Ameris Bank Q4 2025 Ameris Bancorp Earnings Call | AllMind AI Earnings | AllMind AI
Q4 2025 Ameris Bancorp Earnings Call
Speaker #1: Good day, and welcome to the Ameris Bancorp Q4 conference call. All participants will be in listen-only mode. Should you need assistance, please signal the conference specialist by pressing the star key followed by zero.
Speaker #1: After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad.
Speaker #1: To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Nicole Stokes, Chief Financial Officer.
Speaker #1: Please go ahead.
Speaker #2: Thank you, Megan. And thank you to all who have joined our call today. During the call, we will be referencing the press release and the financial highlights that are available on the Investor Relations section of our website at amerisbank.com.
Nicole Stokes: Thank you, Megan, and thank you to all who have joined our call today. During the call, we will be referencing the press release and the financial highlights that are available on the Investor Relations section of our website at amerisbank.com. I'm joined today by Palmer Proctor, our CEO, and Doug Strange, our Chief Credit Officer. Palmer will begin, and then I will discuss the details of our financial results before we open up for Q&A. But before we begin, I'll remind you that our comments may include forward-looking statements. These statements are subject to risks and uncertainties. The actual results could vary materially. We list some of the factors that might cause results to differ in our press release and in our SEC filings, which are available on our website.
Nicole Stokes: Thank you, Megan, and thank you to all who have joined our call today. During the call, we will be referencing the press release and the financial highlights that are available on the Investor Relations section of our website at amerisbank.com. I'm joined today by Palmer Proctor, our CEO, and Doug Strange, our Chief Credit Officer. Palmer will begin, and then I will discuss the details of our financial results before we open up for Q&A. But before we begin, I'll remind you that our comments may include forward-looking statements. These statements are subject to risks and uncertainties. The actual results could vary materially. We list some of the factors that might cause results to differ in our press release and in our SEC filings, which are available on our website.
Speaker #2: I'm joined today by Doug Strange, our Chief Credit Officer. Palmer will begin, and then I will discuss the details of our financial results before we open up for Q&A.
But before we begin, I'll remind you that our comments may include forward-looking statements. These statements are subject to risks and uncertainties. The actual results could vary materially.
Speaker #2: We list some of the factors that might cause results to differ in our press release and in our SEC filings, which are available on our website.
Speaker #2: We do not assume any obligation to update any forward-looking statements as a result of new information early developments or otherwise, except as required by law.
Nicole Stokes: We do not assume any obligation to update any forward-looking statements as a result of new information, early developments, or otherwise, except as required by law. Also, during the call, we will discuss certain non-GAAP financial measures in reference to the company's performance. You can see our reconciliation of these measures and GAAP financial measures in the appendix to our presentation. And with that, I'll turn it over to Palmer.
We do not assume any obligation to update any forward-looking statements as a result of new information, early developments, or otherwise, except as required by law. Also, during the call, we will discuss certain non-GAAP financial measures in reference to the company's performance. You can see our reconciliation of these measures and GAAP financial measures in the appendix to our presentation. And with that, I'll turn it over to Palmer.
Speaker #2: Also, during the call, we will discuss certain non-GAAP financial measures in reference to the company's performance. You can see our reconciliation of these measures and GAAP financial measures in the appendix to our presentation.
Speaker #2: And with that, I'll turn it over to
Speaker #2: Palmer. Thank you, Nicole.
Palmer Proctor: Thank you, Nicole. Good morning, everyone. I appreciate you taking the time to join our call this morning. I'm proud of our Q4 performance and our record-setting results for the full year of 2025. We continue to operate at a high level of consistent core profitability while remaining focused on capital returns and accretive growth to enhance our shareholder value. We're positioned extremely well going into 2026, both from a growth and profitability level. Not only are we in the best Southeastern markets that are growing faster than the national average, but we also have the best bankers who are focused on serving our customers and growing our franchise organically. Nicole is going to talk about the details of our financials in just a minute, but I did want to give you just a few top-level comments about our core profitability.
Palmer Proctor: Thank you, Nicole. Good morning, everyone. I appreciate you taking the time to join our call this morning. I'm proud of our Q4 performance and our record-setting results for the full year of 2025. We continue to operate at a high level of consistent core profitability while remaining focused on capital returns and accretive growth to enhance our shareholder value. We're positioned extremely well going into 2026, both from a growth and profitability level.
Speaker #3: Good morning, everyone. I appreciate you taking the time to join our call this morning. I'm proud of our fourth quarter performance and our record-setting results for the full year of operate at a high level of consistent, core profitability while remaining focused on capital returns and accretive growth to enhance our shareholder value.
Speaker #3: We're positioned extremely well going into 2026, both from a growth and profitability level. Not only are we in the best Southeastern markets that are growing faster than the national average, but we also have the best bankers who have focused on serving our customers and growing our franchise organically.
Not only are we in the best Southeastern markets that are growing faster than the national average, but we also have the best bankers who are focused on serving our customers and growing our franchise organically. Nicole is going to talk about the details of our financials in just a minute, but I did want to give you just a few top-level comments about our core profitability.
Speaker #3: Nicole is going to talk about the details of our financials in just a minute, but I did want to give you just a few top-level comments about our core profitability.
Speaker #3: We reported record earnings for 2025 at over $412 million for the year, with our diluted EPS hitting $6 per share for the first time in our history.
Palmer Proctor: We reported record earnings for 2025 at over $412 million for the year, with our diluted EPS hitting $6 per share for the first time in our history. That's a 15% increase in EPS year-over-year, and we did it organically. Our PPNR ROA was consistently above 2% this year. Our margin expanded every quarter, and our efficiency ratio improved throughout the year. We remain focused on generating revenue growth and positive operating leverage. We reported a 6% growth in revenue for the year, while our expenses declined by 1%. Combined, this positive operating leverage pushed our efficiency ratio to 50% for the year. This core profitability led to tangible book value growth of over 14% for this year. We remain diligent with our capital planning and are focused on generating shareholder returns.
We reported record earnings for 2025 at over $412 million for the year, with our diluted EPS hitting $6 per share for the first time in our history. That's a 15% increase in EPS year-over-year, and we did it organically. Our PPNR ROA was consistently above 2% this year. Our margin expanded every quarter, and our efficiency ratio improved throughout the year. We remain focused on generating revenue growth and positive operating leverage. We reported a 6% growth in revenue for the year, while our expenses declined by 1%. Combined, this positive operating leverage pushed our efficiency ratio to 50% for the year. This core profitability led to tangible book value growth of over 14% for this year. We remain diligent with our capital planning and are focused on generating shareholder returns.
Speaker #3: That's a 15% increase in EPS year over year, and we did it organically. Our PP&R ROA was consistently above 2% this year. Our margin expanded every quarter, and our efficiency ratio improved throughout the year.
Speaker #3: We remained focused on generating revenue growth and positive operating leverage. We reported a 6% growth in revenue for the year, while our expenses declined by 1%.
Speaker #3: Combined, this positive operating leverage pushed our efficiency ratio to 50% for the year. This core profitability led to tangible book value growth of over 14% for this year.
Speaker #3: We remained diligent with our capital planning and are focused on generating shareholder returns. We paid off all of our sub-debt during 2025, and as a result, have a very simple common stock capital structure going forward.
Palmer Proctor: We paid off all of our sub-debt during 2025, and as a result, have a very simple common stock capital structure going forward. During Q4, we announced an increased share repurchase program, and we were active in Q4, buying back almost 1% of our stock at an average price of $72. For the year, we repurchased 77 million, or 2% of the company, at an average price under $67. Capital ratios remained strong, ending the year with Common Equity Tier 1 at 13.2% and tangible common equity ratio growing to 11.4%. Capital at this level positions us well for future growth expectations. On the growth front, we were very pleased with our asset generation during Q4, growing earning assets by almost 6%.
We paid off all of our sub-debt during 2025, and as a result, have a very simple common stock capital structure going forward. During Q4, we announced an increased share repurchase program, and we were active in Q4, buying back almost 1% of our stock at an average price of $72. For the year, we repurchased 77 million, or 2% of the company, at an average price under $67. Capital ratios remained strong, ending the year with Common Equity Tier 1 at 13.2% and tangible common equity ratio growing to 11.4%. Capital at this level positions us well for future growth expectations. On the growth front, we were very pleased with our asset generation during Q4, growing earning assets by almost 6%.
Speaker #3: During the fourth quarter, we announced an increased share purchase repurchase program, and we were active in the fourth quarter buyback almost 1% of our stock at an average price of $72.
Speaker #3: For the year, we repurchased 77 million, or 2%, of the company at an average price under $67. Capital ratios remained strong, ending the year with common equity tier one at 13.2% and tangible common equity ratio growing to 11.4%.
Speaker #3: Capital at this level positions us well for future growth expectations. On the growth front, we were very pleased with our asset generation during the fourth quarter, growing earning assets by almost 6%.
Speaker #3: We experienced unusually high payoffs in the CRE portfolio this quarter, which is indicative of a healthy economy but does affect our net loan growth.
Palmer Proctor: We experienced unusually high payoffs in the CRE portfolio this quarter, which is indicative of a healthy economy, but does affect our net loan growth. Notwithstanding, we grew loans almost 5% in Q4, even with the elevated CRE payoffs of over $500 million. Under normal CRE payoffs, our loan growth would have approached double digits. Our pipelines remained strong, and we saw the highest level of loan production since 2022, coming in at $2.4 billion for the quarter, which was a 16% increase above Q3 levels. Asset quality for the year remained strong, with net charge-offs and NPAs improving from the prior year. Our allowance remains healthy at 1.62 of loans. CRE and construction concentrations were consistent at 262 and 43, respectively. On the funding side, we remain focused on core deposits and relationship banking.
We experienced unusually high payoffs in the CRE portfolio this quarter, which is indicative of a healthy economy, but does affect our net loan growth. Notwithstanding, we grew loans almost 5% in Q4, even with the elevated CRE payoffs of over $500 million. Under normal CRE payoffs, our loan growth would have approached double digits. Our pipelines remained strong, and we saw the highest level of loan production since 2022, coming in at $2.4 billion for the quarter, which was a 16% increase above Q3 levels. Asset quality for the year remained strong, with net charge-offs and NPAs improving from the prior year. Our allowance remains healthy at 1.62 of loans. CRE and construction concentrations were consistent at 262 and 43, respectively. On the funding side, we remain focused on core deposits and relationship banking.
Speaker #3: Notwithstanding, we grew loans almost 5% in the fourth quarter, even with the elevated CRE payoffs of over $500 million. Under normal CRE payoffs, our loan growth would have approached double digits.
Speaker #3: Our pipelines remain strong, and we saw the highest level of loan production since 2022 coming in at 2.4 billion for the quarter. Which was a 16% increase above third quarter levels.
Speaker #3: Asset quality for the year remained strong with net charge-offs and NPAs improving from the prior year. Our allowance remains healthy at 162 of loans.
Speaker #3: CRE and construction concentrations were consistent at respectively. On the funding side, we remain focused on core deposits and relationship banking. Our non-interest-bearing deposits represent a strong 29% of total deposits.
Palmer Proctor: Our non-interest-bearing deposits represent a strong 29% of total deposits, even with typical seasonality of the Q4. We're well-positioned for future growth, both from the strength of our balance sheet and our fundamental operating model. We have strong momentum into 2026 with our organic growth strategies, which will be complemented by the disruption with our growing Southeastern markets. We have strong core profitability with diversified and durable revenue streams. These will continue to grow tangible book value, franchise value, and shareholder value in 2026 and beyond. I'll stop there and turn it over to Nicole to discuss our financial results in more detail.
Our non-interest-bearing deposits represent a strong 29% of total deposits, even with typical seasonality of the Q4. We're well-positioned for future growth, both from the strength of our balance sheet and our fundamental operating model. We have strong momentum into 2026 with our organic growth strategies, which will be complemented by the disruption with our growing Southeastern markets. We have strong core profitability with diversified and durable revenue streams. These will continue to grow tangible book value, franchise value, and shareholder value in 2026 and beyond. I'll stop there and turn it over to Nicole to discuss our financial results in more detail.
Speaker #3: Even with the typical seasonality of the fourth quarter, we're well-positioned for future growth, both from the strength of our balance sheet and our fundamental operating model.
Speaker #3: We have strong momentum into 2026 with our organic growth strategies, which would be complemented by the disruption with our growing Southeastern markets. We have strong core profitability with diversified and durable revenue streams.
Speaker #3: These will continue to grow tangible book value, franchise value, and shareholder value in 2026 and beyond. I'll stop there and turn it over to Nicole to discuss our financial results in more detail.
Speaker #2: Thank you, Palmer. We reported net income of $108.4 million, or $1.59 per diluted share, in the fourth quarter. Our return on assets was 1.57%.
Nicole Stokes: ... Thank you, Palmer. We reported net income of $108.4 million or $1.59 per diluted share in the fourth quarter. Our return on assets was 1.57, our PPNR ROA was 2.38, and our return on tangible common equity was 14.5 for the quarter. For the full year 2025, we reported record net income of $412.2 million or $6 per diluted share. That brings our full year ROA to 1.54 compared to 1.38 last year. Our year-to-date PPNR ROA was 2.25 compared to 2.05 in 2024, and our full year ROTC improved to 14.51 from 14.41 last year. Tangible book value increased by $1.28 during the fourth quarter to end at $44.18.
Nicole Stokes: ... Thank you, Palmer. We reported net income of $108.4 million or $1.59 per diluted share in the fourth quarter. Our return on assets was 1.57, our PPNR ROA was 2.38, and our return on tangible common equity was 14.5 for the quarter. For the full year 2025, we reported record net income of $412.2 million or $6 per diluted share. That brings our full year ROA to 1.54 compared to 1.38 last year. Our year-to-date PPNR ROA was 2.25 compared to 2.05 in 2024, and our full year ROTC improved to 14.51 from 14.41 last year. Tangible book value increased by $1.28 during the fourth quarter to end at $44.18.
Speaker #2: Our PP&R ROA was 2.38, and our return on tangible common equity was 14.5% for the quarter. For the full year 2025, we reported record net income of $412.2 million, or $6.00 per diluted share.
Speaker #2: That brings our full year ROA to a 154 compared to 138 last year. Our year-to-date PP&R ROA was 225 compared to 205 in 2024, and our full year ROTC improved to 1451 from 1441 last year.
Speaker #2: Tangible book value increased by $1.28 during the fourth quarter to end at $44.18. For the full year, we grew tangible book value by $5.59 per share or 14.5%.
Nicole Stokes: For the full year, we grew tangible book value by $5.59 per share, or 14.5%. As Palmer mentioned, our capital levels remain strong. We were active in our buyback, buying back $40.8 million of common stock, or about 564,000 shares at an average price of $72.36 during the quarter. Our remaining share repurchase authorization was $159.2 million at the end of the year. On the revenue side, our net interest income increased $7.3 million in the quarter or 12.2% annualized. The core bank grew by about $8.7 million, while mortgage and premium finance both saw some seasonal declines in spread revenue. For the first time this year, we saw improvements on both components of spread revenue.
For the full year, we grew tangible book value by $5.59 per share, or 14.5%. As Palmer mentioned, our capital levels remain strong. We were active in our buyback, buying back $40.8 million of common stock, or about 564,000 shares at an average price of $72.36 during the quarter. Our remaining share repurchase authorization was $159.2 million at the end of the year. On the revenue side, our net interest income increased $7.3 million in the quarter or 12.2% annualized. The core bank grew by about $8.7 million, while mortgage and premium finance both saw some seasonal declines in spread revenue. For the first time this year, we saw improvements on both components of spread revenue.
Speaker #2: As Palmer mentioned, our capital levels remained strong. We were active in our buyback, purchasing 40.8 million dollars of common stock, or about 564,000 shares, at an average price of $72.36 during the quarter.
Speaker #2: Our remaining share repurchase authorization was $159.2 million at the end of the year. On the revenue side, our net interest income increased 7.3 million in the quarter or 12.2% annualized.
Speaker #2: The core bank grew by about 8.7 million while mortgage and premium finance both saw some seasonal declines in spread revenue. For the first time this year, we saw improvements on both components of spread revenue.
Speaker #2: Not only did our interest income grow by 3 million, but our interest expense also improved by 4.3 million. Our net interest margin expanded five basis points to a robust 385 for the fourth quarter, and that expansion came from a 10 basis point positive impact on the funding side more than offsetting the five basis point decline on the asset side.
Nicole Stokes: Not only did our interest income grow by $3 million, but our interest expense also improved by $4.3 million. Our net interest margin expanded five basis points to a robust 3.85% for the fourth quarter, and that expansion came from a ten basis point positive impact on the funding side, more than offsetting the five basis point decline on the asset side. For the full year, net interest income increased $87.7 million or 10.3% from 2024, and our margin expanded from 3.56% last year to 3.79% for the full year 2025. Although we have positioned ourselves to be mostly neutral from an asset liability sensitivity perspective, we anticipate we could see some slight margin compression over the next few quarters due to the pressure on deposit costs.
Not only did our interest income grow by $3 million, but our interest expense also improved by $4.3 million. Our net interest margin expanded five basis points to a robust 3.85% for the fourth quarter, and that expansion came from a ten basis point positive impact on the funding side, more than offsetting the five basis point decline on the asset side. For the full year, net interest income increased $87.7 million or 10.3% from 2024, and our margin expanded from 3.56% last year to 3.79% for the full year 2025. Although we have positioned ourselves to be mostly neutral from an asset liability sensitivity perspective, we anticipate we could see some slight margin compression over the next few quarters due to the pressure on deposit costs.
Speaker #2: For the full year, net interest income increased 87.7 million or 10.3% from 2024, and our margin expanded from 366 last year to 379 for the full year '25.
Speaker #2: Although we have positioned ourselves to be mostly neutral from an asset liability sensitivity perspective, we anticipate we could see some slight margin compression over the next few quarters due to the pressure on deposit costs.
Speaker #2: As we see loan growth increasing, we believe there will be additional deposit pressure as we fund that growth in '26. During the fourth quarter, we recorded $23 million of provision expense, with $6.3 million of that relating to reserves for unfunded commitments.
Nicole Stokes: As we see loan growth increasing, we believe there will be additional deposit pressure as we fund that growth in 2026. During Q4, we reported $23 million of provision expense, with $6.3 million of that relating to reserves for unfunded commitments. That's a real positive signal for future loan growth, and our reserve remains strong at 1.62 of total loans, which was the same as last quarter. Annualized net charge-off this quarter normalized to 26 basis points. For the full year, net charge-offs improved from 19 basis points down to 18 basis points. We anticipate net charge-offs in the 20 to 25 basis point, 20 to 25 basis point range in 2026. Overall, asset quality trends remain good, with non-performing assets, net charge-offs, and both classifieds and criticized remaining low for the quarter. Moving on to non-interest income.
As we see loan growth increasing, we believe there will be additional deposit pressure as we fund that growth in 2026. During Q4, we reported $23 million of provision expense, with $6.3 million of that relating to reserves for unfunded commitments. That's a real positive signal for future loan growth, and our reserve remains strong at 1.62 of total loans, which was the same as last quarter. Annualized net charge-off this quarter normalized to 26 basis points. For the full year, net charge-offs improved from 19 basis points down to 18 basis points. We anticipate net charge-offs in the 20 to 25 basis point, 20 to 25 basis point range in 2026. Overall, asset quality trends remain good, with non-performing assets, net charge-offs, and both classifieds and criticized remaining low for the quarter. Moving on to non-interest income.
Speaker #2: That's a real positive signal for future loan growth. And our reserve remained strong at 1.62% of total loans, which was the same as last quarter.
Speaker #2: Annualized net charge-off this quarter normalized to $26 basis points. For the full year, net charge-offs improved from 19 basis points down to 18 basis points.
Speaker #2: We anticipate net charge-offs in the '20 to '25 basis point range in 2026. Overall, asset quality trends remain good, with non-performing assets net charge-offs and both classified and criticized remaining low for the quarter.
Speaker #2: Moving on to non-interest income, adjusted non-interest income decreased 10.5 million this quarter, mostly from seasonal declines in mortgage. And for the full year 2025, adjusted non-interest income actually increased 1.4 million year over year.
Nicole Stokes: Adjusted non-interest income decreased $10.5 million this quarter, mostly from seasonal declines in mortgage, and for the full year 2025, adjusted non-interest income actually increased $1.4 million year-over-year. Total non-interest expense decreased $11.5 million in the quarter, mostly driven by lower compensation costs and also some lower marketing and advertising costs. For the full year 2025, our total non-interest expense declined $3.8 million or almost 1% year-over-year. The majority of this decline is from the mortgage division, as variable costs declined with the decreased production due to the current interest rate environment. For Q4, our efficiency ratio improved to 46.6%, and for the full year 2025, our efficiency ratio was 50%, an improvement from the 53.2 reported last year.
Adjusted non-interest income decreased $10.5 million this quarter, mostly from seasonal declines in mortgage, and for the full year 2025, adjusted non-interest income actually increased $1.4 million year-over-year. Total non-interest expense decreased $11.5 million in the quarter, mostly driven by lower compensation costs and also some lower marketing and advertising costs. For the full year 2025, our total non-interest expense declined $3.8 million or almost 1% year-over-year. The majority of this decline is from the mortgage division, as variable costs declined with the decreased production due to the current interest rate environment. For Q4, our efficiency ratio improved to 46.6%, and for the full year 2025, our efficiency ratio was 50%, an improvement from the 53.2 reported last year.
Speaker #2: Total non-interest expense decreased 11.5 million in the quarter, mostly driven by lower compensation costs and also some lower marketing and advertising costs. For the full year 2025, our total non-interest expense declined 3.8 million, or almost 1% year over year.
Speaker #2: The majority of this decline is from the mortgage division, as variable costs declined with the decreased production due to the current interest rate environment.
Speaker #2: For the fourth quarter, our efficiency ratio improved to 46.6%. And for the full year '25, our efficiency ratio was 50%, an improvement from the 53.2% reported last year.
Speaker #2: I do anticipate the efficiency ratio to return above 50% in the first quarter, especially when you consider our seasonally heavy first quarter payroll taxes, and 401(k) contributions.
Nicole Stokes: I do anticipate the efficiency ratio to return above 50% in Q1, especially when you consider our seasonally heavy Q1 payroll taxes and 401(k) contributions. Looking at our balance sheet, we ended the quarter with $27.5 billion of total assets, compared to $27.1 billion last quarter and $26.3 billion at the end of 2024. For the year, that reflects a 4.8 balance sheet growth, and we had a 5.5% earning asset growth. Profitability, looking at NII and EPS, they grew over 10% during that same time, really reinforcing our focus on profitable growth and positive operating leverage.
I do anticipate the efficiency ratio to return above 50% in Q1, especially when you consider our seasonally heavy Q1 payroll taxes and 401(k) contributions. Looking at our balance sheet, we ended the quarter with $27.5 billion of total assets, compared to $27.1 billion last quarter and $26.3 billion at the end of 2024. For the year, that reflects a 4.8 balance sheet growth, and we had a 5.5% earning asset growth. Profitability, looking at NII and EPS, they grew over 10% during that same time, really reinforcing our focus on profitable growth and positive operating leverage.
Speaker #2: Looking at our balance sheet, we ended the quarter with $27.5 billion of total assets. Compared to $27.1 billion last quarter and $26.3 billion at the end of '24.
Speaker #2: For the year, that reflects a 4.8% balance sheet growth, and we had a 5.5% earning asset growth. Profitability, looking at NII and EPS, they grew over 10% during that same time, really reinforcing our focus on profitable growth and positive operating leverage.
Speaker #2: Deposits increased 148 million with strong seasonal growth in our public funds, partially offset by some usual seasonal outflows of mortgage-related escrow deposits that will fund back over the year.
Nicole Stokes: Deposits increased $148 million, with strong seasonal growth in our public funds, partially offset by some usual seasonal outflows of mortgage-related escrow deposits that will fund back over the year. Because of the seasonality of deposits, our NIB to total deposit ratio is usually lowest at year-end, and this year it remains at a strong 28.7%. And then broker deposits were stable in the quarter, representing only 5% of total deposits at the end of the year. We continue to anticipate loan and deposit growth going forward in that mid-single-digit range and expect that longer-term deposit growth will be the governor of loan growth. And with that, I'm going to wrap it up and turn the call back over to Megan for any questions from the group. Megan, go ahead, please.
Deposits increased $148 million, with strong seasonal growth in our public funds, partially offset by some usual seasonal outflows of mortgage-related escrow deposits that will fund back over the year. Because of the seasonality of deposits, our NIB to total deposit ratio is usually lowest at year-end, and this year it remains at a strong 28.7%. And then broker deposits were stable in the quarter, representing only 5% of total deposits at the end of the year. We continue to anticipate loan and deposit growth going forward in that mid-single-digit range and expect that longer-term deposit growth will be the governor of loan growth. And with that, I'm going to wrap it up and turn the call back over to Megan for any questions from the group. Megan, go ahead, please.
Speaker #2: Because of the seasonality of deposits, our NIB to total deposit ratio is usually lowest at year-end, and this year it remains at a strong 28.7%.
Speaker #2: And then broker deposits were stable in the quarter, representing only 5% of total deposits at the end of the year. We continue to anticipate loan and deposit growth going forward in that mid-single-digit range, and expect that longer-term deposit growth will be the governor of loan growth.
Speaker #2: And with that, I'm going to wrap it up and turn the call back over to Megan for any questions from the group. Megan, go ahead, please.
Speaker #2: We will now begin the question and answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the key.
Operator: We will now begin the question and answer session. To ask a question, you may press Star, then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the key. If at any time your question has been addressed and you would like to withdraw your question, please press Star then two. At this time, we will pause momentarily to assemble our roster. The first question comes from Stephen Scouten with Piper Sandler. Please go ahead.
Operator: We will now begin the question and answer session. To ask a question, you may press Star, then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the key. If at any time your question has been addressed and you would like to withdraw your question, please press Star then two. At this time, we will pause momentarily to assemble our roster. The first question comes from Stephen Scouten with Piper Sandler. Please go ahead.
Speaker #2: If at any time your question has been addressed and you would like to withdraw your question, please press star then two. At this time, we will pause momentarily to assemble our roster.
Speaker #2: The first question comes from Steven Scouton with Piper Sandler. Please go ahead.
Speaker #2: ahead. Yeah, good
Stephen Scouten: Yeah, good morning, everyone. Thanks. Great quarter on loan production, obviously, and Palmer, you noted if payoffs had been more normal, you think loan growth could have been in the double-digit range. Can you talk about what sort of visibility you have into future payoffs and maybe how they were surprisingly high this quarter and kind of what you're seeing as loans maybe mature and renew, or are those maturing and renewing at the same pace? Or kind of what caused some of the elevated paydowns and how we can think about the progression of that into the new year?
Stephen Scouten: Yeah, good morning, everyone. Thanks. Great quarter on loan production, obviously, and Palmer, you noted if payoffs had been more normal, you think loan growth could have been in the double-digit range. Can you talk about what sort of visibility you have into future payoffs and maybe how they were surprisingly high this quarter and kind of what you're seeing as loans maybe mature and renew, or are those maturing and renewing at the same pace? Or kind of what caused some of the elevated paydowns and how we can think about the progression of that into the new year?
Speaker #3: morning, everyone. Thanks. Great quarter on loan production obviously, and Palmer, you noted if payoffs had been more normal, you think loan growth could have been in the double-digit range.
Speaker #3: Can you talk about what sort of visibility you have into future payoffs and maybe how those were—maybe how they were surprisingly high this quarter? And kind of what you're seeing as loans maybe mature and renew?
Speaker #3: Are those maturing and renewing at the same pace, or what kind of caused some of the elevated paydowns, and how should we think about the progression of that into the new—
Speaker #3: year? Yeah, two things there.
Palmer Proctor: Yeah, two things there. Good morning, Stephen. We are encouraged by the pipeline we continue to see building. And then more importantly, too, when you look at the payoffs, Q4 is typically for us one of the busier quarters in terms of payoffs, and I think that's reflected in a lot of banks that have reported. So we see that moderating as we move into Q1 and Q2 of the year. So that's encouraging. I will tell you, activity continues to improve, and we like what we're seeing throughout the entire bank, not just in certain pipelines, but all the pipelines across the board. Now, mortgage, we'll see what happens there with the 10-year, so that could be a real tailwind for us, depending on what transpires.
Palmer Proctor: Yeah, two things there. Good morning, Stephen. We are encouraged by the pipeline we continue to see building. And then more importantly, too, when you look at the payoffs, Q4 is typically for us one of the busier quarters in terms of payoffs, and I think that's reflected in a lot of banks that have reported. So we see that moderating as we move into Q1 and Q2 of the year. So that's encouraging. I will tell you, activity continues to improve, and we like what we're seeing throughout the entire bank, not just in certain pipelines, but all the pipelines across the board. Now, mortgage, we'll see what happens there with the 10-year, so that could be a real tailwind for us, depending on what transpires. But all in all, we feel pretty bullish.
Speaker #4: Good morning, Steven. We are encouraged by the pipeline. We continue to see building, and then, more importantly too, when you look at the payoffs, the fourth quarter is typically for us one of the busier quarters in terms of payoffs, and I think that's reflective in a lot of banks that have reported.
Speaker #4: So we see that moderating as we move into the first quarter and second quarter of the year. So that's encouraging. I will tell you, activity is continues to improve.
Speaker #4: And we'd like what we're seeing throughout the entire bank, not just in certain pipelines, but all the pipelines across the board. Now, mortgage we'll see what happens there with the 10-year, but that could be a real tailwind for us depending on what transpires.
Speaker #4: But all in all, we feel pretty bullish.
Palmer Proctor: But all in all, we feel pretty bullish.
Speaker #3: Okay. And with rates kind of well, we'll see. If they continue to trend down, I guess, would you think that would accelerate paydowns even further, or would you be more excited about a pick further pickup in production and activity kind of to offset that potential phenomenon?
Stephen Scouten: Okay. And with rates kind of... Well, we'll see. If they continue to trend down, I guess, would you think that would accelerate paydowns even further, or, or would you be more excited about a further pickup in production and, and activity, kind of to, to offset that potential phenomenon?
Stephen Scouten: Okay. And with rates kind of... Well, we'll see. If they continue to trend down, I guess, would you think that would accelerate paydowns even further, or, or would you be more excited about a further pickup in production and, and activity, kind of to, to offset that potential phenomenon?
Speaker #4: Yeah, I think for us where we are and our business development stage, I don't think the I think the increase or decrease in rates would actually accelerate our opportunity.
Palmer Proctor: Yeah, I think for us, where we are in our business development stage, I don't think the I think the increase or decrease in rates would actually accelerate our opportunity. And in terms of payoffs, I don't see that causing any migration out to refinance elsewhere, because most people are either, depending on the conditions of the loan or the terms of the loans, are locked in. And, you know, like a lot of banks, we've got prepayment penalties, refinance penalties, and so forth. So I don't see that being a big contributor to outward movement.
Palmer Proctor: Yeah, I think for us, where we are in our business development stage, I don't think the I think the increase or decrease in rates would actually accelerate our opportunity. And in terms of payoffs, I don't see that causing any migration out to refinance elsewhere, because most people are either, depending on the conditions of the loan or the terms of the loans, are locked in. And, you know, like a lot of banks, we've got prepayment penalties, refinance penalties, and so forth. So I don't see that being a big contributor to outward movement.
Speaker #4: And in terms of payoffs, I don't see that causing any migration out to refinance elsewhere. Because most conditions of the loan or the terms of loans, they're locked in, and like a lot of banks, we've got prepayment penalties, refinance penalties, and so forth.
Speaker #4: So I don't see that being a big contributor to outward.
Speaker #4: movement. Got it.
Stephen Scouten: Got it. Makes sense. That's great. And then, I guess in terms of thoughts around new hiring activity, I mean, this has come up on every earnings call I think I've been on in the Southeast this quarter, and people are calling it, you know, somewhat of a generational opportunity. I think your approach to it maybe has sounded different in terms of just improving your talent throughout the spectrum of your bank, but maybe not adding just pure headcount quite as aggressively. Can you talk a little further about that, if I'm hearing you right when I summarize that and kind of how you're thinking about it in the new year with the opportunity set?
Stephen Scouten: Got it. Makes sense. That's great. And then, I guess in terms of thoughts around new hiring activity, I mean, this has come up on every earnings call I think I've been on in the Southeast this quarter, and people are calling it, you know, somewhat of a generational opportunity. I think your approach to it maybe has sounded different in terms of just improving your talent throughout the spectrum of your bank, but maybe not adding just pure headcount quite as aggressively. Can you talk a little further about that, if I'm hearing you right when I summarize that and kind of how you're thinking about it in the new year with the opportunity set?
Speaker #3: Makes sense. That's great. And then I guess in terms of thoughts around new hiring activity, I mean, this has come up on every earnings call I think I've been on in the Southeast this quarter.
Speaker #3: And people are calling it somewhat of a generational opportunity. I think your approach to it maybe has sounded different in terms of just improving your talent throughout the spectrum of your bank, but maybe not adding just pure headcount quite as aggressively.
Speaker #3: Can you talk a little further about that? If I'm hearing you right when I'm summarizing that, and kind of how you're thinking about it in the new year with the opportunity set?
Speaker #4: Yeah, I think ours is very different. And like we've said for several years, when I look at the budget and our expectations, we do not have the compulsion or the need to have to go out and hire massive amounts of people to accomplish what we want to do here.
Palmer Proctor: Yeah, I think ours is very different. And like we've said for several years, when I look at the budget and our expectations, we do not have the compulsion or the need to have to go out and hire massive amounts of people to accomplish what we want to do here. We've been very fortunate with the level of talent that we have. We've been very fortunate with retention, and we stay focused on that. But to put it in perspective, I mean, we hired 21 lenders this year, but net-net, we were up 3. So what we do a constant view of is looking at the talent, how it's progressing or not.
Palmer Proctor: Yeah, I think ours is very different. And like we've said for several years, when I look at the budget and our expectations, we do not have the compulsion or the need to have to go out and hire massive amounts of people to accomplish what we want to do here. We've been very fortunate with the level of talent that we have. We've been very fortunate with retention, and we stay focused on that. But to put it in perspective, I mean, we hired 21 lenders this year, but net-net, we were up 3. So what we do a constant view of is looking at the talent, how it's progressing or not.
Speaker #4: We've been very fortunate with the level of talent that we have. We've been very fortunate with retention, and we stay focused on that. But to put in perspective, I mean, we hired 21 lenders this year, but net-net, we were up three.
Speaker #4: So what we do a constant view of is looking at the talent, how it's progressing or not. And so what we've been able to do is upgrade talent on a consistent basis, thereby eliminating a lot of the churn and the constant need to have to add additional bankers.
Palmer Proctor: So what we've been able to do is upgrade talent on a consistent basis, thereby eliminating a lot of the churn and the constant need to have to add additional bankers. We've got great bankers, and they can help us deliver on what we need to deliver on. Now, that being said, we obviously will remain selective and if there's opportunities out there, but in terms of having a need to drive up non-interest expense and add on a bunch of bankers each quarter, we're in a very fortunate position in which we don't have to do that.
So what we've been able to do is upgrade talent on a consistent basis, thereby eliminating a lot of the churn and the constant need to have to add additional bankers. We've got great bankers, and they can help us deliver on what we need to deliver on. Now, that being said, we obviously will remain selective and if there's opportunities out there, but in terms of having a need to drive up non-interest expense and add on a bunch of bankers each quarter, we're in a very fortunate position in which we don't have to do that.
Speaker #4: We've got great bankers, and they can help us deliver on what we need to deliver on. Now, that being said, we obviously will remain selective, and if there's opportunities out there— but in terms of having a need to drive up non-interest expense and add on a bunch of bankers each quarter, we're in a very fortunate position in which we don't have to do that.
Speaker #3: Fantastic. We'll go ahead and step back. Thanks for all the—
Stephen Scouten: Fantastic. I will go ahead and step back. Thanks for all the information.
Stephen Scouten: Fantastic. I will go ahead and step back. Thanks for all the information.
Speaker #4: You
Palmer Proctor: You bet.
Palmer Proctor: You bet.
Speaker #4: bet. The next question
Operator: The next question comes from Catherine Mealor with KBW. Please go ahead.
Operator: The next question comes from Catherine Mealor with KBW. Please go ahead.
Speaker #2: comes from Katherine Mueller with KBW. Please go
Speaker #2: ahead. Thanks.
Catherine Mealor: Thanks. Good morning. I wanted to ask about the margin. Nicole, appreciate your caution on just thinking that the margin will come down next year just as deposit costs accelerate, but we're coming from such a higher level than maybe your... Historically, I think you've kind of talked about a margin in, like, the 360 to 365 range, but we're a lot higher than that today. So just kind of curious if you could put a range on your margin expectations for the year. Thanks.
Catherine Mealor: Thanks. Good morning. I wanted to ask about the margin. Nicole, appreciate your caution on just thinking that the margin will come down next year just as deposit costs accelerate, but we're coming from such a higher level than maybe your... Historically, I think you've kind of talked about a margin in, like, the 360 to 365 range, but we're a lot higher than that today. So just kind of curious if you could put a range on your margin expectations for the year. Thanks.
Speaker #5: Good morning. I wanted to ask about the margin, Nicole. Appreciate your caution on just thinking that the margin will come down next year just as deposit costs accelerate, but we're coming from such a higher level than maybe you're historically, I think you've kind of talked about a margin in like a 360, a 365 range, but we're a lot higher than that today.
Speaker #5: So just kind of curious if you could put a range on your margin expectations for the year. Thanks.
Speaker #6: Yeah, absolutely. And I know this is yet another quarter of saying that it's going to go down and then it went up, but real quickly on that five basis points of expansion, two basis points of that expansion really came from our sub debt payoff.
Nicole Stokes: Yep, absolutely. And I know this is yet another quarter of saying that it's going to go down and then it went up. But real quickly on that 5 basis points of expansion, 2 basis points of that expansion really came from our sub-debt payoff. So really, we only had kind of 3 basis points from both the loan and deposit side. So when I look out over the next few quarters, so much of our guidance is dependent on those deposit costs and the deposit pressure that we see as we see growth accelerating. So I feel like 5 to 10 basis points over the next few quarters, and then longer term, it's really going to depend kind of on growth and interest rate environment and where we are after that kind of one-year horizon.
Nicole Stokes: Yep, absolutely. And I know this is yet another quarter of saying that it's going to go down and then it went up. But real quickly on that 5 basis points of expansion, 2 basis points of that expansion really came from our sub-debt payoff. So really, we only had kind of 3 basis points from both the loan and deposit side. So when I look out over the next few quarters, so much of our guidance is dependent on those deposit costs and the deposit pressure that we see as we see growth accelerating. So I feel like 5 to 10 basis points over the next few quarters, and then longer term, it's really going to depend kind of on growth and interest rate environment and where we are after that kind of one-year horizon.
Speaker #6: So, really, we only had kind of three basis points from the loan and deposit side. So, when I look out over the next few quarters, so much of our guidance is dependent on those deposit costs.
Speaker #6: And the deposit pressure that we see as we see growth accelerating. So I feel like 5 to 10 basis points over the next few quarters and then longer term, it's really going to depend kind of on growth and interest rate environment and where we are after that kind of one-year
Speaker #6: horizon.
Speaker #5: Okay. And that's 5 to 10
Catherine Mealor: Okay, that's - and that's 5 to 10 basis points from today's level, or the full year 2025?
Catherine Mealor: Okay, that's - and that's 5 to 10 basis points from today's level, or the full year 2025?
Speaker #5: basis points from today's level or the full year
Speaker #5: '25? Got
Speaker #6: That would be kind of where
Nicole Stokes: That would be kind of where we are today.
Nicole Stokes: That would be kind of where we are today.
Speaker #6: we are today.
Speaker #5: it. Okay. Okay. Great. And then maybe on the expenses, I know there was a big reduction in expenses this quarter just from personnel. Can you help us get a range just for where it gets starting point for one Q just given the increase in payroll taxes and things like
Catherine Mealor: Got it. Okay. Okay, great. And then maybe on expenses, I know there was a big reduction in expenses this quarter, just from the, from personnel. Can you help us get a range just for where a good starting point is for Q1, just given the increase in payroll taxes and things like that?
Catherine Mealor: Got it. Okay. Okay, great. And then maybe on expenses, I know there was a big reduction in expenses this quarter, just from the, from personnel. Can you help us get a range just for where a good starting point is for Q1, just given the increase in payroll taxes and things like that?
Speaker #5: that? Absolutely.
Nicole Stokes: ... Absolutely. So when you look at Q4, Q1, there's always some big swings. So when you look at Q4, the difference in payroll taxes and 401(k) match we have, a lot of that is kind of front-loaded in Q1. So that's about a $5 million swing that we expect to come back in the first quarter. And then we also had some less incentive accrual in Q4 based on truing up all those accruals based on end-of-year numbers. So that's about another $2.5 million. So I know that Q4, we were at $143 million. If you add back in that $7.5 million, you kind of get us back in that 150, 151 range.
Nicole Stokes: ... Absolutely. So when you look at Q4, Q1, there's always some big swings. So when you look at Q4, the difference in payroll taxes and 401(k) match we have, a lot of that is kind of front-loaded in Q1. So that's about a $5 million swing that we expect to come back in the first quarter. And then we also had some less incentive accrual in Q4 based on truing up all those accruals based on end-of-year numbers. So that's about another $2.5 million. So I know that Q4, we were at $143 million. If you add back in that $7.5 million, you kind of get us back in that 150, 151 range.
Speaker #6: So when you look at the fourth quarter to first quarter, there's always some big swings. So, when you look at the fourth quarter, the difference in payroll taxes and 401(k) match—we have a lot of that is kind of front-loaded in the first quarter.
Speaker #6: So that's about a $5 million swing that we expect to come back in, in the first quarter. And then we also had some less incentive accrual in the fourth quarter, based on chewing up all those accruals based on end-of-year numbers.
Speaker #6: So that's about another two and a half million. So I know that the fourth quarter, we were at $143 million. If you add back in that seven and a half million, you kind of get us back in that $150, $151 million range.
Speaker #6: And then I think kind of a guide is probably for the year, I think, consensus is really good. But I feel like maybe the first quarter might be a little bit heavy.
Nicole Stokes: And then, I think kind of a guide is probably for the year. I think consensus is really good, but I feel like maybe the first quarter might be a little bit heavy. So maybe the year-to-date consensus number is good, but it might be a little bit heavy in the first quarter. Some of it may come in later in the year as we see growth accelerate throughout the year. Some of those expenses, commissions, et cetera, could come in as well. So probably, you know, $1.54, somewhere between $1.54, $1.55 is a good starting point for first quarter.
And then, I think kind of a guide is probably for the year. I think consensus is really good, but I feel like maybe the first quarter might be a little bit heavy. So maybe the year-to-date consensus number is good, but it might be a little bit heavy in the first quarter. Some of it may come in later in the year as we see growth accelerate throughout the year. Some of those expenses, commissions, et cetera, could come in as well. So probably, you know, $1.54, somewhere between $1.54, $1.55 is a good starting point for first quarter.
Speaker #6: So maybe the year-to-date consensus number is good, but it might be a little bit heavy in the first quarter. Some of it may come in later in the year as we see growth accelerate throughout the year.
Speaker #6: Some of those expenses, commissions, etc. could come in as well. So probably 154, somewhere between 154, 155 is a good starting point for first
Speaker #6: quarter. Okay.
Doug Strange: Okay, great. Very helpful. Thank you. Great quarter and year.
Catherine Mealor: Okay, great. Very helpful. Thank you. Great quarter and year.
Speaker #5: Great. Very helpful. Thank you. Great quarter and year.
Speaker #4: Thank you.
Palmer Proctor: Thank you.
Palmer Proctor: Thank you.
Speaker #3: Thanks. The next question comes
Operator: The next question comes from Russell Gunther with Stephens. Please go ahead.
Operator: The next question comes from Russell Gunther with Stephens. Please go ahead.
Speaker #2: From Russell Gunther with Stevens. Please go ahead.
Speaker #4: Hey, good morning, guys. I wanted to start with just a margin follow-up, if I could. Nicole, could you give us a sense of where kind of new production is coming online relative to the incremental cost of deposits, and sort of along that question set, just the cadence of the fourth-quarter margin over the course of that quarter—kind of where we exit it?
Russell Gunther: Hey, good morning, guys. Wanted to start with just a margin follow-up, if I could. Nicole, could you give us a sense of where kind of new production is coming online relative to the incremental cost of deposits? And sort of along that question set, just the cadence of the fourth quarter margin over the course of that quarter, kind of where we exited.
Russell Gunther: Hey, good morning, guys. Wanted to start with just a margin follow-up, if I could. Nicole, could you give us a sense of where kind of new production is coming online relative to the incremental cost of deposits? And sort of along that question set, just the cadence of the fourth quarter margin over the course of that quarter, kind of where we exited.
Speaker #6: Sure. So the fourth quarter, kind of when you look at lung production, it came in right at about 635 for the quarter. And that's with all divisions.
Nicole Stokes: Sure. So, the fourth quarter, kind of when you look at loan production, it came in right about 6.35 for the quarter, and that's, that's with all divisions. That's with the bank, premium finance, warehouse, all of that kind of blended yield was about a 6.35. And that's compared to, the deposit production, all deposits came in right around 2%. So we're looking at about a 4.35 spread on production, which is accretive to growth. I'm sorry, which growth is accretive to margin. However, if you look at that loan spread compared to the interest-bearing deposits only, it was a little bit dilutive.
Nicole Stokes: Sure. So, the fourth quarter, kind of when you look at loan production, it came in right about 6.35 for the quarter, and that's, that's with all divisions. That's with the bank, premium finance, warehouse, all of that kind of blended yield was about a 6.35. And that's compared to, the deposit production, all deposits came in right around 2%. So we're looking at about a 4.35 spread on production, which is accretive to growth. I'm sorry, which growth is accretive to margin. However, if you look at that loan spread compared to the interest-bearing deposits only, it was a little bit dilutive.
Speaker #6: That's with the bank, premium finance, warehouse—all of that kind of blended yield was about a 6.35%. And that's compared to the deposit production; all deposits came in right around 2%.
Speaker #6: So we're looking at about a 435 spread on production, which is accretive to growth—I'm sorry, which, growth is accretive to margin—spread compared to the interest-bearing. However, if you look at that loan-deposits only, it was a little bit dilutive.
Speaker #6: And so that really says where our focus continues to be on the growth in NIB and really those core deposit growth to be able to help with the interest-bearing spread that we see the pressure on.
Nicole Stokes: So that really says where our focus continues to be on the growth in NIB, and really those core deposit growth, to be able to help with the interest-bearing spread that we see the pressure on. And then I think the second part of your question was kind of the quarter. We were very consistent, the 3.85 for the quarter. I mean, it was up or down each month by 1 or 2 basis points, but there were no significant swings over the quarter.
So that really says where our focus continues to be on the growth in NIB, and really those core deposit growth, to be able to help with the interest-bearing spread that we see the pressure on. And then I think the second part of your question was kind of the quarter. We were very consistent, the 3.85 for the quarter. I mean, it was up or down each month by 1 or 2 basis points, but there were no significant swings over the quarter.
Speaker #6: And then I think the second part of your question was kind of the quarter. We were very consistent the 385 for the quarter. I mean, it was up or down each month by one or two basis points, but there were no significant swings over the quarter.
Speaker #4: Okay, very helpful, Nicole. Thank you. And then maybe just switching gears to capital—very robust position here. You've got reserve levels that are incredibly healthy.
Russell Gunther: Okay. Very helpful, Nicole. Thank you. And then maybe just switching gears to capital, very robust position here. You got reserve levels that are incredibly healthy. Just level set us in terms of your kind of CET1 bogey in order to get a sense of what you guys might consider excess. And then given how quickly you accrue capital, you know, how do you guys plan to put a dent in that over the course of the year?
Russell Gunther: Okay. Very helpful, Nicole. Thank you. And then maybe just switching gears to capital, very robust position here. You got reserve levels that are incredibly healthy. Just level set us in terms of your kind of CET1 bogey in order to get a sense of what you guys might consider excess. And then given how quickly you accrue capital, you know, how do you guys plan to put a dent in that over the course of the year?
Speaker #4: Just level-set us in terms of your kind of CET1 bogey, in order to get a sense of what you guys might consider excess.
Speaker #4: And then given how quickly you accrete capital, how do you guys plan to put a dent in that over the course of the year?
Speaker #3: Yeah. Capital priorities have not changed. I mean, obviously, first and foremost, it's growing into it organically and levering it up. Then, as you saw, we were active in the buybacks.
Palmer Proctor: Yeah, our capital priorities have not changed. I mean, obviously, first and foremost, it's growing into it organically and levering it up. Then, as you saw, we were active in the buybacks. We will remain opportunistic there, then the dividend, and then obviously, last would be any sort of external activity. But, you know, given the markets we're in now and the opportunities we see, that would be far, far down the list. You know, in terms of target for us, I think we would be looking more at, at on the TCE level, probably around 10, 10.5, and then on the CET1 target of around 12%, if you wanted to look at longer term.
Palmer Proctor: Yeah, our capital priorities have not changed. I mean, obviously, first and foremost, it's growing into it organically and levering it up. Then, as you saw, we were active in the buybacks. We will remain opportunistic there, then the dividend, and then obviously, last would be any sort of external activity. But, you know, given the markets we're in now and the opportunities we see, that would be far, far down the list. You know, in terms of target for us, I think we would be looking more at, at on the TCE level, probably around 10, 10.5, and then on the CET1 target of around 12%, if you wanted to look at longer term.
Speaker #3: We will remain opportunistic there. Then the dividend, and then obviously last would be any sort of external activity. But given the markets we're in now and the opportunities we see, that would be far, far down the list.
Speaker #3: In terms of target for us, I think we would be looking more at the TCE level probably around 10, 10 and a half, and then on the CT1 target of around 12% if you wanted to look at longer term.
Speaker #3: In terms of target for us, I think we would be looking more at the TCE level probably around 10, 10 and a half, and then on the CT1 target of around 12% if you wanted to look at longer term.
Speaker #4: That's really helpful, Palmer. Thank you for that. And guys, just last one for me. I hear you on the charge-off guide. For the year, fourth quarter results are kind of at the high end of that.
Russell Gunther: That's really helpful, Palmer. Thank you for that. And guys, just last one for me. Hear you on the charge-off guide for the year. Fourth quarter results are kind of at the high end of that. Can you just discuss quickly the drivers of the net charge-off activity this quarter and, and perhaps Balboa's contribution specifically?
Russell Gunther: That's really helpful, Palmer. Thank you for that. And guys, just last one for me. Hear you on the charge-off guide for the year. Fourth quarter results are kind of at the high end of that. Can you just discuss quickly the drivers of the net charge-off activity this quarter and, and perhaps Balboa's contribution specifically?
Speaker #4: Could you just discuss quickly the drivers of the net charge-off activity this quarter and perhaps Balboa's contribution
Speaker #4: specifically?
Speaker #1: Well, Russell, this is Doug. First of all,
Doug Strange: Well, Russell, this is Doug. First of all, equipment finance really was, they were, they were in line and consistent for the whole year. We did have some consumer medical notes that we charged off, but, you know, our charge-offs, they tend to ebb and flow from quarter to quarter, and fourth quarter was preceded by two very low charge-off quarters, that being at 14 basis points. But as Nicole framed it, when you look at it for the year at 18 basis points, you know, we were below the prior year, below consensus. And just to reiterate, you know, for this year, we're still in that 20 to 25 basis point guidance.
Doug Strange: Well, Russell, this is Doug. First of all, equipment finance really was, they were, they were in line and consistent for the whole year. We did have some consumer medical notes that we charged off, but, you know, our charge-offs, they tend to ebb and flow from quarter to quarter, and fourth quarter was preceded by two very low charge-off quarters, that being at 14 basis points. But as Nicole framed it, when you look at it for the year at 18 basis points, you know, we were below the prior year, below consensus. And just to reiterate, you know, for this year, we're still in that 20 to 25 basis point guidance.
Speaker #1: all, equipment finance really was they were in line and consistent for the whole year. We did have some consumer medical notes that we charged off, but our charge-off, they tend to ebb and flow from quarter to quarter.
Speaker #1: And fourth quarter was preceded by two very low charge-off quarters, that being at 14 basis points. But as Nicole framed it, when you look at it for the year at 18 basis points, we were below the prior year, below consensus, and just to reiterate, for this year, we're still in that 20 to 25 basis point
Speaker #1: Guidance. Thank you, guys, for taking my
Russell Gunther: Thank you guys for taking my questions.
Russell Gunther: Thank you guys for taking my questions.
Speaker #6: Thank questions. you.
Nicole Stokes: Thank you.
Nicole Stokes: Thank you.
Speaker #2: The next question comes from John McDonald with Truist Securities. Please go ahead.
Operator: The next question comes from John McDonald with Truist Securities. Please go ahead.
Operator: The next question comes from John McDonald with Truist Securities. Please go ahead.
Speaker #4: Thanks. Good morning. Nicole, I was wondering if you could give us a little more color on the puts and takes on deposit trends in the fourth quarter.
John McDonald: Thanks. Good morning. Nicole, I was wondering if you could give us a little more color on puts and takes on deposit trends in the fourth quarter. There was a little bit of decline in the NIB, and wondering if you've seen some of that come back. And then just as you think about your mid-single-digit outlook for this year, what kind of mix evolution are you planning for in the overall deposit mix?
John McDonald: Thanks. Good morning. Nicole, I was wondering if you could give us a little more color on puts and takes on deposit trends in the fourth quarter. There was a little bit of decline in the NIB, and wondering if you've seen some of that come back. And then just as you think about your mid-single-digit outlook for this year, what kind of mix evolution are you planning for in the overall deposit mix?
Speaker #4: There was a little bit of a decline in the NIB and wondering if you've seen some of that come back. And then just as you think about your mid-single-digit outlook for this year, what kind of mix evolution are you planning for in the overall deposit mix?
Speaker #6: Sure. So we did have, and there is some cyclicality in our balance sheet every year. And this year was no different. We have kind of the fourth quarter—we have public funds that roll in, and then at the same time, we kind of have some mortgage escrow deposits that roll out.
Nicole Stokes: Sure. So we did have, and there is some cyclicality in our balance sheet every year, and this year was no different. We have kind of the fourth quarter, we have public funds that roll in, and then at the same time, we kind of have the, some mortgage escrow deposits that roll out. So fourth quarter is always kind of our lowest point for that NIB mix. So we were pleased that it ended up, you know, close to 29%. What I saw this year was a little bit different to your point about has any of it come back? And the answer is yes. So from a non-interest-bearing perspective, our number of accounts has continued to increase.
Nicole Stokes: Sure. So we did have, and there is some cyclicality in our balance sheet every year, and this year was no different. We have kind of the fourth quarter, we have public funds that roll in, and then at the same time, we kind of have the, some mortgage escrow deposits that roll out. So fourth quarter is always kind of our lowest point for that NIB mix. So we were pleased that it ended up, you know, close to 29%. What I saw this year was a little bit different to your point about has any of it come back? And the answer is yes. So from a non-interest-bearing perspective, our number of accounts has continued to increase.
Speaker #6: So fourth quarter is always kind of our lowest point for that NIB mix. So we were pleased that it ended up close to 29%.
Speaker #6: What we also saw this year was a little bit different to your point about has any of it come back. And the answer is yes.
Speaker #6: So, from a non-interest-bearing perspective, our number of accounts has continued to increase. And so, what we saw in that decline of NIB were two things.
Nicole Stokes: And so what we saw in that decline of NIB were two things, some of that mortgage escrow deposits, and then also we had some customers, and I'm not talking about two lumpy customers. It's, you know, spread across 20 to 30 customers that moved money out at the end of the year. And some of that, we believe was used for some tax planning purposes with some of the one day beautiful bill items. And then also some of it was used to kind of do their balance sheet management at the end of the year. And we've seen a lot of that come back in already.
And so what we saw in that decline of NIB were two things, some of that mortgage escrow deposits, and then also we had some customers, and I'm not talking about two lumpy customers. It's, you know, spread across 20 to 30 customers that moved money out at the end of the year. And some of that, we believe was used for some tax planning purposes with some of the one day beautiful bill items. And then also some of it was used to kind of do their balance sheet management at the end of the year. And we've seen a lot of that come back in already.
Speaker #6: Some of that mortgage escrow deposits and then also we had some customers, and I'm not talking about two lumpy customers. It's spread across 20 to 30 customers that moved money out at the end of the year.
Speaker #6: And some of that we believe was used for some tax planning purposes with some of the one big beautiful bill items. And then also some of it was used to kind of do their balance sheet management at the end of the year.
Speaker #6: And we've seen a lot of that come back in already. So while it looks a little bit like an anomaly I think it's our underlying focus continues to be on non-interest-bearing.
Nicole Stokes: So while it looks a little bit like an anomaly, I think it's our underlying focus continues to be on non-interest-bearing, and based on the number of accounts that we're opening and that net growth and number of accounts, we still feel positive about NIB growth. So that kind of leads right into the second part of your question: where do we see that growth? You know, we are so focused on growing core deposits, and being the relationship banker, and that's where we see some of the excitement of the market, potential market disruption or the potential from the market disruption, where we can continue to grow those core deposits with the relationships.
So while it looks a little bit like an anomaly, I think it's our underlying focus continues to be on non-interest-bearing, and based on the number of accounts that we're opening and that net growth and number of accounts, we still feel positive about NIB growth. So that kind of leads right into the second part of your question: where do we see that growth? You know, we are so focused on growing core deposits, and being the relationship banker, and that's where we see some of the excitement of the market, potential market disruption or the potential from the market disruption, where we can continue to grow those core deposits with the relationships.
Speaker #6: ing. And based on the number of accounts that were opening and that net growth in number of accounts, we still feel positive about NIB growth.
Speaker #6: So that kind of leads right into the second part of your question is where do we see that growth? We are so focused on growing core deposits.
Speaker #6: And being the relationship banker. And that's where we see some of the excitement of the market—potential market disruption or the potential for the market to continue to grow those core disruptions where we have deposits with the relationship.
Speaker #6: So we would focus on the operating accounts as well as their money market accounts. And then that fill any of that with broker. But we were pleased to be able to keep brokered at 5% year over year.
Nicole Stokes: So we would focus on, you know, the operating accounts as well as their money market accounts, and then backfill any of that with brokered. But we were pleased to be able to keep brokered at 5%, year-over-year.
So we would focus on, you know, the operating accounts as well as their money market accounts, and then backfill any of that with brokered. But we were pleased to be able to keep brokered at 5%, year-over-year.
Speaker #4: Great. And just to follow up on the idea that deposit growth is a governor of loan growth, are they if you're looking at mid-single-digit growth on both, is it a related forecast or are they independent?
John McDonald: Great. And just to follow up on the idea that deposit growth is a governor of loan growth, if you're looking at mid-single digit growth on both, is it a related forecast or are they independent? Because as Palmer mentioned, it feels like the loan growth, if pay downs normalize, could be better than mid-single digit. Just kind of wondering if those are connected as a forecast.
John McDonald: Great. And just to follow up on the idea that deposit growth is a governor of loan growth, if you're looking at mid-single digit growth on both, is it a related forecast or are they independent? Because as Palmer mentioned, it feels like the loan growth, if pay downs normalize, could be better than mid-single digit. Just kind of wondering if those are connected as a forecast.
Speaker #4: Because as Palmer mentioned, it feels like the loan growth at paydowns normalized could be better than mid-single-digit. Just kind of wondering if those are connected as a
Speaker #4: forecast. So we do
Nicole Stokes: So we do actually forecast. I mean, we budget and we forecast for core deposit growth. But when you look at our balance sheet, there's several components of our loan portfolio that don't necessarily have a deposit feature with it. So really one of the—if you kind of look at where we get core loan growth for the bank, core deposit growth, and then some of these other lines of business. So if we ended up funding some of those other lines of business with either brokered or wholesale, as long as we are, you know, continuing to focus on that margin. So that's where you may see from our kind of forecast perspective. But from a core bank, core growth, we are definitely focused on funding that with core deposits.
Nicole Stokes: So we do actually forecast. I mean, we budget and we forecast for core deposit growth. But when you look at our balance sheet, there's several components of our loan portfolio that don't necessarily have a deposit feature with it. So really one of the—if you kind of look at where we get core loan growth for the bank, core deposit growth, and then some of these other lines of business. So if we ended up funding some of those other lines of business with either brokered or wholesale, as long as we are, you know, continuing to focus on that margin. So that's where you may see from our kind of forecast perspective. But from a core bank, core growth, we are definitely focused on funding that with core deposits.
Speaker #6: Actually, forecast—I mean, we budget and we forecast for core deposit growth. But when you look at our balance sheet, there are several components of our loan portfolio that don't necessarily have a deposit feature with them.
Speaker #6: So really, if you kind of look at where we get core loan growth for the bank, core deposit growth, and then some of these other lines of business.
Speaker #6: So if we ended up funding some of those other lines of business with either brokered or wholesale as long as we are continuing to focus on that margin.
Speaker #6: So that's where you may see, from our kind of forecast perspective, but from a core bank—core growth—we are definitely focused on funding that with core deposits.
Speaker #4: Great. And one last follow-up. On the provision bill this quarter, some of it was for unfunded commitments. Is that relationship of growth to provision bill something that had anything unique about it this quarter, or is that how we should think about it going forward?
Speaker #4: Great. And one last follow-up. On the provision bill this quarter, some of it was for unfunded commitments. Is that relationship of growth to provision bill something that had anything unique about it this quarter, or is that how we should think about it going forward?
John McDonald: Great. And one last follow-up. On the provision build this quarter, some of it was for unfunded commitments. Is that relationship of growth to provision build something that had anything unique about it this quarter, or is that how we should think about it going forward?
John McDonald: Great. And one last follow-up. On the provision build this quarter, some of it was for unfunded commitments. Is that relationship of growth to provision build something that had anything unique about it this quarter, or is that how we should think about it going forward?
Speaker #6: So I think a lot of that unfunded commitment—and this is actually the second quarter in a row that we've seen that. And when you look back over, we kind of put a governor on some of our CRE and some of our construction, whether that was homebuilder as well as CRE.
Nicole Stokes: So I think a lot of that, that unfunded commitment, and this is actually the second quarter in a row that we've seen that. And when you look back over our, you know, we kind of put a governor on our, some of our CRE and all of our constructions, whether that was home builder as well as CRE. So that bucket of unfunded kind of hit a lull, and now we're building that bucket back up. So as we're building that bucket, in a normal environment that, that stays consistent, you don't have that refill. So kind of we're starting from, you know, a much lower point of filling it, and we've got it about full. Now, if we had a really big quarter of production, that unfunded, you could see it go up, but we also see that as opportunistic.
Nicole Stokes: So I think a lot of that, that unfunded commitment, and this is actually the second quarter in a row that we've seen that. And when you look back over our, you know, we kind of put a governor on our, some of our CRE and all of our constructions, whether that was home builder as well as CRE. So that bucket of unfunded kind of hit a lull, and now we're building that bucket back up.
Speaker #6: So, that bucket of unfunded kind of hit a lull. And now we're building that bucket back up. So as we're building that bucket, in a normal environment, that stays consistent—you don't have that refill.
So as we're building that bucket, in a normal environment that, that stays consistent, you don't have that refill. So kind of we're starting from, you know, a much lower point of filling it, and we've got it about full. Now, if we had a really big quarter of production, that unfunded, you could see it go up, but we also see that as opportunistic.
Speaker #6: So, kind of, we're starting from a much lower point of filling it, and we've got it about full. Now, if we had a really big quarter of production that unfunded, you could see it go up.
Speaker #6: But we also see that as opportunistic. That means we've produced loans, we've closed loans—they just haven't funded. So every time we see a growth in that unfunded, we feel like that's a good driver for future loan growth, because we know we have those.
Nicole Stokes: That means we've produced loans, we've closed loans; they just haven't funded. So every time we see a growth in that unfunded, we feel like that's a good driver for future loan growth because we know we have those in the pipeline.
That means we've produced loans, we've closed loans; they just haven't funded. So every time we see a growth in that unfunded, we feel like that's a good driver for future loan growth because we know we have those in the pipeline.
Speaker #6: In the pipeline.
Speaker #4: Great. Thank you very much.
John McDonald: Great. Thank you very much.
John McDonald: Great. Thank you very much.
Speaker #2: The next question comes from Gary Tenner with DA Davidson. Please go
Operator: The next question comes from Gary Tenner with D.A. Davidson. Please go ahead.
Operator: The next question comes from Gary Tenner with D.A. Davidson. Please go ahead.
Speaker #4: Thanks. Good morning, everybody.
Gary Tenner: Thanks. Good morning, everybody.
Gary Tenner: Thanks. Good morning, everybody.
Speaker #7: Good morning.
Nicole Stokes: Good morning.
Nicole Stokes: Good morning.
Gary Tenner: So I've got a couple of questions on, on the mortgage segment. You know, you had the $2 million net revenue decline from the MSR sale and the valuation change, but given the flattish production and gain on sale margins, can you talk about kind of what drove the remainder of that $10 million quarter-over-quarter decline in fee income in the division?
Gary Tenner: So I've got a couple of questions on, on the mortgage segment. You know, you had the $2 million net revenue decline from the MSR sale and the valuation change, but given the flattish production and gain on sale margins, can you talk about kind of what drove the remainder of that $10 million quarter-over-quarter decline in fee income in the division?
Speaker #4: So I've got a couple of questions on the mortgage segment. You had the $2 million net revenue decline from the MSR sale and the valuation change.
Speaker #4: But given the flattish production and gain on sale margin, can you talk about kind of which are the remainder of that $10 million quarter over quarter decline in fee income in the division?
Speaker #6: Absolutely. So while mortgage was stable, the fourth quarter had a heavier mix of wholesale production, and that's a little less profitable than the retail originations.
Nicole Stokes: Absolutely. So, you know, while mortgage production and gain on sales were fairly stable, the fourth quarter had a heavier mix of wholesale production, and that's, that's a little less profitable than the retail origination. And you always have a little bit of cyclicality in the fourth quarter because your pipelines are down, so that gain on, I'm sorry, your market value of your pipeline is down as well. So, but when you look at the year to date, if you take out that MSR gain last year, and you, you kind of level the playing field for that noise, and you look, mortgage revenue was down about $13 million, or about 8% from 2024 to 2025, and then our expenses were down $6 million or about 4%.
Nicole Stokes: Absolutely. So, you know, while mortgage production and gain on sales were fairly stable, the fourth quarter had a heavier mix of wholesale production, and that's, that's a little less profitable than the retail origination. And you always have a little bit of cyclicality in the fourth quarter because your pipelines are down, so that gain on, I'm sorry, your market value of your pipeline is down as well. So, but when you look at the year to date, if you take out that MSR gain last year, and you, you kind of level the playing field for that noise, and you look, mortgage revenue was down about $13 million, or about 8% from 2024 to 2025, and then our expenses were down $6 million or about 4%.
Speaker #6: And you always have a little bit of cyclicality in the fourth quarter because your pipelines are down. So that gain on I'm sorry, your market value of your pipeline is down as well.
Speaker #6: But when you look at the year-to-date, if you take out that MSR gain last year and you kind of level the playing field for that noise, and you look, mortgage revenue was down about $13.5 million, or about 8%, from '24 to '25.
Speaker #6: And then our expenses were down 6 million or about 4%. So it's right in line with our expectations of running kind of that additional growth or pullback in the mortgage group at that 50% efficiency ratio.
Nicole Stokes: So it's right in line with our expectations of running kind of that additional growth or pullback in the mortgage group at that 50% efficiency ratio. So while there were some anomalies in the Q4, it evens out for the year.
So it's right in line with our expectations of running kind of that additional growth or pullback in the mortgage group at that 50% efficiency ratio. So while there were some anomalies in the Q4, it evens out for the year.
Speaker #6: So, while there were some anomalies in the fourth quarter, it evens out for the
Speaker #6: year.
Gary Tenner: Okay, great. And then the second mortgage question, I guess, is, can you give us, because I didn't see it, and I apologize if I missed it, but the unpaid principal balance of the servicing portfolio at year-end?
Gary Tenner: Okay, great. And then the second mortgage question, I guess, is, can you give us, because I didn't see it, and I apologize if I missed it, but the unpaid principal balance of the servicing portfolio at year-end?
Speaker #4: Great. And then the second mortgage question, I guess, is can you give us—because I didn't see it, and I apologize if I missed it—but the unpaid principal balance of the servicing portfolio at...
Speaker #4: year-end? Yes.
Nicole Stokes: Uh, yes.
Nicole Stokes: Uh, yes.
Speaker #6: At the end of the year, our unpaid principal balance was about $8.7 billion, which is about 4% of Tier One capital. So well, well below the 25% regulatory.
Gary Tenner: Do you have it?
Gary Tenner: Do you have it?
Nicole Stokes: At the end of the year, our unpaid principal balance was about $8.7 billion, which is about 4% of Tier 1 capital, so well below the 25% regulatory threshold.
Nicole Stokes: At the end of the year, our unpaid principal balance was about $8.7 billion, which is about 4% of Tier 1 capital, so well below the 25% regulatory threshold.
Speaker #6: threshold. Great.
Gary Tenner: Great. Thank you for that. And then last question for me, just to follow up on the capital side. Roger, you talked about you remaining opportunistic there. I'm just curious if you're willing to talk about any kind of sensitivities around price levels. I mean, the stock is up 15% from where you repurchased in the Q4. Obviously, the capital accretion outlook remains very strong, so just wondering how you balance, kind of the, you know, relative price versus your appetite there.
Gary Tenner: Great. Thank you for that. And then last question for me, just to follow up on the capital side. Roger, you talked about you remaining opportunistic there. I'm just curious if you're willing to talk about any kind of sensitivities around price levels. I mean, the stock is up 15% from where you repurchased in the Q4. Obviously, the capital accretion outlook remains very strong, so just wondering how you balance, kind of the, you know, relative price versus your appetite there.
Speaker #4: Thank you for that. And then, last question from me to follow up on the capital side. Roger, you talked about your remaining opportunistic there.
Speaker #4: I'm just curious if you'd be willing to talk about any kind of sensitivities around price levels. I mean, the stock is up 15% from where you repurchased in the fourth quarter.
Speaker #4: Obviously, the capital accretion outlook remains very strong. So just wondering how you balance kind of the relative price
Speaker #4: versus your appetite there. Yeah.
Palmer Proctor: Yeah, no, it is a balancing act, but, you know, a lot of the way we look at it, right or wrong, is it's if you see a lot of M&A out there in the market, and if there was a mini Ameris Bank for sale out there, what would we be willing to pay for it? Is another way to look at it, and who better to invest in than yourself. So we, we will still be selective there in terms of buyback opportunities.
Palmer Proctor: Yeah, no, it is a balancing act, but, you know, a lot of the way we look at it, right or wrong, is it's if you see a lot of M&A out there in the market, and if there was a mini Ameris Bank for sale out there, what would we be willing to pay for it? Is another way to look at it, and who better to invest in than yourself. So we, we will still be selective there in terms of buyback opportunities.
Speaker #3: No, it is a balancing act. But a lot of the way we look at it, right or wrong, is if you see a lot of M&A out there in the market and if there was a mini Ameris Bank for sale out there, what would we be willing to pay for it?
Speaker #3: Is another way to look at it. And who better to invest in than yourself? So we will still be selective there in terms of buyback
Speaker #4: Great. Thank you.
Christopher Marinac: Great. Thank you.
Christopher Marinac: Great. Thank you.
Palmer Proctor: Mm-hmm.
Palmer Proctor: Mm-hmm.
Speaker #2: The next question comes from David Feaster with Raymond James. Please go ahead.
Operator: The next question comes from David Feaster with Raymond James. Please go ahead.
Operator: The next question comes from David Feaster with Raymond James. Please go ahead.
Speaker #8: Hey, good morning, everybody.
David Feaster: Hey, good morning, everybody.
David Feaster: Hey, good morning, everybody.
Speaker #6: Good morning. Good
Speaker #6: Good morning. Good
Nicole Stokes: Good morning.
Nicole Stokes: Good morning.
Palmer Proctor: Good morning.
Palmer Proctor: Good morning.
Speaker #3: morning. I wanted to
David Feaster: I wanted to circle back to the production side. I mean, again, production was really, you know, the strongest in the past three years. I wanted to get a sense of how much that is, you know, increased productivity from your bankers versus a shift in demand, and just the typical market that you're maybe more in shape, more opportunities.
David Feaster: I wanted to circle back to the production side. I mean, again, production was really, you know, the strongest in the past three years. I wanted to get a sense of how much that is, you know, increased productivity from your bankers versus a shift in demand, and just the typical market that you're maybe more in shape, more opportunities.
Speaker #8: circle back to the production side. I mean, production was really the strongest in the past three years. I wanted to get a sense of how that is increasing productivity for your bankers versus a shift in demand.
Speaker #8: And just curious if the market that you're maybe more opportunities.
Speaker #4: David, this is Palmer. I'll try and answer your question. You're kind of coming in and out—there's a bad connection. But I would answer it this way.
Palmer Proctor: David, this is Palmer. I'll try and answer your question. You're kind of coming in and out. There's a bad connection, but I would answer it this way. I would say it's all of the above. We've got a lot of focused individuals that are here and generating great production, regardless of additional market disruption from M&A. And then you compound that with recent activities that I think will continue to deliver additional opportunities for us. And then also, given how we're positioned in just high-growth markets, that bodes well for us as we look out. And you know, if the macro environment continues to improve, I think what you'll see is our- we're well positioned to grow at a faster pace.
Palmer Proctor: David, this is Palmer. I'll try and answer your question. You're kind of coming in and out. There's a bad connection, but I would answer it this way. I would say it's all of the above. We've got a lot of focused individuals that are here and generating great production, regardless of additional market disruption from M&A. And then you compound that with recent activities that I think will continue to deliver additional opportunities for us. And then also, given how we're positioned in just high-growth markets, that bodes well for us as we look out.
Speaker #4: I would say it's all of the above. We've got a lot of focused individuals that are here and generating great production regardless of additional market disruption from M&A.
Speaker #4: And then you compound that with recent activities that I think will continue to deliver additional opportunities for us. And then also given how we're positioned and just high growth markets, that bodes well for us as we look out.
Speaker #4: And if the macro environment continues to improve, I think what you'll see is we're well positioned to grow at a faster pace. Now, we're not going to stretch on our assumptions because to put it another way, we prefer to earn the upside rather than
And you know, if the macro environment continues to improve, I think what you'll see is our- we're well positioned to grow at a faster pace. Now we're not going to stretch on our assumptions because, you know, to put it another way, we prefer to earn the upside rather than promise it.
Palmer Proctor: Now we're not going to stretch on our assumptions because, you know, to put it another way, we prefer to earn the upside rather than promise it.
Speaker #4: promise it. Yeah.
David Feaster: Yeah. Okay. And maybe just on the loans side, I mean, you know, anecdotally, we hear a lot about increasing competition. It sounds like it's primarily on the front, but I'm just curious, what's the competitive landscape lending like from your standpoint? Has it primarily just been on the pricing side, or are you starting to see more pressure on, you know, standards and structures, as well?
David Feaster: Yeah. Okay. And maybe just on the loans side, I mean, you know, anecdotally, we hear a lot about increasing competition. It sounds like it's primarily on the front, but I'm just curious, what's the competitive landscape lending like from your standpoint? Has it primarily just been on the pricing side, or are you starting to see more pressure on, you know, standards and structures, as well?
Speaker #8: Okay. And maybe just on the loan side, I mean, anecdotally, we hear a lot about increasing competition. It sounds like it's primarily on the front, but I'm just curious, what's the competitive landscape for lending like from your standpoint?
Speaker #8: Has it primarily just been on the pricing side, or are you starting to see more pressure on standards and structures as well?
Speaker #4: No, it's mainly been on pricing. I mean, structure, fortunately for us and for the industry—which is a good sign—has held up relatively well.
Palmer Proctor: No, it's mainly been on pricing. I mean, structure, fortunately, for us and for the industry, which is a good sign, has held up relatively well. You'd have some folks that are getting a little more aggressive than others, but, you know, good for us. We've grown up in a very competitive environment, when you're in these high-growth markets, so the competition is nothing new to us to have to adapt and adjust to, and we will, we'll get our fair share of the, of the opportunities.
Palmer Proctor: No, it's mainly been on pricing. I mean, structure, fortunately, for us and for the industry, which is a good sign, has held up relatively well. You'd have some folks that are getting a little more aggressive than others, but, you know, good for us. We've grown up in a very competitive environment, when you're in these high-growth markets, so the competition is nothing new to us to have to adapt and adjust to, and we will, we'll get our fair share of the, of the opportunities.
Speaker #4: You'd have some folks that are getting a little more aggressive than others. But, good for us, we've grown up in a very competitive environment.
Speaker #4: When you're in these high-growth markets, the competition is nothing new to us to have to adapt and adjust to. And we will get our fair share of the opportunities.
Speaker #8: Okay, and then premium finance—you talked about this as a segment I know you all have been pretty excited about. You mentioned some of the seasonality in the prepared remarks.
David Feaster: Okay. And then, you know, premium finance, you talked about... This is a segment I know you all have been pretty excited about. You talked about some of the seasonality and it compared to March. Just kind of curious, what are you seeing about, within that segment, and, and growth expectations and any other opportunities there? Thanks.
David Feaster: Okay. And then, you know, premium finance, you talked about... This is a segment I know you all have been pretty excited about. You talked about some of the seasonality and it compared to March. Just kind of curious, what are you seeing about, within that segment, and, and growth expectations and any other opportunities there? Thanks.
Speaker #8: Just kind of curious, what are you seeing about within that segment and growth expectations, and any other opportunities there? Thanks.
Speaker #4: Yeah, no, thank you for the question. Premium finance has been a good, steady, stable performer for us. I don't think you're going to see, in terms of balance sheet composition, it's not going to consume a lot more balance sheet. What it will do is continue to provide meaningful earnings to the company on a go-forward basis.
Palmer Proctor: Yeah. No, thank you for the question. Premium finance has been a good, steady, stable performer for us. I don't think you're going to see in terms of balance sheet composition, it's not going to consume a lot more of the balance sheet, but what it will do is continue to provide meaningful earnings to the company on a go-forward basis. And, the pipelines there remain full. There are additional opportunities I think that we will see in the market, but we like that space and are committed to that space, and it's obviously delivered for us.
Palmer Proctor: Yeah. No, thank you for the question. Premium finance has been a good, steady, stable performer for us. I don't think you're going to see in terms of balance sheet composition, it's not going to consume a lot more of the balance sheet, but what it will do is continue to provide meaningful earnings to the company on a go-forward basis. And, the pipelines there remain full. There are additional opportunities I think that we will see in the market, but we like that space and are committed to that space, and it's obviously delivered for us.
Speaker #4: And the pipelines there remain full. There are additional opportunities, I think, that we will see in the market. But we'd like that space and are committed to that space.
Speaker #4: And it's obviously delivered for us.
Speaker #2: Our next question comes from Christopher Marinak with Janie Montgomery Scott. Please go ahead.
Operator: Our next question comes from Christopher Marinac with Janney Montgomery Scott. Please go ahead.
Operator: Our next question comes from Christopher Marinac with Janney Montgomery Scott. Please go ahead.
Speaker #9: Hey, thanks. Good morning. Palmer, Nicole wanted to look at just the growth over the last couple of years in terms of the accounts of DDAs and non-interest, and the NOW accounts.
Christopher Marinac: Hey, thanks. Good morning. Palmer, Nicole, I wanted to look at just the growth over the last couple of years in terms of the accounts of DDAs and non-interest, and the NOW accounts. It seems that you're up about 4 or 5% in both those categories, and I'm just in money markets, too. I'm curious, as you look at net new accounts being higher, is there a way that you are incenting to get balances to grow faster? And does it start with getting the account in the first place on a net basis?
Christopher Marinac: Hey, thanks. Good morning. Palmer, Nicole, I wanted to look at just the growth over the last couple of years in terms of the accounts of DDAs and non-interest, and the NOW accounts. It seems that you're up about 4 or 5% in both those categories, and I'm just in money markets, too. I'm curious, as you look at net new accounts being higher, is there a way that you are incenting to get balances to grow faster? And does it start with getting the account in the first place on a net basis?
Speaker #9: It seems that you're up about 4 or 5% in both those categories. And I'm just in money markets, too. I'm curious, as you look at net new accounts being higher, is there a way that you are incenting to get balances to grow faster?
Speaker #9: And does it start with getting the account in the first place on a net basis?
Speaker #6: Yes, Chris, sorry. We had a little technical difficulty here. So, we do focus on— I mean, you're exactly right. The first part is getting the customer in the door and getting the account opened.
Nicole Stokes: Yes, Chris. Sorry, we had a little technical difficulty here. So we do focus on... I mean, you're exactly right. The first part is getting the customer in the door and getting the account open. And then the second aspect is, how do you grow that relationship? And you start with one account, and then how do you get more? And I think that's where we look forward to some of the disruption in our markets, because maybe right now we're, you know, we have one account, but not the whole account. And so as they maybe have some disruption in their banking relationship with the other bank, we might be able to pick up some of those other deposits as well as grow the current relationship. So we see it as two- kind of a two-prong.
Nicole Stokes: Yes, Chris. Sorry, we had a little technical difficulty here. So we do focus on... I mean, you're exactly right. The first part is getting the customer in the door and getting the account open. And then the second aspect is, how do you grow that relationship? And you start with one account, and then how do you get more? And I think that's where we look forward to some of the disruption in our markets, because maybe right now we're, you know, we have one account, but not the whole account. And so as they maybe have some disruption in their banking relationship with the other bank, we might be able to pick up some of those other deposits as well as grow the current relationship. So we see it as two- kind of a two-prong.
Speaker #6: And then the second aspect is, how do you grow that relationship? You start with one account, and then how do you get more?
Speaker #6: And I think that's where we look forward to some of the disruption in our markets, because maybe right now we have one account, but not the whole account.
Speaker #6: And so, as they maybe have some disruption in their banking relationship with the other bank, we might be able to pick up some of those other deposits, as well as grow the current relationship.
Speaker #6: So we see it as kind of a two-prong. One, you have to grow the number of accounts, and you have to grow the number of relationships, and then you also have to grow those relationships within it, within the relationship.
Nicole Stokes: One, you have to, to grow the number of accounts, and you have to grow the number of relationships, and then you also have to grow those relationships within each other-within it, within the relationship. So yes, it's absolutely both of those.
One, you have to, to grow the number of accounts, and you have to grow the number of relationships, and then you also have to grow those relationships within each other-within it, within the relationship. So yes, it's absolutely both of those.
Speaker #6: So yes, it's
Speaker #6: Absolutely both of those. And Chris, just—
Palmer Proctor: And, Chris, just to add a further comment, our incentive plans are geared around that, too, and motivate that type of behavior. And one of the things I think that a lot of folks in the industry, with the exception of a few, overlook, is a lot of the value of the consumer accounts. And while they may not add as much in the way of total deposits and funding, what they do add are meaningful, sticky, stable relationships. So we have not lost focus of the consumer, and we're able to leverage our branches in the retail land extremely well, and we'll continue to do that. And then a lot of the additive, too, with us, is the investments we've made in treasury management over the last several years. A lot of people talk about, you know, lenders that they've hired.
Palmer Proctor: And, Chris, just to add a further comment, our incentive plans are geared around that, too, and motivate that type of behavior. And one of the things I think that a lot of folks in the industry, with the exception of a few, overlook, is a lot of the value of the consumer accounts. And while they may not add as much in the way of total deposits and funding, what they do add are meaningful, sticky, stable relationships. So we have not lost focus of the consumer, and we're able to leverage our branches in the retail land extremely well, and we'll continue to do that. And then a lot of the additive, too, with us, is the investments we've made in treasury management over the last several years.
Speaker #3: To add a further comment to that, too, and motivate that type of behavior. And one of the things I think that a lot of folks in the industry, with the exception of a few, overlook is a lot of the value of the consumer accounts.
Speaker #3: And while they may not add as much in the way of total deposits and funding, what they do add are meaningful, sticky, stable relationships.
Speaker #3: So we have not lost focus of the consumer. And we're able to leverage our branches and the retail land extremely well. And we'll continue to do that.
Speaker #3: And then a lot of the additive, too, with us is the investments we've made in treasury management over the last several years. A lot of people talk about lenders that they've hired.
A lot of people talk about, you know, lenders that they've hired. We like to focus on the deposit side and on the treasury side equally, if not more. And so I think that's been a big driver for us as we look forward into opportunities for good commercial deposit growth.
Palmer Proctor: We like to focus on the deposit side and on the treasury side equally, if not more. And so I think that's been a big driver for us as we look forward into opportunities for good commercial deposit growth.
Speaker #3: We like to focus on the deposits and on the treasury side equally, if not more. And so, I think that's been a big driver for us as we look forward into opportunities for good commercial deposit.
Speaker #3: growth.
Speaker #9: Is the
Christopher Marinac: ... Is the treasury success gonna show up in just the now accounts, or will it show up in money market, to some extent, too?
Christopher Marinac: ... Is the treasury success gonna show up in just the now accounts, or will it show up in money market, to some extent, too?
Speaker #9: Treasury success— is that going to show up in just the NOW accounts, or will it show up in money market to some extent too?
Speaker #4: Both. You're right. Both. I mean, you've got your operating payroll accounts, and then obviously any excess funds will be swept into a money market-type of account.
Palmer Proctor: Both. You're right, both. I mean, you got your operating payroll accounts, and then, obviously, any excess funds will be swept into a money market type of account or higher interest-bearing account.
Palmer Proctor: Both. You're right, both. I mean, you got your operating payroll accounts, and then, obviously, any excess funds will be swept into a money market type of account or higher interest-bearing account.
Speaker #4: Or higher
Speaker #4: interest bearing account. And then
Speaker #9: You've had success dropping the cost of funds, as we see every quarter here. And I'm just tweaking deposit pricing to get more dollars in and still keep your margin where you are trying to.
Speaker #9: You’ve had success dropping the cost of funds, as we see every quarter here. And I’m just—do you tweak deposit pricing to get more dollars in and still keep your margin where you are trying to manage?
Christopher Marinac: And then you've had success dropping the cost of funds, as we see every quarter here. And I'm just curious, do you have any opportunity to kind of tweak deposit pricing to get more dollars in and still keep your margin where you are trying to manage?
Christopher Marinac: And then you've had success dropping the cost of funds, as we see every quarter here. And I'm just curious, do you have any opportunity to kind of tweak deposit pricing to get more dollars in and still keep your margin where you are trying to manage?
Speaker #4: It's becoming more and more competitive. Obviously, when you look out there at the rates that are being offered by banks and non-banks, and you compound that with the fact we've got a lot of new entrants coming in with splashy rates.
Palmer Proctor: It's becoming more and more competitive. Obviously, you know, when you look out there at the rates that are being offered by, you know, banks and non-banks, and you compound that with the fact we've got a lot of new entrants coming in with splashy rates. But most of those are gonna be at your, those are gonna be more your, I call it, hot money, where people are just chasing the yield. What we try and stay focused on is garnering opportunities to bring in more core relationships and less on that. But that doesn't mean, at some point, we don't have to participate and have to be competitive, but our focus remains on the relationship side.
Palmer Proctor: It's becoming more and more competitive. Obviously, you know, when you look out there at the rates that are being offered by, you know, banks and non-banks, and you compound that with the fact we've got a lot of new entrants coming in with splashy rates. But most of those are gonna be at your, those are gonna be more your, I call it, hot money, where people are just chasing the yield. What we try and stay focused on is garnering opportunities to bring in more core relationships and less on that.
Speaker #4: But most of those are going to be at your—those are going to be more your, I call it, hot money, where people are just chasing the yield.
Speaker #4: What we try and stay focused on is garnering opportunities to bring in more core relationships, and less on that. But that doesn't mean at some point we don't have to participate and have to be competitive.
But that doesn't mean, at some point, we don't have to participate and have to be competitive, but our focus remains on the relationship side. And then I'd rather pay an existing relationship customer a higher rate on their CD than just lure people in with high-rate funding.
Speaker #4: But our focus remains on the relationship side. And then I'd rather pay an existing relationship customer a higher rate on their CD than just lure people in with high-rate funding.
Palmer Proctor: And then I'd rather pay an existing relationship customer a higher rate on their CD than just lure people in with high-rate funding.
Speaker #9: Got it. Thank you both for the color this morning. We appreciate it.
Christopher Marinac: Got it. Thank you both for the color this morning. We appreciate it.
Christopher Marinac: Got it. Thank you both for the color this morning. We appreciate it.
Speaker #4: You bet.
Palmer Proctor: You bet.
Palmer Proctor: You bet.
Speaker #2: This concludes our question-and-answer session. I would now like to turn the conference back over to Palmer Proctor, CEO, for any closing remarks.
Operator: This concludes our question and answer session. I would now like to turn the conference back over to Palmer Proctor, CEO, for any closing remarks.
Operator: This concludes our question and answer session. I would now like to turn the conference back over to Palmer Proctor, CEO, for any closing remarks.
Speaker #4: Great, thank you, Megan. And finally, I'd also like to thank all of our Ameris teammates for their contributions to a record year in 2025.
Palmer Proctor: Great. Thank you, Megan. And finally, I'd like to also thank all of our Ameris teammates for their contributions to a record year in 2025. I'd also like to thank everybody again for listening to our Q4 and full year 2025 earnings call. We're proud of another solid quarter of performance, and we're really looking forward to 2026. And please know that we remain focused on core profitability, organic growth, and enhancing value through our core deposit base and tangible book value growth. We appreciate your continued interest in Ameris Bank. Thank you.
Palmer Proctor: Great. Thank you, Megan. And finally, I'd like to also thank all of our Ameris teammates for their contributions to a record year in 2025. I'd also like to thank everybody again for listening to our Q4 and full year 2025 earnings call. We're proud of another solid quarter of performance, and we're really looking forward to 2026. And please know that we remain focused on core profitability, organic growth, and enhancing value through our core deposit base and tangible book value growth. We appreciate your continued interest in Ameris Bank. Thank you.
Speaker #4: I'd also like to thank everybody again for listening to our fourth quarter and full year 2025 earnings call. We're proud of another solid quarter of performance, and we really look forward to 2026.
Speaker #4: And please note that we remain focused on profitability: organic growth and enhancing core value through our core deposit base and tangible book value growth.
Speaker #4: We appreciate your continued interest in Ameris Bank. Thank you.
Speaker #4: You. The conference is now concluded.
Operator: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.
Operator: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.
