Q2 2026 United Community Banks Inc Earnings Call

July 21, 2026

Speaker #1: Good morning, and welcome to United Community Banks' second quarter 2026 earnings call. Hosting the call today is Chairman and Chief Executive Officer, Lynn Harton.

[Company Representative] (United Community Banks): Good morning, welcome to United Community Banks' Q2 2026 earnings call. Hosting the call today are Chairman and Chief Executive Officer, Lynn Harton; Chief Financial Officer, Jefferson Harralson; Chief Banking Officer, Rich Bradshaw; and Chief Risk Officer, Rob Edwards. United's presentation today includes references to operating earnings, pre-tax, pre-provision earnings, and other non-GAAP financial information. For these non-GAAP financial measures, United has provided a reconciliation to the corresponding GAAP financial measure in the Financial Highlights section of the earnings release, as well as at the end of the investor presentation. Both are included on the website at ucbi.com. Copies of the Q2's earnings release and investor presentation were filed this morning on Form 8-K with the SEC, a replay of this call will be available in the Investor Relations section of the company's website at ucbi.com.

Operator: Good morning, welcome to United Community Banks' Q2 2026 Earnings Call. Hosting the call today are Chairman and Chief Executive Officer, Lynn Harton; Chief Financial Officer, Jefferson Harralson; Chief Banking Officer, Rich Bradshaw; and Chief Risk Officer, Rob Edwards. United's presentation today includes references to operating earnings, pre-tax, pre-provision earnings, and other non-GAAP financial information.

Speaker #1: Chief Financial Officer Jefferson Harralson, Chief Banking Officer Rich Bradshaw, and Chief Risk Officer Rob Edwards. United's presentation today includes references to operating earnings, pre-tax pre-credit earnings, and other non-GAAP financial information.

Speaker #1: For these non-GAAP financial measures, United has provided a reconciliation to the corresponding GAAP financial measure in the financial highlights section of the earnings release, as well as at the end of the investor presentation.

Operator: For these non-GAAP financial measures, United has provided a reconciliation to the corresponding GAAP financial measure in the Financial Highlights section of the earnings release, as well as at the end of the investor presentation. Both are included on the website at ucbi.com. Copies of the Q2's earnings release and investor presentation were filed this morning on Form 8-K with the SEC, a replay of this call will be available in the Investor Relations section of the company's website at ucbi.com.

Speaker #1: Both are included on the website at ucbi.com. Copies of the second quarter's earnings release and investor presentation were filed this morning on Form 8-K with the SEC, and a replay of this call will be available in the investor relations section of the company's website at ucbi.com.

Speaker #1: Please be aware that during this call, forward-looking statements may be made by representatives of United. Any forward-looking statement should be considered in light of the risks and uncertainties described on pages 5 and 6 of the company's 2025 Form 10-K, as well as other information provided by the company in its filings with the SEC and included on its website.

[Company Representative] (United Community Banks): Please be aware that during this call, forward-looking statements may be made by representatives of United. Any forward-looking statements should be considered in light of risks and uncertainties described on page five and six of the company's 2025 Form 10-K, as well as other information provided by the company in its filings with the SEC and included on its website. At this time, I will turn the call over to Lynn Harton.

Operator: Please be aware that during this call, forward-looking statements may be made by representatives of United. Any forward-looking statements should be considered in light of risks and uncertainties described on page five and six of the company's 2025 Form 10-K, as well as other information provided by the company in its filings with the SEC and included on its website. At this time, I will turn the call over to Lynn Harton.

Speaker #1: At this time, I will turn the call over to Lynn Harton.

Speaker #2: Good morning, and thank you for joining our call today. This was a great quarter with solid results and progress on our strategic goals. We had a large non-operating item from the Novitas reserve release this quarter, which Jefferson will cover in more detail later.

H. Lynn Harton: Good morning, thank you for joining our call today. This was a great quarter with solid results and progress on our strategic goals. We had a large non-operating item from the Navitas reserve release this quarter, which Jefferson will cover in more detail later. For now, leaving that aside, I will focus on our operating results. On that basis, EPS of $0.71 per share was up 8% over last year. Total revenue was up 7% over last year. Our net interest margins reached 3.68%, up 18 basis points over last year, and up 3 basis points from last quarter. Credit results were solid, with bank-only net charge-offs of 9 basis points and total net charge-offs of only 16 basis points. Past dues were very low at only 11 basis points, and special mention and substandard accruing loans were at the lowest level in several quarters at only 2.5%.

Lynn Harton: Good morning, thank you for joining our call today. This was a great quarter with solid results and progress on our strategic goals. We had a large non-operating item from the Navitas reserve release this quarter, which Jefferson will cover in more detail later. For now, leaving that aside, I will focus on our operating results.

Speaker #2: For now, leaving that aside, I will focus on our operating results. On that basis, EPS of 71 cents per share was up 8% over last year.

Lynn Harton: On that basis, EPS of $0.71 per share was up 8% over last year. Total revenue was up 7% over last year. Our net interest margins reached 3.68%, up 18 basis points over last year, and up 3 basis points from last quarter. Credit results were solid, with bank-only net charge-offs of 9 basis points and total net charge-offs of only 16 basis points. Past dues were very low at only 11 basis points, and special mention and substandard accruing loans were at the lowest level in several quarters at only 2.5%.

Speaker #2: Total revenue was up 7% over last year. Our net interest margins reached 3.68%, up 18 basis points over last year, and up 3 basis points from last quarter.

Speaker #2: Credit results were solid, with bank-only net charge-offs of 9 basis points and total net charge-offs of only 16 basis points. Past dues were very low at only 11 basis points, and special mention and substandard accruing loans were at the lowest level in several quarters, at only 2.5%.

Speaker #2: Loan growth reached 6.8% annualized for the quarter, more importantly, organic loan growth, excluding Novitas, was the strongest it has been in some time, reaching 6.4% annualized for the quarter.

H. Lynn Harton: Loan growth reached 6.8% annualized for the quarter. More importantly, organic loan growth, excluding Navitas, was the strongest it has been in some time, reaching 6.4% annualized for the quarter. For comparison, it was 4.3% for the year of 2025 and 3.9% annualized for Q1 of this year. This is due to our investment in hiring new producers. When we decided early last year that it was time to sell Navitas and refocus on our core franchise, we spent time developing a playbook and strategy to put the same effort and attention we have paid to integrating merged teammates into hiring new revenue producers. We began executing that plan in Q3 of last year and have seen net expansion of 17% in producers since that time. We're pleased with this execution and look forward to continuing strong growth as a result.

Lynn Harton: Loan growth reached 6.8% annualized for the quarter. More importantly, organic loan growth, excluding Navitas, was the strongest it has been in some time, reaching 6.4% annualized for the quarter. For comparison, it was 4.3% for the year of 2025 and 3.9% annualized for Q1 of this year. This is due to our investment in hiring new producers.

Speaker #2: For comparison, it was 4.3% for the year of 2025 and 3.9% annualized for the first quarter of this year. This is due to our investment in hiring new producers.

Speaker #2: When we decided early last year that it was time to sell Novitas, and refocus on our core franchise, we spent time developing a playbook and strategy to put the same effort and attention we have paid to integrating merged teammates into hiring new revenue producers.

Lynn Harton: When we decided early last year that it was time to sell Navitas and refocus on our core franchise, we spent time developing a playbook and strategy to put the same effort and attention we have paid to integrating merged teammates into hiring new revenue producers. We began executing that plan in Q3 of last year and have seen net expansion of 17% in producers since that time. We're pleased with this execution and look forward to continuing strong growth as a result.

Speaker #2: We began executing that plan in the third quarter of last year, and have seen net expansion of 17% in producers since that time. We're pleased with this execution, and look forward to continuing strong growth as a result.

Speaker #2: Our operating return on assets was 122 basis points. And our operating return on tangible common equity was 13%. Both essentially equal to last quarter, even with elevated hiring costs and a notable one-time expense item.

H. Lynn Harton: Our operating return on assets was 122 basis points, and our operating return on tangible common equity was 13%, both essentially equal to last quarter, even with elevated hiring costs and a notable one-time expense item. We continue to be excited about bringing Peach State into the United family. When we put the two teams together, we will have the best bankers and the top deposit market share in one of the fastest-growing counties in the Southeast. Everything is on track for a close early in Q3 as planned. Capital levels remain high. Even though we had extended blackout periods resulting from the Navitas and Peach State announcements, we continue to have repurchase authorization remaining that is sufficient to retire the shares to be issued for the acquisition of Peach State, which is our intention.

Lynn Harton: Our operating return on assets was 122 basis points, and our operating return on tangible common equity was 13%, both essentially equal to last quarter, even with elevated hiring costs and a notable one-time expense item. We continue to be excited about bringing Peach State into the United family. When we put the two teams together, we will have the best bankers and the top deposit market share in one of the fastest-growing counties in the Southeast.

Speaker #2: We continue to be excited about bringing Peach State into the United family. When we put the two teams together, we will have the best bankers and the top deposit market share in one of the fastest-growing counties in the Southeast.

Speaker #2: Everything is on track for a close early in the third quarter as planned. Capital levels remain high, and even though we had extended blackout periods, resulting from the Novitas and Peach State announcements, we continue to have repurchase authorization remaining that is sufficient to retire the shares to be issued for the acquisition of Peach State, which is our intention.

Lynn Harton: Everything is on track for a close early in Q3 as planned. Capital levels remain high. Even though we had extended blackout periods resulting from the Navitas and Peach State announcements, we continue to have repurchase authorization remaining that is sufficient to retire the shares to be issued for the acquisition of Peach State, which is our intention. I'll now turn it to Jefferson to cover our Q2 performance in more detail.

Speaker #2: I'll now turn it to Jefferson to cover our second-quarter performance in more detail.

H. Lynn Harton: I'll now turn it to Jefferson to cover our Q2 performance in more detail.

Speaker #1: Thank you, Lynn, and good morning to everyone. I will start on page 4 and talk about some of the details of the quarter. We recorded GAAP results of $0.95 per share.

Jefferson Harralson: Thank you, Lynn, and good morning to everyone. I will start on page four and talk about some of the details of the quarter. We recorded GAAP results of $0.95 per share that benefited from a large non-operating item. Specifically, we released our Navitas loan loss reserve as we reclassified those loans to held for sale. This added $0.25 to our GAAP earnings in the quarter. On page four, we also highlight a $4.5 million notable operating expense that we do not expect to recur. In Q2, we settled with the state of California to obtain a lender's license for Navitas. Navitas had previously held a California license but let it expire after we bought them in 2018 because we believed it was no longer required to have one under United ownership as a bank subsidiary.

Speaker #1: That benefited from a large non-operating item. Specifically, we released our Novitas loan loss reserve as we reclassified those loans to held for sale. This added $0.25 to our GAAP earnings in the quarter.

Speaker #1: On page 4, we also highlight a 4.5 million dollar notable operating expense that we do not expect to recur. In the second quarter, we settled with the state of California to obtain a lender's license for Novitas.

Jefferson Harralson: On page four, we also highlight a $4.5 million notable operating expense that we do not expect to recur. In Q2, we settled with the state of California to obtain a lender's license for Navitas. Navitas had previously held a California license but let it expire after we bought them in 2018 because we believed it was no longer required to have one under United ownership as a bank subsidiary.

Speaker #1: Novitas had previously held a California license, but let it expire after we bought them in 2018 because we believed it was no longer required to have one under United ownership as a bank subsidiary.

Speaker #1: That said, we settled with the California Department of Financial Protection and Innovation, the DFPI, and the $4.5 million represents our cost. About 75% of the $4.5 million notable item was not tax deductible.

Jefferson Harralson: That said, we settled with the California Department of Financial Protection and Innovation, the DFPI, and the $4.5 million represents our cost. About 75% of the $4.5 million notable item was not tax-deductible. Including the associated legal fees and adjusting for the tax impact, we estimate that notable items negatively impacted Q2 by $0.035. I will move on to page six to talk about the deposit results. On an end-of-period basis, our customer deposits declined by $295 million, with two-thirds of the decline coming from expected seasonal public funds outflows. On an average basis, excluding public funds, our customer deposits grew $169 million or 3.3% annualized. We were also very pleased that our cost of deposits remained relatively flat, improving by 1 basis point in Q2.

Speaker #1: Including the associated legal fees and adjusting for the tax impact, we estimate that notable items negatively impacted Q2 by 3.5 cents. I will move on to page 6 to talk about the deposit results.

Jefferson Harralson: I will move on to page six to talk about the deposit results. On an end-of-period basis, our customer deposits declined by $295 million, with two-thirds of the decline coming from expected seasonal public funds outflows. On an average basis, excluding public funds, our customer deposits grew $169 million or 3.3% annualized. We were also very pleased that our cost of deposits remained relatively flat, improving by 1 basis point in Q2.

Speaker #1: On an end-of-period basis, our customer deposits declined by $295 million, with two-thirds of the decline coming from expected seasonal public funds outflows. On an average basis, excluding public funds, our customer deposits grew $169 million, or 3.3% annualized.

Speaker #1: We were also very pleased that our cost of deposits remained relatively flat, improving by 1 basis point in the second quarter. On page 7, we turn to the loan portfolio.

Jefferson Harralson: On page seven, we turn to the loan portfolio where our loan growth accelerated to a 6.8% annualized pace. Excluding Navitas, we grew at a 6.4% annualized pace. Similar to past quarters, we saw strong growth in the HELOC and C&I categories, which continue to be our focus for growth. We have included a new section at the bottom of the page showing what our new loan mix is ex Navitas, which is still diversified and C&I heavy. Turning to page eight, where we highlight some of the strengths of our balance sheet. We believe that our balance sheet is in good position from a liquidity and capital standpoint to be ready for any economic volatility. We show that our loan-to-deposit ratio, excluding Navitas, came in at 76%, up from 74%. Our CET1 ratio was relatively flat at 13.5% and remains a source of strength for the bank.

Speaker #1: Our loan growth accelerated to a 6.8% annualized pace. Excluding Novitas, we grew at a 6.4% annualized pace. Similar to past quarters, we saw strong growth in the HELOC and C&I categories, which continued to be our focus for growth.

Speaker #1: We have included a new section at the bottom of the page showing what our new loan mix is, excluding Novitas, which is still diversified and CNI-heavy.

Speaker #1: Turning to page 8, where we highlight some of the strengths of our balance sheet, we believe that our balance sheet is in good position from a liquidity and capital standpoint to be ready for any economic volatility.

Jefferson Harralson: Turning to page eight, where we highlight some of the strengths of our balance sheet. We believe that our balance sheet is in good position from a liquidity and capital standpoint to be ready for any economic volatility. We show that our loan-to-deposit ratio, excluding Navitas, came in at 76%, up from 74%. Our CET1 ratio was relatively flat at 13.5% and remains a source of strength for the bank.

Speaker #1: We show that our loan-to-deposit ratio, excluding Novitas, came in at 76%, up from 74%. Our CET-1 ratio was relatively flat at 13.5%, and remains a source of strength for the bank.

Speaker #1: On page 9, we look at capital and more detail. As I mentioned, our CET-1 ratio was 13.5%, and our TCE was also flat at just under 10%.

Jefferson Harralson: On page nine, we look at capital in more detail. As I mentioned, our CET1 ratio was 13.5%, and our TCE was also flat at just under 10%. Moving on to spread income on page 10. Spread income grew 14% annualized due to the combination of 6.8% loan growth, 6% average earning asset growth, and the benefit of the extra day. Spread income grew 7% on a year-over-year basis. Our net interest margin increased 3 basis points to 3.68% compared to last quarter and was up 18 basis points compared to last year. The Q2 is the sixth quarter in a row of margin expansion. Moving to page 11. Non-interest income was $38.4 million in the quarter, which was relatively flat as compared to last quarter when Q1 is adjusted for the $5.2 million gain on an interest rate cap that we sold last quarter.

Speaker #1: Moving on to spread income on page 10. Spread income grew 14% annualized due to the combination of 6.8% loan growth, 6% average earning asset growth, and the benefit of the extra day.

Speaker #1: Spread income grew 7% on a year-over-year basis. Our net interest margin increased 3 basis points to 3.68% compared to last quarter, and was up 18 basis points compared to last year.

Jefferson Harralson: Our net interest margin increased 3 basis points to 3.68% compared to last quarter and was up 18 basis points compared to last year. The Q2 is the sixth quarter in a row of margin expansion. Moving to page 11. Non-interest income was $38.4 million in the quarter, which was relatively flat as compared to last quarter when Q1 is adjusted for the $5.2 million gain on an interest rate cap that we sold last quarter.

Speaker #1: In the second quarter, this is the sixth quarter in a row of margin expansion. Moving to page 11, non-interest income was $38.4 million in the quarter, which was relatively flat as compared to last quarter, when Q1 is adjusted for the $5.2 million gain on an interest rate cap that we sold last quarter.

Speaker #1: Our operating expenses were $159.9 million in the second quarter. Excluding the California lender license issue that I described earlier, non-interest expenses grew by $2.9 million as compared to the first quarter.

Jefferson Harralson: Our operating expenses were $159.9 million in Q2. Excluding the California lender license issue that I described earlier, non-interest expenses grew by $2.9 million as compared to Q1, of which our annual merit increase contributed $1.8 million. The cost of new revenue producer hiring comprised the remaining $1 million of expense growth. Excluding the license issue, our efficiency ratio improved slightly to around 55%. We added a new page on page 13, where we talk about our significant hiring since 30 September 2025. Since then, we have added 37 net new producers, of which about half are commercial lenders. This increases our overall sales force by about 17%. We are encouraged that we are starting to see the balance sheet growth from this initiative. This was a factor in our increased loan growth this quarter. Moving to credit quality on page 14.

Speaker #1: Of which, our annual merit increase contributed $1.8 million. The cost of new revenue producer hiring comprised the remaining $1 million of expense growth.

Speaker #1: Excluding the license issue, our efficiency ratio improved slightly to around 55%. We added a new page—page 13—where we talk about our significant hiring since September 30, 2025.

Jefferson Harralson: We added a new page on page 13, where we talk about our significant hiring since 30 September 2025. Since then, we have added 37 net new producers, of which about half are commercial lenders. This increases our overall sales force by about 17%. We are encouraged that we are starting to see the balance sheet growth from this initiative. This was a factor in our increased loan growth this quarter. Moving to credit quality on page 14.

Speaker #1: Since then, we have added 37 net new producers of which about half are commercial lenders, this increases our overall sales force by about 17%.

Speaker #1: We are encouraged that we are starting to see the balance sheet growth from this initiative and this was a factor in our increased loan growth this quarter.

Speaker #1: Moving to credit quality, on page 14, net charge-offs were only 16 basis points in the quarter, and only 9 basis points on a bank-only basis.

Jefferson Harralson: Net charge-offs were only 16 basis points in the quarter and only nine basis points on a bank-only basis. Credit was stable with essentially flat NPAs and nice improvements in past dues, special mention, and substandard accruing loans. On page 15, we show the allowance for credit losses. Our $29.8 million net reserve release included a $38.5 million Navitas reserve release as we reclassified those loans to held for sale as a result of the pending sale of Navitas. On a bank-only basis, we had an $8.7 million provision, which more than covered our $4.2 million in bank net charge-offs. With the Navitas release, our allowance for credit losses moved down to 1.04% of loans. This decrease reflects the lower potential loss content and variability of losses with the sale of the Navitas portfolio. With that, I'll pass it back to Len.

Speaker #1: Credit was stable, with essentially flat NPAs and nice improvements in past dues, special mention, and substandard accruing loans. On page 15, we show the allowance for credit losses. Our $29.8 million net reserve release included a $38.5 million Novitas reserve release, as we reclassified those loans to held-for-sale as a result of the pending sale of Novitas.

Speaker #1: On a bank-only basis, we had an 8.7 million dollar provision which more than covered our 4.2 million dollars in bank net charge-offs. With the Novitas release, our allowance for credit losses moved down to 1.04% of loans, this decrease reflects the lower potential loss content and variability of losses with the sale of the Novitas portfolio.

Jefferson Harralson: On a bank-only basis, we had an $8.7 million provision, which more than covered our $4.2 million in bank net charge-offs. With the Navitas release, our allowance for credit losses moved down to 1.04% of loans. This decrease reflects the lower potential loss content and variability of losses with the sale of the Navitas portfolio. With that, I'll pass it back to Len.

Speaker #1: With that, I'll pass it back to Lynn.

Speaker #2: Thank you, Jefferson. Given that this will be the last quarterly call before the sale is completed, I'd like to take this opportunity to thank the Novitas team for being a valuable part of United for the past 8 years.

H. Lynn Harton: Thank you, Jefferson. Given that this will be the last quarterly call before the sale is completed, I'd like to take this opportunity to thank the Navitas team for being a valuable part of United for the past eight years. It has been a pleasure working with all of you. You've made a great contribution to our growth and success. I wish you continued success in your next chapter. I look forward to remaining in touch. I'd like to now open the call to questions.

Lynn Harton: Thank you, Jefferson. Given that this will be the last quarterly call before the sale is completed, I'd like to take this opportunity to thank the Navitas team for being a valuable part of United for the past eight years. It has been a pleasure working with all of you. You've made a great contribution to our growth and success. I wish you continued success in your next chapter. I look forward to remaining in touch. I'd like to now open the call to questions.

Speaker #2: It has been a pleasure working with all of you, and you have made a great contribution to our growth and success. I wish you continued success in your next chapter, and I look forward to remaining in touch.

Speaker #2: I'd like to now open the call to questions.

Speaker #3: At this time, we will begin the question and answer session. To ask a question, you may press star, then 1, using a touch-tone telephone.

Operator: At this time, we'll begin the question and answer session. To ask a question, you may press star and then one using a touch-tone telephone. To withdraw your questions, you may press star and two. If you are using a speakerphone, we do ask that you please pick up the handset prior to pressing the keys to ensure the best sound quality. Once again, that is star and then one to join the question queue. Our first question today comes from Stephen Scouten from Piper Sandler. Please go ahead with your question.

Speaker #3: To withdraw your questions, you may press star and 2. If you are using a speakerphone, we do ask that you please pick up the handset prior to pressing the keys to ensure the best sound quality.

Speaker #3: Once again, that is star, and then 1 to join the question queue. Our first question today comes from Stephen Scouton from Piper Sandler. Please go ahead with your question.

Speaker #4: Yeah, thanks. Good morning, everyone. I guess maybe first question, I hope I didn't miss it in your comments, Jefferson, but obviously 6 consecutive quarters and then expansion.

Stephen Scouten: Yeah, thanks. Good morning, everyone. Maybe first question, I hope I didn't miss it in your comments, Jefferson, obviously six consecutive quarters in NIM expansion. Do you feel like we can get to seven here, or is the deposit cost kind of stabilizing here? Does that negate that ability moving forward?

Speaker #4: Do you feel like we can get to 7 here, or is the deposit cost kind of stabilizing here? Does that negate that ability moving forward?

Speaker #1: Thanks, Stephen. That's a great question. Talk about the go-forward with the margin, and I'll throw in there what we might look like ex-Novitas.

Jefferson Harralson: Hey, Stephen. That's a great question. Talk about the go forward with the margin, I'll throw in there what we might look like ex Navitas. On a static basis, selling Navitas and reinvesting the proceeds at four and a quarter moves our margin down by about 30 basis points. Dynamically, and I think where your question was going, the underlying margin should be widening because we will be adding loans at an increasing pace in the 6% range. Our reinvestment will end up being higher than that four and a quarter percent. We still have the back book of loans and securities that should provide some tailwind. We also will be paying down with the proceeds of Navitas borrowings, that shrinks the balance sheet a little bit and helps the margin.

Speaker #1: So on a static basis, selling Novitas and reinvesting the proceeds, at 4 and a quarter, moves our margin down by about 30 basis points.

Speaker #1: But dynamically—and I think where your question was going—the underlying margin should be widening, because we will be adding loans at an increasing pace.

Speaker #1: In the 6% range, so our reinvestment will end up being higher than that 4.25%. We still have the back book of loans and securities that should provide some tailwind, and we also will be paying down with the proceeds of Novitas borrowings, and that shrinks the balance sheet a little bit and helps the margin.

Jefferson Harralson: Our reinvestment will end up being higher than that four and a quarter percent. We still have the back book of loans and securities that should provide some tailwind. We also will be paying down with the proceeds of Navitas borrowings, that shrinks the balance sheet a little bit and helps the margin.

Speaker #1: So Q3 is difficult because it hinges on the timing of the Novitas sale, but I believe the fourth quarter assuming the third quarter Novitas sale is down maybe 20 to 25 basis points if you assume 30 basis points down on a static basis and that underlying widening margin should offset that over two quarters.

Jefferson Harralson: Q3 is difficult because it hinges on the timing of the Navitas sale. I believe the Q4, assuming the Q3 Navitas sale is down maybe 20 to 25 basis points. If you assume 30 basis points down on a static basis and that underlying widening margin should offset that over 2 quarters. The Q3 is somewhere in between that down 20 to 25 and where we are today.

Speaker #1: And the third quarter is somewhere in between that down 20 to 25 and where we are today.

Speaker #4: Okay, got it. Yeah, that makes sense. And just around the time deposits specifically, I think in the deck you noted 3-month repricings, maybe coming off at 3.09%, and I think new CDs were coming on at 3.2.

Stephen Scouten: Okay. Got it. That makes sense. Just around the time deposits specifically, I think in the deck you noted 3-month repricings maybe coming off at 3.09%, I think new CDs were coming on at 3.2. Could we see CD costs going higher from here, or is the liquidity from Navitas and paying down other higher cost funds, does that allow you to kind of manage that a little bit more than just those numbers would suggest?

Speaker #4: So could we see CD costs going higher from here, or is the liquidity from Novitas and paying down other higher-cost funds, does that allow you to kind of manage that a little bit more than just those numbers would suggest?

Speaker #1: We have a few strategies in the CD book. One is that 30% is down from the 50% maturities that we've been having, so we've been extending this book a little bit, which has the effect of raising the CDs a little bit.

Jefferson Harralson: We have a few strategies in the CD book. One is that 30% is down from the 50% maturities that we've been having. We've been extending this book a little bit, which has the effect of raising the CDs a little bit. We do think we will have stronger loan growth in H2. The competition is a little stronger for deposits. Now we will have something that will help us, which is a lot of cash to, and a big securities portfolio to fund some of our loan growth. If you add all that together, I think our cost of deposits will drift slightly higher in H2.

Speaker #1: We do think we will have stronger loan growth in the second half, the competition is a little stronger for deposits. Now, we will have something that will help us, which is a lot of cash to and a lot of big securities portfolio to fund some of our loan growth.

Speaker #1: But if you add all that together, I think our cost of deposits will drift slightly higher in the back half.

Speaker #4: Okay, great. And maybe just last thing for me, curious, we seem to be seeing an uptick in smaller bank M&A these days, kind of sub $5 billion in asset banks.

Stephen Scouten: Okay, great. Maybe just last thing for me. Curious, we seem to be seeing an uptick in smaller bank M&A these days, kind of sub $5 billion in asset banks. What's kind of the conversation dynamics like? Do you feel like some of these potential smaller bank sellers are more receptive? Just kind of any feel for what conversations are looking like and your appetite once you get beyond Peach State?

Speaker #4: What are the conversation dynamics like? Do you feel like some of these potential smaller bank sellers are more receptive? And do you have any feel for what those conversations are looking like and your appetite once you get beyond Peach State?

Speaker #1: Hey, Stephen, this is Lynn. Yeah, I would say they're very active conversations in that smaller bank, call it, billion and a half and less size.

H. Lynn Harton: Hey, Stephen, this is Len. Yeah, I would say they're very active conversations in that smaller bank, call it 1.5 billion and less size. Yeah, I would expect to see more activity once Peach State is completed for the rest of the year.

Lynn Harton: Hey, Stephen, this is Len. Yeah, I would say they're very active conversations in that smaller bank, call it 1.5 billion and less size. Yeah, I would expect to see more activity once Peach State is completed for the rest of the year.

Speaker #1: So, yeah, I would expect to see more activity once Peach State is completed for the rest of the year.

Speaker #4: Great. Thanks for the call. I appreciate everyone's time this morning.

Stephen Scouten: Great. Thanks for the call. Appreciate the time this morning, everyone.

Speaker #1: All right. Thanks, Stephen.

H. Lynn Harton: Thanks, Stephen.

Lynn Harton: Thanks, Stephen.

Jefferson Harralson: Thanks, Stephen.

Speaker #5: Thanks, Stephen.

Speaker #3: Our next question comes from Jacob Morton from Stevens. Please go ahead with your question.

Operator: Our next question comes from Jacob Morton from Stephens. Please go ahead with your question.

Jacob Morton: Hey, good morning. This is Jacob Morton on for Russell Gunther. I just want to start out with, I hear you on the hiring. I'm wondering historically, how much incremental annual loan production does an experienced banker contribute once fully ramped up? As a follow-up to that, what is your level of conviction on loan growth? I hear you on the 6%, but I'm wondering what specific asset classes are you expecting the growth to come from and which geographies in your footprint do you expect to produce the most? Thank you.

Jake Morton: Hey, good morning. This is Jacob Morton on for Russell Gunther. I just want to start out with, I hear you on the hiring. I'm wondering historically, how much incremental annual loan production does an experienced banker contribute once fully ramped up? As a follow-up to that, what is your level of conviction on loan growth? I hear you on the 6%, but I'm wondering what specific asset classes are you expecting the growth to come from and which geographies in your footprint do you expect to produce the most? Thank you.

Speaker #4: Hey, good morning. This is Jacob Morton on for Russell Gunther. I just want to start out with—I hear you on the hiring. I'm wondering, historically, how much incremental annual loan production does an experienced banker contribute once fully ramped up?

Speaker #4: And as a follow-up to that, what is your level of conviction on loan growth? I hear you on the 6%, but I'm wondering what specific asset classes are you expecting the growth to come from, and which geographies in your footprint do you expect to produce the most?

Speaker #4: Thank you.

Speaker #1: Good morning, Jacob. This is Rich. In terms of the experience that we're looking for in the hiring side, 30 million funded would be where I would say that person is.

H. Lynn Harton: Good morning, Jacob. This is Rich. In terms of the experience that we're looking for in the hiring side

Rich Bradshaw: Good morning, Jacob. This is Rich. In terms of the experience that we're looking for in the hiring side 30 million funded would be where I would say that person is. We're going after the 20 years experience. We want them to have a portfolio that they produce greater than $100 million. We know them in the marketplace. Just to be clear, we're using no recruiters in our hiring, and culture makes a big difference.

Rich Bradshaw: 30 million funded would be where I would say that person is. We're going after the 20 years experience. We want them to have a portfolio that they produce greater than $100 million. We know them in the marketplace. Just to be clear, we're using no recruiters in our hiring, and culture makes a big difference. In terms of the forecast, in terms of Q3, we're looking at the 7% range ex Navitas. In terms of next year, I'm even more confident of obtaining upper single digit next year, particularly based on the hiring that has occurred and the pace is going to slow down the second half of the year, but we still have ongoing discussions. In July, we've hired five more that are on payroll already. We're feeling pretty good.

Speaker #1: We're going after the 20 years' experience, where we want them to have a portfolio that they've produced greater than $100 million. We know them in the marketplace.

Speaker #1: Just to be clear, we're using no recruiters in our hiring, and culture makes a big difference. In terms of the forecast, in terms of Q3, we're looking at the 7% range X Novitas.

Rich Bradshaw: In terms of the forecast, in terms of Q3, we're looking at the 7% range ex Navitas. In terms of next year, I'm even more confident of obtaining upper single digit next year, particularly based on the hiring that has occurred and the pace is going to slow down the second half of the year, but we still have ongoing discussions. In July, we've hired five more that are on payroll already. We're feeling pretty good.

Speaker #1: And then in terms of next year, I'm even more confident in obtaining upper single-digit next year, particularly based on the hiring that has occurred and those the pace is going to slow down in the second half of the year, but we still have ongoing discussions.

Speaker #1: And in July, we've hired five more that are on payroll already, so we're feeling pretty good.

Speaker #3: Got it. Thank you. And then I guess on the expense side now, a bit of a bigger-picture question—trying to get the pro forma expense base. Given recent commercial lender hirings and related aspirations, in addition to the impact of the sale of Navitas and 3Q close of the deal, when all is said and done and deal cost saves are achieved, where do you see the expense base shaking out?

Jacob Morton: Got it. Thank you. I guess on the expense side now, a bit of a bigger picture question, trying to get the pro forma expense base, given recent commercial lender hirings and related aspirations, in addition to the impact of the sale of Navitas in Q3 close of the deal, when all is said and done and deal cost saves are achieved, where do you see the expense base shaking out? Longer term, what is a good core expense growth rate to consider?

Jake Morton: Got it. Thank you. I guess on the expense side now, a bit of a bigger picture question, trying to get the pro forma expense base, given recent commercial lender hirings and related aspirations, in addition to the impact of the sale of Navitas in Q3 close of the deal, when all is said and done and deal cost saves are achieved, where do you see the expense base shaking out? Longer term, what is a good core expense growth rate to consider?

Speaker #3: And longer-term, what is a good core expense growth rate to consider?

Speaker #1: All right, I'll take that one. Thanks, Jacob. So, we just did $154.5 million in expenses on what I would call a run-rate basis.

Jefferson Harralson: All right. I'll take that one. Thanks, Jacob. We just did $154 and a half million in expenses on what I would call run rate basis. Overlay Peach State, it adds $4 million quarterly, we'll have $2 million roughly of cost savings off of that $4 million next year. We expect that to close 1 August, think about that $2.5 million hitting this quarter. Offsetting that, you have Navitas has a $9 million quarterly run rate that will go away when the deal closes. Think about $154 million expense base is growing at roughly a 3.5% pace. You have $9 million of expenses going away with Navitas and $4 million coming on, turning into $2 million with cost saves next year of Peach State. With an asterisk that we will be hiring lenders in an opportunistic way, just as Rich mentioned.

Speaker #1: Overlay, Peach State, it adds $4 million quarterly. And then we'll have $2 million roughly of cost savings off of that $4 million next year.

Speaker #1: We expect that to close August 1st, so think about that $2.5 million hitting this quarter. Now, offsetting that, you have Novitas, which has like a $9 million quarterly run rate that will go away when the deal closes.

Jefferson Harralson: Offsetting that, you have Navitas has a $9 million quarterly run rate that will go away when the deal closes. Think about $154 million expense base is growing at roughly a 3.5% pace. You have $9 million of expenses going away with Navitas and $4 million coming on, turning into $2 million with cost saves next year of Peach State. With an asterisk that we will be hiring lenders in an opportunistic way, just as Rich mentioned. Q3 has timing issues of when Navitas goes away, it's hard. Net net in Q4, we should be looking at roughly $150 million base, maybe just a slight higher depending on the lender hires.

Speaker #1: So think about 154 million dollar expense base is growing at roughly a 3 and a half percent pace. Then you have 9 million of expenses going away with Novitas, and 4 million coming on, turning into 2, with with cost saves next year of Peach State.

Speaker #1: With an asterisk that we will be hiring lenders in an opportunistic way, just as Rich mentioned. So Q3 has timing issues of when Novitas goes away, so it's hard.

Jefferson Harralson: Q3 has timing issues of when Navitas goes away, it's hard. Net net in Q4, we should be looking at roughly $150 million base, maybe just a slight higher depending on the lender hires.

Speaker #1: But net-net, in Q4, we should be looking at roughly a $150 million base, maybe just slightly higher depending on the lender hires.

Rich Bradshaw: Jacob, to finish answering your question, you had several on there. I want just to answer in terms of what type of were we producing. It's kind of probably look equal between C&I and CRE, and it would be spread across all the geographies. We're seeing really good equal production, and the geographies are kind of fighting it out each quarter on who's the top. We're starting to see really equal, which is a good feeling.

Speaker #4: And Jacob, to finish answering your question—you had several in there—I'll just answer in terms of what type of, where we're producing. It's probably about equal between CNI and CRE.

Speaker #4: And it would be spread across all the geographies. We're seeing really good equal production in the geographies that are kind of fighting it out each quarter on who's the top.

Speaker #4: So we're starting to see things really equalize, which is a good feeling.

Speaker #3: Got it. Awesome. I appreciate all the color there. And that's it for me. Thank you, guys.

Jacob Morton: Got it. Awesome. I appreciate all the color there, and that's it for me. Thank you, guys.

Jake Morton: Got it. Awesome. I appreciate all the color there, and that's it for me. Thank you, guys.

Speaker #1: Thanks, Jacob.

Jefferson Harralson: Thanks, Jacob.

Speaker #3: Our next question comes from Catherine Mueller from KBW. Please go ahead with your question.

Operator: Our next question comes from Catherine Mealor from KBW. Please go ahead with your question.

Speaker #6: Hi, this is Hannah Wynn stepping in for Catherine Mueller. I wanted to start off on the reinvestment side as Novitas comes out next quarter, and you redeploy the proceeds.

Hannah Wynn: Hi, this is Hannah Wynn stepping in for Catherine Mealor. I wanted to start off on the reinvestment side. As Navitas comes out next quarter and you redeploy the proceeds, how are you thinking about the timing and pace of the securities purchases throughout the rest of the year?

Speaker #6: How are you thinking about the timing and pace of the securities purchases throughout the rest of the year?

Speaker #1: That is a great question. And one that we are thinking about quite a bit because the 4 and a quarter, I think, is a realistic number to think about.

Jefferson Harralson: That is a great question and one that we are thinking about quite a bit because the 4.25%, I think, is a realistic number to think about. I don't know if we invest that all right away because I think some of that will be in cash. We're using that 4.25% as a proxy, so I think that's a relatively easy number to get to. For the first 1 to 3 months, I think you'll see a portion of that at 3.75% in cash. That will be offset somewhat by using some of that cash for 6% plus loans. We settled on the 4.5% as a good proxy, but I think it could be, or 4.25%.

Speaker #1: But I don't know if we invest all of that right away, because I think some of it will be in cash. So we're using that 4 and a quarter as a proxy.

Speaker #1: I think that's a relatively easy number to get to. But for the first one to three months, I think you'll see a portion of that at $375 in cash.

Jefferson Harralson: For the first 1 to 3 months, I think you'll see a portion of that at 3.75% in cash. That will be offset somewhat by using some of that cash for 6% plus loans. We settled on the 4.5% as a good proxy, but I think it could be, or 4.25%. I think it could start slightly slower than that or slightly lower than that, and then move up towards 4.25% and beyond over time.

Speaker #1: Then again, that will be offset somewhat by using some of that cash for 6% plus. Loans. So we settled on the 4 and a half percent as a good proxy, but I think it could be or 4 and a quarter percent, I think it could start slightly slower than that or slightly lower than that and then move up towards 4 and a quarter and beyond over time.

Jefferson Harralson: I think it could start slightly slower than that or slightly lower than that, and then move up towards 4.25% and beyond over time.

Speaker #6: Great, thank you. And then my other question is—I know you mentioned in your prepared remarks about repurchases—if you could just give a little more detail there on your mentality moving through the rest of the year.

Hannah Wynn: Great. Thank you. My other question is, I know you mentioned in your prepared remarks about repurchases. If you could just give a little more detail there on your mentality moving through the rest of the year. I know you were in the blackout period for this quarter, we didn't see any, just curious where you expect to go for the rest of the year.

Speaker #6: I know you were in the blackout period for this quarter and so we didn't see any, but just curious where you expect to go for the rest of the year.

Speaker #1: That's great, thanks. We have said publicly that we intend to buy back the other $50 million. Of the $100 million in total consideration that we're paying for Peach State, we still expect to do that.

Jefferson Harralson: That's great. Thanks. We have said publicly that we intend to buy back the other $50 million of the $100 million in total consideration that we're paying for Peach State. We still expect to do that. We have $63 million in authorization as well. Think about that maybe for the rest of this year. However, in the bigger picture with Navitas sold, it will be roughly a 14.5% CET1 ratio. We haven't given capital targets, we're not giving capital targets today. If you think about just getting back to the 13% range, that's about $300 million of excess capital. I think that is something that we will be talking about in board meetings over the next year. I think you could realistically see capital usage and perhaps in buybacks increase significantly next year.

Speaker #1: We have 63 million dollars in authorization. As well, so think about that maybe for the rest of this year. However, in the bigger picture with Novitas in sold, we will be roughly a 14 and a half percent CET1 ratio.

Speaker #1: We haven't given capital targets, so we're not giving capital targets today, but if you think about just getting back to the 13% range, that's about $300 million of excess capital.

Jefferson Harralson: We haven't given capital targets, we're not giving capital targets today. If you think about just getting back to the 13% range, that's about $300 million of excess capital. I think that is something that we will be talking about in board meetings over the next year. I think you could realistically see capital usage and perhaps in buybacks increase significantly next year.

Speaker #1: So I think that is something that we will be talking about in board meetings over the next year. So I think you could realistically see capital usage and perhaps in buybacks increase significantly next year.

Speaker #6: Great, that's all from me. Thanks for taking my questions.

Hannah Wynn: Great. That's all for me. Thanks for taking my questions.

Speaker #3: Our next question comes from Gary Tenner from DA Davidson. Please go ahead with your question.

Operator: Our next question comes from Gary Tenner from D.A. Davidson. Please go ahead with your question.

Speaker #5: Thanks. Good morning. I just wanted to ask in terms of, again, on sale, piece, kind of the relative impact of the equipment finance sales versus SBA, just to kind of drill down to a more base gain on sale number.

Gary Tenner: Thanks. Good morning. Just wanted to ask in terms of the gain on sale piece, kind of the relative impact of the equipment finance sales versus SBA, just to kind of drill down to a more base gain on sale number going forward?

Speaker #5: Going forward.

Speaker #1: Yeah. So, I don't have the amount of Novitas gain on sale in front of me. I don't think—let's talk after, but I think about 75% of the gain on sale this quarter was SBA.

Jefferson Harralson: Yeah. I don't have the amount of Navitas gain on sale in front of me, I don't think. Let's talk after, I think about 75% of the gain on sale this quarter was SBA. Let's talk after this, and I'll get you the exact number.

Speaker #1: But let's talk after this, and I'll get you the exact number.

Speaker #5: Okay, I appreciate that. And then just to follow up on the repurchases—my sense when you announced the sale of Novitas a couple of months ago was that it sounded a little more definitive, maybe around buybacks, and maybe sooner than just thinking about 2027.

Gary Tenner: Okay. Appreciate that. Just to follow up on the repurchases. My sense of things when you announced the sale of Navitas a couple of months ago was a little more definitive maybe around buyback and maybe sooner than just thinking about 2027. Did anything change? Is it timing of the deal closing or anything that pushes that out at all versus maybe front-loading it a bit more?

Speaker #5: Did anything change? Is it timing of the deal closing or anything that pushes that out at all versus maybe front-loading it a bit more?

Speaker #1: Yeah. No, nothing's changed. We're just continuing to evaluate all the options. Our priorities still remain obviously continuing to fund loan growth, which is accelerating.

H. Lynn Harton: Yeah. No, nothing's changed. We're just continuing to evaluate all the options. Our priorities still remain, obviously continuing to fund loan growth, which is accelerating, then opportunistic M&A. Think of things like Peach State. We're not looking at large deals. We're not looking at out-of-market deals. As we mentioned earlier in the call, there continue to be some nice small banks that very high quality that we're interested in. In my mind, doing some of those for cash is a more effective buyback in a way than we're looking at buybacks. We're looking at other balance sheet options as well. Nothing's changed. It's just we're continuing to evaluate all those options.

Lynn Harton: Yeah. No, nothing's changed. We're just continuing to evaluate all the options. Our priorities still remain, obviously continuing to fund loan growth, which is accelerating, then opportunistic M&A. Think of things like Peach State. We're not looking at large deals. We're not looking at out-of-market deals.

Speaker #1: Then opportunistic M&A. So think of things like Peach State. We're not looking at large deals. We're not looking at out-of-market deals. But as we mentioned earlier in the call, there continue to be some nice little small nice small banks that very high quality that we're interested in.

Lynn Harton: As we mentioned earlier in the call, there continue to be some nice small banks that very high quality that we're interested in. In my mind, doing some of those for cash is a more effective buyback in a way than we're looking at buybacks. We're looking at other balance sheet options as well. Nothing's changed. It's just we're continuing to evaluate all those options.

Speaker #1: So, in my mind, doing some of those for cash is a more effective buyback, in a way. Then we're looking at buybacks, and we're looking at other balance sheet options as well.

Speaker #1: So nothing's changed. It's just we're continuing to evaluate all those options.

Speaker #5: Okay. So maybe more of a sense of not wanting to just kind of slow pulling it a little bit to give you some more flexibility if other things arise.

Gary Tenner: Okay. Maybe more a sense of not wanting to just kind of slow pulling it a little bit to give you some more flexibility if other things arise. Is that the way to think about it?

Speaker #5: Is that the way to think about it?

H. Lynn Harton: That is a great way to think about it.

Lynn Harton: That is a great way to think about it.

Speaker #1: That is a great way to think about it.

Speaker #5: Okay. All right. Thank you.

Gary Tenner: Okay. All right. Thank you.

Speaker #3: Our next question comes from Michael Rose from Raymond James. Please go ahead with your question.

Operator: Our next question comes from Michael Rose, from Raymond James. Please go ahead with your question.

Michael Rose: Hey, good morning, guys. Thanks for taking my questions. Maybe for Rich, just wanted to go back to kind of the underlying strength in loan growth and the commentary about stronger growth in the back half of the year. Just as we think about the lending hires that you made, once you continue the addition of Peach State, and probably pay-downs waning, which I suspect has been a headwind for you like it has been for others. Should we begin to think about UCB as a mid to high single-digit grower versus a mid-single digit grower, which you've laid out previously? It just seems like you guys have some real momentum here in building out some other verticals and markets. Thanks.

Speaker #7: Hey, good morning, guys. Thanks for taking my questions. Maybe for Rich—just wanted to go back to the underlying strength in loan growth and the commentary about stronger growth in the back half of the year.

Speaker #7: Just as we think about the lending hires that you made, what you continue, the addition of Peach State, and probably pay downs waning, which I suspect has been a headwind for you like it has been for others.

Speaker #7: I mean, should we begin to think about UCB as a kind of a mid to high single-digit grower versus a mid single-digit grower, which you've laid out previously?

Michael Rose: Should we begin to think about UCB as a mid to high single-digit grower versus a mid-single digit grower, which you've laid out previously? It just seems like you guys have some real momentum here in building out some other verticals and markets. Thanks.

Speaker #7: It just seems like you guys have some real momentum here in building out some other verticals and markets. Thanks.

Speaker #1: Well, Michael, I think you're spot on. So I agree with you. That's where we're headed. I feel that we've got a really good balance now with some strong CNI initiatives.

Rich Bradshaw: Well, Michael, I think you're spot on. I agree with you. That's where we're headed. I feel that we've got a really good balance now with some strong C&I initiatives. For instance, the ABL group's really shown the last 2 quarters and provides another alternative for our lenders out there. Very positive.

Speaker #1: I mean, for instance, the ABL group's really shown the last two quarters and provides another alternative for our lenders out there. So very positive.

Speaker #7: Okay. And maybe as a follow-up, how should we think about kind of loan yields as we move forward, X Novitas, just I know there's going to be a lot of moving parts in the third quarter for sure, but just on a go-forward basis, just given the competitive dynamics and it just seems like there's going to be an increasing amount of pressure as we move forward.

Michael Rose: Okay. Maybe as a follow-up, how should we think about kind of loan yields as we move forward ex Navitas? I know there's going to be a lot of moving parts in Q3 for sure. Just on a go-forward basis, just given the competitive dynamics and it just seems like there's going to be an increasing amount of pressure as we move forward, but would love to hear any thoughts.

Speaker #7: But we'd love to hear any thoughts.

Speaker #1: I can talk about it from a market perspective and a competition perspective. Right now, we're seeing for the first time in a while that pricing and structure have both kind of leveled off.

Rich Bradshaw: I can talk about it from a market perspective and competition perspective. Right now, we're seeing for the first time in a while that pricing and structure have both kind of leveled off. You did see particularly CRE come down over the last year. That has stabilized and again, structure is stabilized right now.

Speaker #1: So you did see, particularly, CRE come down over the last year. That has stabilized, and again, structure has stabilized right now. I'll throw in.

Jefferson Harralson: I'll throw in-

Michael Rose: All right, perfect. Go ahead.

Speaker #7: I'm perfect. And maybe I just got it.

Jefferson Harralson: Michael, real quick, this is Jefferson. The loan yield does come down with Navitas going away by about 30 basis points. We are putting on loans, new loans at a higher rate than that. We do get the initial impact of Navitas going away, but we should have an increasing loan yield off of that lower base.

Speaker #1: Michael, real quick, this is Jefferson. So the loan yield does come down with Novitas going away, by about 30 basis points. And we are putting on new loans at a higher rate than that.

Speaker #1: So we do get the initial impact on Novitas going away, but we should have an increasing loan yield off of that lower base.

Speaker #7: Perfect. Appreciate it, Jefferson. And maybe just one last follow-up, just and congratulations on your upcoming retirement, Jefferson. But just trying to get a sense of when we could expect to see the announcement for a new CFO.

Michael Rose: Perfect. Appreciate it, Jefferson. Maybe just one last follow-up, and congratulations on your upcoming retirement, Jefferson. Just trying to get a sense of when we could expect to see the announcement for a new CFO. Thanks.

Speaker #7: Thanks.

Speaker #1: Yeah, so we're actively recruiting. We've got some great candidates in. My expectation would be probably sometime—let's call it September, October, something like that would be a good timeframe.

H. Lynn Harton: Yeah. We're actively recruiting. We've got some great candidates in. My expectation would be probably sometime let's call it September, October, something like that would be a good timeframe to expect that.

Lynn Harton: Yeah. We're actively recruiting. We've got some great candidates in. My expectation would be probably sometime let's call it September, October, something like that would be a good timeframe to expect that.

Speaker #1: To expect that.

Speaker #7: All right. Thanks, guys.

Michael Rose: All right. Thanks, guys.

Speaker #1: Thanks, Michael.

H. Lynn Harton: Thanks, Michael.

Lynn Harton: Thanks, Michael.

Speaker #3: Once again, if you would like to ask a question, please press star and then one. To withdraw your questions, you may press star and two.

Operator: Once again, if you would like to ask a question, please press star and one. To withdraw your questions, you may press star and two. Our next question comes from Christopher Marinac from Janney Montgomery Scott. Please go ahead with your question.

Speaker #3: Our next question comes from Christopher Marinac from Bring Capital. Please go ahead with your question.

Speaker #8: Thanks. Good morning. I wanted to ask about the impact of the new hires on loans. And should we see that accelerate? I think Rich had touched on that earlier.

Christopher Marinac: Thanks. Good morning. Wanted to ask about the impact of the new hires on loans, and should we see that accelerate? I think Rich had touched on that earlier. Just wanted to quantify that.

Speaker #8: I just wanted to quantify that.

Speaker #1: The answer is yes, because we really started this in Q4, saw their impact in Q2 in the call at approximately $30 million funded, which for us is kind of like another state. That’s kind of how we think of the net funding when we look at that.

Rich Bradshaw: The answer is yes, because we really started this Q4, saw their impact in Q2 in the, call it the approximately $30 million funded, which for us is kind of like another state net. It's kind of how we think of the net fundings when we look at that. Going forward, we expect to see that continue to accelerate in the rest of the year and obviously feel very good and optimistic about next year.

Speaker #1: So, going forward, we expect to see that continue to accelerate in the rest of the year. And, obviously, I feel very good and optimistic about next year.

Speaker #8: Great. Thank you for that, Rich. And then Jefferson, just a quick one on net charge-offs, X Novitas. Is the number you told us in June still a good number to use?

Christopher Marinac: Great. Thank you for that, Rich. Jefferson, just a quick one on net charge-offs ex Navitas. Is the number you told us in June still a good number to use?

Speaker #1: So hey, Chris, this is Rob Edwards. When I look back over the last 10 years, it's really been between 8 and 13 basis points net charge-offs for the bank excluding Novitas.

Rob A. Edwards: Hey, Chris, this is Rob Edwards. When I look back over the last 10 years, it's really been between eight and 13 basis points net charge-offs for the bank excluding Navitas. Last two years have been 12 basis points. I'm not remembering what we stated recently, but I would say those are good ranges to think about going forward.

Rob Edwards: Hey, Chris, this is Rob Edwards. When I look back over the last 10 years, it's really been between eight and 13 basis points net charge-offs for the bank excluding Navitas. Last two years have been 12 basis points. I'm not remembering what we stated recently, but I would say those are good ranges to think about going forward.

Speaker #1: The last two years have been 12 basis points. So, I'm not remembering what we stated recently, but I would say those are good ranges to think about going forward.

Speaker #8: That's perfect. Thank you for that. I appreciate it. And then just one last question about M&A pricing. As you think about possibilities in the future, is the pricing kind of similar to what you did with Peach State a few months ago?

Christopher Marinac: That's perfect, Rob. Thank you for that. I appreciate it.

Rob A. Edwards: Yep.

Rob Edwards: Yep.

Christopher Marinac: Just a last one about M&A pricing. As you think about possibilities in the future, is the pricing kind of similar to what you did with Peach State a few months ago? Is it any different as you've looked at the possibilities this year?

Speaker #8: Is it any different as you've looked at possibilities this year?

Speaker #1: Yeah. I would say each deal is a bit unique. We target three-year earn-back and on an all-stock basis. So it really depends on overlap, the underlying momentum of the bank itself.

H. Lynn Harton: Yeah, I would say each deal is a bit unique. We target three-year earn back on an all-stock basis, so it really depends on overlap, the underlying momentum of the bank itself. Peach State was unusual, so I would say that was probably on the high side. Yeah, each deal is priced individually, but it's based on those attributes.

Lynn Harton: Yeah, I would say each deal is a bit unique. We target three-year earn back on an all-stock basis, so it really depends on overlap, the underlying momentum of the bank itself. Peach State was unusual, so I would say that was probably on the high side. Yeah, each deal is priced individually, but it's based on those attributes.

Speaker #1: Peach State was unusual. So I would say that was probably on the high side. But yeah, each deal is priced individually, but it's based on those attributes.

Speaker #8: Sounds good, Wayne. Thank you all for taking our questions this morning.

Christopher Marinac: Sounds good, Lynn. Thank you all for taking our questions this morning.

Speaker #1: All right. Thank you.

H. Lynn Harton: All right. Thank you.

Lynn Harton: All right. Thank you.

Speaker #3: And with that, ladies and gentlemen, seeing no additional questions, I'd like to turn the floor back over to Lynn for any closing comments.

Operator: With that, ladies and gentlemen, showing no additional questions, I'd like to turn the floor back over to Lynn for any closing comments.

Speaker #8: Great. Well, once

H. Lynn Harton: Great. Well, once again, thanks to everyone for joining our call and for the great questions. Have any additional questions, don't hesitate to reach out, and we'll look forward to talking to you again soon. Have a great day.

Lynn Harton: Great. Well, once again, thanks to everyone for joining our call and for the great questions. Have any additional questions, don't hesitate to reach out, and we'll look forward to talking to you again soon. Have a great day.

Speaker #1: Again, thanks to everyone for joining our call and for the great questions. If you have any additional questions, don't hesitate to reach out. We look forward to talking to you again soon.

Speaker #1: Have a great day.

Operator: With that, ladies and gentlemen, we'll conclude today's presentation. We do thank you for joining. You may now disconnect your lines.

Q2 2026 United Community Banks Inc Earnings Call

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