with no meaningful concentration risks.
Simon R. Griffiths: Our credit risk team continues to review our portfolio proactively and has not identified any systemic areas of concern. We continue to see moderate loan demand in our communities. Our residential mortgage pipeline has remained consistent quarter to quarter, and at the same time, we have seen a sizable uptick in our commercial loan pipeline, primarily driven by a few larger commercial real estate opportunities. We are seeing nice momentum in fee income spurred by a focus on and investment in wealth management and brokerage services. Combined, our wealth and brokerage services generated revenue of $3.3 million in the second quarter, an increase of 11% over the first quarter of this year.
Speaker Change: Disciplined underwriting culture and team asset management.
Speaker Change: Our reported net interest margin increase as a result of deposit cost pressure beginning to ease during the back half of the second quarter as we started to benefit from seasonal deposit flows and our markets.
Simon Griffiths: Our taking decisive action on certain high cost, non-core deposit relationships and continued asset allocation remix as we utilize investment cash flows to fund loan growth. Mike will expand on the net interest margin discussion and drive us in a few minutes.
Speaker Change: Taking decisive action on certain high cost non core deposit relationships and continued asset allocation remix as we utilize investment cash flows to fund loan growth.
Speaker Change: Mike will expand on the net interest margin discussion and drivers in a few minutes.
Mike: Our team continues to focus on driving deposit growth, both through new customer acquisition and by deepening relationships with our existing customers.
Mike: Including by leveraging data and analytics to make informed swift decisions.
Mike: As fed rate cuts become increasingly likely we are ready to quickly act to manage our funding costs.
Simon Griffiths: of the United States and the United States. The United States and the United States and the United States and the United States and the United States and the United States. Credit continues to perform in line with expectations, and my all measures are credit measures continue to perform better than pre-pandemic levels. We continue to manage credit rigorously, consistent with our disciplined credit culture. For the second quarter, we reported strong asset quality with just a marginal uptick in non-performing assets, which accounted for just 17 basis points of total assets as of June 30, 2024. Our commercial loan portfolio remains well balanced, with no meaningful concentration risk.
Mike: We saw while interest rates were increasing we expect the first 25% to 50 basis point rate cut.
Mike: It likely will result in a lower beta than subsequent rate cuts as we balance customer needs and market competition.
Mike: We remain focused on improving our operating leverage during the second quarter of 2024 revenues increased 3% over the previous quarter noninterest expense remained flat.
Mike: We continue to take disciplined actions to maintain and manage costs in response to net interest margin pressure, while also driving opportunities to increase fee income and diversify our revenue base.
Mike: <unk> continues to perform in line with expectations and by all measures our credit metrics continued to perform better than pre pandemic levels. We continue to manage credit rigorously consistent with our disciplined credit culture.
Mike: For the second quarter, we reported strong asset quality with just a marginal uptick in nonperforming assets, which accounted for just 17 basis points of total assets as of June 32024.
Mike: Our commercial loan portfolio remains well balanced with no meaningful concentration risk or credit risk team continues to review our portfolio proactively and have not identified any systemic areas of concern we continue to see moderate loan demand in our communities.
Simon Griffiths: Our credit risk team continues to review our portfolio proactively and have not identified any systemic areas of concern. We continue to see moderate loan demand in our communities. Our residential mortgage pipeline has remained consistent quarter to quarter. And at the same time, we have seen a size of uptick in our commercial loan pipeline, primarily driven by a few larger commercial real estate opportunities. We are seeing nice momentum in fee incomes, spurred by our focus and investment in wealth management and brokerage services. Combined our wealth and brokerage services generated revenue of 3.3 million in the second quarter, an increase of 11% over the first quarter of this year.
Residential mortgage pipeline pipeline has remained consistent quarter to quarter and at the same time, we have seen a sizable uptick in our commercial loan pipeline, primarily driven by a few larger commercial real estate opportunities.
Mike: We are seeing nice momentum in fee income spread by focus in investment and wealth management and brokerage services combined our wealth and brokerage services generated revenue of $3 3 million in the second quarter, an increase of 11% over the first quarter of this year.
Simon Griffiths: The increase is driven by sales activity and continued strength in the financial markets. We have crossed over 2 billion in assets under administration as of June 30, 2024, representing an increase of 12% compared to June 30, 2023. We are well positioned to expand or advise you distribution by leveraging our new wealth operating platform and mobile app as we stay committed to full relationship banking and growing our diversifying our fee income. We continue to make significant progress on digital roadmap and innovation ideation. Last quarter, we shared we invested a new online deposit account opening platform, and I'm pleased to report that it remains on schedule to go live at year end.
Simon R. Griffiths: The increase is driven by sales activity and continued strength in the financial market. We have crossed over $2 billion in assets under administration as of June 30, 2024, representing an increase of 12% compared to June 30, 2023.
Mike: Increase was driven by sales activity and continued strength in the financial markets. We've crossed over 2 billion in assets under administration as of June 30 of 2024, representing an increase of 12% compared to June 30th 2023.
We are well positioned to expand our advisory distribution by leveraging our new wealth operating platform, our mobile app as we stay committed to full relationship banking and growing and diversifying our fee income.
Simon R. Griffiths: We are well positioned to expand our advisory distribution by leveraging our new wealth operating platform and mobile app as we stay committed to full relationship banking and growing and diversifying our fee income. We continue to make significant progress on our digital roadmap and innovation ideation. Last quarter, we shared we invested in a new online deposit account opening platform, and I'm pleased to report that it remains on schedule to go live at year-end.
Mike: We continue to make significant progress on digital roadmap and innovation ideation last quarter, we shed we invested a new online deposit account opening platform and I am pleased to report that it remains on schedule to go live at year end. This new technology will enable customers to open fund unused deposit accounts for the minutes whenever.
Simon Griffiths: This new technology will enable customers to open fund and use deposit accounts for the minutes whenever and wherever they choose. We will leverage this technology to steer into our Omni channel approach, which aims to provide a consistent customer experience across all digital and brick and mortar sales and marketing channels to provide a uniform customer experience. Our robotics automation team continues to surpass expectations. We recently celebrated processing over two million support service transactions through our digital platform. At our current velocity, we will process a million transactions every six months. Additionally, our robotics automation reached a milestone with a newly developed API integration into our customer service workflow management tool.
Simon R. Griffiths: This new technology will enable customers to open, fund, and use deposit accounts within minutes, whenever and wherever they choose. We'll leverage this technology to guide our omnichannel approach, which aims to provide a consistent customer experience across all digital and brick-and-mortar sales and marketing channels to provide a uniform customer experience. Our robotics automation team continues to surpass expectations. We recently celebrated processing over 2 million support service transactions through our digital platform.
Mike: And wherever they choose we will leverage this technology to stare into our Omnichannel approach, which aims to provide a consistent customer experience across all digital and brick and mortar sales and marketing channels to provide a uniform customer experience.
Mike: Our robotics automation team continues to surpass expectations.
Mike: We recently celebrated processing over 2 million support service transactions through our digital platform.
Simon R. Griffiths: At our current velocity, we will process a million transactions every six months. Additionally, our robotics automation reached a milestone with a newly developed API integration into our customer service workflow management tool. For the first time, this allows true end-to-end automation of predictable, repeatable customer service activities, creating real capacity across multiple internal departments. Further, our data analytics team partnered on an AI beta pilot with a third party for data scientist emulation, simplifying the technical skills needed to request higher-order analytic models.
Mike: At our current velocity, we will process a million transactions every six months. Additionally, our robotics automation reached a milestone with the newly developed API integration into our customer service workflow management tool for the first time. This allows true end to end automation, a predictable repeatable customer service activities, creating.
Simon Griffiths: For the first time, this allows true end-to-end automation, predictable, repeatable customer service activities, creating real capacity across multiple internal departments. Further, our data analytics team partnered on AI Beta pilot with a third party for data scientist emulation, simplifying the technical skills needed to request higher order analytic models. If successful, this has the potential to drive sophisticated analytics further into the hands of business units, and the pilot will be completed in Q4. We believe our investments in talent, technology, products and services will continue to benefit as macroeconomic conditions improve. And that our strong foundation will permit us to generate consistent, sustainable, and long-term performance as we remain focused on execution and evolving the bank to meet customer and shareholder expectations.
Mike: Real capacity across multiple internal departments.
Mike: Further our data analytics team partnered on AI beta pilot with a third party for data scientists emulation simplifying the technical skills needed to request higher order analytic models. If successful this has the potential to drive sophisticated analytics.
Simon R. Griffiths: If successful, this has the potential to drive sophisticated analytics further into the hands of business units, and the pilot will be completed in Q4. We believe our investments in talent, technology, products, and services will continue to benefit as macroeconomic conditions improve, and that our strong foundation will permit us to generate consistent, sustainable, and long-term performance as we remain focused on execution and evolving the bank to meet customer and shareholder expectations. Now Mike will provide some highlights from the second quarter. Thank you, Simon, and good luck.
Speaker Change: They are into the hands of business units and the pilot will be completed in Q4, we.
Speaker Change: We believe our investments in talent technology products and services will continue to benefit as macroeconomic conditions improve and that our strong foundation will permit us to generate consistent sustainable and long term performance as we remain focused on execution and evolving the bank to meet customer and shareholder expectations.
Speaker Change: Patients now Mike will provide some highlights from the second quarter.
Michael Archer: Now Michael provides some highlights from the second quarter.
Michael R. Archer: This morning, we reported a net income of $12 million in diluted earnings per share of 81 cents for the second quarter of 2024 and a net income of $25.3 million in diluted EPF of $1.72 for the first six months of the year. We are pleased with our second quarter financial results as they demonstrate real momentum within our core business, highlighted by a reported non-GAAP pre-tax pre-provision income of $15.5 million, which is up 9% on a linked quarter basis.
Michael Archer: Thank you, Simon, and good afternoon, everyone. This morning, we reported a net income of $12 million in diluted earnings per share of 81 cents to the second quarter of 2024 and net income of $25.3 million in diluted EPF of $1.72 through the first six months of the year. We are pleased with our second quarter financial results as they demonstrate real momentum within our core business as highlighted by a reported non-GAAP, pre-tax, pre-provision income of $15.5 million, which is up 9% on a link quarter basis.
Michael R. Archer: Thank you, Simon. And good afternoon, everyone.
Mike: Thank you Simon and good afternoon, everyone. This morning, we reported net income of $12 million and diluted earnings per share of <unk> 81 for the <unk>.
Mike: Second quarter of 2024, and net income of $25 3 million and diluted EPS of $1 72 through the first six months of the year.
Speaker Change: We are pleased with our second quarter financial results as they demonstrate real momentum within our core business as highlighted by our reported non-GAAP pre tax pre provision income of $15 5 million, which was up 9% on a linked quarter basis.
Michael Archer: As a reminder, in the first quarter of this year, we recorded a negative provision expense at $2 million as we released loan reserves due to the strength of our loan portfolio. And we recovered 910,000 proceeds upon the sale of our Signature Bank bond. With our solid earnings for the second quarter, our tangible capital position grew during the quarter. As of June 30th, 2024, on a non-GAAP basis, our tangible book value per share stood at $28.34, up 2% from the first quarter and 11% over the past 12 months. Total revenues for the second quarter of 2024 increased 3% over the first quarter of 2024.
Michael R. Archer: As a reminder, in the first quarter of this year, we recorded a negative provision expense of $2 million as we released loan reserves due to the strength of our loan portfolio. And we recovered $910,000 in proceeds upon the sale of our signature bank bond.
Speaker Change: As a reminder, in the first quarter of this year, we recorded a negative provision expense of $2 million as we release loan reserves due to the strength of our loan portfolio and we recovered 910000. The proceeds upon the sale of our signature bank bond with.
Michael R. Archer: With our solid earnings for the second quarter, our tangible capital position grew during the quarter. As of June 30, 2024, on a non-gap basis, our tangible book value per share stood at $28.34, up 2% from the first quarter and 11% over the past 12 months. Total revenues for the second quarter of 2024 increased 3% over the first quarter of 2024. Net interest income grew 3% during the second quarter to $32.2 million, led by an increase in the net interest margin of 6 basis points to 2.36%.
Speaker Change: Our solid earnings for the second quarter, our tangible capital position grew during the quarter as of June 32024 on a non-GAAP basis, our tangible book value per share stood at $28 34.
Speaker Change: 2% from the first quarter and 11% over the past 12 months.
Speaker Change: Total revenues for the second quarter of 2024 increased 3% over the first quarter of 2024.
Michael Archer: Net interest income grew 3% down the second quarter to $32.2 million, led by an increase in net interest margin of 6 basis points to 2.36%. In June, a $100 million balance sheet interest rate swap matured, providing approximately 5 basis points of lift for the partial month, and we anticipate 6 to 7 basis points for a full month benefit at current interest rates. In June, we also began to see normal inflows from seasonal deposits in our market. Looking forward, we can anticipate continuing net interest margin of expansion during the third quarter due to the aforementioned factors, along with the continued redeployment of investment cash flows to support new new loan originations at current market rates.
Speaker Change: Net interest income grew 3% during the second quarter to $32 2 million led by an increase in net interest margin of six basis points to 236%.
Michael R. Archer: In June, a $100 million balance sheet interest rate swap matured, providing approximately five basis points of lift for the partial month, and we anticipate six to seven basis points for a full month's benefit at current interest rates. In June, we also began to see normal inflows from seasonal deposits in our markets.
In June of $100 million balance sheet interest rate swap mature, providing approximately five basis points of lift for the partial month, and we anticipate six to seven basis points for a full month's benefit at current interest rates.
Speaker Change: In June we also began to see to see normal inflows from seasonal deposits in our market.
Michael R. Archer: Looking forward, we can anticipate continued net interest margin expansion during the third quarter due to the aforementioned factors, along with the continued redeployment of investment cash flows to support new loan originations at current market rates. Non-interest income for the second quarter of 2024 totaled $10.6 million, an increase of 3% over the first quarter of this year. As Simon noted in his comments, we are seeing positive momentum across our brokerage and wealth business.
Speaker Change: Looking forward, we anticipate continued net interest margin expansion during the third quarter due to the aforementioned factors along with the continued redeployment of investment cash flows to support new new loan originations at current market rates.
Michael Archer: Not interesting income for the second quarter of 2024 total of $10.6 million, an increase of 3% over the first quarter of this year. Simon noted in his comments, we are seeing positive momentum across our brokerage and wealth business lines. Regarding mortgage banking, we continue to sell our qualifying residential mortgage production. For the second quarter, we sold 52% of a residential mortgage production, and through the first six months, we sold 51% of our production.
Simon: Noninterest income for the second quarter of 2020 for a total of $10 6 million an increase of 3% over the first quarter of this year Simon.
As Simon noted in his comments, we are seeing positive momentum across our brokerage and wealth business lines regarding regarding mortgage banking, we continue to sell our qualifying residential mortgage production for the second quarter, we sold 52% of our residential mortgage production and through the first six months, we sold 51% of our production.
Michael R. Archer: Regarding mortgage banking, we continue to sell our qualifying residential mortgage production. For the second quarter, we sold 52% of our residential mortgage production, and through the first six months, we sold 51% of our production. As we work our way back to historical financial performance levels, we are focused on the management of operating expenses and driving positive operating leverage while continuing to invest in the organization. Non-interest expenses for the second quarter of 2024 were $27.3 million, a small decrease from the first quarter of this year.
Michael Archer: As we work our way back to historical financial performance levels, we are focused on the management of operating expenses and driving positive operating leverage while continuing to invest in the organization. Not interest expenses for the second quarter of 2024 were 27.3 million, a small decrease from the first quarter of this year. The positive combination of lower non-interest expense and revenue growth for the second quarter improved our non-GAAP efficiency ratio on a link quarter basis. Our efficiency ratio for the second quarter of 2024 was 63.53% compared to 65.55% for the first quarter of 2024.
Simon: As we work our way back to historical financial performance levels. We are focused on the management of operating expenses and driving positive operating leverage leverage while continuing to invest in the organization not.
Simon: Noninterest expenses for the second quarter of 2024 were $27 3 million.
Speaker Change: <unk> decrease from the first quarter of this year the positive combination of lower noninterest expense and revenue growth for the second quarter improved our non-GAAP efficiency ratio.
Michael R. Archer: The positive combination of lower non-interest expense and revenue growth for the second quarter improved our non-gap efficiency ratio on a lean quarter basis. Our efficiency ratio for the second quarter of 2024 was 63.53% compared to 65.55% for the first quarter of 2024. Based on these results, for the second quarter, we are now estimating our quarterly operating expenses will range between $27.5 to $28 million for the remainder of the year.
Speaker Change: Linked quarter basis, our efficiency ratio for the second quarter of 2024 was 63, 53% compared to 65, 55% for the first quarter of 2024.
Michael Archer: Based on these results for the second quarter, we are now estimating our quarterly operating expenses will range between 27.5 to 28 million for the remainder of the year. Moving to the balance sheet, total are loans as of June 30, 2024, or 4.1 billion, and grew less than 1% in the second quarter of 2024, and 1% through the first six months of this year. Our loan growth of the first half of 2024 has been mixed across our loan segments. We continue to maintain our loan pricing discipline across our products in the current interest rate environment. Total deposits as of June 30, 2024, were 4.5 billion, a decrease of 1% during the second quarter of 2024, and 2% through the first half of the year.
Speaker Change: Based on these results for the second quarter. We are now estimating our quarterly operating expenses will range between 27, 5% to $28 million for the remainder of the year.
Speaker Change: Moving to the balance sheet total or loans as of June 32024 were $4 1 billion and grew less than 1% in the second quarter of 2024 and 1% through the first six months of this year.
Michael R. Archer: Moving to the balance sheet, total loans as of June 30 of 2024 were $4.1 billion, and they grew less than 1% in the second quarter of 2024 and 1% through the first six months of this year. Our loan growth for the first half of 2024 has been mixed across our loan segments. We continue to maintain our loan pricing discipline across our products in the current interest rate environment. Total deposits as of June 30, 2024, were $4.5 billion, a decrease of 1% during the second quarter of 2024 and 2% through the first half of the year.
Speaker Change: Our loan growth through the first half of 2024 has been mixed across our loan segments. We continue to maintain our loan pricing discipline across our products in the current interest rate environment.
Speaker Change: Total deposits as of June 32024 for $4 5 billion, a decrease of 1% during the second quarter of 2024 and 2% through the first half of the year. The decrease in deposits during the second quarter and the first half of the year reflects the decisive actions, we took to manage and optimize net interest margin through the first six months.
Michael R. Archer: The decrease in deposits during the second quarter and the first half of the year reflects the decisive actions we took to manage and optimize net interest margin. Through the first six months of the year, we managed out approximately $150 million of high-cost municipal interest checking and CD balances as part of this effort.
Michael Archer: The decrease in the deposit during the second quarter in the first half of the year reflects the decisive actions we took to manage and optimize net interest margin. To the first six months of the year, we managed out approximately 150 million of high cost municipal interest checking and CD balance as part of this effort. Our loan and deposit products are geared towards driving full relationship banking and us being the primary bank for our customers. In the second quarter, we launched our high-yield savings product, which is a new money product requiring that the customer also maintain a checking account with us.
Speaker Change: For the year, we manage out approximately $150 million of high cost municipal interest checking in CD balances as part of this effort.
Michael R. Archer: Our loan and deposit products are geared towards driving full relationship banking and us being the primary bank for our customers. In the second quarter, we launched our high-yield savings product, which is a new money product requiring that the customer also maintain a checking account with us. We're pleased with these results for the product, which include an 8% growth in savings deposits in the second quarter of 2024. Our asset quality for the second quarter continued to be strong, supported by excellent credit quality metrics, including non-performing loans of 0.23% of total loans, annualized net charge-offs of four basis points of average loans, and past-due loans of five basis points of total.
Speaker Change: Our loan and deposit products are geared towards driving full relationship banking and that's been the primary bank for our customers in the second quarter, we launched our high yield savings product, which is a new money product requiring that the customer also maintain a checking account with us we've been pleased with these results of the product which include an 8% growth in savings.
Michael Archer: We've been pleased with these results of the product, which includes an 8% growth in savings deposits in the second quarter of 2024. Our asset quality for the second quarter continues to be strong, supported by excellent credit quality metrics, including non-performing loans of 0.23% of total loans, annualized net charge off to four basis points of average loans, and past due loans of five basis points of total loans. Non-performing loans and net charge-offs to modestly increase in the second quarter compared to the first quarter, but we do not believe they reflect any signs of systemic stress within our loan portfolio.
Speaker Change: Savings deposits in the second quarter of 2024.
Our asset quality for the second quarter continued to be strong supported by excellent credit quality metrics, including nonperforming loans of <unk>, 3% of total loans annualized net charge offs of four basis points of average loans and past due loans of five basis points of total loans.
Michael R. Archer: Non-performing loans and net charge-offs modestly increased in the second quarter compared to the first quarter, but we do not believe they reflect any signs of systemic stress within our loan portfolio. The strength of our asset quality combined with modest loan growth gave us the confidence to hold loan loss reserves at 0.86% of total loans as of June 30, 2024, which was consistent with our loan loss reserve coverage ratio as of the end of last quarter.
Speaker Change: Nonperforming loans and net charge offs modestly increase in the second quarter compared to the first quarter, but we do not believe they reflect any signs of systemic stress within our loan portfolio.
Michael Archer: The strength of our asset quality combined with modest loans gave us the confidence to hold loss reserves at 0.86% of total loans at June 30th, 2024, which was consistent with a loan loss reserve's coverage ratio as of the end of last quarter.
Speaker Change: The strength of our asset quality combined with modest loan growth gave us the confidence to hold loan loss reserves at <unk>, 86% of total loans at June 32024, which was consistent with our loan loss reserve coverage ratio as of the end of last quarter.
Speaker Change: Our capital and liquidity positions also continues to be strong our non-GAAP tangible common equity ratio increased 22 basis points during the second quarter to 734% as of June 32024, which included the repurchase of 50000 shares of common stock totaling $1 6 million of capital.
Michael Archer: Our capital and liquidity positions also continued to be strong. Our non-GAAP tangible common equity ratio increased 22 basis points from the second quarter to 7.34% as of June 30th, 2024, which included the repurchase of 50,000 shares of common stock, totaling 1.6 million of capital. Are uninsured and uncliricalized deposits as of June 30th, 2024, or 14.6% of total deposits in our available liquidity sources, where two times uninsured and uncliricalized deposits.
Michael R. Archer: Our capital and liquidity positions also continue to be strong. Our non-GAAP tangible common equity ratio increased 22 basis points in the second quarter to 7.34% as of June 30, 2024, which included the repurchase of 50,000 shares of common stock totaling 1.6 million of capital. Our uninsured and uncollateralized deposits, as of June 30, 2024, were 14.6% of total deposits, and our available liquidity sources were two times uninsured and un
Speaker Change: Our uninsured and uncollateralized deposits as of June 32024 were 14, 6% of total deposits and our available liquidity sources were two times uninsured and uncollateralized deposits. This concludes our comments, we will now open the call up for questions.
Michael Archer: This concludes our comments; we'll now open the call up for questions.
Operator: This concludes our comments. We'll now open the call up for questions. Thank you.
Lydia: Thank you. We'll now begin the question and answer session. To ask a question, you may press star, then one on your touch-tone phone keypad. If you're using a speaker phone, please pick your handset up before pressing the key. To avoid your question, please press star, then two.
Speaker Change: Thank you.
Operator: We'll now begin the question and answer session. To ask a question, you may press star then 1 on your touch screen phone keypad. If you're using a speaker phone, please pick your hand up before pressing the key. To withdraw your question, please press star then 2. At this time, we'll pause momentarily to assemble our roster. Our first question comes from Steve Moss with Raymond James. Your line is open, please go ahead.
Speaker Change: We will now begin the question and answer session.
To ask a question you May Press Star then one on your touch sang thank you Pat.
Speaker Change: If youre using a speakerphone please pick Johan the floor question Nicky.
Speaker Change: To withdraw your question Please press star.
Speaker Change: At this time, we'll pause momentarily to assemble our.
Lydia: At this time, we'll pause momentarily to assemble our roster.
Speaker Change: Okay.
Steve Moss: Our third question comes from Steve Moss with Raymond James. Your line is open; please go ahead.
Speaker Change: Our first question comes from Steve Moss with Raymond James Your line is open. Please go ahead.
Steve Moss: How good afternoon. Start off with the margin guidance here. In terms of the mic, you said you had a five-base point lift from the swap expiring this quarter, and then additional six or you expect six to seven-base points of benefit for a full month. If I hear you correctly and think about, call it 11 or 12 upside going forward here in the third quarter?
Stephen M. Moss: Good afternoon.
Stephen M. Moss: Maybe start off with the margin guidance here.
Stephen M. Moss: Maybe start off with the margin guidance here. I'll start off with the margin guidance here. In terms of the, Mike, you said you had a five-base point lift from the swap expiring this quarter, and then an additional six, or you expect six to seven base points of benefit for a full month. So am I hearing you correctly in thinking about, call it 11 or 12 basis points? of Additional Margin Upside going forward here in the third quarter.
Sorry for the margin guidance here in terms of the <unk>.
Speaker Change: Like you said you had a five basis point lift from the swap expiring this quarter and then additional six alright, you expect six to seven basis points of benefit.
Speaker Change: A full months so if I'm hearing you correctly in thinking about call it.
Speaker Change: 11, or 12 basis points.
Speaker Change: Additional margin upside going forward here in the third quarter.
Michael Archer: No, no, Steve. Good question. As we think about margin for next quarter, we're thinking that we're probably in the neighborhood of three to seven basis points. It's called 239-243-ish for the third quarter, which is a function of what you just mentioned there. The additional lift of the $100 million going to swap that ran off, as well as some of the seasonal flows and other activity occurring.
Speaker Change: No no Steve Good question. So as we think about margin for next quarter, we're thinking that we're probably in the neighborhood of three to seven basis points, let's call. It $2 39 to $2 43 ish.
Michael R. Archer: No, no, Steve, a good question. So as we think about margin for next quarter, we're thinking that we're probably in the neighborhood of up three to seven basis points, you know, let's call it 239 to 243 ish for the third quarter, which is a function of what you just mentioned there, you know, the additional lift of the $100 million loan swap that ran off, as well as some of the seasonal flows and other activity occurring.
For the third quarter, which is a function of what you just mentioned there the additional lift of the $100 million loan swap that ran off.
Speaker Change: As well as to some of the seasonal flows and other activity occurring.
Steve Moss: Okay.
Speaker Change: Okay.
Stephen M. Moss: Okay. And just as we think about the seasonal flows on deposit costs, I mean, definitely seeing, you know, nice seeing your guys' deposit cost increases slow down here, but definitely seeing it across the board. You know, Curious if you think, like, in addition to seasonal flows, you could get a little bit more of a lift here, just given that deposit costs are likely to stay. Why don't you get the massive repricing?
Steve Moss: And just so we think about the seasonal flows on deposit costs. We've definitely seen, you know, nice seeing your guys's deposit costs increases flow down here, but definitely seeing it across the board. You know, curious as you think like, in addition to seasonal flows, you could get a little bit more of a lift here, just given that deposit costs are like this.
Speaker Change: And just as we think about the seasonal flows on deposit cost and we're definitely seeing nice senior guys as deposit cost.
Speaker Change: Increases slowdown here, but definitely seen it across across the board.
Speaker Change: Curious if you think like in addition to seasonal.
Speaker Change: Flows you could get a little bit more of a lift here.
Just given that deposit costs are likely to stabilize and get some asset repricing.
Michael Archer: Why does it get the mass requested? Yeah, I think so. In terms of this deposit cost, I want to say for June, we landed around 236 off the top of my head for, excuse me, all in funding costs, not deposit costs. I do anticipate that we'll continue just to hang around there, maybe up a basis point or two, but then we'll just continue to have the continued asset yield of expansion as well as we move forward. So, as we're thinking about our seasonal deposit flows, I do think, well, we are seeing the benefit there. I think one of the questions is we still see a level of remixed as well.
Yes, I think so in terms of just deposit costs I wanted to say for June we landed around $2 32 to 36 off the top my head for excuse me all in funding costs not deposit costs.
Michael R. Archer: Yeah, I think so in terms of deposit costs, I want to say for June, we landed around 230-236 off the top of my head for, excuse me, all in funding costs, not deposit costs. I do anticipate that we'll continue just to hang around there, maybe up a basis point or two. But then we'll just continue to have continued asset yield expansion as well as we move forward.
Speaker Change: I do anticipate that will continue just to hang around there maybe up a basis point or two.
Speaker Change: But then we'll just continue to have the continued asset yield expansion as well as we as we move forward. So as we're thinking about are our seasonal deposit flows I do think we are seeing the benefit there I think one of the questions is we still see a level of remix as well.
Michael R. Archer: So as we're thinking about our seasonal deposit flows, I do think we are seeing the benefit there. But I think one of the questions is whether we still see a level of remix as well. So, you know, as we think about that on a go forward over the next few months, do we think that could level itself off and call one or two basis points up from a remix could be offset by the seasonal flow. So that's how we're thinking about deposits and funding costs right now.
Michael Archer: So, you know, as we're thinking about that on a go forward over the next few months, Steve, we think that could level itself off and then call one or two basis points up on from a remixed could be offset by the seasonal flows. So that's how we're thinking about deposits and funding cost rate at this moment.
Speaker Change: So as we're thinking about that on a go forward over the next few months do we think that good level itself off in call. It one or two basis points up on from a remix could be offset by the seasonal flu. So that's how we're thinking about deposits and funding cost right at this moment.
Steve Moss: Okay. Great. That's helpful.
Okay great.
Speaker Change: Great that's helpful.
Stephen M. Moss: And then, Simon, in your comments, you mentioned, you know, I guess like moderate loan demand, but that you're seeing some sizable, I think, commercial real estate opportunities. Just kind of curious; you get a little color around those larger commercial real estate opportunities.
Simon Griffiths: And then Simon, in your comments you mentioned, you know, I guess like moderate loan demand, but that you're seeing some sizeable, I think commercial real estate opportunities, is what you said. Just kind of curious, you get a little color around those large, large commercial real estate opportunities you're seeing. Yeah, thanks, Steve. I mean, just overall, you know, we see continuously, you know, nice demand across our business. You know, we're seeing low single-digit loan growth for the third quarter, and that's been pretty consistent with this quarter. Certainly seeing some nice opportunities, particularly on the commercial real estate side.
Speaker Change: And then Simon in your comments you mentioned.
Simon: I guess like moderate loan demand that youre seeing some sizable.
Speaker Change: I think commercial real estate opportunities as what you said just kind of curious if you give a little color around.
Simon: Those larger larger commercial real estate opportunities Youre seeing.
Yeah, Thanks, Steve I mean, just overall.
Simon R. Griffiths: Yeah, thanks, Steve. I mean, just overall, we continue to see, you know, nice demand across our business. You know, we're seeing low single-digit loan growth for the third quarter, and that's been pretty consistent with this quarter. Certainly, we are seeing some nice opportunities, particularly on the commercial real estate side. We're also seeing, on the resi side, a nice pickup in our home equity business, and solid demand on the resi mortgage side as well.
Simon: We see continue to see.
Speaker Change: And a nice demand across our business, we're seeing low single digit loan growth for the third quarter and thats been pretty consistent with this quarter certainly seeing some nice opportunities, particularly on the commercial real estate side.
Simon Griffiths: We're also seeing on the Rezzi side, nice pick up in our home equity business, and solid demand on the Rezzi mortgage side as well. So, overall, you know, I think it continues the theme that we've been articulating, Steve, which is, you know, we're leveraging the balance sheet, focusing on relationships, being, you know, conscious obviously of quality, and broadening that out and leveraging the opportunities we have to, you know, commit to the communities that we serve and continue to lend into those communities.
Speaker Change: Are you seeing on the resi side nice pick up in our home equity business and solid demand on the resi mortgage side as well. So overall I think it continues the theme that we've been articulating, Steve which is.
Simon R. Griffiths: So overall, you know, I think it continues the theme that we've been articulating, Steve, which is, you know, we're leveraging the balance sheet, focusing on relationships, being conscious, obviously, of quality, and broadening that out and leveraging the opportunities we have to commit to the communities that we serve and continue to invest in those communities.
Stephen M. Moss: Leveraging the balance sheet focusing on relationships.
Stephen M. Moss: Conscious obviously of quality and broadening that out and leveraging the opportunities we have to.
We commit to the communities that we serve.
Stephen M. Moss: Continue to lend into those communities.
Stephen M. Moss: Yes.
Simon Griffiths: Guy, yeah, and are the projects, you know, multi-family nature or, you know, industrial? Just kind of curious as to where you see the type of demand, if you will. Yeah, it's a mix. It's definitely a mix. We definitely have some of those, you know, moldy family couple off, you know, we have a couple of, you know, moldy families that particularly, we've had a couple of hotels, you know, high quality hotel locations in some just a great locations as well. Take those sort of, probably the two kind of themes of income through. Okay, great. I appreciate all the color and all step back in the queue here.
Stephen M. Moss: Guy. And are the projects, you know, multifamily in nature or, you know, industrial? Just kind of curious as to where you've seen the type of demand, if you will.
Stephen M. Moss: Got you.
Speaker Change: Are the projects multifamily nature or <unk>.
Speaker Change: Industrial just kind of curious as to like.
Speaker Change: Where are you seeing that type of demand if you will.
Simon R. Griffiths: Yeah, it's a mix. It's definitely a mix. We definitely have some of those, you know, Mouldie families, a couple of, you know, we have a couple of Mouldie families that particularly, we've had a couple of hotels, you know, high-quality hotel locations and some great locations as well. I'd say those sort of, probably the two kinds of themes I've seen come through.
Yes, it's a mix it's definitely a mixed we definitely have some of those multifamily couple of we have a couple of multi families that particularly we've had a couple of hotels.
Speaker Change: High quality hotel locations in some great locations as well I'll take those sort of probably the two kind of things as income.
Speaker Change: Okay, Great I appreciate all the color and I'll step back in the queue here.
Stephen M. Moss: Okay, great. I appreciate all the calls, and I'll step back into the queue here.
Speaker Change: Yeah.
Steve Moss: Thank you.
Speaker Change: Thank you. Our next question comes from Matthew Breese with Stephens.
Operator: Thank you. Our next question comes from Matthew Breese, with Stephen.
Matthew Breese: And the next question comes from Matthew Breeze with Stephen. Please go ahead. Good afternoon. I was hoping you could talk a little bit more about the high yield savings program. You know, I guess I guess first, what rate are you offering on that program so long as folks meet all the criteria? Two, does it continue? And three, what's the expectation for how that program might impact, you know, deposit costs overall, but in particular, the savings category, given, you know, at least on the average balance sheet, it's still on a really low level. Just some thoughts there.
Speaker Change: Please go ahead.
Matthew M. Breese: Good afternoon.
Matthew M. Breese: I was hoping you could talk a little bit more about the High Yield Savings Program. You know, I guess, first, what's the interest rate you are offering on that program so long as folks meet all the criteria? Two, does it continue? And three, what's the expectation for how that program might impact, you know, deposit costs overall, but in particular savings? category, given, you know, at least on the average balance sheet, it's still at a really low level. Some thoughts there.
Matthew M. Breese: I was hoping you could talk a little bit more about the high yield savings program I guess I guess first what rate are you offering on that program. So long as folks need all the criteria to does it continue.
Speaker Change: Three what's the expectation for how that program might impact.
Speaker Change: Deposit cost overall budget, particularly the savings.
Speaker Change: Category given at least on the average balance sheet still at a really low level just some thoughts there.
Michael Archer: Yeah, sure. I can start off there, Matt. So we did, as I mentioned, I think our savings growth for the quarter was eight percent. I want to say that was in the neighborhood of around 50 million. The majority, the vast majority, that certainly was from that high yield product. Overall, I want to say that the weighted rate that we put on the high yield is 413 for the quarter. So we do have a couple called tiers there, around four, four, four and a quarter, four and a half, that we're out there selling and marketing, and it had a good traction.
Speaker Change: Yeah sure I can start off there Matt so.
Michael R. Archer: Yeah, sure. I can start off there, Matt.
Speaker Change: So we did as I mentioned I think our savings growth for the quarter was 8% and I won't say that was in the neighborhood of around 50 million. The majority of the vast majority of that certainly was from that high yield product.
Michael R. Archer: So we did, as I mentioned, I think our savings growth for the quarter was 8%. I want to say that was in the neighborhood of around 50 million. The majority, the vast majority of that certainly was from that high yield product. Overall, I want to say that the weighted rate that we put on the high yield was $4.13 for the quarter.
Speaker Change: Overall I wanted to say that the weighted rate that we put on the high yield at $4 13 for.
Michael R. Archer: So we do have a couple, call them tiers, that are around $4.00, $4.25, $4.50 that we're out there selling and marketing and have had good traction. And as we said, I'm really trying to drive new customer acquisition along with that product as well. I think one of the things that we're also thinking about in the back of our heads is that CDs start to reprice and start to roll off here over the coming months as well as being thoughtful about trying to get the money back into illiquid products and have the ability to roll down the curve if and when that happens. So we're trying to balance all those factors and be certainly very thoughtful about that.
Speaker Change: For the quarter. So we do have a couple of call. It tiers there around four <unk>.
Speaker Change: <unk> hundred four in quarter, four and a half.
Speaker Change: That that were out there selling and marketing and have had good traction and as we said I mean, we're really trying to drive new customer acquisition, along with that product as well I think one of the things that we're also in the back of our heads thinking about is that Cds start to reprice and start to roll off here over the coming months as well as being thought.
Michael Archer: And as we said, I mean, really trying to drive, you know, new customer acquisition along with that product as well. I think one of the things that we're also in the back of our heads thinking about is that CDs start to reprice and start to roll off here over the coming months, as well as being thoughtful of trying to get the money back into the good products. Have the ability to roll down the curve if one that happens.
Speaker Change: I'm trying to get the money back into liquid products have the ability to roll down the curve, if and when that happens.
Michael Archer: So we're trying to balance all those stackers and be certainly very thoughtful about that.
Speaker Change: So we're trying to balance all those factors it would be certainly very thoughtful about that.
Speaker Change: Yes.
Simon Griffiths: Hey, Matt, this is something to talk about. Matt, I just had just a comment to that. It's, you know, continue to see, you know, one of the nice things about the CD roll off and we continue to have about 80 percent retention, which is very favorable; leverage these relationships to really deepen and expand into other products as well. So we really seeing that opportunity to engage our clients and, you know, look to opportunities deeper as I mentioned.
Speaker Change: Hey, Matt This is Scott and I'll just add to that.
Simon R. Griffiths: Hey Matt, this is Simon. I'll just add to that. It's, you know, one of the nice things about the CD roll-off and, you know, we continue to have about 80% retention, which is very favorable. leverage these relationships to really deepen and expand into other products as well. So we're really seeing that opportunity to engage our clients and, you know, look to opportunities to deepen, as I mentioned.
Speaker Change: Mark I'll, just add just to comment to that.
Matt: Continued to see one of the nice things about the CD roll off and we.
Speaker Change: We continue to have about 80% retention, which is very favorable leverage these relationships.
Matt: So really deepen and expand into other products as well, so what you're really seeing that opportunity to engage our clients.
Matt: And look through opportunities deepen as I as I mentioned.
Matthew Breese: I appreciate that color.
Matt: Yes.
Speaker Change: I appreciate that color.
Matthew M. Breese: I appreciate that color. Maybe just looking at the NIM, you know, it feels like we're at that inflection point for you all, where deposit cost increases start to slow, while asset yields really start to rise. As you extend and look at your outlet for, you know, beyond 2024 and into 2025, how much of the lost ground on the NIM can we recapture? Can we get back to a, you know, call it a 275-type NIM based on, you know, a forward curve? I think there's three or four cuts in there. Just some overall thoughts on the longer-term trajectory of the NIM, or not just the next one or two quarters but into 25.
Matthew Breese: Maybe just looking at the name, you know, it feels like we're at that inflection point for you all. We're a deposit cost increases start to slow, while acid yields really start to reprice higher. As you extend and look at your outlet for beyond 24 into 2025. How much of the loss ground on the name can we recapture? Can we get back to a, you know, a quality 275 type name? And based on, you know, forward curve, I think there's two or four cuts in there, just some overall thoughts on the long return to direct the nimble, not just the next one or two quarters, but into 25.
Speaker Change: Maybe just looking at the NIM it feels like we're at that inflection point for you all where deposit cost increases start to slow.
Speaker Change: Asset yields really start to reprice higher as you extend and look at your outlook for beyond 'twenty four and into 2025.
Speaker Change: How much of the last round on the NIM can we recapture can we get back to a.
Speaker Change: Call It 875 typed in.
Speaker Change: Based on forward curve I think there is three or four cuts in there just some overall thoughts on the longer term trajectory of the NIM not just the next one or two quarters, but in the 25.
Michael Archer: Yeah, it's a great question. I think your comment there, Matt, is certainly going to, you know, matter with the shape of the curve. I mean, I certainly hope that we get back to, you know, margin levels that we were at certainly, you know, a few years ago. How fast we get there to be seen, certainly as we think about federated cuts. Hopefully, we're coming months and quarters, assuming that the yield curve doesn't, you know, the long end doesn't go down with it. That will certainly be beneficial to us. And I do anticipate, you know, to your comment there, I do anticipate us getting back to 270.
Speaker Change: Yes, it's a great question I think your comment there Matt is certainly going to matter what the shape of the curve is.
Michael R. Archer: Yeah, it's a great question. I think your comment there, Matt, it's certainly going to matter what the shape of the curve is. I certainly hope that we get back to, you know, margin levels that we were at, certainly, a few years ago. How fast we get there will certainly be seen. Certainly, as we think about Fed rate cuts, hopefully over the coming months and quarters, assuming that the yield curve doesn't, you know, the long end doesn't go down with it, that will certainly be beneficial to us.
Speaker Change: I mean, I certainly hope that we get back to margin levels that we were at certainly a few years ago, how fast we get there to be seen certainly as we think about fed rate cuts hopefully over coming months and quarters.
Speaker Change: Assuming that the yield curve doesn't.
Speaker Change: The long end doesn't go down with that that will certainly be beneficial to us.
I do anticipate to your to your to your comment there I do anticipate us getting back to $2 70, I don't know off the top of my head.
Michael R. Archer: And I do anticipate, to your comment there, I do anticipate us getting back to 270. I don't know off the top of my head, you know, how fast that is, but certainly something we're steering into. And we've been communicating, you know, now for years and quarters is that we really are focused on optimizing margin, and we want to, you know, communicate that we're focused on growing the business, but we want to do it profitably. And that's top of mind for us.
Michael Archer: I don't know off the top of my head, you know, how fast that is, but certainly something we're certainly spearing into, and then we've been communicating, you know, now for, for years and quarters is, you know, we really are focused on optimizing margin, and we want to, you know, get that we're focused on growing the business. We want to do it profitably, and that's top of mind for us.
Speaker Change: How fast that is but certainly something we're certainly steering into an <unk>.
Speaker Change: And communicating now for for years and quarters as we really are focused on optimizing margin and we want to get that we're focused on growing the business, but we wanted to do it profitably and that's top of mind for us.
Matthew Breese: I appreciate that the last one for me is just some help on the key income front.
Speaker Change: I appreciate that the last one for me is just some help on the fee income front.
Matthew M. Breese: Appreciate that. The last one for me is just some help on the Fee Income Fund, you know, outlook for the rest of the year, but then within that, just the points where you have some additional leverage. Could you just update us on the wealth management business assets under management, what you're doing to grow that, and the mortgage banking effort as well?
Michael Archer: You know, I'll look for the reps of the year, but then within that, just the point where you have some additional leverage. Could you just update us on the wealth management business assets and the management, or you're doing to grow that the mortgage banking effort as well. Yeah, thanks for the question, Matt. On the fee income front, you know, for the third quarter, I think very much in line what we reported this quarter, we've got an estimated range of about 10 and a half to 11 million. And certainly we think that the fourth quarter fee income might come in will probably come in a little higher than that, about 1,075 to 1,125.
Speaker Change: Outlook for the rest of the year, but then within that just three.
Speaker Change: Where you have some additional leverage could you just update us on the wealth management business assets under management, what you're doing to grow that.
Speaker Change: The mortgage banking effort as well.
Speaker Change: Yes, thanks for the question Matt.
Michael R. Archer: Yeah, thanks for the question, Matt. On the fee income front, you know, for the third quarter, I think, very much in line with what we reported this quarter, we've got an estimated range of about 10 and a half to 11 million. And certainly, we think that the fourth-quarter fee income might come in, will probably come in a little higher than that, about 1075 to 1125. And that's due to the annual visa incentive bonus that we have in the fourth quarter.
Speaker Change: The income front.
Speaker Change: For the third quarter I think very much in line, what we reported this quarter, we've got an estimated range of that.
Speaker Change: 10, and a half to $11 million and suddenly we think that the fourth quarter fee income might come in we'll probably come in a little higher than that about $2 75 to $11 25, and that's due to the annual fees or incentive bonus that we have in the fourth quarter. So overall I think the underlying picture for us is continuing to invest in that business and the wealth business.
Michael Archer: And that's due to the annual visa incentive bonus that we have in the fourth quarter. So overall, I think the underlying picture for us is continuing to invest in that business and the wealth business. I think we've got some nice traction there, as we reported. We're up, you know, just over 10%. And, you know, I think we see nice momentum on the brokerage side. We brought Garrett in to lead the wealth business, and he started to suddenly build that out. And that's certainly in an area that we believe has a lot of opportunity for us, given our geography and given the momentum we have with that team.
Michael R. Archer: So overall, I think the underlying picture for us is continuing to invest in that business. And the wealth business, I think we've got some nice traction there. As we reported, we were up, you know, just over 10%. And, you know, I think we see nice momentum on the brokerage side. We brought Garrett in to lead the wealth business, and he's starting to build that out. And that's certainly an area that we believe has a lot of opportunity for us, given our geography and given the momentum we have with that team. So it's an area that we continue to look at and I think it could be a nice area of growth for us going forward.
Speaker Change: We've got some nice traction there as we reported we were up just over 10% and.
Speaker Change: I think we see nice momentum on the brokerage side, we broke garrett into to lead the wealth business and he started to Sunday build that out and that's certainly an area that we believe has a lot of opportunity for us given our geography and given the momentum we have with that team. So scenario that we continue to look to and I think cannot be a nice area of growth for us going forward.
Michael Archer: So it's an area that we continue to look to, and I think can be a nice area of growth for us going forward.
Speaker Change: Excellent I'll leave it there. Thank you for taking all my questions.
Matthew Breese: Excellent.
Matthew M. Breese: Excellent. I'll leave it there. Thank you for taking all my questions. Thank you, and have a great day.
Matthew Breese: I'll leave it there.
Matthew Breese: Thank you for taking all my questions.
Speaker Change: Okay.
Michael Archer: Thank you.
Operator: Thank you. And as a reminder, if you'd like to ask a question today, it's a star followed by one on your telephone keypad. We have no further questions, so this concludes our question and answer session. I'd now like to turn the conference back over to Simon Griffiths for any closing comments.
Speaker Change: Thank you and as a reminder, if you'd like to ask a question today.
Lydia: And, as a reminder, if you'd like to ask a question today, it's *start* followed by one on your telephone keypad.
Speaker Change: One on your tenant thank you Pat.
Lydia: We have no further questions, so this concludes our question-and-answer session.
Speaker Change: We have no further questions. This concludes our question and answer session I would now like to turn the conference back over to Shannon Greene for any closing comments.
Simon Griffiths: I'd now like to turn the conference back over to Simon Griffith for any closing comments. Thank you all for your time today and your interest in Camden National Corporation.
Speaker Change: Yeah.
Shannon Greene: Well. Thank you I want to thank you all for your time today and your interest in Camden National Corporation.
Simon R. Griffiths: Well, thank you. I want to thank you all for your time today and your interest in Camden National Corporation. We wish you all a great rest of your day, and thank you for your time.
Operator: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.
Simon Griffiths: We wish you all a great rest of your day, and thanks for your time.
Speaker Change: Wish you all a great rest of your day and thanks for your time.
The conference has now concluded.
Speaker Change: Thank you for attending today's presentation you may now disconnect.
Speaker Change: [music].