Earnings call transcript Q4 2022

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Operator

Good morning or good afternoon all and welcome to the Berkshire Hills Bancorp Fourth Quarter 2022 Earnings Conference Call. My name is Adam, and I'll be your operator for today. [Operator Instructions]

I will now hand the floor over to Kevin Conn to begin.

So Kevin, please go ahead, when you are ready.

Kevin Conn

you Berkshire thank earnings fourth and call. morning, for Bank's joining quarter Good Kevin and Investor name Conn, My is Relations Corporate Officer. Development

website release is information news information section furnished our is in the berkshirebank.com ir.berkshirebank.com our to the be and website Supplemental provided at in in to Our and this SEC. will we our Investor refer available presentation of investor Relations at an remarks. will

statements forward-looking those remarks actual could differ include from Our materially statements. results and will

earnings release Forms our most recent For on see details, and SEC reports XX-K please XX-Q. and

as financial measures addition, certain are or results will In is release. you and be GAAP this in A financial conference projections. to future news on and provided references non-GAAP in and included measures measures measures non-GAAP of trends reconciliation be our our to results not performance discussed actual to understanding in comparison assist call, should only relied

Nitin Hills Chief Executive we Chief Chief Mhatre, Risk Lindenmuth, today, and call our Brett Officer; Officer; Interim Operating Sean the Bancorp; Accounting CFO; Brbovic, our Greg Stephen our have On Treasurer and President Finocchio, Chief Berkshire Gray, and of Officer our

Mhatre. I At our Nitin call turn Nitin? over will CEO, to the this time,

Nitin Mhatre

all Kevin. of Thank and a everyone Good Year. you, Happy New morning you wishing

with quarter, Slide the the where quarter solid a see this momentum begin fourth my I'll and comments on improvement of continuing year highlights key Overall, strong another X, robust all was the you financial can and XXXX. capping across full-year metrics.

growth driven headwinds income. and This loan and growth more a in net growth. strong X% solid strong margins, the up by offset which quarter-over-quarter was interest revenues were up non-interest XX% improved revenues driven year-over-year, than Adjusted in income by

of of in X% XXX% million were X% up year-over-year. $XX Resulting X% PPNR was up adjusted operating leverage Adjusted and year-over-year, XX% up and and XX% year-over-year. quarter-over-quarter quarter-over-quarter expenses resulting quarter-over-quarter positive

of per X% $X.XX quarter-over-quarter was up XX% earnings year-over-year. up share Adjusted and

on of are return the targets earnings was and per tangible lower was both of quarterly the adjusted we X.XX% Adjusted to share assets quarter return since for which XXXX. the adjusted close highest program set points, on mid-XXXX. common was BEST This end equity basis XXX

On common quarter X XX.X% balance of common Tier our equity to ratio ended a and with front, the X%. remain sheet the equity a We of strong. capital tangible continues ratio

We of fund have time. We continue repurchases. loan prudent in of and increased the and over stock a target to ratio to fourth $X.XX our net dividend ample XX% income by capital both dividend our quarter $X.XX payout to XX% continued to we'll XX% from growth

quarter share capital about returned $XX program repurchases via million We authorization shareholders to stock and XXXX. repurchase $XX a for new million of this have in dividends we and

remains partially we additional we the to remain vigilant, from charge-offs and increased provision asset the strong, quarter. charge-offs our As quarter absorb this in charged-off primarily overall for that credit same third expense quality

This credit any was credit. and broad and does not reflect remains an isolated in deterioration

capital low. In on loan leading XX-year fact and our and remarkably strong at classified are most a credit risk-based assets to of indicators are delinquencies

balance sheets de-risked the loan run-off XX% down Separately, the which the credit We've At to non-strategic further de-risking of program of continued for year, lending, year-over-year. auto been aircraft indirect Upstart we mid-last run-off through balance announcing are Firestone an including BEST few we our have last and launch, accelerated books. by sheet also both actively years. books, the an

several the included tracking appendix and loan have in we of and ahead books years. how we've which over data page, last plan de-risked book is these Credit of both our the details

more in Brett, quality metrics detail management, new our XXXX an outlook provide While indicators, of and it reasonably feel uncertain will originations leading years. recent overall we credit moment. is on credit and good about credit for in environment, the based XXXX high in proactive a review

we significant front, strategy made in BEST progress XXXX. the On

continued optimization performance banking employee have sustainability in Comeback our our our financial goals, ESG ranking, ahead significantly tracked BEST improved physical the improvements Community bond in enhance and customer issued digital We program accelerated programs to experience engagement. along capabilities, of of a second our footprint, our and with quarter,

with started What We With getting while before to pricing guiding a idea we loan credit or not guiding bigger. the is, we idea to getting means BEST now resumed plan transitioned our get we better get growth, sacrifice have will bigger better. grow. to this

responsible. that is deposit continue cost will to durable on focused is be We and Central growth responsible differentiated, to growth lower base. organic profitable a

MSAs many six our rural are We out less in and in well markets. smaller deposit shares eight are competitive and high of relatively positioned of we very with city

part well as we as encourage to our generation, strategy, changed BEST also loan plans deposit of As generation. incentive

We including also MyBanker banking strategies, and our enhancements. deposit several niche platform our program digital have

is quarters. the coming an good it feel we volumes environment, in While relative our deposit and uncertain about cost

add We to continue bring customers talented and to us. frontline new relationships to bankers

many served executives who Rosato, XX you know, the for at supplement February. leadership Webster Bank join talented at finance early seasoned Dave was as to years. years in also team. United Treasurer have hired will We our in People's the as to last was three of CFO CFO team People's, nine their and us for David may recently years. for Prior eight David

them for our planning Head Georgia the We Melas, senior them retiring. We to of been George and service Officer. best Berkshire of for executives, many on our who future. Credit have Commercial and Chief two thank very years immensely Banking; contributions Bank significant their their wish also and Bacigalupo, replaced

an has our less from was Private joined deposits. as as business growing billion experience over at including over Officer Banking Phil, as his welcome team. Greg experience Risk billion Berkshire and President to He for in XX has We're to leadership $X banking successfully Brown, brings us We've page executive. of new of years Banking excited Commercial our $X.X at in Senior joined in over Boston commercial in reporting each deposits assignment $X he Credit last than short the the Risk Commercial appendix XX Jim of Santander. Head our to have Banking Berkshire. executives to Banking. seasoned Jurgeleit, and Officer. bios instrumental Jim Vice our billion Lindenmuth, loans brings Phil Jim ran Chief Chief where loans and joined of David, to team. Credit included in Commercial us also years Phil

Slide ahead X, shows our We'll targets North of metrics. which chart, that to three report we've achieved Star details plan. progress our BEST five five program performance well of our key are on happy

low PPNR low XXXX end million target to range. of fourth our target at annualizes assets on on at We points million of also of basis the are at the our quarter $XX range end our and return XXX $XXX

We the ESG at XX top a the are XXXX by We've percentile, quartile in steady solidly X.XX% the XXXX of achieved metrics. improvement ended our back end lower and our top under this encouraged score to this and quartile. in in performance a critical XX% quarter momentum XX% target bit just the in ROTCE and

working about we will As calls, time. expect are Score mentioned are further on through our momentum to Power and we Net the process XXXX In summary, on our earnings show JD our drive improvements. with momentum pleased and are prior rating that improving energized with we Promoter NPS over

Interim our socially their hard commitment to like would for our ongoing becoming the to strategy community is driving finance Brett always performance years do, the customers of would Brbovic to commitment service and to is and colleagues our CFO and of this and continued I performing responsible like what work Berkshire I thank bank. a vision of for continued leadership also Their As dedication XX improvement as leading team at to transition. I Berkshire Bank his our all high our progress. his thank of for during

that, Brett? the our financials discuss call With to I'll Brett, over turn more in detail. to

Brett Brbovic

Thank you, Nitin.

the for funding X% grew adjusted income financials. basis XXXX were a reconciliation shows Please comments statement. XXXX. versus non-GAAP. growth, our interest yields, Slide My be XX% and and to of in on growth Net appendix increased revenues and up an costs. see X due loan annual will income modest asset adjusted GAAP

We were X%. with primarily down by EPS maintained by up fees efficiency average revenues driven gain flat driven and fully declined sale discipline ratio declines. spending XX%. our diluted XX% lower and XX% improved wealth expenses our and about Adjusted lower about by management to shares SBA year-over-year Fee market was on

expense our X% operating quarter-over-quarter in up up a $XX $XX efficiency allowance quarter-over-quarter moment. more interest and basis offset quarter-over-quarter X% quarter year-over-year about year-over-year for our the million strength discuss as year-over-year X Provision Expenses XX% detail X% stable revenues. leverage for at our income shows quarter income net was XX%. and credit revenues, expenses relatively million. the remained and a I'll as was were was ratio credit quarterly had fee in and and both statement. and Nitin, positive Revenue a Slide we and decline in mentioned on

third quarter real growth estate Slide increase in average average shows loans X% On increase and had respectively. an X% with a assets. loans X up basis, versus in earning loan were We C&I both average with period another the commercial X% a year-over-year. strength broad-based quarter X% and XX% of our and end in up of quarter-over-quarter loans

even yielding difficult rose last shift Loan hired the over continued third mix benefit quarter season higher quarters. the officers balances in several Mortgage investments continued the loan lower largely in to XX from and points yields a basis into grow yielding to environment, the versus by from driven loans.

X% deposits average X% rose the our year-over-year. quarter total Slide declined X shows versus liabilities. and Average third

of deposits at XX was total points from quarter. basis cost Our third up points, the basis XX

XX% quarter is for deposit total the fourth total cumulative was our XX%. Our and beta beta deposit

coming we through still expect in to strong While deposit to a base we do XXXX, be benefited from increase the deposit and the in expect quarters XX% range. we to the cost cycle total over XX% deposit betas

grew shows our margin. interest quarter-over-quarter X interest income XX% Net income more and net year-over-year. detail and Slide on XX%

NIM the and this XXX XX at margin the our adjusted to essentially Our interest third quarter quarter basis was report and basis happy points. up are we're versus reported points that net same

our third resulted this period. late sale. credit million which credit quarter the SBA improvement fees we fee due This fee -- the more offset down our XX, agent accelerated sequential to XX%. which $X.X in were the tax tax by Slide to than amortization, deals our is the quarter. to tax fees lowered were credit business tax loan other related this the which rate fee expense, versus Loan of quarter revenues is benefit show This into in our revenues, more due the on amortization timing contra to being higher and our about revenues closed in and credit down in swap gain primarily full X% to tax Turning current and is a item received of a on revenue

to reduction are our benefited that day note acquired less show benefit I we X, the year-over-year. X% quarter and and versus up Slide a working compensation quarter expenses. Expenses one third the X% On expenses the from executive expense. plan in

and our as expense we a business. technology continue which was were seasonally heating equipment result, for snow higher up commitment increased expenses was removal and and we of digital is unfunded invest from to as higher rollout on in Occupancy requirements our to the doing and platform. up reserve, reserve function banking Other expenses continue more a

a lease up. termination costs Finally, a favorable restructuring costs outlook our I'll moment. on our of merger included -- expense, a $X.X were prior were in which trued a show reversal estimated negative period I'll share and more expense million, as

quality is of asset XX Slide metrics. summary our a

receivable this Nitin customer corrugated $X defaults exposure had about this we've the box by one market quarter. net charge-offs quarter filed of of million bankruptcy is charged-off credit manufacturer for $XX.X the about million charge-off, As middle a of driven in largely to and XX% and prior that mentioned, remaining impacted was collateralized. loan Including the we fourth by quarter,

monitor in to credit this continue will XXXX. We

credit XX while were to non-performing of XX% versus broad-based a and and not down year-over-year seeing on at loans quarter we on deterioration are monitoring are a loans down accruing Delinquencies early are non-performing XX% loans XX low, the and loans basis are and X% Delinquent quarter closely delinquent the basis. credit XX% that at delinquencies basis. versus third a year-over-year points we year are third or down encouraged our portfolio any and stage

and positions. Slide details liquidity our XX capital of shows

XX% was ratio loan-to-deposit below of target our Our XX%. this quarter, BEST

Our ratio capital common ended an estimated equity Tier quarter the at XX.X%. X

a given third to included over modestly on Our mark TCE of $XXX and quarter, environment. in an after-tax basis, million $X million included will OCI includes the are ratio X% improvement booked improvement to quarter. bond ended regulatory fourth ratios. mark the par quarter lower Those a bond the in a capital after the at rate an marks bonds The cumulative and tax pull time not

at clear $X, historically making quarter want this adjustment, share that to at by We the value for in would Our but mark, tangible share book GAAP the highest provided be tangible the TBV the TBV about to per total appendix. $XX. ended $XX. per increase share a book reconciliation Berkshire excluding I it is value a non-GAAP the adjusted per about about AOCI

priority capital Our to is to support top deploy growth. organic

repurchased Given our XXX,XXX in million the we position, about capital excess shares continuing about fourth for quarter. $XX

are biased book repurchases low opportunistic stock our to value. given valuation We stock tangible to relatively

mentioned, Nitin dividends by As XX% authorization. per the announced quarter we a $X.XX stock fourth our in new $XX million grew share cash per repurchase quarter to and

XX Slide once XXXX. a the our We quarter on shows operating for guidance changes meaningfully. fourth unless outlook plan share our year environment call, to

upside which XXXX, outlook modest be our based outlook do, for our on we banks interest is and the many based and conservative As funds forecast at to provide X.XX% income. of on our most net Fed may baseline Moody's

XX% expect X% XXXX, X%. With are up amortization. to revenues of due of higher XX% be average full-year to XX%. growth of credit it tax forecast headwinds to loan know decline interest growth Fee to expect and XX%, income I the that to down We is to but in rates XX% be and average a of of net most face deposit we that, XX% continue to to

We of quarter, a per our million are is to function expense which credit growth. largely million of loan targeting expected $X provision $X

XX about XX average our context, to For points. XX year loans provisions is to basis

We higher this We expense versus driven disciplined our expect maintain insurance inflation, costs. will expenses operating positive management and in investment in wage X% approximately leverage still peers. our believe deposit with differentiate growth XXXX technology to expense by growth

share Our tax on above XX% plan. execute expected XX% repurchase to rate be is we million to new expect to opportunistically and $XX the

it I'll turn comments. And over further to with Nitin Nitin? that, back for

Nitin Mhatre

Thank you, Brett.

on economy positioning. I'll and with the remarks close my our comments

in solid market, steady be primarily relatively remains New on footing. England which are We fortunate operating to a Eddie

tight As chain the are our a market, levels at labor the recovery to and by time, we same we from by talk inflation is demand customers, bit corresponding supply more doldrums. but activity seeing the and caution, driven concerns, supported pandemic

Syracuse, microchips that markets companies creating about over nation. $XXX in through in we're of investments be private the and local like investing will largest being In like government excited billion plants made Micron, one the

environment. As I beginning are the well to call, at an of positioned we the said through navigate uncertain

are better. focused responsible get profitable and will while confident bigger on and are that We getting growth

for turn I'll that, with And Adam Adam? it over to questions.

Operator

Young And [Operator ahead. from our first please question from RBC. Billy, go Billy Instructions] comes

line open. Your is

Billy Young

quarter Good here.

in First, little in drivers a to I guess, I your can mentioned we remarks. speak your outlook. the you of it of your deposit prepared bit growth know

Nitin Mhatre

say, growth broad-based. would I was Yes, broadly speaking, the

Our growth satisfied but a the XX%. deposits below that accounts coming and CDs we're probably faster think grow trend. momentum do I we the rate at have. very and believe months quarters, expect NAV will in with came we same levels We XX% at the at that, beyond that relatively and The continue to market, through remained predominantly to interest-bearing that money the

Operator

is is question Please Mark, Fitzgibbon Sandler. your your from ask open, ahead. comes Mark line go next Mark, your question. Piper line open. from please The

next Let's go go from ahead. please question Hovde Group, David Bishop to the from is David,

line Your is open.

Nitin Mhatre

we think, the can don't like silent. I hear It questions gone line. the Adam, looks it's on

Operator

Me too. stand by issue. rectify the while for Please we there. issue Apologies the

to our return will previous order. We Q&A

Fitzgibbon from Piper Mark So Sandler.

Please go is open. line ahead. Your

Mark Fitzgibbon

Guys, okay? can me you hear

Nitin Mhatre

now. can we Yes,

Mark Fitzgibbon

super. Good morning. Okay,

to color commercial charged-off, Is any bankruptcy? that quarter. company filing exposure is you I for happened caused could credit there bankruptcy there up this filed what if that maybe add on completely for end residual just First, wondering that and no one the that

Nitin Mhatre

now partially quarter Mark. same the quarter. it's and we this the more Yes, have charged-off Yes in third in that charged-off credit

this collateralized value at So quarter time. it written down its we've to

XX% that's it's $X-ish that's so books. left about on million the residual, So

marking is, business experiencing on proactive ground. supply a And what way is it to been but we've some not, the tracking in linked down and and it But disruption situation and the is caused we're in it's facts a it's the on based that there model ways fluid it. chain this customer some that's

Mark Fitzgibbon

this to we positive Should And in merger point? those Are in of pretty quarters? restructuring that Great. then, Nitin, expect behind charges, coming much and at Okay. those terms gone be negative. both

Brett Brbovic

a be I significant piece is Yes, little may but the expect see gone this We the would to now. right bit, Brett. majority,

Mark Fitzgibbon

Okay. of the think the us help Super. And margin of about next trajectory can over then you quarters? the couple

Nitin Mhatre

think, XXX we Mark, post did I Yes, quarter. NIM as this

the For next that an NIM on NIM we believe modestly year average would that the first basis, peak. we half higher, believe be in somewhere do will

Mark Fitzgibbon

growing deteriorating about lastly, I at with putting guess then in that comfortable get And worry year a how what a be you double-digit do environment? doing will that in do rate arguably growth? much economic Okay. loans you loan this

Nitin Mhatre

question. No. Yes. Great

reason our of we And we've all, in seeing comfortable incentive terms is, the I credit that we're some that in is started the momentum producers the a pockets. it fact, box back tightened really a the measures changed the the why and productivity bit in in haven't XXXX because think we're plan. of we and reflection little investment making at

So that. really it's reflected in

remains Our levels, and at criticized credit historic a which is we we've and our about, seen. are as originations of new that classifieds the strong delinquencies reflection low of quality talked some

And my good new we feel I originations in said but the about strong. just in remarks, remain we continue we trajectory to are. on So vigilant, stay where will as

Operator

RBC. The next Billy, question is from from please go Billy Young ahead.

Your open. line is

Billy Young

guys, me you Hi can hear okay?

Nitin Mhatre

Hey, Yes, correction. want before we Billy a we just start, can to make I now.

at you non-interest I right. about to I was think, question hope halfway that on bearing. are how talking lost we XX% and heard you we XX% through your I

Billy Young

But your can follow-up so, that. I appreciate transcript the catch I actually. answer, always on didn't I

Nitin Mhatre

Okay. Thank you.

Billy Young

loan through on for think growth year? been growth. mortgage follow-up I but did driver your you primary a of big a this think guess where in of do resi nice the obviously, for on quarters, about, growth has bounce just in How are Yes, quarter. last few do question see you kind this we drivers Mark's to a back

composition about So think XXXX? we how for the should

Nitin Mhatre

think I be Yes, going the to similar. competition is

a are see but similar growth growth, loans in would The rate balanced because different both will percentage 'XXs. the parallel. differ, these the percentages of see expect commercial as about mix baselines keep resi low growth and in We we we to of portfolios, growth commercial might for total

significantly. mix doesn't change that So

Billy Young

potential this we've expenses. where XXXX? to hold going -- potential forward pressure your you XXs, at you switching over points to these expectations months from your here the in Low some last and all from speak on cost seen are your Thank peers from do of perfect. few the And ratio just efficiency looks what done going for ability kind to some pretty hiring I outlook you. to levels you've controlled see What confidence guess, also and just The compared your given can quarter. forward?

Brett Brbovic

Hi, this is Brett.

I think reinvest digital our to see to we we're as platform. continue expecting technology in

deposit, in increases well. some see as expense to insurance expecting are We

I going to think drivers. those primarily are be our

Nitin Mhatre

are of part program. compensation say, that of like continue I the and was optimization Yes would in that about technology the talked Brett BEST the some bucket and there

is and estate equipment, some that actually real improves elements rate. of technology So items there to occupancy related run our

So good operating be X% to in growth those maintaining but the positive a factors, leverage. offsetting while expense, it's about still leads will overall

Operator

Please ahead. David, from your Hovde David The Bishop question next Group. is go is line from open.

David Bishop

not a just loan loans, The in for period? XX% housekeeping guidance, correct, to guidance XX% that Hi, that's point. the the average

Nitin Mhatre

Correct.

David Bishop

it. Got

above, couple been rate, of has quarters implies probably think, So or which correct? expectation growth for the mid-single-digit guidance that your past I

Nitin Mhatre

Correct. Yes.

David Bishop

Got. Question lot on banking England color to the of appreciate the a experience. new good -- hires,

-- in new if credits loan provide you or as there, banking make expansion any there's does curious maybe for types strategic ground could Just the board? you that new or foresee start that any of change target? curious company they to do on any outlook hit you the the opportunities -- the the commercial niches geographic change does personnel Just with

Nitin Mhatre

Yes, I think the geography doesn't change.

increasing one of create areas think the strength in, specific opportunities but being into of within that it some will I the operate for our are we stay we them. more sectors, profits not potentially

deals of There and private is vertical we would a experience that get we're that family venture at. there some capital is more business also looking kind sponsored or equity, leverage through

think areas, of some and quality XX% from. there we going strategy remain clients after more of the is addressing I importantly, which business on the otherwise, So be will the needs margins. about with high we're comes existing Yes, new but clients of still consistent our the

David Bishop

for disclosed And number if Got XXXX? year, know this the know relationship of and hires then, numbers it. lender this do that what maybe have you new don't budgeting you that, you're

Nitin Mhatre

Yes. as at to Dave, on of front and I we we about gross to don't of but time. compared were this that it pre-BEST to we say did the hire in had a that have looking tracking XX% number point baseline me, that basis, we're in

David Bishop

the sheet, ratio. And it. Got then you on loan-to-deposit relatively balance capacity noted the still low

at competitive look a of you balance maybe combination As curious portfolio? the cash of flow how from on just growth, the use sheet, pricing, funding just you're Thanks. thinking that loan deposit pressures deposits of the or the a given some borrowings is and securities

Nitin Mhatre

I'll ask that Stephen Dave. take Yes, question. to

Stephen Finocchio

Stephen. morning. good This is Yes,

jump broadly think opposed not a little opportunistically in to tend deposits. having basis in continue a I -- a of year, funding have on as So more we to to on latter bit bit on. We next later that more but wholesale more do have lot market a to work will

loan-to-deposit the still during a year. think, growth. good spot don't now I obviously watch ratio around we growth we're a will the loan I'm little think, bit overall are I So -- on versus deposit probably the and where the right grow at I

Operator

The is Hunsicker Point. next Laurie, ahead. line from Laurie go is question your Please from Compass open.

Laurie Hunsicker

much how you charge-off, million C&I to one of then, loans it hoping here more how middle versus And specifically the so C&I on Just little give could commercial, you I CRE? related bit that was that $XX.X charge-offs. much market of what was the charge-offs? a was had guess in that color

Nitin Mhatre

part Laurie, and rest was distributed credit, $X of million was about as the regular. particular This Yes. the

million to I think our $X $X million. regular around been charge-off, have historically,

and out, commercial we mix $X.X of So if and includes million credit, consumer. you credit single about that commercial were at take a that the

Laurie Hunsicker

Got it.

Okay.

you off is charged and So $X credit, correct? million $X remain, million that on that

Nitin Mhatre

Correct.

Laurie Hunsicker

it. Got

remind then And or $XX Okay. just with, million big something? like it to is was how the me, credit start

Nitin Mhatre

in No, we about it the million took quarter $X million and third was quarter. $XX in $X million this and

Laurie Hunsicker

Perfect.

at were Firestone, Okay. then, appreciate you non-performers categories $XXX to XX Page granular $XXX that what quarter the upstart, give I'm I charge-offs you on sorry some but charge-offs looking categories and disclosure charge-offs the update the hotter of some categories, then Great. and you where detail, we of give and SBA? the non-performers? And deck, on loan And million, and on namely balances. million of Thanks. were this really ask the what those an gave more But the gave this non-performers guaranteed then if you could two for

Nitin Mhatre

Yes.

in So than me, it and we front XXX loss model I those the expectations have -- are of we what could better basis were, performing the annualized. numbers, provide could numbers upstart but of is they about but don't of points rate

Laurie Hunsicker

XXX for quarter points a annualized. That's this basis

Nitin Mhatre

Yes, Annualized. full-year. for the No.

Laurie Hunsicker

it. Got

Okay.

the what you were charge-offs for quarter? do so this know And

Nitin Mhatre

it million. annualize, If you $X was

Laurie Hunsicker

$X Great. million. Got it.

about what And then, sorry, Okay. so I'm Firestone?

Nitin Mhatre

that with me. have don't I Firestone, number

Brett Brbovic

Greg, do you number? have open Firestone

Greg Lindenmuth

that. do Laurie, I Hi, $XXX,XXX. have

Laurie Hunsicker

$XXX,XXX.

Okay. then, any office you do Great. was And refresh ago. a last had the details I office, around have year

office at piece which so was medical. care, sort $XXX health million million lower education, risk $XXX of numbers the You or that of had round

on a that? You guys have refresh

Nitin Mhatre

Greg. Yes

Laurie Hunsicker

And maybe why you're --

Greg Lindenmuth

Absolutely.

ex education space Laurie, is commercial it. medical. our office $XXX it's got You million, and on --

Laurie Hunsicker

$XXX million.

Okay. me -- And is in of how that remind just much

Kevin Conn

-- Laurie sorry, And is Laurie, this Kevin.

it XX% of that space. suburban office office point the out On is I just exposure,

space A not business and predominantly So the central space. central district Class it's is district business

on the after expire one other portfolio, the point is, XX% don't office just of office also, to about And XXXX. leases XX%

there So relevant marketplace. environment is position it's book office, very uncertain doesn't. -- given Even but it though, so on the

Laurie Hunsicker

helpful. super That's

have back Okay. margin. gears spot And shifting to December question, then you guys just last margin? totally one Do the

Nitin Mhatre

don't. as think, the with trend going But my, other one earlier. we along up and rates been response has said No, in the I I

half. to the the peak first in but higher margins be next full-year expect We to average NIM the year,

Laurie Hunsicker

quarter. you about And Right. those far Got funding million that Do quarter this have I'll one here I $XXX just have those? question then brokered you're a it. number maybe thinking last leave and it CDs. so just and more how using for

Brett Brbovic

Yes. average is million period million. now. Right CDs on end balance for and about of brokered $XXX about $XXX The was

Operator

Chris comes O'Connell Please open. is today from ahead. KBW. question final go from Our your Chris, line

Chris O'Connell

to provide the if could point? loan you commercial buckets circle on hoping there? four run-off versus the if And could expected yields also current resi are then portfolio. yields what consumer those Just wondering update what to before an on just at the this And coming back timeline maybe on the provide, the And portfolios? you run-off origination the just

Nitin Mhatre

take quarter points higher Sure, on a about a we're handle coming the four XX basis seeing than XX for basis the part higher -- I can about commercial come again, then with prior seeing first six on, handle. we're points and with residential

Brett Brbovic

and looking were think on you the was an I XX. was And for Firestone yield a around handle seven then Firestone upstart the upstart portfolios. around had

Chris O'Connell

you long to before guys run-off? how an update those are could if expected it. Got on take And provide Okay.

Nitin Mhatre

Yes.

in to back, schedule We the have Chris. about of six the eight quarters. quarters that roughly It's

Chris O'Connell

cash portfolio? Okay. flows the What the is quarterly off Great. there? is what security then And monthly or coming

Nitin Mhatre

repeat question you Chris? Could the

Chris O'Connell

portfolio. flow The after securities monthly cash the

Stephen Finocchio

million $XX last the per This and in right, about during the month, it's Stephen, quarter. last Yes. quarter is

Chris O'Connell

And be Great. driven to to mostly down, the be just by the investment on there forward? does is how then in line it Is movement going guide seems Okay. line. some flat look tax 'XX? going fee that -- Does or credit it that

Brett Brbovic

amortizing over on lumpy, depends with be you're period. how credits that or they even the year the much can in close during So that depending on quarter, tax during when

So we the be really lumpy. And -- it believe can we

Chris O'Connell

Do in like plan change that material number, starting just of point? kind

Nitin Mhatre

Chris point I there. the think Yes, then important

the you're is, up going that's actually think modestly. where fee core business I goes

of net adjustments. think tax I

goes income business and goes the non-interest core it pretty income based up think I in outlook, we've core but down broad as fee the stents. actually outlined

Stephen Finocchio

expand XXXX do to And credit love in as really tax looking and we well. we're our business

Operator

from Laurie We Hunsicker follow-up please Laurie, Compass have ahead. go from Point, a

Laurie Hunsicker

Yes. good Hi. morning. Thanks,

taking to thinking my one growing you item, balance what circle wanted how it. is for Just back that? that on know follow-up. don't and normally SBA about this you Thanks disclose because are unguaranteed, guys I

Sean Gray

Laurie. Hey, it's Sean.

million So The X% it XX to US for balances $XXX quarter. about fourth was charge-offs are year-over-year. bps down and

Laurie Hunsicker

going about you of Got going to you it. about think do book that? And growing are kind thinking How how the you line? hold that forward. Are

Brett Brbovic

holding we're think the I line.

I think year. this year down I going X%. is to And we'll it like indicative next of about what do into was said continue

Operator

in the queue. further Nothing

hand team the back concluding to So I'll remarks. for management

Nitin Mhatre

call and call can you Thank for you Adam Adam, Berkshire. today day now. your all the our and for joining be investment Have and us thank on a interest in close great you, and well.

Operator

your Thank you, much this attendance. concludes today's you call. for very Thank

your now You disconnect may lines.

Berkshire Hills Bancorp (BHLB) 26 Jan 232022 Q4 Earnings call transcript