STL - Earnings call transcript Q1 2018

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Operator

Good day, and welcome to the Sterling Bancorp Q1 2018 Conference Call. Today's conference is being recorded. At this time, I'd like to turn the conference over to Jack Kopnisky, President and CEO of Sterling Bancorp. Please go ahead, sir.

Jack Kopnisky

Good morning, everyone, and thanks for joining us to present our results for the first quarter of 2018.

call Massiani, the Officer. Chief on me is our Luis Financial Joining

provides details. have results presentation, then along the website release our presentation we're with call ton the press We the outlining open our going for to a quarter through of Instead going quarter summarize on the for a the of and which questions.

financial to positions very company's model. results financial Astoria, this progressed. model, corporate The in We us performing the performance and tax integration changes strong continue how continue metrics pleased to The very with benefited evolve expansion be high from of to are of rates. favorable has quarterly and the our

quarter over we model, will business enhance that anticipate metrics value the operating continues quarter our continue quarter. first strong We from adjusted assets higher than XXXX, opportunistic as to million last our higher ratio and our recent quarter efficiency tangible demonstrating earnings XX.X% one million higher of by fourth earnings times. quarter ratio operating the the than the XXXX. XX% leverage strong XX.X%. our were representing common same leverage our share fourth basis equity the XXX was outcomes. of XX% M&A and diversification, return activity. were of our than Operating increased improve return X.X were XXXX XXXX, result adjusted increased and $XXX $XX expenses of operating by was to points $X.XX Adjusted year on the of metrics positive operating the adjusted year and Revenues XX% $XXX For first average core activities demonstrated quarter throughout the period on per than operating M&A results operating and of million The XXX% in average and greater

levels continued that me of categories highlight of balance number activities and drive income associated let will performance. and high statement Now a sheet

First, the line quarter interest for given margin first the net in the X.X% tax change was laws. taxable expectations in our the equivalent with

impact of basis interest with basis linked margin the adjusting relative for an of in quarter four in to the the XXX Excluding and and points the our forecast. tax accretion which core improvement law, points income was net was change line

We balance and have rate benefited from increase continued the of a repositioning the sheet.

expect to XXX point range the the in to XXX the basis in for XXXX. range We and XXX core NIM to overall XXX the full-year approximately be be to NIM point basis

relative X% period bookings, quarter. the There's loan linked commercial than meaningfully months excluding February was warehouse future balances of some Secondly, in growth points volume basis based year. on were but balances. terms and mortgage average pipelines pick in slow January seasonality annualized to increased quarters. and in linked the prior of X.X% accretion the significantly up on end and greater based payroll over yields picked are factoring March and an quarter XX and in income net will up also that Loan

our York in targeted lending Additionally market we the be see below priced Metropolitan ROEs. CRE to New opportunities new City

relative this have increases the market. in benefiting very We rates not seen the Fed in competitive pricing

X.X%. Finally, approximately we of at $XXX portfolio million Funding of the brings on yields loan average completed April Xnd, the which acquisition of priced Advantage

market. year XX% are We organic and growth accelerate for are confident are expecting strong in Overall, the the the business several in growth growth the many as portfolio we net in years. acquisition will loan we this line to over targeted targets next finding X% loan

X%. was an growth annualized deposit Third,

certain deposits, become and driving types money been strong priced products continue deposits maintain CD no growth more for high The We Astoria runoff. and have virtually market acquisition the in to base of have aggressively with has of a experienced market aggressive now ratios. levels reflects a savings deposit to CDs that building loan high of base market have have deposit core not strong in money that of to which DDA banks and a changed core base points pricing mix from especially deposits. The and deposit balance

Our DDA, points. XX% savings, be at and of deposit CDs cost XX XX% basis with mix XX% a strong MMDA, approximately continues XX% to

continue to to and deposit confident loan We ability drive XXXX be to match in ratios ultimately net in below XX%. growth our with growth loan deposit

operating have better our than levels expense we Finally, program. executed continue as to planned be carefully integration

of XXXX. consolidations We the on which integration the have the personnel of through branch a steady will with completed occur exception all pace

consolidation anticipate We eight the and of in quarter. first have additional notifying closed one in second quarter. notified seven We branches branches the

holdings. our begun estate of strategy our have real We executing streamlining also

entered headquarters new reduce to can have relationship leased Lake Success we that and staff support time, add locations. time reduce over over our agreement managers Astoria’s and to continue into oriented footprint to to our estate to sell At anticipate our owned and continue in by both real relative building today. XX% same we the We an company. will risk We

professionals high many to quality this finding model. are attracted are that We

be of $XXX below guidance expenses intangibles excluding will We for amortization the XXXX. expect million

As previously, to unfolds. we the the as metrics year improve I mentioned continue financial

to and to see segments. based using model consumer meaningful opportunities the in grow team We organically continue select commercial

seen significant the in companies. increase We opportunities and a portfolios quarter in finance commercial also to have acquire

traditionally created activity. We years past the plus value very on we focused delivering over are that the six of have

for call the open questions. let's Now

Operator

Thank Instructions]. you. [Operator

question Casey first Please go We Haire ahead. Jefferies. will take from from our

open. is line Your

Casey Haire

really in come out I XXXX for to up C&I? look a play growth Good I sounds was on Do start it quarters. the Wanted up the pipelines that it last expect year -- appreciate as you seasonally but have for outlook, similarly to quarter is morning you pattern after year loan like at if later the Thanks. last it start-off and that slow at a a guys. soft can C&I ramped

Jack Kopnisky

way. and Yes we'll Advantage acquisitions the we some of Funding do it supplement also the the with acquisition along like

yes. So is answer

Casey Haire

Okay.

there it you I And more, now the you were between like loan quarter right you're to more so and Advantage that think XX:XX opportunities. I mean split and deals about organic last to have you thinking said deals, with and get growth, sounds

you're of that the updated likely it's go, some more it opportunity? on is XX:XX to going or a split just So M&A thoughts

Jack Kopnisky

so XXX But we during at side. one-third. recognize the example quarter, it's We actually is an one on CRE Yes, X.XX looked more CRE the market fungible, of things you of targeted it kind two-thirds, the equity. -- billion I’ll than bookings. the in a give the our I opportunities up like the booking of about points think of our and new loan billion billion. of X.XX less targeted probably basis We million return points about XXX less The XX ended than X.XX about on basis yield was

other will compromise going So asset categories. not we returns we're that to to we our target turn

up stay if come CRE, we and of yield will metrics targeted and example our on targeted things multifamily return we'll do we If to they more. our of and and those risk do adjusted acquisitions. below low less for level will do types So to levels,

in of of one and levers broad we to is the we originate don't can assets times diversification these the beauties categories. can So model we other category capital pull because different we in have have move this one that's categories at different and to

Casey Haire

obviously grow I that money market a the guide. your an the deposits particularly pretty, on Okay, confident deposit deliver great. And eye of guide in It's your arena NIM but struggle NIM just jumbo that we're and that local very pretty growth. lot mean seeing identified funding switching market the to on on with competitive growth you competitors sound arena, outlook, you money obviously loan to guys

So confidence I'm just there? curious what's underlying your

Jack Kopnisky

on I one, to in of confident lifts as the can we're drive terms of we capital get side in we we're and the also loans on mix For of said yields the around on asset that, confident numerator the to of the that have part deposits. the move types NIM

is different went markets the cost thing. past, mix something in money competitive up of balance of mix some by in It’s if sides think deposits. increase and of area our look why it's was is past core, I each in non-interest a CD bit So little sensitive, XX% you to deposits point of their the the those on at and mix the like very high the each basis a obviously and relatively our really quarter. bank XX% for this deposit

where areas would side our money relationship levels yielding approach some growth, we of the is just will pass. some in market there areas we are So and where good deposit play

which exudes hold asset of sheet So would ones deposits equation that allocate also and the thoughtful and and balance we areas price the way the levels. the we of one, confidence the up mixing NIM side being capital the what looking we where where our in do and from of pricing the the and we pricing at are types

Luis Massiani

deposit quite first the in the was in the Casey Yes, first quite low strong quarter. beta --

to deposit up the a beta quarter call comments we being you under guided two-year XX% just relative recall to fourth if XX% treasury. to ended it XX% So our movement about had

thought. the deposit So a competitors bit clear that same are loud we composition saying, cost has the and from in the than and -- the things deposit are. we that seeing and we the hear we our to But been you are perspective we little progression market better

the the difference commercial coming anticipate and more from going off The marketplace every about deposit that what that you relative diversified pressure continue difference else in picking dollars CRE drastic residential beta loan in will a that be maintain to today, replace I have mortgages to basis asset about relative from of with in it’s and to up on door an here sheet a that deposit is would of yield to given points core loans static mortgage going core of drive even NIM billion key residential to mix driven So we XX% incremental the the residential that's and XX%. composition dollar of that about past XX perspective for the in being think XX to balance mortgage earning you're than if the the assets to yield something that the it's off. be we talked assets securities marginal up think we that perspective, runs we the and more that severe be

eight before a points margin that the dollars interest of really that transition maintain the of that's So think it is increase we gives things for net it expansion one the every XX year. that to there's balance us to basis drive we've sheet NIM there that gives trade of the billion over said ongoing ability about course us and to what

Casey Haire

mean right. could with that you I well -- growth there. just out XX.X I'm sense. is some makes remix as deposit nice a of that that Thanks. Okay, All

Jack Kopnisky

you. Thank Sure.

Operator

question from ahead. from And Alex Sandler is Please O'Neill. Twerdahl our go next

open. is line Your

Alex Twerdahl

guys you out want will million bit be which Just that the I drill less however unchanged guide there if prepared is you your should laid to extra target this that or and saying fully to another the out expenses slide remarks in expenses more we a much you million on I'm quarter, where guys to $XXX Jack take the that from out, pretty that not deal; is the numbers is here not and thinking put believe last that that guidance then that in little we're than the we that So where expense year from kind correct? something expecting Advantage only in the $X are of? that have that’s else be consolidation is the in of finding mistaken

Luis Massiani

all of the combination a It's above.

on the opportunities in as think relative doing bunch are we're Astoria about put talked both finding estimate to that them, calls the in of a a now different I quarter, fourth exceed we couple areas. that we third of had initial and merger, to we've out

and about alluded the fifth Jack organization across than just reducing the just And entire the renewed a finalizing costs having still company systems direct to estate or we impact inning respective of in a from the we're estate what integration One with manage you it And to the from real a being both then -- to of sixth having do -- of footprint combined the comments footprint everything bunch that a indirect real that need. with of a hidden in a broader two-fold of that going great are today. call had areas has the perspective. his impact impact opportunity direct key

that place to that the is see because and half it. year to opportunities operations from quarter in are is you line the expense fourth and like related of to will of you a and we that and processing data hit this third and our items potentially will progression on occupancy So will see $XXX increase what will everything expenses a will Advantage, see office expense we specific you see us of will meaningfully acquisition going decline offset comes million enough to get where exceed second

there's also brings of deal itself. that associated with it. So that Advantage to be the guidance off Advantaged though savings going yes we're come some maintaining even And OpEx deal the some

chip for year about rate we $X remainder annual three course them into integrate the will of at the to million, of have Advantage that run the of the we operating the expense over well next some away once fully So is opportunities as quarters.

Alex Twerdahl

very and helpful. great That's

things to sitting another incorporated potentially and guys you when go So kind see XQ X just say if branch next months eight and in like just fully that's in more we're got had that consolidate that clarify the here three of we're branches the planning announced to million you we or the $XXX number guys lower? over further consolidations in million when of we've quarter that $XXX saying even that

Luis Massiani

we've we course that to have million. the again It has Jack have announced OpEx would other to his notice It to alluded depend than could Jack to over those ones on the XX to factored the $XXX closures, into accelerated of to branch the are XXXX XX on more just extent ones now, the potentially initial forward. the accelerate go decrease rate alluded the will remainder that's in comments going a lower but you that these that opportunity

Alex Twerdahl

then the borrowing as of plan of bit question strategically but had that's strategy? which the can look a how kind the at how you and for to of there this kind up Okay, appreciate and on about deposit And just picked use at I kind you what of in your and quarter, funding augment just borrowings outlook great. on a deposit different comments growth and you durations talk rates you sort layer do to you

Luis Massiani

short we of XX% short FHLB here latter the target the design loan with borrowings. that bit take of one, three end. up Sure. and curve is bias little The that between stayed majority by two of to to We a made deposit intention towards out vast parts the that We all year is XX% and -- of and the FHLB take we maintain ratio.

-- loan be the loans in security further combination deposits the -- the funded well. and So the decrease in growth growth composition sheet a the balance so as growth -- in by a of will

not So loan will going result result growth not dollar-for-dollar growth -- dollar-for-dollar will forward. growth loan in sheet balance

loans book well. to the transition fund also utilize have runoff incremental to allows the itself sheet residential us You remember that to balance the commercial mortgage of as

going of in to balance with kind factors -- is more So one-to-one maintain deposit growth different the a perspective it's is there a from reduction a a of much sheet bunch intention ratio but the forward securities. funded of growth and being

Operator

from our And question from Nicholas go next Stephens Inc. Please is Austin ahead.

Austin Nicholas

Maybe provision, especially a give there's coming can you deck provision addition in business? the growth know higher -- forward the prepared flavor but going a look and remarks at I outlook your from in balance just of for can taking of with of just the the that the you the Advantage no some

Luis Massiani

combination. as so business a Yes, accounting XQ remember we are so Advantage that for its

take already to completion We've fair value fair upon mark that portfolio a the taken on going portfolio. a on deal. that we're So of value mark

will there will the portfolio of meaningful driven in a change requirement was be into lifetime value be into the acquired. fair estimates going in a by short-term we're into So Advantage forward provisioning not mark lot factored as that the the for that loss that factoring the

and medallion were continuing one are this substantial of charge-offs to which quarter million relationships $XX It make The to had gift that. the a So a progress we is related to being the bit talked keeps portfolio was higher so little than on. of quarter on giving that chunk $XX We fourth we our that about guidance. therefore incurred maintain obviously we about the million. medallion

through the of with number aside move in estimated that line of be be been what we continues as have, to set the would it's to forward I year. in the provision we think past have lower towards good so had million range $XX right $XX we rest to You and going end that a the the the million

Jack Kopnisky

at you metrics, charge-offs basis basis give the probably improved you credit guidance think the most the to range. look that other our would is and kind metrics if our be part XX in of of should credit I annualized I XX And all for point

we feel metrics off charging continued to five improve. our is have -- but were what have overall around folks an is this a not we this. credit confident So arms when for in pristine on The XXXX. basis expectation points It's basis annualized time our

Operator

Bishop David ahead. Our go Please question FIG from is next from Partners.

David Bishop

line there than you out of federal the in what expect of anything curious in seasonality relates change I'm in a worse you noted it specialty Hey the tax might law the perspective any to from some of in to segments in better playing related guys tax just or terms finance as in the laws. change those expected segments the even growth

Luis Massiani

that. I'd say

listen Jack's business think think feel is we I to strongly second, quite going very third the -- I quarter good. that to So fourth the be and comments before pipelines of

business the the think of positive. what our investment pretty that is across in and markets sentiment of hearing of the I small from nature kind we're all board

that We stuff board very pipeline have bunch we in see that the commercial different are you we're across the but we growth a are of C&I interesting just would investment the have kind in not lending in definitely of seeing. kind of estate that real traditional type opportunities projects

growth for Jack's refinancing players. the starting So seen that kind we were has through one been a and think environment competitive clients greater were think for just change seen think we've good a Think clients the on, in existing and before market commercial of which comments law I has of been part long by have in estate we to out -- bit from larger their share we're I perspective the to period stuck of again time Conversely loans. for not very that their you're in also businesses of I pricing we in just kind of changes of of is that what -- little -- what to see investing of traditional a driven see. essentially real which -- has tax a kind not new

a you rate benefit yields. the of tax an increase to the have a factored seen and that being -- tax -- hikes new origination not into have the the perspective increase think is hike. to There to a rate not fact large where without in having the rate I more that relative component from lower the is an corresponding origination at does tax the attractive need of rate origination the in

So the asset are board good But have pipelines the good that's opportunities point will one there. will good see asset we the thing to traditional rate resulting of is we spreads just credit on adjusted focus that that classes in the before of kind other the why, ton returns with them. and across pricing with we we and originate when to real Jack's -- extent associated reasons that estate a better of in as that to floating side the in commercial risk

and will adjusted So deploy the be allocate we see we and will where flexible returns. the risk capital we better to places

Jack Kopnisky

good Yes, point. a it's

to of we've the necessarily to not one our on is be It So is is built company objective the things more profitable. be bigger.

those returns the volume look at than for we rather of that of the margin different asset categories things. we the and we side get off opt So

get sake going the more focused monoline that a right good some putting on -- of We're market and just adjusted for as for it’s volume. out the are returns. that’s There's in put now other companies opportunities on to are of not adjusted said that where lot risk are have certain to risk and where categories difficult returns. there on Luis So there categories playing this volume

high create we So very performing of company long-term, that to foundation out the want we have. profitable a

David Bishop

first runoff relates bit than the quarter per it can it. the -- we'd I And between residential thinking as less a terms story in million in for plays out? modeled quarter million book to Got to think then XXXX be runoff $XXX was as little I be know about you're of the it choppy still $XXX of can

Luis Massiani

year a that's for billion anticipate. we $X to what million $XXX

even the about amount so arm a think or increasing good I in portfolio, it a environment fair high-end cash shorter-term will sure, a an flow kind and that $XXX of to about rate book an should million is XX-year shorter for $X be of billion. duration

David Bishop

from maybe in of new sort New of target or manager there the got across bench area strength there any Okay, or relationship adding terms a it. to either And team then a in the system. Island Jersey target Long

Jack Kopnisky

Yes, great question.

quarter of types joining the relationship XX teams we're a that is in the what interested are great in manager and professionals added finding we into So we lot new team. the

them, also staff we So of are many folks we've lot a we building as amount many cognizant -- by that need quarter or the a so added from of over those the those systems a areas the and infrastructure very have. of way evolve are added were we in proactive in the a the company very we supports that risk increased managers of infrastructure we significant we standpoint sophistication management and relationship the and another of of kind XX in areas behind the data

the both quarter terrific support So strong in we and really a talent the side. quarter and talent good in market the in we had on have acquiring side good client a acquiring

David Bishop

what's critical Remind hit in of managers target? in them to relationship deposit the funding me loan terms the of sort of terms sort of in terms the math of runway

Luis Massiani

to each a take million -- the the and people loans and expand. and million expect to months of -- are year about each in but expect it’s get of Yes, running that in good of deposits as we six minimum to RMs the components up we produce $XX to three continue we teams of $XX to start

the the and and and third start the the accrete to make year. return of a of come the by are breakeven of by end groups to or year in we people the those and great end teams year So expect second really first into

David Bishop

that stand? the the of where number teams does quarter at question final of One end

Jack Kopnisky

Good question think I --

Luis Massiani

XX, yes.

Jack Kopnisky

that. said you Glad

David Bishop

was What sorry. that? I'm

Jack Kopnisky

XX. sorry, David,

David Bishop

yes. XX,

Jack Kopnisky

deposit we’ve biggest cases that you more significantly the to that's one added questions expertise new labor pretty teams. their find in gathering on the we've again area The area, is see that fruits XXX days. the we managers teams, again adding and of XX productive some relationship and treasury than deposits in existing back management the where added And expect around to we've added to to of XX.

Operator

from question is Matthew from next Breese Piper Please ahead. Jaffray. Our go

Matthew Breese

morning Good guys.

Jack Kopnisky

Good morning. you How are doing?

Matthew Breese

Maybe just and the loan to I Good. finance given for deals make starting growth the with I is sure estate right versus of is the outlook that sounds right the where pricing specialty real the lack have message commercial growth; it want like portfolios there inorganic preference loan organic is more betas message?

Jack Kopnisky

No.

So prefer organic we still origination.

X% So two-thirds XX% organically growth come to third will of XX% will expectation growth about of the of and from that to come our X% a acquisitions. about net

Matthew Breese

then Right, okay. -- And

Jack Kopnisky

Okay.

Matthew Breese

that and you potential how more do And Understood. this then there's two is acquisition about getting year? that done noted another you portfolio Yes. feel or why one deals

Jack Kopnisky

coming in uptick six it's number significant of a the seen deals we've market. months probably last Yes, the to interesting

refining So they're market are refining businesses their companies and are because one coming companies to models.

some of sale. these that period to time that basically businesses out these So to right the on of for time a execute of portfolios this private believing equity have and is come they're held a of

balance on are up coming larger out them kind want their areas focus banks certain of clean Some sheet. and to that of of

because things look of believe the of another we kind and and majority down two a the the So lot and in at at these done the by portfolios them these of pretty praise of disciplined price the we we those way end turn vast deal are get that can sources are look or We structure. deals year. we of of

the that. able enough accomplish So be to we there's think market to in

Matthew Breese

less commentary that expense for well? in you what into footprint level growth then think of And we it. got branches. kind expense low gets $XXX expenses sub think through that us said extent as is that the keeps think in can XXXX the XX see Okay, million XXXX possible mitigated and XXXX XX% I it I the you do To

Luis Massiani

is That possible. is It intention. Yes. the

as about you can past. you so talked we've can the think in So if get this

with long-term We factor factored numbers -- that have is the It's banking we efficiently from have more of our the out the XXXX of into what Sterling guidance exactly just hanging into chip not the Provident ability put a pure redundant ability we to the run continue the consolidation not to does It's did branch Longer-term kind and closures the that substantially fruit as what legacy retail low current there the perspective. valley Legacy facilities. to activity. networks. footprint is just is from away in since

If XX the have you added branches. XX those were up we gotten we did before down merger Astoria we to to branches would

side. take more saves the on profitable retail to saving So for commercial portion of return you real more businesses financial think to I'm which not continue ability footprint efficient and consumer centers the then side the but on and is if the into six broader of going do that past retail out done that differently suggesting run to efficiently a reallocate continue we're of adjusted what cut and risk higher of end you XX% amount estate more side banking to years generate of the things the there's and the expense about of we've kind to to growth, to a substantial on

Jack Kopnisky

a And maybe to bit, believe extend your little ratio efficiency Matt, below XX%. question we that get will do the

levels volume And to as more on we productivity we numerator operate enable from below side, believe things trade types folks. of talking get dynamics have expected the us to more it’s being of to efficiently denominator taking continue variable side of higher again on then kind outsource Luis the XX% us efficiency the do side activities more do about So one expense and we on to this that as to model was the maybe able get like ratio. of phases allows more retail maybe the

Matthew Breese

Understood.

guess FTE was little the your with but the the a to think to first we seems margin new it points, it I roughly is of XXX XQ at a adjustment that turning five -- Advantage adjustment, we bump which the Okay when I seven And XXX. guidance above impact or was line or two factor to get in expectations tax core is will was different? by in was XXX like bit then basis

to by will seems XQ be get we the it your wanted and there? kind just So thoughts like at of new square already high guidance end the

Luis Massiani

Yes.

sector first adjustment was to for security full-year we the side Remember side. you line for assets to on call that XX public the tax in about go back point quarter municipal in we adjustment equivalent. So continue to to is XXXX invest guided the question, efficient the tax an in when so tax basis your that but because and fourth eight the equivalent

So were going be the five points year points, was would that's impact under under anticipating points current, basis course the was this full-year to because but over basis tax. the that old the to the eight quarter increase continued five have about about of we basis

change the what just year is the of It's the efficient adjustment have of and impact was going the quarter. tax the growth the larger course rest we side. in So margin tax given dynamic equivalent interest we’re the that the first to thought that would the over be on for net been seeing impact asset

that up we XXX. to Secondly, XXX moved yes, have to

I before But comments response the to very Haire. going comments Casey is question and I to think helpful think my Advantage to in to be from that. Jack’s to

aggressive. we the in on is competitive dynamic there -- deposit cognizant in which the in pretty local are dynamic funding We are the fact that that and operate markets the that

under the through in that We that and growth. mentioned continue taking think we first be XX% approach that going I the as we before we're we to the remember higher a move deposit just focus on cautious perspective that the we're beta And of the as so as being and generating to had is in quarter. year course think therefore of I was

So the I to from we at be the that cautious on a which will what is at will most realistic helpful be pressure scenario is think time, we some perspective growth funding perspective. the from funding come the cost Advantage think same side want presenting of

that we to have. NIM going of We balance are very offset sheet forward. duration as it short transitioning as confident the things sort relatively difficult of the repricing of that that well we But assets a Advantage with is environment the well as able just like as are

Matthew Breese

Got it.

Jack Kopnisky

too we’ve our to lesson go learned the And far on not NIM.

extremely be go too process to not in this trying we're and So thoughtful far.

Matthew Breese

posted about that got those way on can Along talk the performance given the around ideas giving capital the any we share totally deployment guys and I you the stock you fundamentals repurchases? change some lines particularly maybe or it. of does Right, front

Jack Kopnisky

sure Not answer how that. to

are performance frankly or company very stock think think and integration of acquisition the the will first very the future. strong in that this we we in this We’re now we've this disappointed put and and strong subsequent quarter a in we're together through financial be they company dynamics integration the obviously

dividend, continue to demonstrated returns to we presents we've if So authorization very do growing a always repurchases believe sheet but the lots like to is balance strong environment things stock so of this we and financially a will as we've options and grow. company and that we in at that on we look choose to diverse is investors that have an

the side we put keep and hopefully We to and better. options. we've continue that growing at performing at those or the all something at created we But look those look capital do by alternative we time. this side think allocation level all So

Luis Massiani

changed ROEs everything out plus organic or the perspective growth from we little a to -- we point we organic back bit Jack’s XX% IRRs of to cannot have And which up we first go pragmatic said if loan returns, the will an or be an buy on to To types environment that what our world. that about allows growth, that determine and on that ability full to those and and achieve has have acquisition the continue to we shares XX we those million believe to suitable XX-K. we is investment perspective we us with perspective capital the growth deposit approved generate Matt flexibility the extent there from connection grow. review that in quarter and that differently XX% we're continue it opportunities in

it -- the anything more to suitable than do front have the because on up to So capital more repurchase we're opportunities, absolutely don’t that extent until the also intending now. we again do that share say but ability going for to manage flexibly not now what we're to to not we we have we investment find going not are is

Operator

from Please Gilbert our question next KBW. go from is And Collyn ahead.

Collyn Gilbert

nope more have that the but I place It sorry. seems wrap like up would got questions been to a call nice

are deposit so do within happen the okay you Sterling the you Astoria have or So guys beta just starting Legacy curious out breaking the to versus franchise franchise?

Jack Kopnisky

from We -- retail the the essentially footprint can tell that is on do Astoria until acquired I have will has non-existent beta Astoria but I on been you that. We don't up share that this. the publicly what

Collyn Gilbert

Okay.

mix adjusted is then growth discipline terms commentary lot the change? seeing CRE growth on end how year, know it risk Okay. still returns you're the really kind of you’re it, just targets X% side and thinking a appreciate comments enough around about insufficient the I and does target on for of the the given which the pricing of loan And that focus the XX% I of change and all of in that of that but mix to returns,

Jack Kopnisky

you I see. think will

on double-digit that going see to growth real side. ADC -- think absolute dollar think that meaningful an you’re all. will going including either. don’t or you not the commercial at perspective But high-single-digit the from there is and that term that will decrease balances be on multifamily I growth I not double to estate the see or commercial that side

opportunities lines just commercial effective. are are So more the finance towards both more what the more and other we’re traditional across seeing was these I business growth C&I will to we which C&I be of kind before weighted alluding differentiated which believe that

plus So greater and being traditional proportion and CRE. C&I I generated year that a will do represented at being growth think of by of you commercial end the the see finance

Luis Massiani

get much And to C&I mix, directive trying the versus it CRE on more helps the balance our side. our we’re

where return put an capital anyhow more we it. will get adjusted it’s we where to risk So higher we an into area want, that area it’s continue but

Collyn Gilbert

share credit on Okay, Luis or okay have then Advantage? willing you helpful. the to what was mark you do And that's

Luis Massiani

that not going design we material of going that are that it’s be anything those you making so performance chunk has we any they a market something there not into materially to portfolios. delinquency are will are at couple in we’ve hammered Advantage the continue past the public strong or had limited not we or were continue not very market in on. have a issues information that The we but not very with going that. further sectors the is and folks portfolio of quarter second there liquidating we majority on couple and of they the credit about number, is that substantial don’t That going to and we sure with -- performance But towards their it’s by that move to that see as in like vast book the will had any Advantage of to talked portfolios that are business big level, rate from run that -- a focus that

Collyn Gilbert

The Okay. or with within you pull those were that from portfolio? were hammered that what sectors might you not that

Jack Kopnisky

scene from start There -- less where get there into areas were to things more black fleet than a Cars, that that’s difficult. like end like certain you are there vehicles little the Black are $XXX,XXX cars when and like

this ones fundings are much types we the to of the competitive bring manufacturers. side it types because that of we more in categories business really through two believe more flip think price the you trucks tractor out other that everything advantage funding market targeted the to so to from So specialized be there is of line, of can we trailers

saying in not was is opportunity think types very of this grow specific categories we across board. to the business as Luis So in the an

that it’s niches where we categories. all almost the frankly those adjusted done So profitable comfortable we’re business on what the segments on of risk focused that out getting and have with we’re we've returns

Luis Massiani

the we portfolio number. The acquire, stuff that big a we don't not like is that less than XX% of

Collyn Gilbert

it. Got Okay.

but finally the uptick Okay, a that? in then quarter, what net not the charge-offs curious just big drove number, just finance that's helpful. equipment in the And

Luis Massiani

bit One portfolio. transaction. a it other indicative the was the charge-off Not relationship the not nothing from portfolio levels -- broad-based and drove and It charge-off that was increase we loan That’s equipment. that -- everything related larger but exposures provisioning else just any size like. had traditional this performance relationship really was to in looks in in of a little it what in and large and all. the have status finance to a delinquency equipment really the The relatively discreet large situation or

Collyn Gilbert

Okay, up if that’s it you what do mean this to be lingering you or then anticipate, more all there okay coming? and did I quarter cleaned

Luis Massiani

on No, the equipment side.

and charge-off, aggregate for bucks medallion of just quarter $X.X the levels charge-off million were represented at over by of this So when you the the were relationship. that that about two-thirds the by look

result an in are seeing issue, but we portfolio this we anything up, in we you Always the until the quarters. don’t that again. million you of a so we in anticipate would the at that don’t I financial in issue following it $X anticipate you So cleans this in charge-off point think that portfolio would don’t have revenue credit single know not that charge-off a have have an equipment

Operator

for any today’s to additional I’d call will hand speaker like the That back conclude to or question-and-answer session. closing remarks.

Jack Kopnisky

a so company That’s you. were following it. those questions, Thanks Thank great day. we the Have great and great. lot a appreciate for

Operator

participation. That you you your gentlemen for will conclude Thank disconnect. today’s may Ladies conference. and now

Sterling Bancorp (STL) 25 Apr 182018 Q1 Earnings call transcript