Q1 2025 Stellar Bancorp Inc Earnings Call
Karen: Thank you for standing by. My name is Karen, and that will be your conference operator today.
Speaker Change: Our team would like to welcome you to our earnings call for the first quarter of 2025.
Speaker Change: This morning's earnings call will be led by our CEO, Bob Franklin and CFO Paul <unk>.
Speaker Change: Also in attendance.
Speaker Change: They are Steve Retzloff executive Chairman of the company Ray Vitulli President of the company and CEO of the Bank and Joe <unk> Senior Executive Vice President and Chief Credit Officer of the bank before.
Speaker Change: Before we begin I need to remind everyone that some of our remarks made today constitute forward looking statements as defined in the private Securities Litigation Reform Act of 1095 as amended.
Speaker Change: We intend all such statements to be covered by the Safe Harbor provisions for forward looking statements contained in the act.
Speaker Change: Also note that if we give guidance about future results that guidance is only a reflection of management's beliefs at the time. The statement is made and such beliefs are subject to change we disclaim any obligation to publicly update any forward looking statements, except as may be required by law.
Speaker Change: Please see the last page of the text in this morning's earnings release, which is available on our website at IR Best seller Bancorp, Inc. Dot com.
Speaker Change: For additional information about the risk factors associated with forward looking statements.
Speaker Change: The conclusion of our remarks, we will open the line and allow time for questions I will now turn the call over to our CEO Bob Franklin.
Speaker Change: Alright.
Speaker Change: Courtney.
Courtney: Good morning, everyone and welcome to the seller Bank Corp, first quarter earnings call I'll begin by thanking our outstanding team at stellar with solid work continues to build a strong finance financial institution for our communities.
Courtney: As we entered 2025, we spoke of our focus on the customer internal existing and perspective, our focus is unchanged. We must acknowledge however that the administration has introduced a fair amount of uncertainty into the economy.
Courtney: It is too early to see signs of impact at all.
Courtney: On our communities.
Courtney: Our team will remain disciplined around credit as we monitor the impact of the new tariff policies on our customers and our communities.
Courtney: We continue to see opportunities for new customer acquisition and our pipelines are growing.
Courtney: While we are also seeing significant commercial real estate paydowns as interest rates begin to stabilize given these conditions and the economic climate. We will proceed cautiously.
Courtney: Challenges also provide opportunity and.
Courtney: And we took out we took advantage of our strong capital position to return capital to our shareholders through meaningful share repurchases during the first quarter.
Courtney: Purchases are in line with our goal to manage our capital to the benefit of our shareholders.
Courtney: We remain focused on building.
Courtney: Great.
Courtney: We remain focused on building a great Foundation, our team has put in place.
Courtney: Given the economic uncertainty of the first quarter, we believe that growth will be pushed to the third and fourth quarters of the year.
Courtney: Although conditions make us cautious are dynamic markets and our team keeps us optimistic.
Paul: I will now turn the call over to Paul <unk>, our CFO for more details on the quarter.
Paul: Thanks, Bob and good morning, everybody.
Paul: We are very pleased to report first quarter 2025, net income of $24 7 million.
Paul: Our <unk> 46 per diluted share, which represents an annualized return on average assets of 94 basis points and an annualized return on average tangible common equity of 11 four 8%.
Paul: Key highlights of our first quarter performance included a reduction of noninterest expenses and a meaningful repurchase of common stock along with the continuation of core net interest margin progress after seeing inflection during 2024.
Paul: Our balance sheet shrunk during the quarter on a point to point basis, largely due to the seasonal outflow of government banking deposits in cash balances that had significantly inflated our balance sheet at year end, which we acknowledged during our last earnings call.
Paul: Looking at it on an average basis the linked quarter decrease in assets was much less significant and more reflective of the decrease in loans experienced during the quarter.
Paul: The net result is a smaller but stronger and more core balance sheet.
Paul: With a very strong capital position.
Paul: Notwithstanding our share repurchase activity during the quarter.
Paul: And if not for two less days to earn interest from the first quarter earnings would have been up relative to the prior quarter.
Paul: Notwithstanding broader economic uncertainty, we believe we are well positioned to return to a reasonable level of growth during the year.
Paul: Later than initially planned and.
Paul: And incremental growth will position us well to deliver operating leverage and earnings improvement in 2025.
Paul: Net interest income for the quarter was $99 3 million reps.
Paul: Representing a decrease from the $103 million booked in the fourth quarter. This was largely due to lower purchase accounting accretion and two less days to earn interest due to the 90 day quarter.
Paul: This translated into a net interest margin of four 2% in the first quarter relative to $4 two 5% in the fourth quarter of 2024.
Paul: Purchase accounting accretion in the first quarter with $5 4 million relative to $7 6 million in the fourth quarter.
Paul: Excluding purchase accounting accretion tax equivalent net interest income decreased slightly in the quarter to $94 million from $95 5 million in the prior quarter and net interest margin, excluding purchase accounting accretion was 397% up from 394% in the prior quarter.
Paul: Key drivers to the strong margin performance during the first quarter included the relative stability and maintaining a strong proportion of noninterest bearing deposits, which represented over 37% of our deposit base.
Paul: A 14 basis point improvement in our cost of funds driven by 21 basis point improvement in our cost of interest bearing liabilities.
Paul: Also we had incrementally higher securities yields and pretty strong loan yields after excluding purchase accounting accretion.
Paul: Walking further down the income statement, we booked a provision for loan losses.
Paul: The first quarter of $3 6 million.
Paul: In combination with minimal net charge offs of $163000 during the quarter.
This brings our allowance for credit losses on loans to $83 $7 million or 115% of loans from $81 $1 million or one 9% of loans at the end of the prior year.
Paul: Moving on to noninterest income, we earned $5 5 million for the first quarter versus $5 million in the fourth quarter, noting that the first quarter benefited from small gains on sales of assets.
Paul: Next noninterest expense for the quarter was down.
Paul: Five.
Paul: Down to $5 1 million.
Paul: Around $5 $1 million to $70 2 million from $75 3 million.
Paul: In non interest expense during the fourth quarter.
Paul: This was better than planned and reflective of both some timing driven dynamics and our focus on holding the line on expenses, where we can.
Paul: Our strong bottom line results have driven a continuation of our track record of growing our regulatory capital ratios and tangible book value per share since the merger.
Paul: Total risk based capital was $15, 94% at the end of the first quarter relative to 16% at the end of 2024 and $14, 82% at the end of 2023 a.
Paul: Our regulatory capital ratios at the bank actually ticked up.
Paul: Year over year tangible book value per share increased 14, 3% from $17 23.
Paul: To $19 69 per share and that is after the effect of both dividends and share repurchases.
Paul: We continue to like our prospects for strong internal capital generation and the Optionality that it creates which we feel is very valuable in the current operating environment.
Paul: During the first quarter, we acted on this optionality through share repurchases buying back $1 4 million shares of our stock at a weighted average price of $27 99 per share. Additionally.
Paul: Additionally, we repurchased 679000 shares at a weighted average price of 25.
Paul: $83 per share.
Paul: Since the end of the first quarter, representing in total nearly 4% of our shares outstanding at year end.
Paul: The board of Directors also authorized a new share repurchase program, which allows us to repurchase up to $65 million in shares through may of 2026.
Paul: While our preference would be to deploy capital to growth in M&A. We appreciate having the flexibility to pursue capital optimization through buybacks when appropriate.
In closing, we really like where we sit both financially and strategically we've laid the foundation to support adding more scale to the stellar bank platform and it remains our goal to deliver positive operating leverage during the year, while maintaining a really strong balance sheet and the financial flexibility to be opportunistic.
Bob Franklin: Thank you and I'll now turn the call back over to Bob.
Bob Franklin: Thank you Paul I think operator, we're ready for questions.
Bob Franklin: Yes.
Bob Franklin: At this time I would like to remind everyone in order to ask a question Press Star then the number one on your telephone keypad.
Bob Franklin: We will pause for just a moment to compile the Q&A roster.
Speaker Change: The first question comes from David <unk> from Raymond James Your line is open.
Speaker Change: Hey, good morning, everybody.
Speaker Change: Hey, good morning, guys.
Speaker Change: I wanted to start on the loan side.
Speaker Change: It sounds like we're cautiously optimistic about potential for accelerating growth that this might hopefully kind of the <unk>.
Speaker Change: <unk> here.
Speaker Change: I guess first off touch on on the pulse of your clients, obviously, there's a ton of uncertainty out there. So I'd be curious what are you hearing from your clients or just how the pipeline is trending and how much of this decline is a function of payoffs and paydowns.
Speaker Change: <unk> elevated and higher than expected versus slower originations just given the uncertainty.
Speaker Change: Let me set this up a little bit.
Speaker Change: Not ready to come in and fill in.
One of the things we've been focused on David is.
Speaker Change: I think.
Speaker Change: When you see when you when you see an MLP example, together, especially the way ours is to real community small community banks.
Speaker Change: And then combined into a bank thats over $10 billion in assets.
Speaker Change: So there are some redistribution of the house the loan the loan book should look.
Speaker Change: And we've been attempting to kind of reconfigure what that was.
Speaker Change: The loan side of our balance sheet looks like in other words being able to do across the board.
Speaker Change: Any type of loan that we want to do without being totally reliant on these sort of smaller real estate loans.
Speaker Change: That debt.
Speaker Change: We are all done in the past is a smaller community banks so across the board be able to do the things that we wanted to do so there is a really been a real focus on it and letting some of this stuff rollout so where we were when we started this journey we were over the regulatory guidance.
Speaker Change: In both categories, both C&I and CRE. So while we while we've done is focused on getting those balances back down to what looks more like a larger a larger bank balance sheet. So.
Speaker Change: We've done that we continue to see some of that roll off that we've really kind of focused on letting roll off and then as we add to it it's a little bit different focus on what we are adding to it but I'm going to let ray fill in the gaps here.
Ray: Thanks, Bob and good day.
Ray: On the to your question around pipeline and kind of the waterfall.
Ray: So in the first quarter, our loan originations and this kind of goes to this the build of the pipeline and what we're seeing.
Ray: If you compare to the past four quarters, we've had two good quarters of solid originations that were in excess of the second quarter 2004 in third quarter 24, So fourth quarter of 2004 and first quarter, we're trending in the right direction and that supports what we're seeing in the pipeline as far as.
Ray: Deal flow as well as just the absolute value of the pipeline both in expansion of our existing customer base in new market share gain opportunity. So.
Ray: If you look at where that building is it.
Ray: So long as we can convert it will continue to generate higher loan originations.
Ray: And then we've got to see where those fund, but if they fund the way, we think theyre going to fund.
Ray: That obviously gives us a lift to offset the payoffs, which has been about call it $275 million to $300 million a quarter.
Bob Franklin: The other component of the waterfall that it really kind of goes to what Bob just talked about is that what we call our carried loans, which is our advances.
Bob Franklin: Les our payments on the whole book and because of the posture that Bob mentioned that has not given us a lift over the past four quarters. So as we continue to originate and get Ava.
Bob Franklin: Availability that will then fund we should see a.
Bob Franklin: To the positive lift in the carried which will help the overall.
Bob Franklin: Loan growth story, which we as we as we said we should be in the second half of the year.
Bob Franklin: We're seeing a little bit of growth in our unfunded commitments, which is good which is kind of a leading indicator for that so so we feel good about it our team is laser focused.
Bob Franklin: No what's needed on the origination side in order to generate the growth and to your question about customer sentiment.
Bob Franklin: The way, we're talking about it's still early to tell.
Bob Franklin: Have seen maybe some pull through of things like maybe some inventory purchases early but we still think it's too early in that aspect as far as deal flow, what we're seeing on AR and committee and what we're seeing in the pipelines it's positive.
Bob Franklin: Okay.
Bob Franklin: Okay, that's great color.
Bob Franklin: Maybe just a question on the deposit side I mean, you used some pretty strong language in the press release, saying the markets.
Bob Franklin: Hopefully competitive can you just elaborate on that and touch on some of the trends Youre seeing obviously exclusive of the government deposits.
Bob Franklin: Just where are you having success, winning new relationships, how do you think about core deposit growth and opportunities to further.
Bob Franklin: Optimize funding and maybe drive some <unk>.
Bob Franklin: The improvements in deposit costs, even exclusive of fed cuts.
Bob Franklin: Well, we still we really like our new account.
Speaker Change: Origination story so.
Bob Franklin: First quarter on boarded.
Bob Franklin: In both number and dollar amount more than the fourth quarter.
Ed mixes.
Bob Franklin: It's consistent with our overall bank NIM mix and.
Bob Franklin: You got to also you can't talk about new accounts without closed accounts in closed accounts were at the lowest level in four quarters. So.
Bob Franklin: And of that of those new accounts close to 40% were to customers that werent here before which we really love that trend I think it talks about the stellar brand, where we sit in the market are a bit or.
Bob Franklin: Our success in having doors open for us.
Bob Franklin: And do we continue as we said six of them.
Bob Franklin: In the MSA in deposit market share kind of the opportunity to continue to take market share gains.
Bob Franklin: And that's notwithstanding.
Bob Franklin: Our track record of not really being a market leader in price.
Bob Franklin: By our deposit base.
Bob Franklin: We work we work at the hard way and it's reflective of the new account openings.
Bob Franklin: Being skewed towards the way, we want it a lot of non interest bearing deposits and things along those lines.
Bob Franklin: Okay.
Bob Franklin: That's great and then just maybe shifting gears to credit quickly not not surprise me to see some migration to non accruals. It seems like it's across several segments, but maybe notably in CRE, obviously, you've got a track record of being really conservative on credit very disciplined I was just hoping you could touch on what youre seeing on the credit side.
Bob Franklin: And maybe what you're watching more closely and especially anything that you maybe more concerned with just given the trade wars tariff issues those impacts.
Bob Franklin: It does.
Bob Franklin: All of those issues.
Bob Franklin: Yes.
Bob Franklin: Yes, Joe.
Bob Franklin: The migration was.
Bob Franklin: Owner occupied CRE.
Bob Franklin: I wouldn't classify it as anything related to tariffs or just some.
Bob Franklin: All of our occupied CRE with manageable issues then.
Bob Franklin: We noticed that in.
Bob Franklin: Granted it appropriately and put appropriate reserves against it.
Bob Franklin: What we're seeing as rates. It is little early in this tariff issue to know how much Goldman such that there is a lot of talking but.
Bob Franklin: Haven't really seen too much in the way of.
In a deteriorating financial reports from the customers.
Bob Franklin: So I think we're just.
Bob Franklin: We'll wait and see attitude.
Bob Franklin: I'm just checking.
Yes.
Bob Franklin: Cautious approach to it as we examine new credits.
Bob Franklin: Yes.
Bob Franklin: Just wait and see what happens.
Speaker Change: Are there any adjustments to to underwriting our risk ratings are management as a result of this.
Bob Franklin: No I mean, we've always had a strong focus on <unk>.
Bob Franklin: And sources of cash flow will continue to do that as we grind our credits and look at our credits where we want to know how we're going to get paid back and then what the secondary source of repayment that will.
Bob Franklin: Follow up behind that.
Bob Franklin: It's coming from credit enhancement guaranteed or additional collateral but.
Bob Franklin: So just a strong focus on operating cash flow.
Bob Franklin: Okay.
Bob Franklin: Thanks, everybody.
Bob Franklin: Thank you David.
Speaker Change: The next question comes from Matt Olney from Stephens. Your line is open.
Hi, Thanks, Good morning, guys.
Speaker Change: I wanted to dig more into it.
Speaker Change: Good morning dig more into capital.
Speaker Change: Paul mentioned, the active buyback in the first quarter and even even more activity in recent weeks I think that makes a lot of sense, considering devaluation and the capital just would love to hear just updated thoughts from capital from here, including consideration for additional.
Speaker Change: That redemption.
Speaker Change: Just with the context of course of economic uncertainty.
Speaker Change: Yes, Matt I think.
Speaker Change: We continue with the same posture that we've had.
Speaker Change: Trying to decide what the what the right use of the capital as we continue to.
Speaker Change: To build capital.
Speaker Change: At a pretty significant rate.
Speaker Change: There are some sub debt.
Speaker Change: Or thinking about.
Speaker Change: Possibly retiring I think we weigh that.
Speaker Change: Versus the benefits of what buybacks might be or.
Speaker Change: What refinancing that debt might look like and what the benefits of that but we're losing capital treatment on some of the best.
Speaker Change: So we're going to make a decision around that a little later.
Speaker Change: Year, but we.
Speaker Change: We continue to build capital.
Speaker Change: Which allows us some flexibility certainly adopt capital four.
Speaker Change: For what we think our growth is going to be over the next couple of years.
Speaker Change: And so we have the ability to use it for some other things at this point.
Speaker Change: We haven't given up on M&A I think M&A is still out there for us all I think it's been put on hold.
Speaker Change: Like a lot of.
Speaker Change: Folks, but I think people are still talking we're still talking we're still talking to folks.
Speaker Change: <unk> transactions.
Speaker Change: I think it's a little bit different if you think about public to public versus public to private.
Speaker Change: Those conversations are a bit different.
Speaker Change: And most of ours tend to be with the progress.
Speaker Change: At this point, but.
Speaker Change: So all of these things are still on the table and I think we're going to have to balance that out over the rest of the year as to what the best place in utilization of that capital is.
Speaker Change: But that's kind of how we're approaching it.
Speaker Change: Okay.
Speaker Change: I appreciate that and I guess other other capital options some of them.
Speaker Change: Is that your peers are.
Speaker Change: <unk> at this point I'm curious if this is on your radar as far as you know our focus just whether it's.
Speaker Change: Security purchases, whether it's kind of a smaller wholesale trade with some wholesale funding.
Speaker Change: <unk> or even a few years ago I think you guys purchased some loans as well are those other options are being considered or is the focus still on like you said that the buyback.
Speaker Change: With a kind of a longer term eye on M&A.
Speaker Change: Yes.
Speaker Change: Sure.
Speaker Change: We are a core bank and this is this is where we keep our focus.
Speaker Change: We don't manage this thing on a quarter by quarter basis, We've got a very good game plan around what we want this to look like in the markets that we're in and we're on track to build those bags. The way that we think that it ought to be built in our markets.
Speaker Change: So to do something on an AD hoc basis is probably not in our DNA.
Speaker Change: We're going to continue on an organic basis to focus on are the great markets that we're in.
Speaker Change: Look for opportunities to add a partnership with someone.
Speaker Change: Someone else in the future and then we can look at dividends or buybacks.
Speaker Change: Those opportunities arise.
Speaker Change: We tend to like buybacks.
Speaker Change: Because from a tax standpoint, it seems to be a little bit better way to return capital to shareholders. Although dividends are nice also so.
Speaker Change: We'll continue to manage that as we go along.
Speaker Change: And for what it's worth we've seen both with increased dividends in the fourth quarter.
Speaker Change: And we've chosen to be selectively active on the share repurchase. So we appreciate that flexibility and we think we fit it.
Speaker Change: Kathryn seat relating to.
Speaker Change: Having a lot of plenty of options and ability to do a lot of things.
Speaker Change: But I'll end, where Bob started our goal is to continue to be a core bank.
Speaker Change: Yes, okay.
Speaker Change: The commentary there and then I guess switching gears the other positive theme in the quarter that I saw was just a nice improvement on your interest bearing deposit cost we love to appreciate just how much more room. You think you have to to bring that down whether if the fed kind of stays put or continues to.
Speaker Change: Cut rates and then for margin takes a little bit higher loved depreciate your view of kind of the outlook there. Thanks.
Speaker Change: Certainly well the first quarter, we saw the what I'll call.
Speaker Change: The full quarter impact of the rate activity you saw in the back half of the year, including in the fourth quarter and we.
Speaker Change: We work everyday to try and optimize that mix, but we can see.
Speaker Change: That we've gotten most of what we could add to that note our cost of deposits.
Speaker Change: <unk> did not skew as high as a lot of our peers. So we are.
Speaker Change: We're going to continue to work on working that down that ultimately.
Speaker Change: It's going to continue to be a slot and I don't think were going to have.
Speaker Change: Or.
The World will see the same kind of improvement.
Speaker Change: From that in the second quarter from the first quarter.
Speaker Change: But day by day.
Speaker Change: <unk> continue to drive an optimal mix of deposits and try to grow that base.
So while we'll be working just as hard but the incremental return.
Speaker Change: In terms of improvement.
<unk> be hard to compete with this prior quarters improvement.
Speaker Change: Okay, and Paul I guess, the last part of the question was just around the core margin. Thank the 397 ex the accretion.
Speaker Change: I would love to hear thoughts on kind of Directionally, where that could go.
Speaker Change: While we are pleased with showing incremental improvement three basis points quarter over quarter, our goal would be to get.
Speaker Change: <unk> handle back on our.
Speaker Change: Core net interest margin.
Speaker Change: Excluding purchase accounting adjustments and we think we're on that path. It's just.
Speaker Change: Given a lot of the uncertainty.
Speaker Change: We'd rather.
Speaker Change: Under promise and outperform on that front.
Speaker Change: I think every basis point from here.
Speaker Change: Going to be a win and where.
Speaker Change: We're just keeping our nose down to track our core balance sheet and with that we will we believe will come.
Incremental improvement, but we're already in rare air so.
Every basis point, we get from here is going to be considered.
Speaker Change: A pretty good win and we're going to continue to work on it.
Speaker Change: Okay. Thanks for taking my questions I'll step back.
Smith.
Speaker Change: Again, you do have a question press star followed by the no move on the.
Speaker Change: The next question comes from will Jones from <unk>. Your line is open.
Will Jones: Yeah, Hey, guys. Good morning, thanks for the questions.
Speaker Change: Sure.
Speaker Change: I just wanted to circle back to the growth conversation Ray maybe if you could just help us frame, what you kind of see and know his upcoming on the Paydown front I know, it's been obviously a headwind for you guys, but more so I had one for the broader industry. So just just so we understand what the what the BARDA churn is on the Paydown front.
Speaker Change: And then just to the comments about growth being more backend loaded I know that.
Speaker Change: You guys are used to kind of grow in that 5% to 8% range, but would you expect kind of immediately get back to that level or is it really more of a slow grind higher as we move into the latter half of 2025.
Speaker Change: Yes.
Speaker Change: On payoffs I mean, I think what we what we feel the kind of the behavior of the portfolio is something like $275 million to $300 million a quarter is kind of what were what were slower experienced in absolute dollar terms.
Speaker Change: On the growth side, I think we talked about going into the years more like low to mid single digits.
Speaker Change: Obviously, we had the.
Speaker Change: Down in the first quarter, but again as I said earlier.
Speaker Change: It's going to really comment in two areas. One is the just the what's funded a new production and then also where we where we start to see advances exceed payments. So.
Speaker Change: I think as.
Speaker Change: As we as we see that pipeline build in those originations start to increase.
Speaker Change: That should result in and getting us over the payoffs and turn into growth, but again as Bob mentioned in the beginning we think that'll be in the last two second half of the year.
Speaker Change: Yes, great.
Speaker Change: Helpful color.
Speaker Change: I wanted to also circle back.
Speaker Change: Just on the margin.
Speaker Change: I appreciate the new slides on the repricing side, that's really great. It really helps kind of frame and visualize what the fixed repricing opportunities.
Speaker Change: And it really seems like moving beyond 2025 that there is still a pretty meaningful repricing story out there, but just curious today on new loans, where youre seeing pricing come in and what you're seeing from a competitive standpoint on loan pricing.
Speaker Change: Yeah, well I mean.
Speaker Change: It is competitive for the good loan so but the first quarter.
Speaker Change: Our loan originations came on at a weighted average rate of 17 729 <unk>.
Speaker Change: And our renewed loans came on at 748.
Speaker Change: Okay and are you still thinking kind of within the same fixed versus variable skew in terms of the broader portfolio. So it's really kind of more of a <unk> mix.
Speaker Change: Correct.
Speaker Change: The new yes on what's coming on new yes.
Speaker Change: Okay, Great and then just lastly from me I mean, Paul Paul The expense story. This quarter was really quite positive I know, we kind of talked about being more in that $295 million range for this year I know, it's not as simple as just Annualizing. What you guys did this quarter and.
Speaker Change: And then maybe a little bit of timing differences with some costs that are coming through but could you just help us appreciate where you see expenses trending maybe into the next quarter and the balance of the year.
Speaker Change: Certainly we work every day on expenses and we would caution against annualized from the first quarter although.
Speaker Change: We have our notes the grindstone as it relates to managing expenses, but also.
Speaker Change: We want to be as thoughtful as thoughtful about continuing to invest in the business and what's going to drive growth in a go forward basis.
Speaker Change: So we look at this quarter as.
Speaker Change: Something that we can hold our had time with respect to end.
Speaker Change: We like our chances of beating that prior guidance.
Speaker Change: But we will continue to.
Speaker Change: The incremental investment.
Speaker Change: While while.
Speaker Change: Holding the line, where we can some of that probably about 50% of the.
Speaker Change: The relative beat there was timing related things that are likely going to come later in the month, particularly as it relates to professional services fees.
Speaker Change: Certain external audits and things along those lines that have to get done on time and in a timely manner. So not all of it will get pushed into next year, but we.
Speaker Change: We're as diligent as we've ever been and we're very pleased with.
Speaker Change: Our performance on expenses year to date.
Speaker Change: Yes, okay, great well nice work there thanks for the questions guys.
Speaker Change: Sure.
Speaker Change: That concludes our Q&A session I will now turn the call over to Bob from Glenn for closing remarks.
Speaker Change: Alright.
Speaker Change: Thank you very much for joining our first quarter call.
Speaker Change: With that have a great weekend.
Speaker Change: Ladies and gentlemen that concludes today's call. Thank you all for joining and you may now disconnect.
Speaker Change: Please wait the conference will begin shortly.
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