Earnings call transcript Q2 2023

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Operator

Good day, and thank you for standing by. Welcome to the First Western Financial Second Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded.

to call like speaker to now today. for would turn over the your I go ahead. please Rossi, Tony

Tony Rossi

Thank Good second us today call. you, for for you Lisa. First morning, everyone, Western Financial quarter earnings thank XXXX and joining

morning. us presentation and Executive and as our Chairman Chief part Joining Scott Officer. We'll Chief this Julie Chief First of team Officer; Western's are from use Wylie, Courkamp, Operating and Financial management the discussion slide

First Western's If done of & already, Presentations a visit download please presentation. Events relations you've the investor copy not so the to website page of

I'd to this that financial Financial begin, respect condition forward-looking we to expressed materially like future company's on call statements. with Western First be any website. company's in involve forward-looking such Before to risks remind available results that statements or by and of conference and you factors filings, from the results are These discussed the SEC uncertainties. performance future the factors contains Various different cause could are implied which actual

would in investor our read disclaims statements earnings the any made call. also disclaimers during any forward-looking and The company the presentation. to release direct I to obligation update you

GAAP today, most refer well The website, not which supplement measures, to substitute non-GAAP financial as reconciliation may and GAAP to the the press contains measures. to comparable are to discussed for as information intended management Additionally, release, be non-GAAP available the the directly measures. but on quantitative of other the

to Scott? with that, to And call like the Scott. I'd turn over

Scott Wylie

Tony, good everybody. Thanks, and morning,

and stability reflects environment. the continue as in performance despite deposit of built base challenging we asset quality second franchise see the the strength healthy operating quarter good we've our to Our

risk financial we prioritize on core and we continue solid generate indicated, we million deliver call, continue prudent earnings our performance pre-provision we pretax income. last From do perspective, earnings a $X.X in to to would management. As

items had our that reported significantly this quarter. we impacted three However, results

assets, the contingent we in which of sale completed impairment Income value our a XXXX. relates The Fixed carrying Los that pre-tax consideration the first $X.X Team million Angeles of to was to Management Portfolio

The second which third, $X our non-recurring. we a accounted loans $X.XX expect an for items loan, after Collectively, analyzed to value about pretax a million on these million $X.X be diluted earnings was under allowance individually option. we fair the on And this recorded loss tax by quarter. reduced

tightening options. tax balances to In balance typical liquidity our franchise client a out existing base, Our we and in see is to accounts conservative clients client of well as invest higher are payments. the that general, declining to In the the as operating as reflect deposits This sheet trends taken we've Fed continue continues of stability among strength pull system. approach of QX in also the company. excess of the client particular, trend and yielding our to using due

However, our is adding started relationships during were And unchanged the the This month due client deposits increase. we development the through from quarter. June, efforts. that business see total DDAs essentially prior new to our we're end of to largely of

higher we due a markets, lower see our continue demand conditions level in economic While to of rates the healthy about loan to recession. remain a potential concern and

loan during the criteria in to rate our quarter. annualized still disciplined Despite underwriting conservative X% We portfolio a and factors, these also at remain continue pricing. in increased our second our is

our asset we our loan that continue conservatively see markets quality portfolio, strong. Given to the healthy and underwritten to remain continues in our economic conditions

levels During of once again our the charge-offs. had non-performing immaterial and quarter, declined assets we second

we strong, allowance remains coverage quality to approach prudent given asset increased our our risk While management.

in On in consideration diluted adjustment, an $X.XX the had second excluding or we quarter. continued we of asset Moving the net to per Slide share. of the income share X, basis, $X.XX generated million, adjusted impact earnings $X.X per diluted

three sheet items, beginning to all we've and resulting CECL share. our of prudent in non-recurring since financial the strong seen and And balance year, past of had at performance impact due the of earnings our capital management, we from book impact $X.XX adoption the over the value book diluted increases the per Excluding both year. tangible value in the

to we'll our look trends Turning Slide at loan in the X, portfolio.

The in in -- properties loans of we're a being from criteria offset in and increased driven discipline are Our the draws quarter, in developers multifamily total housing lines, pricing. and and primarily funded which had loan existing level prior other seeing which the $XX areas our end CRE slight production increase the the reflects to in strong of our both This portfolio on demand our growth limited by construction was construction in new million million portfolios. experienced projects quarter. very lower declines We $XX underwriting with supply. loan the

the points on month far quarter. this on of Given notable year. just that it's a And largest production pricing the the very production increasing the being sense. number on new With where had we deals, companies from lower opportunities which demand, June, so our represents continue seeing the loan amount loan average banks we're pass aggressive to of level loan pricing, doesn't see which to us in discipline million in to of by prior with rates some loan insurance and higher has production caused loan on make pricing win we $XX new rate any in XX basis

to some starting positive more we're trends recently. see So

a X, our deposit look to Moving take we'll at closer Slide trends.

unchanged the relatively for were deposits total prior quarter. Our

us new in impact seasonal to of on second from clients on to to and million new moving relationships accounts We The see continue in deposits trend continues $XX out helped order non-interest a success have new added we the in the outflows typical in the accounts interest during liquidity. that business deposit the relationships get of higher tax bearing inflows excess reflect The related quarter to yield payments. their mix money bearing of into quarter. lessen development these second

excuse annualized deposits up XXXX. almost average me, of, are quarter Our from of QX XX% fourth

of we opportunities. quarter-over-quarter. and investment outflows X, seeing as primarily categories quarter, nearly our market product increase growth Slide yield trust in investment of had advantage we're in The to take assets being second Turning in offset continue clients some $XXX performance million on partially is by increasing all higher management management AUM to under the with due to

With that, I'll to further to call over financial turn Julie our for Julie? results. of discussion

Julie Courkamp

Thanks, Scott.

Slide our to X, Turning we'll look gross revenue. at

declined interest X% Our net prior lower gross income. to levels both revenue from and quarter due the income non-interest of

look at trends On net interest margin. income Slide in we'll X, and the

interest higher deposits. of average X.X% Our quarter resulting due decreased from interest the prior expense net an cost income in from increase to

to increase the the costs on deposit interest offset interest assets. in Our by net by X.XX% basis partially margin decreased bearing in points yields increase driven earning XX average

while increase we However, average loan the average yields the deposit saw basis costs in month flat were of points June, month. in XX

competitive We sources to higher funds highly in quickly level the the our borrowings lower production we loan of These provide maintain on environment make of deposit see. flows, that cost on short-term are and represent in a than based adjustments liability that continue borrowings be to seeing. we continue other flexibility a that they as continue deposit us trends to to mix,

loans. that our higher XX, loans to net while in a Scott Approximately quarter of were gain prior Net as mortgage our demand. $XXX,XXX we prior for decreased loan to the with continue gain on mortgage decreased XX% the to the mortgage trust Turning items to non-interest investment the on non-core non-interest sources the due fees Slide had quarter, purchase quarter. recurring loans our rates XX% of were and income, in larger originations management mentioned from earlier. decline impact Among second consistent income

look a at Slide Turning our and now expenses. to XX

Our in non-interest XX% from April. the implemented quarter, expense we realignment the that in again prior quarter staffing reduction due headcount first and and the in decreased to

reductions non-interest of expense result expense expense in and a came disciplined our our targeted these range. our As below control,

our current We continue to to remaining of align expense million with better have to and guidance million a $XX year. expenses $XX the revenues range quarters in reduced within manage the for further

provision broad of to to and minimal assets quality. On our as portfolio due look the XX% non-performing allowance quarter losses driven well, we which the take repayment very loan our we had at asset Turning during XX, Slide basis, quarter We another commercial to loan we'll a status that a for two losses perform loans. $X.X declined full an a non-performing of recorded continues was XXXX. the fourth a for million, on credit of established by put private of

We guarantee. personal are of to collect working repayment a sources the loan, on on including this

a at However, to quarter the allowance. to point, loan X.XX% at total June was growth of XXth. to points basis establish of by prudent level The this modest recorded allowance we an increased X level provision with our combined adjust loans felt this it

Scott. Now I'll to call turn Scott? this back

Scott Wylie

Julie. Thanks,

for creation trend book review take in since to to shows Turning our strong to of slide I want creation shareholders. Slide track in our record value a XX, XXXX. our This tangible value IPO moment our

is and our book has presence generated time our our consistent Our number our into a at states, attractive presence we Colorado other ability value communicated expanded strong as increased markets growth improved IPO, deepened of factors. organic and the and our attributable in we've that which in on tangible operating scale We've executed drive plan well of to to growth in a leverage.

our accretive our all which executed them savings book value. tangible economic an we names in and projected, made of acquisition on capturing and standpoint cost strategy, the disciplined our the the to been made we've to sure from integration, sense making We've nicely that well that pricing has

conservative credit high of the inflation throughout ensuing clients period the underwriting few low our the including losses presented conditions pandemic and rates. strength the by our interest of over Our resulted has extremely criteria economic years and of and history, levels in the challenging past

we're shareholders as our for many decided and very the invest experienced the creation notably enabled and value track liability record the that most served we to bonds, built that which not to into our has significant value in proud future. continue yielding low And losses during of to We're the to have we prudent liquidity up capital that banks well, create have believe of hits our finally, to well this positioned asset in portfolios our us additional rates pandemic avoid resulting investment risen. excess shareholders interest management when

XX, near I about with outlook. term wrap Slide comments wanted to Turning our to up some

growth the there's risk reserves, in that level unfunded high near maintained commitments a provides credit levels it's will year. short-term. a While level of maintain of uncertainty, prudent at lines. of management the the to loan profitability high our existing level to We increase higher for impacts likely loan catalyst economic capital we're in as and of of level This future, believe borrowers although, that prioritize potential continue going even throughout a we've utilization if remain a low of liquidity, high degree growth and

deposit few mentioned organization. the continue call, in past be to gathering earnings our As throughout focus will a we've

new add to the who to Given opportunities stronger clients we environment, see current finance continue to a institution. to are economic looking good move

to to market additional shareholders. continue prudent stabilize, risk best the prioritize of long-term acting Accordingly, opportunities can capital in and also management, conditions will that we'll as continue We evaluate to will create remain our shareholders. committed for utilization for value interest

call. your the we're questions. that, please happy With up Lisa, open to take

Operator

question Brady [Operator Thank for KBW. Instructions] of come you. will The Gailey first from today

open. Your line is

Brady Gailey

Good guys. Hey. morning,

Scott Wylie

Brady. morning, Good

Brady Gailey

So from more the But that. this be you're NIMs that's base, you back margin year? not quarter, in hit some alone seen of we took another half the could down the do here, bottom there inflection linked point? have which this and an Or XXX step the slippage industry think has

Scott Wylie

But that the will are our think competitive economic from said little it's Well, we outlook a bit to you we and be previously as the in and difficult today. would margin and financial predict trough we second that case. still we thought the quarter, where know,

our with margin positive talked also in we comments, trends in June. prepared and our DDAs think, June I in increasing about

So like rest year. those of positive the seem for the really indicators

So the our an there's margin. hope is improvement in that

in that QX here, increases rate that is our to short-term but from to assuming from the and also we're we I then our we forward Fed, the won't trough. that going in going think in improvement expecting QX. continued see a numbers whole say prudently, improvement could a slight environment assuming we're increased flat be of hopeful we're Fed relatively lot We're QX, stable

Brady Gailey

been I All remain next Okay. of solid a heard grower. you think helpful. a your about comment do pretty think the in But depressed pretty XXXX year come of next normalized And level That’s term. then loan or has growth will And in do near it low of you level? Western organic historically, right. kind a will growth that level a even year at more First

Scott Wylie

Yeah.

to to depends would that that we'd like build economic think of really the or basis away basis XX being loan basis do, points us environment we're XX from seeing beating we're basis that we competitive on seeing but and the basis points points points. us by points. outlook. taken loans I priced relationships They're the basis or the like We're XXX some These where or are hundreds X not lending. of points under by demand, XXX

factor mean, I a for that's So, us. difficult

And do loans that make to we're us. this just not sense going any like doesn't to in environment,

I do our X%, them to where And wait. think think a things. a clients that. also wait. X%, to we don't doing are here to X%, I They don't X%, lot have don't can make sense at at do saying that things situation things. money borrow sense can of the need that They They're X%, that made we X%, need

seeing demand I so of we're because And think down that.

you we're side, in the are hand, well. doing that economies the On on know, other positive

growing. markets Our well are they're and doing

see benefit benefit see And have drawing the on down, the down. from still that books from I we that we we'll some the loans that on that lines think we'll have the think, people people books I So construction drawing are are that. credit unused some

the bit, continues I we're competition abates be think still said we're abate little is hearing probably machine XXXX. the stronger an we could then before I to for as place. maybe Certainly here growth in economy strong, if to And little the see organization still as And So rates loan nice a has produced think digits, see maybe XXXX. the going side bit, traditionally in growth we've caution mid-single a of loan here. in on that growth, just

Brady Gailey

goal the that to that ratio reduce could a deposit to? took me, loan a And get thoughts you XXX%. It's on up. All to then for now step there modest finally that right. would Is ratio? how any And you like down

Scott Wylie

Yeah.

this really after down then deposit but of to hasn't or, predict. in that And that operated the on back ratio Y and loan view that we'd And said XXX mid-XXs by historically end don't to the to are the hard We've that get month like quarter-to-quarter the or this a we Our year. of changed. or in Again, that. mid-XXs month-to-month changes to of we've manage it's QX focused there, kind organization we of We had some back about trends in X% we were our in and the at deposit in the that June QX deposits past our looked over years. the typically talked year. the successes about historic in deposit of growth, We this several we on and some of And went in saw clear X% we're of particular. we've gathering. positive QX lose down X

policy So, we did pressure the tightening –competitive and pressure that that and I monetary seeing the think we’re that. well given all

deposit loan the out ratio. and our do would line year said think like of the some well. doing I I what doesn’t that there here to go it been and backwards to to but to Obviously, with concern us what reason going or historic half in QX, I So, any feel great feel from relatively change don’t were there’s we’re we remaining back we’ve doing. pan expect get we over to underlying

Brady Gailey

the color, guys. Thanks for Okay.

Scott Wylie

questions, the for Brady. Thanks

Operator

question. moment Clark And be One Sandler. coming of Matthew will next next the question our for Piper from

Your open. line is

Matthew Clark

Hey, good morning.

Julie Courkamp

Good morning.

Scott Wylie

Good morning, Matt.

Matthew Clark

total? end couple -- at around month and of or First margin, trying drivers numbers. spot margin specifically the us deposits, average question's what was But into or questions just on can the more a to June interest-bearing the you rate in drill the the the give either just of the and of June

Julie Courkamp

Sure.

rate X.XX%. So for of the June spot end was the deposits at

as loans So spot increase a bit our rate a higher was what March. ended than rate quite little spot at bit X.XX%. you'll see an over March well in of Actually, on our

as so new X.X%. at booked And just well. moving loans X%, getting nicely we're under that's up seeing So

trend you the which NIM think gives pretty some of I there might head. line indication is our good, where So

right For June, spot was NIM about X.X%.

Matthew Clark

X.X%, I the that's assume? month of June,

Julie Courkamp

the month of. Yeah,

Matthew Clark

Okay. Thank you. it. Got

rate. where Have cost have Sounds I from the pulled And the year, of good. yet? lower those been in you guess? earnings back think that kind additional made coming I the then -- savings you have supporting run half and the in guess, of I decisions additional trigger, mentioned the and those saves, release you

Scott Wylie

cuts any panning we to clear. just planning cost here, put not that further QX have in cost in April be out we as is What We're in we are saves expected. had our place seen and Yeah.

this just range. that's volatility half all that There's producing in kind second expect the with to the results $XX guidance line stuff. operating are for the so that which year in Julie And is expense million we of operate in of the provided, $XX some to million

from don't range million it the already $XX.X $X.X I exactly cuts us so And know like we've will to you a of right made. the but seems where land, million within know

and point I things I is, think quickly impact we could, really that tried doing. efficiency And Matt, provide will some we future that wanted efficiency just here, businesses things we've drive capability broader the tried to think here, valuation frankly, in sooner, to some a of we've postponed do as to into the if the I that's would we've that not make well. the we more there's which investments making are hard

continuing be we're things that, the into think, we've that. we don't But is, shareholders. talked cutting drivers and future the of of are internally the for for intend and company the more done that made that, to and that organization? that are on for cuts do future current there one things in to do about aren't we So, that don't And to we can haven't money want driving I value spend important the

Matthew Clark

the resolution and timing there? for for the And of the situation reserves. of Can type me guess, the remind $X well, the million the of just required you credit, Okay. that specific on us last kind some there, of one then I basis Great. as just non-performer the

Scott Wylie

months $XX ran or C&I business. and repayment that got the And struggling. sources this the fine of there. in in kind is The had valuation ago three credit had Yeah. is as of on personal XX inventory, has a and business we having trouble. once issues them. collateral, They with turned receiver estate look COVID-related into months estate have dried did actually XX real that place We Well, situation, that million that and were we The had a We up of we for usual, real a in uncovered we collateral. we we’re kind out guarantees.

collect Hopefully, we through the and that did the at to process have point that on recovery further on, now at we’ll on sense, like a not a that. we're that continue putting and guarantees, felt this full Hopefully, specific personal all trying plays workout but picture, reserve small looking just will we loss. have The made see it. We’ll out. any whole how

to these you’re as time takes things, get Just aware. well through probably

Matthew Clark

Thanks, Okay. again.

Operator

your you we And the Brett next the from One for prepare coming moment Thank of question. while will question Rabatin for Hovde. be question. next

open. is Your line

Brett Rabatin

Scott you'll to I perspective been out bit afternoon, contacts? there's technical Mark's for regulatory morning. Are Juil, some Obviously, good doing And or late. the little be or some something would some given folks, ways having dial-in. terms desire quote, maybe the joined to and plans normalize, talking. your hear problems Good think off still people you a was can M&A, active? think be think there interested in speak, of and be environment and in that's going get you bulk the Hey. chatter your done? I in up it's hearing Do things, so past, a from you've with if expected. a what anything to the I starting I to little Scott, some but

Scott Wylie

of another, see a then see for own there's of big And March. we've running weaker lots then. experience so banks regulatory that financial kind years that's I one institutions. sort smaller of or see we seen lot And here since blow-ups on of then stronger and in when saw opportunity pressure some we my like to big problems a then the first that or bear do. we My like we of is creates institutions, in then crisis brought XX my little

XX our here so to going course months play -- favor And months. in over I the or of XX that out the think next that's

people that that knocking And have beneficial. they on you tell we door interest. I sure in interested is that can't think here I talking people us to but having and understand be today, have they going critical our are we're mass to that still

to XX. area some nice generating I have at strong need we protect think capital value sure I nice that of as that like Slide ties and that opportunity And make will back all us. that that into play expect into and they're come the capital really our showed we ratios continue creation point for good, tangible a to book on

Brett Rabatin

either want quite And are spend the wasn't I or a year Okay. to on that the outlook accomplished either there expenses, this of operational color clear having half expense or the you I Any in in response then just if perspective that heard inflationary get entirely there? that might on to XQ your the you're and money level but change or technology things on, either from back next year.

Scott Wylie

and that do than if that could too could And expenses. if fill a get be about those then project that decided on January, that that free. to we We it. mindful review at Julie, feel had quarter exactly, fast. And had were we Well, we or maybe that. a thinking don't in, we on, like including you year, spend December, that, we I'll quick you all this remember been take had a wanted it If and listed. want of I be would going add were to saves we we just to $XX that. working something more And stretch things more, if million contracts a vacancy, some we stab out, not cautious wanted to had we cost we we

we on that in. worked hard so And

then run okay, million, take? to And were I get kind $XX what down QX. would did remember on a of number had that same a and the by million or in then started down. now, QX. for internally, we and and working $X.X $XX.X guidance we year XX with FTEs, the of million end number And is think the down given implemented, we we Well, process that with up project, we $XX.X XX was fully rest the out I today of a in said, we've expenses or if April, of expense formal completed then million, it the QX, exact our that And came rate April, don't in can swing in we in

So at a the million the and have one we anticipate because some $XX relatively million, it's you $XX that number big the we talked was fact about number, to make, don't and small just from But quarter of to we just to next. don't expense we know do any and we not Those done, wanted frankly, XXXX. We we better big the as are changes we outlook want some that anticipate they're make. little working, other than that for that to we a had expected. to had expense cuts make look for

Brett Rabatin

stuff? guidance be else, of the other on So Slide anything technology, inclusive XX, would

Scott Wylie

Correct.

Brett Rabatin

the given is Scott there you level Okay. levels? of CETX, any to And get regulators this capital or capital that on have lastly, want Julie, want we level? hey, or you a thoughts Any to, just the then onto, input

Scott Wylie

capital. heard anything We have not regulators from on

that of continue and take road, that terms for capital I seen build acquisition. last it and our we to that ratios, back book are would our we own and build capital organic seems in think in to now, of as ready internal and be of as stock to XX prudent they're where our think for and prices for the know, growth, continue over advantage to of terms be with are, feeling at just terms we've both tangible we is the down in expansion, But protect far the of to days. XX or love buying some the us value, happy wise us we opportunities

Brett Rabatin

for Thanks Okay. all the color.

Scott Wylie

for Thanks the question, Brett. Yeah.

Operator

from question. Thank Tieton. our our will you. question next of One coming moment be Bill Dezellem next And for

line is open. Your

William Dezellem

Thank you.

You loans that dynamics the fine. in in front the hoping go you you a And want bit and to that in deposits, talk had of favorable the saw to front loan July developments deposit more maybe you that's beyond for will and that month some detail, if June, on and referenced specifically us. carry the I'm June on into both and

to isolate to your want you comments that's fine. also If two those items,

Scott Wylie

Sure.

I think things, different. similar they're but

we take maybe it could in pieces. So

we our For taxes. in is usual paying runoff people saw QX in QX me, are what deposits where

QX. about And impact larger do of see, this we had withdrawals seen we QX what as half larger I than in tax see said, historically. because And year of we the so in we for payments have here, depositors we've

So it we playing nice Bill, I was for and be theory, that us. positive out. a to thought seems have a

I because talked that base, going of two others we to calls more of than others I type are think, last experience this, the client in about the did. our that that beta experienced deposit quickly

lot Fed of had regional with bases deposit whatnot. larger that October, a our had more than and had so we our quickly kind catch the depositors And last smaller have average September, paying peers for of retail depositor, a go really a what up to deposit rates our do lot and done to clients

that And a out expectation guys. a think think June. And to and little the six played for months what think it I me exactly that lot that for us other that's the I that seen. in we've off for level curve So played accelerate was bit was out going and I in QX, that I ago think

hits of to be this do, able to at not I'm our better, that our cost So we've is had if earlier cost hopeful as those peers our to well liability we're another funds. least as going because just manage indication increases, that,

would that? answer kind Julie, deposit of side. So there my is that on anything add to be the you to want

Julie Courkamp

was increased but to June the our this to DDAs May. been compared on And then think deposit has a thought, in month, in this point, said, our finer just put were flat nice also We prior costs a I indicator. June, average point which

a flattening in couple positive deposit be and out side. that just to that a starting the indicators think might hopefully of trend things there's So I there more direction on

Scott Wylie

Yes.

William Dezellem

either if even And continue go seen loans, in to numbers you then have or the July, know XX before here same those quantitatively of interrupt you fine the I first qualitatively?\ may if trends we days

Scott Wylie

So looking well, the room our at in of and us Finance we're with bit. little going, him, here Director he's a is yes,

Julie Courkamp

costs We deposit think flat. the are

And seeing As we've continue it's declining July. through we've not but been that think I really trend an don't increase either. kind of in seen DDAs,

good July. flat we're So a seeing in would I to think way describe what be

William Dezellem

you Thank that. Great. for both

Okay, loan onto the side.

Scott Wylie

whatever that higher. to get are or XXX loans and repaid. be, on improve $XXX are originate Bill, a points, or by rate $XX turn to our off we pull XX loan Because And that whatever average million million it the point, that'll got we've our to costs got Yeah. points, And themselves, roll yield extent basis And XX that XX asset be. yields that XXX points and to flat, basis liability out less loans we points, right? actually by turns more basis our a floating the points, basis numbers up quarter then new out basis

really side. us So that having in asset of the liability benefits costs we control on over because nice improvements those passage the by time NIM, just see the

think, be we was a X%. on to going we're interesting and we our there of loan loan loan XXX would points far. gone come the like that I have of growth of basis the loan talked that shock so to client, to about type their what going a pricing, trying then and is, for XXXX, think I a up they kind of explained and volume And for psychological when an six thing think last which sticker rates over actually renew terms bit with there's might where In them little a months that in that lot here guess

And to going really X% they're they rate's do with we new the haven't be any that. that. so can seen or And issues fine, whatever. And

can terms do to need in doing saying, I I now. of they're don't new But well, wait, things, that

And rate so has I shock to passed that's do that's are sticker think that and people have understanding rates now If they build where models. want that that that to things, they are. their in now that the

demand. side we're loan think We And so pipeline that, on June on XX. XX loan a the we actually to going I than on had bigger saw do see March more

of for half the promising the I So think second year. that's

that this that can environment do sign out are people a that's I rate figuring means, think they things. still what

we're of still in to symptomatic things. strong fact the that's and growth with good, do that that think entrepreneurs economies economic good believe I I want

price think when and decision last to I cave bodes making structure that or of that conscious or well us. us been doing our have So of kind just didn't over on sense to rewards months here that things not competitors frankly XX nine lot months the the make all for a

William Dezellem

you. Thank

than really the didn't opportunities financial and have sensing to been now that something they've paused sense kind activities And customers their shock considering so do that your different have but or you model, and phrase, it, or they're has away, do adjusted mentally it they have forward gone you your using that? are sticker adjusted moving now of may still works they that that a

Scott Wylie

goes the economic sort to model has the and sell to can Well, that or decision say, something whatever prices make I that I I'm of think infrastructure something some a are do reset. saying consumer to economy to or that think the want at rents I the the down around the wait going until come just I'm work. whole are do things to of it and re-price the or costs rates I pricing going not and some is charge going to

the short-term if career, You this. haven’t never or our to increase don’t go rates have XXX just we certainly it’s people experienced in, know have I point a that in it’s in but back are things markets to my had if forever fact, doing basis

there’s just of a we’ve that. don’t reflective to shock that. forever. last lot going what And our to sticker I in I results is think it’s think I financial And seen And of think

talking are are from going they going Powell to base way be in. Jay a Then come and for in we’re they’re that’s to to in prosper and my be things that going the create week, doing opportunities way us bad to where markets and are to going grow rates wouldn’t if today case. feeling here settle back, was people the think this have I to a that

William Dezellem

you Thank again. both

Operator

questions Please you like turn I queue. call management for closing for And not over showing to question. any your further go would remarks. time, in At ahead. Thank this I'm to back the the

Scott Wylie

Well, Lisa. you, thank Okay.

and our continue here, short-term fundamentals we on creation long-term years our sound it's despite shareholders. the As been very company the to five And since are for our IPO. of of mid-July, deliver noise value

tripled our XXXX sheet almost has assets. $XXX.X doubled, million balance five have in growing $X total these in to years, to over just $XX.X billion Revenues XXXX. from Over in million

core are up. way earnings Our

Our free really core earnings nice cash flow and to common shareholders shown over growth were our years. actually negative have in these XXXX

since our almost tangible up book X.X the in deck, times value And our IPO. as is noted

operate anniversary that stakeholders really our to big us this of communities have the a made our our here, our So gotten clients, and five-year shareholders, successfully. our company we that so associates in public support this have happen, appreciate of that

in. you And dialing really your great it. We hope have I weekend. everybody appreciate thanks First support So a of for you for Western. Thank

Operator

today's concludes for all you conference. Thank This joining.

enjoy rest You disconnect. the day. may now Everyone your of

First Western Financial (MYFW) 28 Jul 232023 Q2 Earnings call transcript