HBCP - Earnings call transcript Q2 2024

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Operator

Good morning, ladies and gentlemen, and welcome to the Home Bancorp Second Quarter 2024 Earnings Conference Call. [Operator Instructions] Please note, this event is being recorded.

I would now like to turn the conference over to Home Bancorp's Chairman, President and CEO, John Bordelon; and Chief Financial Officer, David Kirkley. Mr. Kirkley, please go ahead.

David Kirkley

Kenneth. you, Thank welcome Call. and Bank's Quarter Second Good to Earnings XXXX morning, Home

Our available disclaimer presentation I investor and earnings and release filings. are in investor everyone refer our SEC statements ask please on to forward-looking the regarding the presentation that website. our

it John I'll the a about to few hand Now quarter. John? make comments second over to

John Bordelon

discuss for interest Thanks, call today. earnings future joining Home in Bank approach long-term David. Home Bank's to Good expectations morning, shareholder and thank our as our and value. we appreciate the for your results, you creating We

$X.X margins We support in continued importantly, rate loans, continue in income or points higher reported slightly. loans except which growth steady second asset our declined appears funds quarter that net million growth $XX.X second of yields first improvement NIM in improving the slight than and stabilized. per construction income net most for will sectors without X.XX%, which We're of came And have cost of and X margin, the in cautiously at optimistic which million increases to quarter interest was net We our share. basis added in quarter. even interest with $X.XX a any all to The stabilization and land cuts. Fed in

could duration optimistic pick still we cuts The strong pipeline, but the X%. loan XXXX that anticipating forecasted loan be that see we're higher half back loan loan X% up. negatively the rate growth to year, and now Given growth be our the we first had rates the we're demand occur, of impacting will between appears in of

opportunities the strong first in brought to number our the we adding were branches accounts very after there the of continue fourth improve operating for to markets with a and million We're Houston our of including Houston from pleased growth our We serve of and talent. stable growth deposits, one last to as another market clients. of teams deposit coverage look $XX.X the new see Deposits, our and by over core quarter relocated brick-and-mortar quarters. demand in

the we had past at a construction nonperforming headlines, for had in -- are $X known Bank the months, with loan interest who few manage some credit. through and work improvements we to negative Despite we've In have go reserves all million cost Home with actually the performing after overruns. we years, to here borrower delays from seeing

$X.X very a recently without about a multifamily nonperforming nonperforming relationship We equity that has $X behind principal about good million also million loan we it. any And $X.X of lending feel resolved loss. million

banks other about most we of markets And ago, both markets. year making struck in were same the in written know empty feel our the number floors. know that to being way. A of We same the and our at have buildings know. not that problem were we in colleagues York, are New high-rise and with We the we loans press. lend don't by community financial in I just David I people We're

shareholders our return. with providing about an is risk-adjusted Banking Community attractive

We are on in that making business that not relationships result loans the fit. in of could the right huge aren't losses

had team, Chief and Operations I'd over successful we forward in turn and Mark career Mark President a to contributions joins community Home to to David, Bank. his back and Vice Finally, where Executive like Home the before long banking, Senior it I at Herpin welcome as Bank Officer. to has look he

it bank. With that, Administrative David. I'll John Chief of congratulate Natalie Lemoine, over to and on President Executive our to Vice Banking like Officer; Chief back Zollinger, promotions to also Officer turn their our I'd Senior the

David Kirkley

new X% annualized loans income from were coming previous continued earned quarter our with flat the $XXX,XXX XX.X%. million quarter. a X.XX% our the X.XX% QX. at up during loan-to-deposit essentially increased totaled portfolio we total Loan Thanks, growth loan at $XX.X which on compared John. ratio to in in QX, Deposits rate a of Net the interest to in pace quarter-over-quarter,

deposit about in $XX We pace that of noninterest-bearing were deposits mostly million market in increase with interest-bearing April, was in million of and The savings CD by see migration accounts, coinciding accounts declines This definitely offset increased has experience the outflows second did combined. outflow by occurred did actually balances million. $X.X and checking slowed, The down in which taxes. and we money an quarter. $XX

are which in the slow The points the increases basis on having migration by in last the of quarter basis quarter deposits, rates second our first quarter, points year. third basis fourth quarter in we paying interest-bearing XX in in the slower in after XX and the increased the increased XX impact in points XX the deposit seen by can basis be points

did our presentation provide credit, covered. quarter XX the second million loans detail and investor million X.XX% of which decrease or XX to $X.X by of already Pages loans. Nonperforming some $XX.X John has total in additional on

prior the expense quarter from $X.X million, up for Provision was quarter. million $X.X the

ratio There in point factors qualitative during our loss no the to the quarter, were reserve levels. loan increased confident in X our we changes for basis allowance in and X.XX% Our second feel quarter.

the basis related. charge-offs X and issues net did These very We and have customer-specific quarter. annualized were in or second points much industry not $XXX,XXX charge-offs

detail historic some its and has NIM XX on components. Slide our

Loan has our we're start loan and liability to loan month of optimistic this pace been steadily mentioned, should slowly due combination And each that here. from As increasing repricing. to NIM increases has with reduced quarter. bottomed growth NIM increased a in John yields costs, and increase have the cautiously of out

CDs next $XXX north CDs approximately little the in specials rates months. at of a The these X are maturing X%. million in majority of have of We

remain see CD costs, if So if do opportunities unchanged, we cuts. see meaningful more deposit where to cost for rates mix and declines marginal in we flat could rate have we reductions

$X.X the April million at was million expense in income third Noninterest $XXX,XXX by Noninterest million by income the $X.X of $XX.X expenses. that of annual XX additional million details about low between increased end has $X.X Slide due increased and to the fourth This some and to $XXX,XXX to be X. should primarily quarters. presentation our took noninterest on expectations. salary increases and effect and

core in third noninterest be second tangible XX% XX,XXX about $XX at the average to expect little million and equates quarters. $XX an AOCI. value excluding book with which of expense $XX.X the share and were to We a of per fourth buyback repurchased We and between million quarter, aggressive in the more shares price

and by Bank increased our of XX We've last adjusted per since dividend few impact Slide the and grown ratios, years. book value XX% by our XXXX, advantage as capital summarizes strategy shares the XXXX which XX% Home our us on successful any maintaining repurchased to while share XX% of arise. they all has economic opportunities since over environment robust in had positions management of tangible take capital be

open that, the Q&A. for line with operator, And please

Operator

question first with Instructions] Hovde Feddie The [Operator from Group. comes Strickland

Feddie Strickland

just in you a you noninterest-bearing bit grow. that on Obviously, C&I to talk success just in more John, little your the Or those more Houston? on opening see through I really of was positive touched wondering this Is bit. the if comments little can side that was a deposits. footprint-wide? a

John Bordelon

to out that happened beginning Houston, the they've at there referring another a think and Houston attracting production loan a year job good from customers mostly a on team. in came lot office the and a the the section in They're We focus of efforts the was in that done northwest and very has team new deposit side. from our been of I bank, of what Well, in we're Houston. pulled of

they've So loan that deposit attracted of some just some of and are are deposit. and that

was there new highlighting that were team. we the what was success that So of

David Kirkley

We've on as market also -- the the C&I business focused DDA growth well. [ that Acadiana heavily seen as has the space market been more some in and ]

Feddie Strickland

the on we think loan as the same come growth going that like lines, bringing in it's just likely you're you're C&I given it along And for more type I about more with focused deposits, of to forward, sounds correct? looking mean,

John Bordelon

Absolutely.

Feddie Strickland

one Got And it. for question last me.

that you think here? I keep keeps share mind the you of powder? a Or mean, you'll slow share do little repurchases price bit upwards And some down think dry moving some repurchases. that level have forward? just we'll of do see going potentially on still kind Just in if

David Kirkley

down dry or that week the higher slow last keep the we've over prices would powder. at -- the it the elevated We and experienced probably

Operator

next [Operator Instructions] Joe question The comes from James. Raymond Yanchunis with

Joseph Yanchunis

occur second bit of So little some expansion ahead takes to appearing and the a NIM what Can you in year? provide with of will drive on the half of NIM schedule. the puts the the

David Kirkley

loan is, course, of factors and growth loan the one repricing. So of driving

of X.XX% a still rate on can You quarter our loan raising to XX, as we're loans Slide we of what by each have slide basis at on still deck we've expect XX been our average that to portfolio continue points loan yield our consistently weighted and about bringing see compared on X.XX%.

of component it. one that's So

touched component a our higher. There slowdown already when special are cases. a X%, it little some CD on said majority of CDs reprice up bit seeing CD bit really in on in actually a lower the is the repriced are for vast our is some to little already we higher. but still portfolio of call and We of north deposit the little Second rates bit you're has migration, a deposits opportunities

as not deposit CD opportunities the on to repricing much there's So space. occur and

cost of to we loan is deposit offset that So yield the pace increases going than think more increases.

John Bordelon

the year to deposits by the Not maintain these will a to bit deposits to the mention or little this lower movement ability [indiscernible] at Fed any rate. contribute

very CD So Fed should upon head rates what stabilize does. that we or our in fact the feel based comfortable the downward

Joseph Yanchunis

note something near-term kind And Understood. experienced? should deposit that of And some about deposits. you've costs? we've think on of your some of trajectory peers increased heard Is how competition the we

John Bordelon

of. any that that most obviously part, some in But have there area. everyone most But bank one in the or for market, the I think not much was pressure. the are take X.XX%, in problem care here market had we the attracting there Houston our X.XXX% that haven't seen one-offs we was most for deposits. There part, We

Joseph Yanchunis

more if Okay. could just then in sneak And one I here.

what though increase improved be thought peaked? secondly, it perhaps if economy deteriorate. you to process? too metrics asset say get to criticized elected we the So Would and reserve And might in drove you fair rate early a call, and doesn't pretty this nicely couple your quality it's the already Can ratio. NPAs but cuts to quarter, have of that discuss really

David Kirkley

our And question of regards really industry-specific -- new first. CECL any of adjust to change that's the any make in We qualitative our factors. mixture qualitative didn't just adjustments with really We loan take portfolio Let duration, the didn't mix increase didn't It's change factors. the loans decide We -- allowance. to me perhaps it. a any quarter-over-quarter.

our really of it's portfolio a So just loan function changing.

John Bordelon

really or not themselves. very the I'm to any issues we're of economy, have there As of really far seeing year, be with one of individually. in optimistic one-offs could remainder We've the it credit, with couple it had just there relates had particular as bit little here that a to industry as nothing do It the to more operators and had a bad. the that gone do but

XXXX So in though environment. lower going to we're as because is the possibly of actually a feeling improve economy rate

Operator

This turn answer closing conference concludes over our and any would ahead. I remarks. Please like John the to session. to go question back

John Bordelon

very us the to Once or much the to about and you look good the I'm so. Thank in again, today. you many to day and has attending. next rest thank for forward Have day. gotten bank position this speaking a you the at very the all of for point joining of year excited

Operator

presentation. concluded. now has today's The Thank you for attending conference

may You disconnect. now

Home Bancorp (HBCP) 18 Jul 242024 Q2 Earnings call transcript