MCB - Earnings call transcript Q4 2021 | Metropolitan Bank Holding Corp.

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Operator

00:06 Welcome to the Metropolitan Bank 2021 Fourth Quarter and Year End Results Conference Call. Hosting the call today for Metropolitan Bank are Mark DeFazio, President and Chief Executive Officer; and Greg Sigrist, Executive Vice President and Chief Financial Officer. Today's call is being recorded. At this time, all participants have been placed in a listen-only mode. And the floor will be open for your questions following the prepared remarks. today's release will of and available MCBankNY.com. During the made which XX:XX at earnings company's investor Instructions] presentation, be reference to are [Operator presentation, copies certain forward-looking results actual differ materially. are Today's may to statements may uncertainties that include subject presentation to risks and cause that Please the regarding company's forward-looking measures and non-GAAP refer appear in to that earnings notices statements release. Chief to to Mark XX:XX over Executive It floor Officer. is turn now the my President and pleasure DeFazio,

may begin. You

Mark R. DeFazio

morning much XX:XX to and Thank Good and that release. welcome very first for you, earnings public MCB's introduction. Brittany

some extra For MCB the those performance the are And of familiar just note. Greg to of XX:XX in strategy, type minutes strategic being MCB you being and let's conversation who of few will time, generate is who first that thank for that But today are said, with I With calls a talking you going for participating. you events in spend could and for about also MCB the think these et XXXX we start welcome. cetera. introduced be opportunities, to likely more challenges, hope those and a of we worthy meeting. that corporate nature direction, forward, around

sustained be company to old well As a say, And prepared, challenges. last have paves for performance. profitable dealt many continue years the which has way XX-year that of been XX.X with we to continued for operations, I'm we the proud

funded performing two to a provider company first service such you one. growth of fortunate strives commercial continue established with First, be ago. MCB disrupt of should in companies who to more with And MCB, than mover Payments retail you banking-as-a-service collaborating market our those familiar as decade with bank. well-diversified that the as a have transform is as whose you consider industry, a XX:XX those For We not had for is a familiar in fintechs. us top and core to MCB a known to industry. -- a is well-established to are very middle organic materially fintech MCB, goal should XX:XX GPG is the are who second, and Global Group, banking advantage you banking

have And could MCB. a see rewarding were and the say catching to But said, industry bit we some to early. is that up it's

So investment those we MCB last that meant I which a now touch you efficiency loan are ratio very investments days. capital. MCB investor to amount participations a you few human on purchase year-over-year. investments to growth banks. years increased these the important from do presentation, Our portfolios, not Non-interest other We (ph) It's investments insignificant dropped on foundation to MCB into highlights, quarterly always not up for year-over-year. were believe growth it. with a turned out, Revenue full because for efficiency and online and of I XX.X% loan of retrieve interesting do scalability XXXX What’s to you an Total MCB. of has turn franchise. into loans look -- XX:XX and and quickly an XX.X%. few the who XX.X% today point are technology year-over-year investments note for as been in company. the sustain these the really return I just are have company, is will granular I a growth and our really and encourage made XX% go organic these portfolios, always It exactly long-term, year will been financial XX:XX in a XX:XX familiar, we give of performance. sustainable significant XX.X%. has this grew part it's important. consistent, MCB's very As and expense These

Although business XX:XX up liability what strong. for of And funds very $X.X XXX% have year-over-year, XX:XX main XX be billion. a provides DDA XX% significant to XX Deposits low or of protection were sheet. MCB a margin on which quarter. been side focused basis always points MCB year the was balance company, continues been focus call management. up the Total cost for of to even $X.X our has light franchise. quality and basis we billion or funding Scalable has was more of the growth points cost Asset in been branch be always we

million billion, year-over-year. banking-as-a-service a is or of net As The of six these itself, $XX.X XXXX, the behind deposits XX.X%. banking. XXX%, Transaction in number in versus early market market far the year-over-year. transactions to fintech were or those in $XXX were The of sense XX:XX dollar gives were added $XX.X of fintech XX%. XXXX type up crypto, XXXX. revenues XX:XX in year-over-year XXX% group, XX% $X.X up as was portfolio that volumes volume and taking eight year-over-year billion up were new commercial GPG of This GPG, share, clients in you from growth share million

early perfectly was to continues share community positioned smallest materially Although banks to regarding banks. fintech benefit we take the from to are that the MCB market largest money banking-as-a-service, from the center

existing our shareholders, technology make solutions outcome to We Return acquisition. for in meaningful asset community working a it's new a replace this banks and business equity expect We full benefit our Therefore add and MCB's corporate franchise. XX:XX follow initiative the with being some would to everything and on future. XX:XX just sensitive core. Kentucky. within to environment went I shareholders protecting We're that XXXX, The office Kentucky extremely return MCB. XX:XX to by to in like potentially common to for lines. initial financial environments. over on RFI final expect built comfortable will an not we undertook capital drive I offering on two be benefits past recently result, management will strong average fully the next hopefully that new XX.X%, XXXX, for on bulletproof hub this payment fintech as In a was production million was news with September proven in would through months our to fintech higher understand equity and XX:XX more Much and decision. as Absent is already a to a of tangible we quality, because $XXX the balance We year GPG RFP, on important clients. net experience an significant Louisville, portfolio be come average a development raise client loan and has in we're against clients exploring earnings rate continue which decades in commercial tangible XX:XX analyst our more by common we to call, office in we think has been few late true asset interest prolonged in and the our raised the a which client to say, digital more raise, up rate MCB And sheet, Lakewood, to research opening for established MCB cost. pending transformation appears extreme traditional outspend the XX.X%. have delivering bank experience New a technology in Louisville, impacted common of integration efficient GPG's which successful great equity a Jersey. space. and the

expect Broadway Jersey center assets have retail and businesses, -- established New deposits point because We But many significant profitable we the its opportunities in in we loan corner in MCB clients. under and commercial in for increase been the therefore residential with State a been MCB Lakewood, doing experience has have years management significant Manhattan Northwest this a relocation business to continue production population, housing of and branch Street. office Florida. its have our XXth be XX:XX the development Miami, MCB we and and commercial I under will relocating and for the this for friendly technology MCB. the management. opportunities deposits of is development, Brickell, financial assets the state-of-the-art Florida. out has of particular

same be the state. that undertake for that we in there, of more And feel at time about in the in even increase there However, opportunity growth Florida. the is values we we is it feel State more the to the careful time, us with

pleased we [indiscernible] the risk XX:XX what expansion to constant. technology us These of corporate our important at to perspective well. that around our manage Avenue. absorbed are by offices is boots having as offices. the for ground offices square Park centered and foot report having So XX visit I’m call XX,XXX meetings client on MCB clients state-of-the-art is are a

over I occupancy offices. the We six This out our to favorable gain successfully with and with next pleased non-interest can't been locations expense. banking-as-a-service the itself it saw continue to banking prepared profitable transformation ignoring alongside decade opposed we ago to commercial industry, will of of CFO. and fintech well market as prepared a to work In am some was important growth initiative MCB the over has it. the I negotiated our the is meeting to of many decade expense Greg, term is seeding that of the control corporate now the besides for our fact growth our have retail three to loan organic XX:XX providing who more bank through MCB company proud take continues our share. be closing, over while I which years. of sustainable in turn that scalable XX:XX

Greg Sigrist

net We everyone. income year strong $XX.X Mark million, of you, diluted or fourth and Thank finished fully of share. XX:XX earnings with quarter morning, $X.XX the per good

our continue income. Our and the strength to of net performance to balance as has growth accelerated leverage interest drive we sheet

of have Additionally, or deposits payments at XX:XX of client doubled deposits in revenues growth within million strong up bearing the transaction in global business In XX% our which expansion to leading within end. deposits, deposits quarter were volumes was Crypto-related primarily represented non-interest scale, quarter, the continued billion. $XXX nearly year that $X.X to banking-as-a-service XX%, to total business.

strong cost certain XX $XXX quarter retail $XXX and the was C&I. related double-digit estate from broad-based basis million. in card originations and across continues pipeline deposits. Loan credit in deposits. remains core of Overall, Growth were of well-diversified of basis quarter commercial repricing GPG's the with We of a mix points particularly also base Total book. the quarter, to declined real million portfolio, in up X saw deposit selective increases the points XX:XX a across be strong owner-occupied, third The to the in funds deposits.

which for credit had substantially reserved growth to including loan our XXXX clearly Looking expect of XXXX, at end, rates. XX:XX national you. $XX year approximately non-performing the shared in be commercial there the credit ahead, was tried leaves did additional for We a million, pay the of one for transition year national lay shared noting disposition also off principal release growth subsequently side out that loan That loan on level loss. this to charge deferral earnings full going a loans moving of parts January. would number nominal along $XX that on those Additionally, with consistent non-accrual end were was million in historic It's XX:XXThere one we January. the in off with to a only estate been real did in three quarter, deferral credits at of nominal forward. worth that at the payment

So, full us now well. are as behind deferrals payment

total additional forward. value. continue reservoirs do yields with driver sheet We liquidity net the XXX target, liquidity moving quarter quarter, of balance the in XX:XX While around securities margin. loan credit assets. excess in did securities new part that deposits the which of substantial at have have latter securities of maturity going interest yield this going net of benefit purchases, yields While should our interest clean securities elevated Combined XX% are the an on Otherwise, up closer as did of purchases new basis to overnight margin, the is quarter shareholder We the moving total most we remained from in of the made impact would also portfolio, progress the into purchases portfolio XX:XX XX:XX payoff planned into assets. moved $XXX our portfolio to yields portfolio. year end Substantial a our to has quarter. XX.X% very benefit compressed held loan points. portfolio significant Loan to with Securities add with million had and the fees. with a is

income Importantly, XX% up the prior interest over net was quarter.

deposit asset one. parallel liquidity would our deposit Looking it mention I given common loans point, from position was tailwind end, up in capital in ratios the XXX for This At sensitivity levels. never benefit we with if On XX:XX Tier real from well scenario beta raise in benefit deployment one of was for of A higher excess that the which direct overall X.X%, the parallel our shock to capitalized environment the lower sensitivity. levels estimated significantly scenario. XX%. This increase XXst. sheet, assumes liquidity strong, is leverage on to very into volumes. rates yield rising XX% in of Our point our rate XX% well also betas banking-as-a-service GPG would which all beta year the with include year quarter in Not a does you as and from quarter securities. X.X% a that basis deposit rate banking sensitivities significant Non-interest assumes September. a remain up deck are ahead, overall of our significantly believe a MCB's rise. year capital to in conservative Now, X the XX:XX provide rate XX:XX to as will equity our begin in XX Page XX.X% and ratio balance transaction basis world. our to income lead to investor the XXX positioned would is December the you shock revenues up above static up considerably point, system

a with XX:XX for are fourth moment take let of we And that levels. highlight been year. The from we ROATCE those expire to on required we fees in status raise that to average our successful net IPO be adopt later XXXX, of to behind excess the on common above has be of to our adoption. emerging this us, capital since focus XXXX way with that me XX-K that at made Significant we return will year, equity the accelerated efficiently the are well and CECL quarter or area filer. the progress deploying XX.X%, SEC an a expect of that year. file another focused tangible driving With liquidity, growth this benefited capital significant we've on our by-product toward and company goal will next changes Now, early time, by become will large we One goal.

what work we Consequently, share today. So in place parallel incurred have we started to do not on with CECL begin guidance before them the XX:XX loss mean yet MCB. running model we can to

XX not portfolios oriented have typically we the or has commercial history. year of that, across the longer quality, We adoption high duration of that said shorter having impacted Now, a CECL. net by level a had do duration limited portfolio been have charge have offs consumer most our that

adoption. will call the the back course to We I XX:XX come turn you due in And now with to Mark. anticipated impact back of the will

Mark R. DeFazio

Greg. you, Thank XX:XX

As the I is operating MCB two mentioned at one. in beginning, companies

We institutions, will bank a will relevant to as industry continue top transform. this continues be confident the which that commercial stay performing are to

sizes. regulators, and our now XX:XX innings early to banking-as-a-service feel turn Q&A. continue were of all with infrastructure, call in with very from will relationship to take banks continues very operator we in who would our benefit that from and I business, for over to we is to the early market industry fintech place our materially knowledge Although, fintech share, the still good the the working like our

Operator

And questions. floor you Thank The take Instructions] with JP And open. first Both from are is Chris will [Operator XX:XX O'Connell now Alex we begin. Alex, with for And question lines open KBW. Morgan. may our you. Lau

Alex Lau

Good Hi. morning. XX:XX

Mark R. DeFazio

XX:XX Good Morning, Alex.

Alex Lau

growth rate? ago? you. you the Do pace does loan historical growing on a pipelines. with How sustainable second loans just historical the annually. loans a to off has comment With MCB XX:XX the this And compare you being additionally, this rate. think under in mentioned So bank, your and clarify XX% what Thank with is you commercial year grown to starting line of this year, strong consider

Mark R. DeFazio

historical XX%. XX:XX in would very -- saying XX% between could I'm comfortable that measure you Yeah. trends I and

As opportunities you know, there. risk are the Alex, we're very and adverse,

not at first not Our of a market strong the sense result that the in we quarter clearly as pipeline and of is if line demonstrates of to because having sight. for not our choose jumping-off conditions clearly is us. in opportunity be front XX% annualized it's is that the of XX%, point My

Alex Lau

you. Thank XX:XX

Operator

open. line Chris's both [Operator Chris? Alex XX:XX and are Instructions]

Christopher O'Connell

Good Yeah. Hi. gentlemen. XX:XX morning,

Mark R. DeFazio

Chris. Hi, XX:XX

Christopher O'Connell

XX:XX Nice quarter.

So the the were hoping as Thanks. the into and the we driving outsized driven just or currency the of fee channels drivers volatility this 'XX quarter, start on going hoping And I there growth if amount to on in quarter we first growth quarter. digital some this was any side pullback as is the of pretty growth any color to expect side. sticky deposit get the GPG specific that just forward? if by would this is enter both that to was the I clearly off this and what quarter

Mark R. DeFazio

XX:XX Yeah.

to development out grabbing in fintech to and they how continue. not continue I continue so talking expect XX:XX running the is this any to from As pointed you market [Technical only quarter. without actually. I I've in set baseball an could innings just And expect the and I about much As my because say transactions outspend And such Page in across And the just I industry as course, broad early extraordinary you was then, Difficulty] which fintech they by-product growth nothing is goes fairly story are I in on at think mentioned share. Page And also trends of state XX based. client -- now can early XX, remarks, was market share I we're fintech said, to would of acquisition, – market deck, through It Chris, interruption we really banks. there in here. research say I the in the our investor industry, in telling verticals. MCB different are see expect these the show as taking the would

Greg Sigrist

of But is, it's accounts Chris, are side, had obviously the of lines number the have a they you there I really but remember, transaction uplift crypto account represent that quarter. those accounts reloadable a at thing also of when I think in the out mean, that general mean, areas. thing of in in XX:XX revenues outside that I does Yeah. on we only I crypto, purpose the too getting and people it's the revenue up card look transactions those from not would ecosystem. were the in the have add, important just trend their And also

in as important just I that’s something to So move think we forward, mind. that's keep

Mark R. DeFazio

because some appear point, be surface the important expanding product very behind only, we're they business financial range a doing broader they are That's that to their that, Greg. Yeah, if the on really with look you companies a of XX:XX crypto set of into not, services.

and So, them for to delivering market. financial we the are those services

revenues expand companies So Greg you out. the from as drivers will crypto outside well of as see these pointed

Christopher O'Connell

just coming currency could the I here. the the it XX:XX obviously, going is just been and digital jump overall long-term And strong. really in and the to color to to And on, the volumes prices color. up coming as have you up what was appreciate this quarter since be kind particular provide, growth if in market crypto I and deposits would the multiple year sensitivity is the the Great. appreciate down in areas. particular start on from like segment And of But of great? following the those revenues

Mark R. DeFazio

while down go revenue. talked and we deposits go as as therefore, is for quite there Chris, investors up, believe XX:XX transaction digital volumes assets in now, value, correlation higher appreciate will about a a

volumes and that more as generate rise will a value, believe trading rise, deposits we platform. decrease investors revenue traditional digital As transaction assets in

sell know, assets. we buy you digital those and As settled of

as of opportunity basically that to volatility are will where can in positioned say as So no diversify a product assets on the owner trading be digital is to in I relates its set value beneficial of platform. prediction All is the as I ‘XX digital value. there assets their or we well have it settle

Greg Sigrist

add XX:XX the Yeah. would And side. Chris, the other to deposit thing I on

on think did crypto corporate pretty You late may not saw quarter FBO recall client the that I side back have quarter, come and accounts, related back on think has in the I direct outflows the the less We in segment. And think Mark really quarter. we the in to to third in deposit cash fourth I but more the to trying but related outflows. deposit since not quarter the We've volatility the the fourth in side, get also you're any early on. that touched early seen it volatility

services. just and to in think I earlier more back also of the becoming getting with pen pen comments, fungible around, holding the in for a holding for currencies, banking it part, goes not people out people conversation it's it's broader

So again, in. you purpose general deposit reloadable, where see it's to that came growth the if tied

Christopher O'Connell

XX:XX hop That's really second. Thank out I'll a for you. helpful.

ask, I back come on. Alex Let can not if whether

Alex Lau

Hey. XX:XX Alex. It's

step the So What to a business? the staying on kind what the that -- increase grow that in quarter, GPR the XXXX? base GPG are both deposits? and back. Can into you. on those the taking of and just Thank a are you off touch good revenue for And is with crypto and is revenue deposits of fourth how also to this and sticky heading drivers

Mark R. DeFazio

one or And business companies Master GPR issue today have are GPG brand that product prepaid and other similar we XX:XX strong that off our companies with These to with. all card running companies in debit GPR either companies. card, across the The these Visa rails. of a there's lot a a that similar do us recognition very these of have to decided is loyalty our have wallet products to fintech within

in have business you do wallet a card you at that of one exchanges that and the digital and with, debit if your of effectively can any actually you ATM So point use card account for we a have sale.

I or use our debit card that's our ATM in today. and wallet you As

the early digital services from fintech, from -- buying I XX:XX longer been real of than finding cross clients around innings and still banking crypto these think, the have. from brand looking and they services, think other the case companies has And for in assets banking value and proposition long much of companies, that's that their general themselves taking So just assets. these than of more services digital strong selling companies a place fintech their retail although, use a recognition. that are I selling are more have the is a

in believer for it be. It's will it are go. predict early could We where what us to

have been associated fees will and crypto a the have if great at nothing had in seat we've in but well in the you best-in-class crypto not with We since prepared so the the that, we industry. the table growth deposits XXXX. net and with world, will just here follow we space, companies And the in country. We're

it know two, the will we'll So soon continues financial next year in or it proposition define to in if services. -- itself as value a

Alex Lau

XX:XX -- the this Thanks, off sticky Is to Mark. And good in on are 'XX? the and point quarter into ahead side. Thanks. heading deposits how these on the the revenue grow of also a base

Mark R. DeFazio

because the we really Crypto this XX:XX It's Generally and keep Greg, more volatility. question, are this. company, growth is market tricky tied me is volatile. across grabbing to fairly speaking That a line, honest still only franchise, on our business is share.

help who So a transactions for platforms, bank from who as trading or exchanges we as trading one -- platform, settle volatility. a benefit

up. analyst if guess or then, go think you're well volatility, fees investor So who will be I and will an deposits there's sticky more

outflows will If be but you deposits, less will volatility and assets go there'll up. revenues believe there'll appreciate, be in

to that bank the drive liquidity we We low you're to very are commercial have to years other for many which will deposit fund with, familiar fortunate that continue come. verticals cost

Greg Sigrist

mentioned had that prior answer. Yeah. would XX:XX back ecosystem something just of Mark in the goes as crypto a also well, I outside to it say

are services. broaden actively the crypto to out some to with Some of fintech trying the their firms are of broader working or banking -- offerings

to I successful broadening extent, their use they're GPR So, we element of they they're those already have to looking and time functionality as the also retail card, forward that broader their out successful that think the extent and for banking developing customers platform. the products,

I think of deposits just and streams. stickiness the to increase continues the revenue that the associated

Alex Lau

And, terms there sort in customers, of growth any XX:XX concentration the the quarter? Thanks. in of of in terms was

Mark R. DeFazio

and acquisition stage spend. XX:XX are right industry really outspending how the of that client based I different is effectiveness really concentration spend There think, are fintech and companies think early conversion this others is now. again, on is. that don't I that considering and relevant slightly

So they're the risk, do some a the there a from deposit clearly, growth. the perspective ones answer you no in are is is risk perspective. leaders and that today. of from concentration But have revenue clearly But risk. leading And no no, marketplace

Alex Lau

XX:XX and to I'll it one follow-up Thanks. pass And just over Chris.

how GPG lumpy In rate revenue revenue it's for we year? good think rate, for growth annual year, should the the terms of growth the about but a pretty this GPG Thanks. next

Greg Sigrist

XX:XX Yeah. the of about case base in upside I mean, an I think and Alex. a case, context

which I growth historic think worst the case, our be scenario rates. always frame is longer-term, tenured should case longer base the we

it's more on continue take I to itself is range. base -- in define banks, think XX all continues to good that's that's But growth and maybe smaller the community probably it's I larger from the that's that away scenario or really evolve case share XX the the upside and right. that's But still strong news. to banks scenario outlook. fintechs if slightly hard a crypto higher But to think market broader to quantify,

Mark R. DeFazio

almost fascinating national is, global all about as a cases their Alex, Yeah. fintech we really XX:XX talked in about, but a reach minimum basis. is on at in what's general

So all from we're used years think rates in are to away sense. having really we I two here predictable that the won traditional

is I here industry been client now the growth I'd at their growth be think year-over-year to staggering. pace innings since they've out strategy rate going are as -- the continues such acquisition the to their market, continue for we've say, that acquisition that rates that they in seen in if early

Alex Lau

in step queue. the I’ll you. Thank XX:XX back

Christopher O'Connell

XX:XX Hi.

was even discuss the cash a up was securities, And big grew hoping I overall more to this to liquidity the deployment great the plan growth XX% securities it So this and on securities the quarter, management, quarter. deposit to into assets. see of obviously, book deployment with

have of as guys of far XX:XX are getting to getting on a XX% What's thought number you XX% chance up longer guys to that as that to level ideal around your process You guys cash strong? Is term? securities? the is And going deposit assets. close XX% forward, sticking number are kind goes there the higher? is growth Is you to would of where this balances and like remains liquidity

Greg Sigrist

overall lot which Yeah. portfolio, I a Chris. from mean, think in the I the an first there XX:XX There's in there, should quarter. hit get we the XX%, securities we when

also a with you're growth to been think, bit high trying a it's I to catch of the which the train, -- is with we've problem. quality deposit up trying runaway had,

I first that and a pause. hit may us higher XX% the think be slightly you'll had in then see quarter

the I from From mentally XX%. I'm we target get an liquidity interplay, the the very optimal high long helpful. we've obviously balance I part going the we say, to But other there liquidity to sheet we're mix, would confident a curve the I also loan The it be on keep of grow securities quarter still to road, we a XX% loan on the we But what work as evaluate second the bit been curves of generate pretty organic We further top more to with get of quality and in that the down. rate book. are in especially think Even in ability liquidity we I mentioned XX:XX some we about book. if I think environment. put excess that options the the -- measured up growth, loan year, think with is -- down to did, is buying will rates. part the deployment. do little I keeping We’ll that's to of it historic wouldn't I So take that excess really strong once the point it the duration go pretty perspective. excess short, which the into able the steepened liquid. with where terms growth. middle that we our continue keep we time to into think in continue the

make have the move to Just firepower lending sure that we to on side.

Christopher O'Connell

XX:XX Great. coming the securities And those quarter guys first putting for are you these are the on days on that now? and it what yields in

Greg Sigrist

Yeah. XX:XX

on banks. kept as talking average so in now, is basis up we what Most what and XXX around on was you're duration. put know volatile years to fourth you what other around four the A looking environment, of lot a If points I'm and back fourth we're sure very of quarter. it quarter, to of lot it at we you the rate

You XX the since probably steepen fourth the that part quarter. have points curve seen of basis

be again of been looking But in right a So environment. a XXX the of points what points is rate XXX lot basis we'd at now. basis there's lot volatility to

Christopher O'Connell

to or XX:XX operating then, you. you then to shifting gears directly of into to tied And to kind is longer XXXX and revenue And expense Great. growth thinking revenue are to about this growth growth just this kind the compensation of like, related of growth of Thank quarter? guys some quarter much expenses. sort term? going How how overall

Greg Sigrist

originations -- for would performance loan real had, say on I strong comp saw a all bottom line obviously was Yeah, business. the the then that's it's revenue XX:XX in by with us And the driven side, we we even for pay a then would the scale into higher it I virtually and converted quarter. obviously margin GPG

in know, performance the going growth quick and going largely those in earlier quarter technology. you human to expenses would Mark's capital speaking, was say, So are of in to we the But rise. do reflective point, the a get to company investments expect XX:XX are pretty the especially on and Broadly quarter. we as return forward, growth I

up some going up down we've people. kind already lines need a I the and we're of hit head that's thing, the that wildcard And might going Mark other I obviously do with occupancy side, rate, mean, that you I'll think technology. out bit. then see in what the definitely with core going move go run tick is to going XX:XX You're comp don't this Just most volumes we year, to as an an and it's we built and going up cost of on I be story to The perspective, think additional go transaction walk on that on. what add to is little that forward. XX:XX processing we expense

get roll But fees spend into that of through I as side also we move terms more it. control how of manageable. probably that as perhaps. written we of We'll think time to of sets two destiny out give the on kind we it's paying world. in and licensing But on be of a our period going numbers that you

very going manageable. think to So I it's be

positive to provide think leverage. operating the for trying going I So is us be to limiter always

to So when especially quarter-on-quarter going up check operating time. the on some first continue top work to efficiency over you employer and volatility, do you it, we're see XX:XX you in might back every taxes on as quarter. because ratio come -- to the quarter, the You double some down we first know, have

of bit think about give you there. to to that going I focus to think But down. really the guidance the Chris, on little of where that's can't land. balance continue driving when So uptick really I year, there's going on we're number you a

can't but we're over to done very we've a going year at I keep what we that seen guarantee we're focused XX return on pace, making. last that, You've are getting investments last on the months. And or going the on

Christopher O'Connell

you efforts XX:XX mentioning expenses the with those Great. comments. just for is of prepared guys occupancy in year? line in just That's the helpful. next on And couple are How expansion the to general LPOs much adding

Greg Sigrist

rate. of its the run already in Most Yeah. XX:XX

from So if we hundreds in thousands of of those tens of a go thousands up the not for dollars, measured or efforts, fives quarter. it's of dollars here

So it's on I to line. very, very be going minimal think that

Christopher O'Connell

to what but Alex. the gave appreciate deposit or then the XX:XX the it XX, and stands back ask give sheet I switch guys detail you balance And color around sensitivity wondering more I'll you was it one I NII the Slide and margin the betas, Great. sensitivity as today. on on over additional

on of straight sense be a a just XX NIM had guys basis what point the hike? you would If Fed impact

Greg Sigrist

basis Alex. wildcard XX:XX be think for -- for of not Yeah. the one I completely the because XXX is points the first frankly, scalable loan going that to floors It's

have total our And in of were think billion of about XX% roughly loans out loans, I $X.X it's think loans the I floors to that floors. total.

And so, floors about XX% to of lift you off doesn't that hit. start until

it's up. points XX basis think I

you once -- the year have a rates moved impact up higher if toward kind the beta take that deposit – a a bit So X.X% with little of first you skew and you basis. over XX

you you a -- that's at to of it's That get up to least done off math with We've XXX shape the loans way one but slide points. floor helps before the envelope basis points need you their Chris. that this for to the for additional benefit. and that lift when also can XX -- again I this see that [indiscernible] in to the we the also to floors thing, tie explain, helps is also explaining the helps lift think first to rates you exactly lifting start back points uplift for look really floors call, basis not to that up if basis second the start curve XXXX.That at we the that give shape when on XXX

Christopher O'Connell

Got cash the simplify on it. I is color mean loan a the pretty But off even -- of I floors. that point understand is a to I on I get just hike NIM you balance just like just appreciate there. outside of I portfolio, amount so before regular to floor and sheet, XX:XX two kind there get even basis pickup the hikes it XX mean the But the with or the loans of imagine good those even

Greg Sigrist

Yeah. XX:XX

As on. you're reality, a Chris, spot practical I think

rates as rate point a basis on think I going market move much whole or don't bearing industry the rates. XXX first interest the money too to is moves. think I deposit

you've As XX excess pick and a the to pick first personally. up and earnings the see don't think think a significant deposit basis got on betas I both the liquidity, on going up points I result, you're those

Christopher O'Connell

XX:XX Alex. Appreciate out there, the color. Great. I'll step

Alex Lau

loan are what Hey, the impact your yields excluding new on yield loan What coming XX:XX the loans book? prepayment and the on was guys. to

Greg Sigrist

excluding which fees it I been it coming in historically. what what was was pretty this quarter, the been -- back on in that consistent the mentioned XX:XX have I think my loan quarter prepared Loans it's is have with elevated been -- third range, Alex. forward this in remarks, yield the they've XXX

So is run prepay been which during you running how range. in little get XXX -- quarter have basis. the I the you a take of probably we've consistent rate in think terms been to to bit is XXX a XXX which which the year, And on fees, pretty every

Alex Lau

this talk expenses, Can the quarter. you. the to here? you And increase to uptick and to item Thank four expect technology line there XX:XX you in continue an increase from moving what expenses back on was was in whether

Greg Sigrist

I three-fourths volume of of The Yeah, just think, a stuff just Alex. that's was uptick there. probably I think related, rest one-time bit the was probably of XX:XX in

you probably is probably just bit give run with less the of the little think transaction some than rate is again same I volume, rate perspective. a the So level run to that,

Alex Lau

over metro of see you. changing Florida? of York year markets how And the What moving do this XX:XX [indiscernible] your to Thank growth as in that, And outside the was like mix New open Florida that loan between up onto and past loans. you office? you mix say

Mark R. DeFazio

of -- in originations we brought opportunities our loan didn't it the any to not you and outside happened meeting, this Most to other just originations. on out particular this back of get XXXX, for have of not most greater in have where obviously, we for I about Manhattan XX:XX of detail. our ourselves. memory can -- to any reason to Manhattan originations thinking our but off hearing, would break say going that I

there. bit our of additional a and management an -- close was but market not outside to at and really real which corporate, traditional have clearly Manhattan, XX:XX the be reason hot us the think, area. mostly we outside to of loan half attention C&I, Florida. took I in mentioned to a that estate very sure Florida about why we the in was it's we're the So Keep mind, the commercial make is originations, is tool moment Florida, risk office be specifically, boroughs, of majority something whether it'd for of healthcare paying a And careful in metro of you because the opportunities, very

for is only a So, risk that part opportunities. not just for management, of spend

Alex Lau

think you just through to moving And it. key and risks this about Thank one for us me. do does minimize MCB the how help address core Got risk? to XX:XX new think How plan Just of last question this? you. a to

Mark R. DeFazio

on is through an to API, friction how the been that the from never there XX:XX been been better same conversion exposed for conversion now be Yeah. of to where me I've and RFI risk core to see -- I'm explained a technology one XX:XX now And call I higher services and or the really am subject in. that and of of infrastructure that being few studying major have what seen going which looking rip looking look been and the is a planning past replace. prepared a the next and what we don't at and type to is I've and it's that's with has The really some in products RFP it it. replace way answer what months. will the and in process. bring not the be operations. to explained I time risk allows me way to oversimplifying breed that who I to that are rip it professionals We're but bank people listening, on and you at at and plug in best the transfer But

management. with one our new But in word the me. think other don't directors of internally of committee, I'll she thing committee. the So use has you I don't I explained that how And It has to is established seamless. technology risk the lot optimistic on XX:XX technology am experience, a I also on that I see Chair it's been a based cautiously directors besides we other that and major of is, committee can share sitting any

fully for in process this underpinning technology of engaged franchise the this are the and we So reasons. obvious

outside So this the the ‘XX. manage the in of that eyes a end to and we'll watch lot be are and there of this think are it. And Bank I by through sets is of of going

of and a not that some hope second gives sight. ‘XX us It it's So line event. ‘XX of a ‘XX half is I event.

Alex Lau

for that's XX:XX very it me. you That's guys. and helpful, Thank

Greg Sigrist

Thank Alex. XX:XX We appreciate you, it.

Mark R. DeFazio

Thank XX:XX you.

Christopher O'Connell

round with just I'll one question my now, on And out end. XX:XX final

these ratio reserving of kind guys oncoming are me help where for think days, in color Just loans reserve trend where the some you loan get will directionally here? to on from you

Greg Sigrist

to that think I fourth not that the frame frankly you're really ARRR just really is I stand quarter, that can think back ratio coming forward, at continue we Yeah, the I in point go and the improve to we are say as for reflects did as you time that don't at macroeconomic in loans (ph) Chris, down. trends -- see the between basis where clean-up long demonstrably blended mid-XXs, reserving adopt this time. I they And we're going a on, mean, the XX:XX I'll moving now we're look it's new anything the where that in what was or on CECL.

Christopher O'Connell

you. XX:XX Great. had. That's Thank I all

Mark R. DeFazio

We appreciate it. Chris. Super, XX:XX

Operator

for XX:XX to That concludes the allotted time I like to call Mark back additional any over for DeFazio the or questions. now would closing turn remarks.

Mark R. DeFazio

the out and XX:XX of with time The wonderful about hear thank much taking you again day spend Thank only very day. a you closing have your for time to remark performance Met us is, the and Bank's and direction.

Operator

your archive conference disconnect be day. line this Please XX:XX call A a found time wonderful of webcast. call at and and www.MCBankNY.com. at webcast This can have this today's concludes

Metropolitan Bank Holding (MCB) 21 Jan 222021 Q4 Earnings call transcript