SPFI - Earnings call 3 2023 | South Plains Financial, Inc.

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Ladies and gentlemen, and welcome to the South Plains Financial Third Quarter 2023 Earnings Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to turn the call over to Mr. Steve Crockett, Chief Financial Officer and Treasurer of South Plains Financial. Please go ahead, sir.

Steven Crockett

good and operator, you, afternoon, everyone. Thank your conference call. appreciate participation in earnings XXXX quarter third our We With today and Executive Officer; Chief me and Officer. Cory Chairman here Credit Newsom, are Curtis our President; Brent our our Bates, Griffith, Chief uncertainties and discussion variety that The the other available results contain this and our spfi.bank.Before call News complement like of I'd statements of on we section may results. is begin, from could slide are Events to that to a cause deck differ website, to presentation risks, those subject today's to & future remind anticipated factors forward-looking everyone actual materially Please safe our on press today our earnings and release that Slide X see slide statement issued the earlier harbor was of in presentation. deck today's statements. are safe call those during to harbor subject comments All made statements law.Additionally, non-GAAP discuss any update duty and our made of only Any herein in useful except today's to by performance. may we during are call, undertake evaluating as certain as we not forward-looking measures, today's presented which required believe do are statements, such forward-looking date, we let of over measures slide these and A GAAP most beginning comparable earnings at also Slide of be to to found on you. XX the of non-GAAP the presentation.Curtis, release it measures deck end reconciliation me can hand our the

Curtis Griffith

will are results.To key take then call, conclude Thank hope review an provide update more over from highlights today's to Steve, points our interest you quarter you, the growth the and will review that next portfolio reprice as X good allocation call. of opportunities loan detail start, well as the I and on Cory I the XXXX priorities. year. briefly will detailed discuss portfolio afternoon.On to in Steve a of that our there capital drive results have our our more financial third away will our we with income

strength of relatively the have franchise. quarter, our deposits the core remained decline in community-based year stable third a further only the modest deposit demonstrating our throughout First, with

experienced the healthy than interest notable our growth cost net in income portfolio, as combined growth offsetting income yield with our our improving interest we loan funds. loan year, more rise strong Second, of growth the through the of drove

that share to year. third drive more quarter Third, while to $XX.X common $X.XX are third per quarter, profile interest Fourth, loan believe credit compares as of diluted income growth further of to through have delivered of approximately million XX% our opportunities net the income believe moderated growth diluted the quarter in the we ago over portfolio reprice or earnings mature we next are results the shares on compared or as loan in earnings of can of per our continued loan value.Turning share our improve XXXX. $XX.X XXXX. at continue to $X.XX income lowest the in as This quarter. of million million to through or $X.XX per portfolio since or IPO And million year second in the share level the for quarter third assets $X.X X our net of our third as XXX,XXX the that repurchased our we diluted to earnings shares quarter in presentation. detail intrinsic $XX.X below we our We nonperforming their trading of third Slide lastly, will in

quarter. the after-tax the triggered incentive in the sales second subsidiary As the loss the previous the transaction of sale Citibank's in realized resulted share per $X.XX the compensation wholly-owned quarter proceeds a income the securities completed insurance expenses, Windmark, on of during less investment in reminder, by of onetime transaction we and sale The second net quarter.

a negative losses million of was in delivered of the a quarter We share.Turning diluted credit in primarily million XXXX. partially more the will the The quarter moment. given second which X.X% deep that specific strong second portfolio. third in quarter. was a quarter, and loan items, charge-off in a and to reserve annualized provision of of earnings the growth loan reduced pipeline to quarter we Cory was detail loan per This our these in loans expected for net recorded reduction provision $XXX,XXX $X.X which the $X.XX our We reserves, as the compared offset discuss in loan by release Excluding activity. second growth in comparable third through $X.X grew

relationship borrower in call, was the which quarter directed we of credit $XX.X from May. As on quarter third that we nonaccrual to was XXXX. we a and discussed had classified expected some see liquidation in of million totaling placed our The second a for in starting business repayments

and However, repaid had we quarter, that prior the in released quarter. we fully was provision specific this in third taken the the related credit

As loans touch classified of our at credit on detail, the Steve portfolio more is are of our lowest will pandemic. loan in strong as level since start quality the the the

approximately represented share of quarter. tax after earnings in the release reserve per $XXX,XXX $X.XX Our

to we result, share a third of million the bank September the the quarter second $X.XX to per believe earnings or XXXX. As at the billion XXXX, end $XX.X the XX, rate deposits of $X.XX X.X% compared run was in grew quarter.We of as

environment.The stable X% in the of represent our stability a current It remained base Our the seen of $XX began public of that provide to quarter. the At the to fund of premium community-based to liquidity, point highlights the out which than in strong liquidity this further Paso. small right Houston in liquidity brokered loan add on XX% funding bank remain that decision strategy the deposits our to stable the offset important major Dallas, in position deposit franchise in growth that Ultimately, We while less March. also Plains our early we Today, our our the deposit second that expect been of growth and deposit excess Brokered is due quarter of quarter Slide failures work position broker historically end, our was part higher end is franchise a quarter. given through and we at $XX funding the expected achieved. year. to deposit be third XXXX deposits increase for paying primarily to were that the brokered million predating a deposit decrease building markets base, a holds. the metropolitan XX% moderately our we our strategy small as had competitive to expand brokered X, our deposits growth South of have and excess through loan in fourth achieve was deposits, deposit believe liquidity and deposits, El strong started million we to a percentage by to we're partially hold can in portion markets which with we deposits rural of

seen can our our The deposit an base approximately have have community be gains #X is and deposit a or strength balance our share total Additionally, in in deposit recent uninsured share only XX% market estimated average strong either of years. $XX,XXX deposits uncollateralized. achieved the In many account to also Lubbock, for due of largely we we from competitor been mergers. dislocation are

the coming the deposit share place X leader now XX% with in market the bank for in are with second first an time XX.X%. We share at years

deposit a and Overall, as Basin we're share in the We #X position the market markets, deposit of deposit growth is dislocation #X, to strong third We we our Odessa, to third Midland in many in to of quarter. and share seeing testament employees the with borrowing we are customers.Turning Permian which rural our in gains quarter our ended a and which also that seeing dedication in the well the contributed where have competitor achieved liquidity. strong their billion to untapped $X.XX our capacity.

$XXX billion the Federal $XXX of availability of program. million Reserve's the from $X.XX the funding capacity Reserve's Home availability have Loan bank discount window of from Bank of We from Federal term Federal million Dallas, and

Board our our Given third remaining and XX, the program program. stock and At XXX,XXX our $XX for bought shares million repurchase May. second we authorized $X.X the million. a had million on capital shares quarter in repurchase strong for September quarter approximately million stock XXX,XXX $X.X of Directors during liquidity $X.X back We during position,

Looking portfolios. economic sound sheets, strong lead forward, with more that and balance we challenging loan liquidity can for environments those to opportunities believe ample

environment, to subdued sense in While further that markets.Over are make will we our time, look our through we remain fit expect financial interest beginning conversations up to pick given to rate current and the acquisitions expand M&A culture. the bank

attractive of we intrinsic the that will below shares, However, program, they the own stock and Board purchasing we current most share exhaust priorities allocation do acquisition trade view as as repurchase we had When to repurchase merits our our have another is review capital consider our value. of continue our will program. our long which

paid has to share over dividend announced ago. a also Board again This be steady a going returning allocation, consecutive our of through we economic deliver We environment despite shares. and risk growing challenging conclude, continue capital our industry. headwinds strategically XX, capital our since of a our our focused quarterly be dividend for dividend stream our remain to XX, and conservatively XXXX, week. X income to shareholders November bank, part per the $X.XX will a on last quarterly on focus buy XXth authorized public of is quarterly shareholders And October XXXX.To years managing to Directors as As for record been of for our shareholders on results using and back our

In parties, conservatively the the still opportunities continue poses we economic the bank. will capital having we and manage market for are other While in as meantime, take grow we the look challenges M&A. conversations our environment advantage of to with to

Now to let me over Cory. call the turn

Cory Newsom

for real XXXX. good compared mortgage, or second loans. $XX.X and quarter commercial Curtis, you, the the demand agricultural estate, primarily investment remained Loan X.X% third Thank everyone.Starting during on by held of X, residential Slide in to seasonal increased loans afternoon, quarter energy annualized and million

we which slow rebuild loan was through strong which a the following third to loan experienced expected, moderation pipeline growth, second reduced quarter. quarter and the As our

growth million in experienced also loans early a and of headwind quarter. a of nonperforming million $XX.X the $XX.X payoff loan an taken relationship payoffs proved which to together the in We

X.XX% approximately in quarter the we to X.XX% yield as these annualized X% in have third compared would the loan growth quarter third Excluding the loan of second quarter.Our payoffs, delivered XXXX. was in

margin We proactively We pressure for the into to and look year focused the loans which on account mitigate pricing contributing managing a growth funding our to costs. as price to environment, remain costs rapid ahead. interest and funding fourth quarter new we to market to is continue higher while deposit loan rate

which we to created benefit at lenders more mergers, to rural relationships to by competitive dislocation talented Citibank. from bring our in customer Looking continue and markets is customer providing opportunities detail, great

the bank. markets who loan and X lenders recruited to both we relationships quarter, deposit our bringing are During in the rural

to annualized to bank.Skipping grew our of to XX.X% new continue X. their loans continue we continue XXXX. add we portfolios compared $XXX Houston culture as $XX major to in the will and our who million these We as El Dallas, grow fit quarter metropolitan Slide selectively million to the markets have We loan by relationships experienced lenders lenders to by added grow bringing second that Paso commercial markets of the to bank. The in or

important than we loan of markets Our during growth third our metro in an source are more community paydowns experienced the that quarter. markets offset the

believe Looking are quarter, loan we loan the seeing achievable. annualized low single-digit is to growth fourth ahead and our pipeline rebuild

current almost Importantly, in more We Slide and funding focused risk solid long-term on of quality relationships we're return decide demand. loans and we business deals, turning and because loan we We to we our this they light We're much an that believe XX% conscious loans high position we or do good our will portfolio. are to levels who approximately XX seeing want $XXX to advantageous this with portfolio X. the is be are be decision next in bank. are reprice which with right the not can include months, healthy relationships. over down environment, of We selective But that customers believe loan in of to in for remain is profiles.Turning the what with underwrite. the healthy mature do loans will being with strongly million of business equity environment,

to continues There loans. approximately rate monthly portfolio being repayments a auto the its higher principal yield quarter. indirect with redeployed during third at rate million in increase fixed our Additionally, amortization these $XX were

remains we XXXX, pick we have in if flat.Skipping balance opportunity to the sheet even considerable relatively income our that interest to XX. Slide While expect ahead loan we only moderate growth up believe

of billion approximately in our portfolio. at exposure of real We our end, $X.X estate portfolio represented have XX.X% loan quarter loan commercial total which

owner-occupied CRE Our offices. exposure portfolio the and office office our total of at the medical quarter. XX% represented Of is loan XX% and of X% XX% exposure end portfolio note, our our third of

and well, performing largest office has Our is our portfolio credit strong guarantors.

credits challenges. to stress test our for continue in the We individual portfolio

estate outlined Slide owner-occupied to show percent have CRE segment, investment community, by more Given loan we important. XX, as which our the which on decided by is the the portfolio location, well real our we detail provide focus balances as commercial on geographical where are as on

can see, many of insulated current more return their outside offices. encountered significant is those CRE to portfolio districts that given employees areas you to our have challenges As and a majority central of are slow that from been business the

and to We continue will quarter, the credits third stress generated the included services quarter the was Slide improve and and sale second will of in the due challenges. third the for to moment.Turning quarter income quarter. portfolio $X.X the That as by decline from largely Steve a excluding in in discuss million the rebates the income declined $XX.X second more gain remain in noninterest incentives quarter, decline to the $XXX,XXX from million interchange XX. the We Windmark to to continued Windmark. our in credit which third and second has the for noninterest $XX.X of through vigilant when million a detail bankcard compared in Of million quarter which test which quarter normalized This larger said, $XX.X of in our individual Third services, loan portfolio bankcard fees. included gain note, quality

also interest with declined seasonality. rise revenues combined rates banking the mortgage Additionally, given in typical

to our to offset expense We continue mortgage focused management be revenue. on declining business and

remain onetime for bank's noninterest the XX% income XXXX quarter revenues delivered of we the from in of third strong the compared believe as XX% quarter third current to the was we excluding second quarter, environment. Windmark.To well the through gain the results conclude, when positioned For and

outstanding We to is driving continue pressure.I have to this continue market given margin turn markets take team our quarter, would customer growth like now will lenders occurring dislocation focus over in added the call to to share our mitigating organic that deposit we and to while on Steve. the

Steven Crockett

loan half for more to on points in additional increase the added helped the million Thanks, interest given strong rates rise third offset in liquidity in of of as combined of quarter third by portfolio million the million our production which year, equivalent third XX. a a Net XXXX. was in XX increase increase. rise margin income, net as the The the million our the interest Cory. Rise the on due Starting increase was result Further, Slide in quarter earnings $XX.X basis compared interest $X.X the interest short-term loan in calculated the in in this quarter. to drive on first new basis with loan was than of tax rates, in second in quarter interest the the lifted on interest the to on interest-bearing X.XX% expense the second $X.X yield $XX.X quarter income for XXXX. compared quarter X.XX% the income primarily liabilities.Our

cost compared with loan of was offset deposits third a point quarter was second of quarter This XX points XX a in to the of combined yield the NIM our our quarter in by second growth basis increase loan partially basis in the as as of corresponding to XXXX. our compared by impacted organic Our increase XXXX.

XXXX. of increase of the Slide quarter, average cost basis quarter in on XX, points second the XX outlined an third As from points deposits was our XXX basis of

on increase of the the Curtis heavily XX our the interest only loan those brokered has we've be deposits costs.Additionally, the on, increase quarter, we liquidity to maintaining year. through had the basis average funding our has to has relationships, remained the rely rate we franchise in points approximately strategically Overall, funded In deposit as funding the contributed we've quarter, in third to expanded rising in had core to in the year not Given our our cost year, funds. led small growth deposit augment and during to rise deposits. touched decline which a our with the in deposit third also steady time proactive relatively environment through as

as deposits of noninterest-bearing Slide of declined total in second to deposits Our to to XX. deposit XX.X% quarter modestly mix XXXX.Turning the XX.X% compared

losses X.XX% at June of compared Our credit XXXX, ratio as to XX, XX, XXXX. to for allowance at loans September was X.XX% total

this touched negative full third quarter. and in $XX.X repayment full a from million ratio has of $XXX,XXX the activity from loans million third to due Curtis the partially net repayments, the in at for decreased $XX.X to quarter in in the points recorded for basis the provision to growth XX. million points reduction of and The $XX.X nonperforming our approximately June credit million we quarter on, relationship of provision The quarter. Classified XX, As loan ahead assets declined assets during a of XXXX. a XX second offset to Slide result payoff largely basis was the reserves reduction a in by quarter total was quarter. Due nonaccrual to charge-off reserves, of XX losses the XXXX.Skipping negative other million in third specific to $X.X third specific $XX.X

expense was the to million sale compensation of a sale incentive $XX.X the recur the quarter. of noninterest in well not in million from transaction the $X.X did primarily on $X.X expenses The XXXX us which related and second as Windmark to quarter the third decrease of second Our impacted million as million $XX.X the in as plus securities, compared loss in due and personnel quarter in quarter XXXX. was third the

while continuing rate the across the we taken Importantly, bank. have mortgage over to the of cost quarters efficiencies operations have implement we our third further quarter noninterest as delivered expense more below came last that X in our run out

after quarter We rising of XXXX. noninterest Slide offsets on the remain at costs. increased noninterest decrease tangible looking at we X.XX% million the in of bond by flat team.Moving tangible The which longer-term as rose repurchases negatively a will ahead $XX.X million capitalized was the decrease partially share we million to quarter net to expense the again of common from with in income equity end rates expense completed quarter expect impacted comprehensive $XX.X the our income, paid. other fair keep the the end quarter, this Tangible which securities. during and well remarks. our to AOCI and That lower driven of accumulated offset based a to manage $X.X was fourth to $XX.XX in we was resulted dividends X.X% to to due continued quarter concluding as values XXXX, XX. second to year of investment selectively of of Curtis talent to the September June back XX the declined said, assets AOCI.I'll turn as $XX.XX XX, value be the impact in of book or decrease share to call third by for add continue to largely as the of per ahead, slightly Looking quarter, compared for

Curtis Griffith

even both sheet growth indirect drive portfolios we Thank loan given as over our only on quarter continued net to last experiences interest have To proud growth reprice will balance yield. once the you, we auto this despite slowing in and next with interest economy. growth if to performance which costs We pressure portfolio's conclude, income rise income our opportunities as growth combined our we the X funding the loan delivered our moderate strong Steve. healthy a year, again over I'm of from very months, delivered believe our commercial the ample benefit continue

assets outlook. XXXX, their I the portfolio our as pleased IPO remained metrics see the loan strong in to before at lowest uncertain our since of our level Additionally, given macroeconomic which am nonperforming are credit

talent will value position brought Plains quarter continue lenders to to for and the growth in long-term we like creation. We recruit South outstanding also this

and today. a line quarter Taken together, heading the in we're open we time strong questions. into for the ahead. you please believe year position Thank the for fourth any your again Operator,

Operator

question-and-answer Piper we with Graham Instructions] Our [Operator Dick at And conduct time, this will first comes session. Thank question Sandler. our you. from

Graham Dick

not encouraged asset kind by like I repricing that couple of the your margin. I to start front It over side quarter. a if on to better how see being wanted from guys further next funding confident if and get here what to are you're wanted might But here. relate on asset this you're And the but to think, going increase the quarters. the can guess that pretty only bottom sense you the of I any just costs you in just lead repricing NII, past from of NIM offset deposit sounds pretty to

Steven Crockett

start. pressures offset, still coming side. Steve. The believe is we I that This that, good expense see is side, but income interest increase. will what's day I'll deposit we mean, that continue on it still The number about on feel we Yes. the Yes, will side. to the hope every

pressure say at we some were bottom I that, And mean but think compression, so this quarter don't to decline NIM challenges see we think side, there. I'd like saw we a I will see but there. we'll the to of with to see what continue see we the continue like the I brokerage would

Cory Newsom

keep Yes. really see all I agree the about costs think what deposit going. know have the months. don't I kidding we we with I mean pressure repricing think But we some we're mean in ourselves XX is on we're coming I next if we'll that excited Steve.

Curtis Griffith

we're exactly very do probably we're a knew to think somewhere quarter there I began that I on Because likely, finding I I many be you that if going find trough us it's have And their obviously, but of been But like going challenge, in, will I to yet That's that'd run because end depends deposit peers really there other not by deposit strong I do the quite we're to but at I top mentioned think do bottom. in Cory decides speak on it NIM, And that pretty pressure Fed the have think think we it. that don't still repriced. we our what offerings. we what ourselves think probable And 'XX, see forward. think depositors relationships our lot had which far have the from a of away 'XX, from to I a that that do wish out during obviously. product slow we not But money the coming don't our see some somewhere think that have depositors will to helped from if it's market depositing and else. the for the have so a to additional costs well said, we to don't Fed, coming. depositors going rate opportunities with we're we're kidding of as additional increases

Graham Dick

But hold mean I the that the bank can check reprice a think you we to see can liquidity in our also much fact without I whole. as we as tried as just

So it. we've been very careful about

are some of those face pressures. We going to

I think do it's So insurmountable?

Curtis Griffith

don't. I No,

good it, of job I pretty to we'll a do think think it. we've job done a pretty continue good and I of

Graham Dick

helpful. I Okay. then And just on repricing All side. guess very the

would time loans reprice reprice you over of think average and months. to they where the then XX% you that those rate next said over today loans You Do period? XX have the of like

Curtis Griffith

Steve?

Steven Crockett

stuff. those. not No, Yes. on say. newer across I they're of is I I some the we've mean, really there's mean that a rate would got specific board,

that mean, So the on some been higher books rates, but I for while. definitely a the is at there's little some have

a it's got mean, going average to no blend. at on I There's that specific just point. this yield be So we've

Curtis Griffith

right in it improvement? got nice now. of Yes. I think us information Do a will we've be think that Yes. I front don't

Cory Newsom

Yes.

Graham Dick

guys bit what's little funding they bit a stable this side. then guess, Last bearing quarter, more on here. were the and Okay. guess Yes. lastly we've then on saw outlook, That's I obviously your quarter little a helpful. from is And And more noninterest I I How you just acceleration that think into front. own quarter? growth from the on guess, this how How are throughout play strategy, side? balances? viewing how they'll do noninterest-bearing your are act you that they on XXXX? And acting here does

Cory Newsom

We're have about effort Well, it. noninterest-bearing we every loan I it balances actually Every talk the mean, we I making much discussion that that. as comes concerted come around with time. revolves more this think with

and with balances. of flow those ebb Some a of happens bit little an it that is

Some it I the are of people money. mean, is, using

good. in of a were pretty bit making from they're But mean so balances have those value we of dollars it. worth past. And on a check the I good a those requirements little but now a whole, trying are than in I keep pretty shrinking. we're job as check. job mean, think even to they in better percentage the keep that help can't to more noninterest-bearing of pressure I of do our of doing loans We those

Curtis Griffith

And we for that definitely put really are of working our those packages lot on a bringing incentive in. on will balances emphasis noninterest-bearing officers

said, So recognize people of bit very until continuing have little early off Cory run a a you're value obviously, going it as as to do that wasn't money, the recently, of which up much.

we accounts. and a them on well. the for of little out Now treasury of that. it still business earned them with high can make behove of that something does side bit are a lot there's on money as to activity But things lot There's do get balances there that a management noninterest-bearing, accounts, high-volume

out we of monetarily our So only those. incentivizing and but go preaching to not really are pushing and team find to more

I So think drop some know some see don't on their larger a decline. going to of it that more we'll mentioned some we're our that, while hope probably our the to banks down again, little of calls. see I peers certainly have and levels maybe

the certainly hold That's it. we're have in right best bank the money now. on to trying we to So

Operator

comes Our Hovde next Group. from question Brett with Rabatin

Brett Rabatin

maturing. back fixed wanted year matures are of the that those Are next to portfolio. clarifying that the loans on just XX% rate loan in start that I

variable? X fixed think versus at, it's if X. So What pie X, slide believe repricing it's I relative I look Slide I to or piece is of that

Steven Crockett

Yes.

those variable should the XX then it also that and less. matures the or or less be fixed months So within months can repriceable that reprice XX immediately and

So think say there the should X%. be and XX I

Brett Rabatin

maturities. not It's just

Steven Crockett

Yes, maturities and repricing.

Curtis Griffith

are starting think a on them they to certainly X put XX-year but a fair X-year just others that the hit have those on, stuff a almost actually X-year fix the we're they some on that some are only of a banks on the rates and coming as up of books many we maybe after schedules of on and But maturity, a reprice of years. schedule, and amount lot did, with was rate,

on reprice, saying to our whatever there, So about agreement, loans as besides due to loan are not certainly seeking higher we're scrub as trigger going be to that take we'll those it going well. situation we in might loan what opportunities to that bashful opportunity and rates we're arise constantly a portfolio and those

expect, a to even but may in that in little XX%. I certainly a big coming not So number, be bit the would addition It's it's meaningful.

Brett Rabatin

the make of from understood committed sure it like maybe little but And capital getting uses sounds continuing guys sense, wanted verbiage I interested also Okay. like here. to I the if the still in it share M&A possible sounds around kind repurchase. a are made you're to scenarios then more you It

just And X in here allocate understood to so the were you quarters? how those as thinking capital of make sure coming about both I I wanted things you

Curtis Griffith

that we're Well, get excited M&A, inquiries are what carefully not some we're to about it. getting while beginning is there trying we about to say out terribly the

is But it's opportunities to challenging we'll in. stay comes markets our in and a what of do But think our anything So I market Board revamping still Don't look know having I along. think aware and about like. to going bit. looking be that program We'll talking some of still repurchase in little soon at what probably real place. it's sort a see

been position way a really the to out. we've where few some days. to place buying that think have Board's As our the pretty what in pretty more. the idea looking good aggressive out on pricing we fairly got past repurchase thought buy. seen be clear a our highly but stock at it's does, you perhaps it's down know everything the than quarter, more think we given And we those some we've And have really going dramatic there swings been and in just get little tell, still don't then market's in we'd But out metrics there. levels, I this likely has even Nobody we last can I might good program some we've do. is to worked

in see place? will. but a I buyback in still adjustment we don't you from think that we been it's one doing, think may I probable what little will program we've have So that

Brett Rabatin

Okay. That's helpful.

interested not in per necessarily you're se? more So M&A, dialog because but more getting

Curtis Griffith

multiple we I markets as we've what's our in here. happen happening. well some you that's obviously out of think need stay to home seen aware But know, fair. certainly acquisitions of And

some we're But would to what market and want we do that gone decide we certainly be particularly metrics the to to clearly And like going very don't through we really the some the defend have about say deal would them feel on replicate I walk cautious to situation. we certainly it. want very that right haven't But well. and we of door, do. may to can it

Cory Newsom

the the when fact think in has But is I the it. our M&A other down I more that really phones thing it than is interesting you anything ringing of get past. mean what's so the side than

Curtis Griffith

Yes.

Brett Rabatin

signs anything I almost the point down that Okay. could on that That's super indicate side that helpful. And starting if to consumer? and slowing But maybe Anything would of consumer curious some you're that is or seeing portfolio weakness prime if consumers slowing curious, last one. just a sneak auto one to seen spending. your would show all I'm you've the in are indirect I'm prime.

Brent Bates

No, this really least We're stage. at not at this is Brent.

below pre-pandemic in levels. are still [ still ] check, delinquencies well repos segment pre-pandemic below and Our

you So a score I we've not higher out, heavy any seeing this at consumers. credit towards weight things pointed really time. mean there got, as

be So part that. a that may of

Cory Newsom

I Cory. And this one think thing, is

you as thing necessities one keep look mind, portfolio, think to of it toys. with more I to our at opposed kind indirect comes in if

And of been people want not way done to making things that so the we've in that from. sure in walk away financing can the we've very much or careful

Operator

Our comes with KBW. Gailey Brady next question from

Brady Gailey

had we quarter. last partial the restructuring bond know I So

those put in use loans. to proceeds you think I

any big, a big Are sell over asset you in higher yield. in additional contemplating pickup you bond doing that's So a loss it into restructuring time? then transition and where bonds earning

Steven Crockett

and least of quarter. want good definitely evaluate us look it. bond it to the more Yes, going last any in always at see the and I do I strategy say was at we like it mean, maybe and to to nothing it But for try months, Steve. there's the challenging think we the definitely volatility than little this several the doing at makes going in beginning weeks to the it. all it's of is with one, mean, at of specific a obviously, market what I that sense, but to we're it's bit look if looks see third it we're merits

Curtis Griffith

very is end Curtis. the pleased I'm did, we given what this Yes, the curve. longer with timing our for additional in the of change

watch little But Steve a the that figure may additional hard starts never taking that we income it's try We now, it. said, where never, watch in loss right it time. there like So there say And all the sense. point out to to be really some a there to it all but make time. to reposition justifies out it really

Steven Crockett

of come increased that think loan with part demand. of kind would I

loan to to it's think little I a demand slow bit, justify right of as now. down continues hard kind that

Curtis Griffith

to off a Windmark. to there noticed the who significantly they And an us, out the nice onetime have of is That's bank I piece with chose another partly just gains do big from larger sold that what It sale of business. theirs. than insurance

be So good pretty we're earnings. about we're bond of we now, be And more for indicated, funding. would portfolio. trying more at of reposition It'd But expecting, good Cory a loan be than looking to probably the I it ramp if more us, that it. use as right do than onetime some source demand think, up just may a

Brady Gailey

a a forward? in single expect about deposit the digits, of think low on think That's All similar you I XXXX. And then we can do loan-to-deposit ratio going said grow right. should pace? Or deposits helpful. year growth change at think the loan How growth you you next the guidance moderate you in loan side? do And

Cory Newsom

on think can Steve to want ago, don't loans. to relates and grow things on how as as start it of build to worked finish. how the going our can one very to see that loans. I'll deposits this pace mean we're incent We to while and we've in But the focused we trying a in same think you at balanced deposits I I alluded be the is I But process. Curtis team that stay I more much

proud some kept this. of we've I really relationship is there. that the thing that opportunities think there's of I'm side The

deposits. no think has center on believe tell at and same, We're I question always at are we and focused been can who and we right it on But that that the now. you anybody don't front we're in. keep here pay the focused say So that to deposits. There's what well, we can

Curtis Griffith

it has NIM so Yes, other like far, to like, for our you little so bit. we're argue side pull we strategy and I'll worked. does pay But not going won't just deposits Well, can. the to it's in. can to anytime what to we up a we need more

to it the are to competitive, handle as but have this. market shareholders at we benefits can of it way, as And up we deposits to that top be do way. don't We long our I that do the think

Brady Gailey

ratio? All at and right. look all about hear you And an in details related higher then calls the acquisition Do ideal Do are loan want to inbound not want target opportunities, me, it ideal for as level things bank low it's that Like finally just more know it's but is an you're you kind market? remind near size? you what to probably of what seriously for asset M&A. a like the term, of to M&A interesting to from can bank I be looking deposit you in target? us

Curtis Griffith

be yet, as far mean announcing. out state It's a there's options don't been it that of quite as called in is, some we've our had it is, that see to one Texas We we'd be a I by there, heard are with. We've different the ones out and some that directly we've where about for lot franchise. some. what but found appetite I already haven't going likely discussion

bank to But would still be if going with deposits it franchise really find to and down historically, one low those just now. a are be. be the that right now AOCI rates, try That's strong that again I'll just move find attractive. it. the inexpensive likely a Texas-based a to that in at narrow go West I this, situation would loan not ratio to the seller right a relatively pretty you core a in willing would is tell where I'm to unicorn say much that's recognize So still we fairly how to driving deposit But

Cory Newsom

as franchise I want what and trying buyer really to liquidity and the away that of seller looking the of sit transactions that to something talking to don't lot bluntly, desire a look taking in mean fit do opposed taken we've sitting add you to has been you you you've us, problems our but success we to downfall is the to understand to add the weren't and does find the would got Texas with. transactions. was cultural and you that Curtis as that, trying a works. exasperate that here to you of I if doesn't much those I market, that value look that our do thing got that you focus sure to find it of we've make trying West that at And you taking problems about culture at not forget, we #X let's our deal I the be anything to prepared something would of that the on what some not and find For mean mentality had to what go have probably the mean do here at recently away. as

the the whether going to our And we've Things together. I'm tremendously a value, capital, on of going our is focused of of liquidity, to I so demand, very, culture team franchise we're is have very pulls proud but be the all most be and loan it culture about, probably, that think we're way be large part that we talked that all things it. stuff,

Operator

Instructions] Raymond next [Operator James. Joseph Our question from Yanchunis comes with

Joseph Yanchunis

Texas now, you West issues on the the that any just of some do have out fact would think of with [ you sort banks already integration that kind of ] of presence, there? question coastal the mitigate M&A piggyback Just that kind

Curtis Griffith

ways generic have other something are a the at, be that might. some it a that better such not statement wouldn't make and Culture a are That's necessarily here basis. on banks I going neighborhood. in would our some look than And necessarily, to fit. just a be Texas great Not we out in say case-by-case better West cultural a of it's fit to there I'm parts state, is wouldn't there challenge banks that there. in

Steven Crockett

so tell Joe, I you, here's the thing would though.

to much you've going those numbers. as do balance think every in it you can't sheet. the all cultures come the put to trying how got effort And determine to as together aspect of be I are just other

I so big part just And that's think a it. of

will the end very think on being of front on outcome I the work. make it focused that

have we grant. to, So it for you take can't

Joseph Yanchunis

if to, you manage the TCE? or I there is that to that's CETX circle capital And capital, whether ratio bank back target to could Understood. a

Steven Crockett

but more, portfolio up is a we down with. good even mean, went I that's And if mean could one, Yes. unfortunately, definitely any... been keep previously tangible that's ratio we've at where in We that the AOCI back down. is, that what at feel think kind we guess, we've a in and were equity bond there common one as But it. occur I keep highs. Xs, with up looked little I of that the we we're mean, I the bit Curtis, in with. low brought I

Curtis Griffith

CETX to we there PCE you're is I much and at basically -- value if recognize of I it end of that, just portfolio, of look well. look mean, the But don't day, the think not I number. that at that at when at really the That's put an of your inflated continue as the end you understanding bond you if real and in

really we look yes. and the So that's more one at

think on place good bank. is I to somewhere the a run in a that Xs

Operator

at questions floor back management hand to Thank you. this closing remarks. for further you. And I'll time. no the Thank

Curtis Griffith

This the participating in Again, Griffith. is everyone, for thanks, call. today Curtis

very the relationships certainly have hard there the all we'll kind time. today. state credit it We we're will economy. But to a of and here peak in same very a markets in think the think to across It's minimize difficulty of be better prepared challenges, that. to And we well through the do And certainly rising production growth to current And will the fortunate slowed. to Texas. loan do and advancing have retain little lot I we're are And out and interest we deposit time, occur. are across allowance the for selective peers. depositor all rates, our we strong have with that. banks be be think thankful long-term, certainly rapidly we in to continuing across be out of loss us out in our there We're than that and see whatever as work specific there that need allowed out all of a our continue Texas we're be environment. still do some we great And work forward, some how team going have we going costs underwriting, books very loans. handles there watch loan loan for are that a I areas that. in that to in cautious with losses be the think some some I may and very to deposits dealing going we rural long-standing to West And them in at do economic markets we But that We the to

that to loan cracks for continue our portfolio look for any stress appearing prepared We them. be and be may and

and result those an end we excited we're additional will and proud chances. So in of the the that keep to to of place, markets, with And we that here advantage will continue With so in do our conservative for thanks, awesome of local and have coming we still place And forward continue team we to those think when all our present I'm your and is some be team, think that, being 'XX. kind to think monitor stock we'll of and of again, add in I be I'll that our today. them, management way cautious, a will take opportunities some opportunities good money, members those themselves. call, move and disruptions everyone,

Operator

a Thank today's conference. disconnect. may concludes parties Thank All you. evening. you. This great Have

South Plains Financial (SPFI) 24 Oct 232023 Q3 Earnings call transcript