HMST - Earnings call transcript Q2 2019

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Operator

Good day and welcome to the HomeStreet, Inc.

Second Quarter 2019 Earnings Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded.

to CEO. conference like Mason, to now and Chairman would turn over the Mark I ahead. go Please

Mark Mason

Hello and for earnings thank you call. quarter our XXXX second joining us for

earnings remind Before on SEC link. under and our that like the begin, on X-K furnished to available at we our to I'd Form detailed website release is the News was yesterday Events you ir.homestreet.com &

same and In will the our transcript recording at a address addition, call. a available be following

statement will is On a some risks make that today's Any is and isn't of statements. forward-looking and we subject fact historical call, description forward-looking many uncertainties. probably to

Our than our expectations, those actual or different anticipate. short currently actions take performance may we fall we of may

our realize financial and expectations affecting origination include Those our volumes and ability the those factors servicing credit meet regulators, our value margins, performance, or mortgage conditions loan at economic cost net expect cost savings rights. we findings interest the pace borrower of or savings to actions, affect conditions that to general requirements our the of performance,

in our may cause report well cause may from SEC Form expectations detailed differ our actual in current our release to as including quarterly other XX-Q are results that our earnings and that various from filings, identified to or plans most deviate us filings. recent factors our as our on Other SEC

results for in of may earnings website. found detailed today's financial a detailed release more reconciliation including on be our referenced SEC of in call, operations. and Additionally, to our to on Please in financial measures GAAP non-GAAP discussion our available condition information measures, measures any filings earnings of release those refer the our and

financial Mark discuss our in results Financial I'd business our Ruh. executing progress Officer, is give In our of a our a today on will moment, But Mark and operations our update to like me review strategy. first, summary Chief briefly results. Joining

sale term closed to related second completed strategic centers significant transferred The were quarter our of Services. our during standalone long home Financial our were that loan in milestone the quarter. offices goals. the personnel of a The HomeBridge substantially marked We and achieving of remaining sold not of all most XXXX

As result, to the the end the at end decreased of second our from a employee quarter XXXX XXXX quarter. the of first at count

Much June, results of place this operations took historical banking entire our activities. an in consolidated quarter activity almost of so mortgage include of

As our exposure Series, of to banking, to part to mortgage of a into letter this of The our WMS we will completion interest sell the decision going reduce we further reduce volume single July, successful in non-binding mortgage in transaction ownership family our entered interest forward. LLC. generate banking

the million perspective, during second we sale $X.X WMS. of loan of held from held volume quarter, for originated investment $XXX and volume loan For for million

had share our we the board second of announced repurchase At the quarter, a beginning million program. $XX authorized

As end receiving Lion $XX.XX. we the an at we average XXX,XXX upon of Reserve objection, price of end, of the at position five of Capital’s XXX% XXXX of Capital weighted our annual represented share prior Lion million and ownership price price affiliate’s $XX.XX, a date meeting. repurchased market purchased share to the quarter the the price which quarter, Subsequent non shares, average X.X open representing to Blue Blue shares Bank per volume per its of Federal in day

focus Capital, going completely forward. reach on are with Lion the Blue business to us which resolution We allow will pleased amicable this to

points from XX assets during total with of basis the improved to and of non-performing end end quarter. of basis the the declining second quarter strong the remains points quarter at quality at first the Asset assets XX

Our large markets the remain with some of the country in economies. strongest diverse

risk. focused controlling on credit fundamentals eye remain on careful a keeping are we However, and

period. years, continuing during opened five within increased de our the on branches, novo quarter our on the the increased same X% deposits last deposits Total those operations XX% and during

and announced our which we customers. September branch dedicated transition will for Lake this quarter, take place a into Oregon our year making seamless of Grove in are the the of branch, retail Oswego, our During we Oregon Lake deposit to consolidation this

to of over it our will who turn I'll the results. details Mark financial share now, And

Mark Ruh

morning, you, location thank and again our Thank In that sell first us. home center joining banking our the we would everyone mortgage business. retain substantially Mark. we business banking mortgage loan smaller based Good you quarter, announced for bank’s and based

and were the going As as these a our banking in April from will included the I mortgage results in quarter. retained financial Beginning assets, continuing of business of mortgage historical revenues location bank’s operations. during and the our in liabilities, of presentation the highlighting be impact reclassified are expenses operations. forward, segment result, the the based banking discontinued results XXXX changes

our quarter regarding results. And second financial now

approximately for share results The a Our the of income on and temporary the to This a both the consolidated per July of Blue common diluted million Lion to dilutive diluted or for loss, caused days of XX resulting last continuing reclassification equity includes continuing equity or end. loss second which us and discontinued for XX, Capital share $X.XX the loss and $X.X ‘XX. as slightly affiliates compared temporary to quarter us net quarter, $X.XX. repurchase $XX.X $X.X net share caused the of equity ‘XX quarter $X.XX second was first per million of share, our operations, from of to million per of from in quarter of effect reclassify to operations both hold

$XX,XXX tax. net business, charges worth income restructuring include comprised center quarter mortgage $X.X or second restructuring and our net of similar acquisition the acquisition of $XXX,XXX the the disposal million of million for loan the ‘XX exit of home recoveries, $X.X quarter net expenses, one-time of from banking items and in One-time of related based of to of of net expenses, first This items of tax, tax. related compared

but closed volume recognized lock the the family during lock, quarter is When million. rate full $X a at mortgage expenses revenue of loan volume, our the of of is of a impacted adversely was loan income based single given the lock only reduced because quarter, by income origination home of interest than imbalance quarter most We net rate volume. are center interest partial Net timing recognized costs, approximately business. rate on during quarter sale volume of is in closed the reduced recognized commissions including mortgage by quarter net the interest lower This revenue loan a income closing. upon majority while on

from second and April, was million, income Net the first will the limited the was in quarter discontinued income will volume, from continue increase, adverse recognize third remaining as the to effect and continue continuing commitment from rate expenses million. operations ’XX, that location the but the is of to business mortgage continuing beginning ‘XX operations forward we loans to close This sold. during net operations. on in quarter of the revenue previously lock included this $X.X million pipeline for ’XX interest the retained expect quarter of bank inclusion, from revenues of to compared $X.X banking due of $X.X Of based for

Excluding investment of received due this increase credit commercial in to decrease provision loans. increase of the in prepayment a on from on and for the in losses sale non-interest the fees increases gain securities, primarily payoff was impact, income and an

$XX.X inclusion, million location beginning the Net The in million from interest of million income $XX.X the quarter. in in first based mortgage income balances the during net of the ‘XX to operations. average discontinued previously in the $X.X was higher held Of due to bank $X.X banking was from retained by April, in business for included quarter. remainder million loans investment interest to the second quarter increase, increased due

to margin interest a offset of growth net higher quarter to interest compared basis deposit at on the in Our points XXX Compared deposit remained by bearing tax prior in costs. bearing of first the quarter the basis quarter. the non-interest ’XX, second equivalent was benefit

million of in decreased held to the $XX for billion mortgage end quarter real at of first estate the the new compared was payoff single $XX.X a million basis had to assets previously of the first nonaccrual Sales commercial or $X.X March The assets loan due downgraded $X.X the quarter million or during or basis March portfolio the second increases total June from SBA net Loans lending. primarily quarter. at investment and at end loans during to of Non-performing million decreased XX family from of that billion points quarter. XX the XX. to offset $X.X from been decrease of construction XX XXX XX the assets to $XX.X at X% points

in for in provision loan losses recorded XX, X% deposits $X.X million an excluding increase quarter. in balances quarter. no loan those related in the from credit a the to the due We recovery XX. The was prior provision in and primarily March decrease time during increase at to the deposits. on by discontinued to billion This provision a driven balances, of primarily consumer the quarter increase quarter June an losses slight was in operations, $X.X were reduction Deposit versus compared first second

generally raised associated deposit than and month on less decrease August. anticipation transfers we related deposit products. the nine months reduced our in deposits of rights with this CD servicing mortgage a rates of in in servicing We final Subsequently, these

also We growth had strong deposits. business in bearing non-interest

was first Our slightly trailing from quarter’s the beta second quarter XX up XX%. beta XX%, the for deposit deposit month of

held Our beta investment second XX for loan XX%. month quarter was

increase of in of location $XX.X retained received due was of in remainder the an loans. securities million an ’XX. banking to April, to of increase the non-interest in penalties from bank on quarter of increased $XX.X income quarter on inclusion, during quarter discontinued on path was to investment beginning the the first the second $X.X included in operations. million ‘XX of in prepayment million million and commercial Non-interest this mortgage business The the increase sale from due the previously $XX.X income gain

the business $XXX,XXX offset in in of legal in in the of to of bank operations. recognized the during retained banking million expenses proxy discontinued $X.X The previously costs, remainder the first meeting increase of inclusion, annual location quarter other based increase expense included quarter $XX solicitation April, to quarter. in the due this was quarter ‘XX beginning first increased primarily $XX.X expense reimbursements, by and million of the Non-interest the million from to of $XX.X mortgage million was ’XX. from second due

benefit interest to income tax state statutory combined effective tax blended exempt of Our primarily the income received proportion and our federal income. due to from differs the of for tax rate total second and XX% its from XXXX net quarter XX.X%, we rate of

discontinued locks interest million to second and loss that a the increase in due volume was imbalance in compared discussed. loss adverse the impact from quarter operations of $XX.X ‘XX. The of quarter the previously net million volume of was first between loans $X.X discontinued in rate closed the loss the to was ‘XX, of from operations of of Net net

for call back your Thank to you now attention. Mason. the turn Mark will I over

Mark Mason

Thank you, Mark.

asset the banking to growth restructuring improving reflect expectations. focus of portion our of most lowered structure to sale business cost and reducing model Now our efficiency completed turned that our our we've operating simplified plan, and we've mortgage our

addition which and involves technology, to a Davis changes. for cost the to Profits by and date reduction range plan expense of opportunities, management, expense and efficiency additional In CBC reductions consultants, identified personnel had are substantial organization Dan

reducing staffing company, contracts, renegotiating where These residing to similar organizational structure company services, or include and the and possible all currently simplifying redundancy, identifying organizations systems changes levels significant and by in possible unnecessary work management and major adjusting consolidating technology, functions the direction. management multiple primarily volumes eliminating the recognize where redundant and in within

and low level projected and consultants, our of our reductions culture by we of yield realize by our assuming challenges assuming to the management quarters, planned curve, within return assets and the XX% and the strong Despite X.X% the average assets, expense we return in maintains problem average that tangible currently on exceeding ratio four time. the with XX% on range, achieve efficiency additional an after improvement exceeding expect next low equity credit

expense, expense will regular amount these nature a These dividend. in depending meaningful of is realized share be repurchases, are establishment only based or expected on the the return The timing the to possible savings of vary without upon targets expense early a XXXX. quarterly of reductions although additional

improve would as return our these revenue cost such of fee Additionally, enhancements, targets. and improvement funds income in

implement better to the able expense our on we by financial Going of be timing the consultants, impact results. will forward, reductions as we our identified their forecast expected

reductions tangible on and expense targets efficiency future more In on timing specific average average future. return date, on of will quarters, numbers assets and we be detailed in equity return providing the ratio, to

change in the of updating are we term. growth our consequence expectations this a also business for As strategy, near

for this our terms. of no year we portfolios, investment will remainder single in held year, be in these over our For growth loan the and runoff family with portfolio net commercial loans next growth resulting replacing in loan in

current the our with interest second in curve, assuming concluded expect consistent Additionally, change yield no margin we a quarter. net just

prepared questions have Mark today. at happy comments. your answer appreciate any this our And We to I and time. attention be concludes will This you

Operator

first comes Luke Instructions] [Operator question The of KBW. from Wooten

Luke Wooten

off relate touch just bit the of just start initiative renegotiations the just to wanted And strategic and of little some questions some kind lot just on with and that to information on upon heavily wanted just I a of technology terms you on services the what systems kind see touched consolidations, the for to does lines. could more forward if you a of guidance. that or in

Mark Mason

expenses. touches it of Sure, several categories

have comprised systems. Of IT provide cost the personnel but And just not of and course, our a inside of software backbone certain is and we systems identified more wide a that among we line services substantially technology item, of of which have products. of operating the we costs, the of duplication of systems And some those have a products, here, loan amount products. fairly menu specialized lot very

We in to mortgage duplication banking are potential as many our sale and with of of the a our majority reduced to of conjunction those activities. the substantially analyzing areas renegotiate contracts consolidation, volumes, result subsequent our of of need

Luke Wooten

that then just that flat interpret growth, loan you I contraction, the what year, the just touching on is loan of how And you offsetting end the it? said relatively on, over the be to, that through growth were should can switching commercial

Mark Mason

to to particularly our Offsetting going of various more origination environment, mortgage those portion levels runoff rate quickly in substantially. greater mortgage But the the the right, in that family is with are than this past decline going expect offset runoff understanding decline in pretty greater single dramatically, we interest of balances, to or loans. commercial volume portfolio, composition

Luke Wooten

next, just just more margin, do given in much touch the do through I'll get the one the like of looks those sense how LIBOR the the yields just prime see get you but end well, year, here to in cut that days, to then your it we trying rate next on or a of, a of And loan and couple floating commercial how of is if trending? cut,

Mark Mason

amount I the portfolio of roughly monthly numbers, is the the of and adjustable. is portfolio right, believe portion nature, of a meaningful A third of adjusting, is short rough remainder it our and about then adjustable term In structure hybrid of floating.

Luke Wooten

that? there's or do do for Okay. is a of you end any the And of to I yields NIM kind imagine, have mean, cut the impact then how I two, or it see down given modestly? guidance the on be just this just kind would cut, year, assumed you of a the if the to that through be

Mark Mason

pretty the loan cut at curve, the that's costs our offsetting beta. impact the of term look when level today, for deposit given we potential And a have at our of in to We're short advances falling a and balanced. funding going

Operator

next Our question D. Jeff A. comes of Davidson. from Rulis

Jeff Rulis

it trying and statement QX, fair income look is start, to and get good fair in discontinued back things Is a expenses the fee approach what on post understanding question income that rightsizing going like efforts to to to then the income maybe start out from an into A okay Understand, reduced forward build fee and the and ops. that to cost. point? and XX.X made X.X a place

Mark Ruh

prior quarter the in of will operations. the into actually The origination reclassifying out and discontinued quarter that continuing No, the portion reverse. of that be in servicing operations was mortgage continued change

those expense. you higher levels And going of expect so, forward, should and to, see revenue

Jeff Rulis

X.X stranded then And the I Okay. you think on costs, identified previously.

suppose has what's those as the run I rate XQ of captured of and One been left?

Mark Ruh

it you second the financial the to the for has that our recent, calling at measures, page of not last of end second for that cost non-GAAP on page, But falling, of most the and shows apologize I release quarter first stranded the if earnings look out. And on quarters, page, to in under numbers XX and the historical X.X the million million course. line declined still X.X and Yeah.

Jeff Rulis

anticipated i.e., further in And no are that complete, is disposal the exit charges quarters. future cost, and

Mark Ruh

with assistance in the transferred a restructuring transition discontinued personnel. In in charges, services we have as still economics we are under miscellaneous loans of for quarter, we may that probably items are third that will net the when while existed that some transferred net HomeBridge. the with closed come be personnel have being agreement, are we offices favorable of we type however, loss smaller Those the that the operations correct. company, loss substantially some And agreement not anticipating pipeline in lock finish terms We loans think operations. of that of some and the discontinued through, operating that's income, closing will

Jeff Rulis

million you loans Okay, and could in you sheet to to deposits planned quarter, mortgage spoke away. about talk had the loans XXX transfer post sale, then, buyer are and held second that elevated deposits about additional balance and just adjustments an you go set structured to for

Mark Ruh

held of So, interest sale million, to ultimately those provides ultimate million. completion less reduction a then right, our $XX in the things driving mortgage past expected closing and course, million currently also $XX discontinued the the sale including us, loans loans, the of fall month originations to which but of of One, pipeline maybe for than the in month. of Two that. larger deposits, services, $XXX sale should in

all the next this previously existing for we number nine is third held those of in sale the quarter. largest equity in quarter. course, that ultimately will being most at loans six create that and decline, deposit over temporarily temporary So -- the of that part months. number discussed, to The this the a of of end The

Operator

of question Steve Moss B. next Riley. from comes The

Steve Moss

an fair of to to annually. I $XXX I on the in the million something think it's mortgage of about sale side, start probably basis the assuming making want billion on $X originations kind annual like guess to here? range WMS

Mark Ruh

still. seasonal It's fair. That's

Steve Moss

of, and how think is period. about about just bulk Should as or next here, over that the do the you're then expenses a it own consultants long take think we plus of to And in XX-month your plans, over implement the recommendations? terms it will really thinking Okay. longer of months six you

Mark Mason

the to in early little just it's and quarters the mean, I planning. that expecting beginning stated just in we I a four realize lion's investigating a Right Well, right. now, XXXX. amount are with potentials we're this my comments meaningful the over hazy, of share next

guidance. good make, And or of so But be but still we it's it's enough first first provide. come, a we can there's as kind to right. good as now, beyond this little the quarters of more to specific, hard unfortunately, more provide right to feel three the And to next half year,

Additionally, if that. in deposit improvement continuing of but growth, these as limiting are growth, you think our funds on don't we about cost include of loan planning any but well, numbers

Steve Moss

cost then, the you CD today wondering, perhaps the where And I of that? current guess, of your ran, that are guys CD funds just kind special [indiscernible]? And rates was on where versus

Mark Mason

Well, a advances had for float transfer a to amount are us points. raise they’re very a considerations, the down and and short that with thing XX one But those past costs over to substantially. very to Yeah, hole plan fill, down CDs right, liquidity servicing term certain life do for, time, And temporary of Right. substantially. was We to basis we deposit. premium. relative to quickly right the money felt with

Steve Moss

between about and construction? then, loan think C&I, should CRE about, we And growth? stable, underlying more sheet think we talked as should less the guess How commercial about mix here I that or you how balance is

Mark Mason

the look trend If you if so. five last lending Residential has relationship I you been lending market. C&I increasing quarter-over-quarter, volumes, consistent our that past generally, slowdown at somewhat, would consistent a or over has expect though, with the quarters construction at declined look in a

that real very Commercial so lending, I slightly real somewhat. strong, estate, we decline be period. to construction general expect volume this commercial see estate perhaps grow during think And you'll

all We that holding will though. sheet our not balance be on

needs And I as originations that have balance to to While days. continue our And grown, we as we work balance product are use business these sheet sales C&I well. growing previously on growing type our stated. effectively

Steve Moss

will, and Okay. it housekeeping, a, that items. came some you guess, operations. more guys severance if and you wondering those disclose was guess like if looks of more, like you continuing proxy looks through expenses And could like I I little quantify I

Mark Mason

that between as delta exclusively, We severance been we've in But haven't, specifically. We described, to items have the continuing primarily relates items. because have discussing, we those personnel. about And, costs and operations, total, did the not related services been that quarter, $X corporate if in salaries and and meaningful for numbers down paring helps. those that have been delta, million the of we've

Operator

The Sandler O'Brien Tim comes and O'Neil from Partners. next question of

Tim O'Brien

with bit here Can growth management but -- First you have also guys. obviously, of little capital where question planned. with you a share key in pending slower I and loan factor going you see forward, the this, stuff. and ratios, and buyback plans a capital ratios about capital needs for talk settling kind That's out

Mark Mason

authorized current million it $XX million the of Sure, the share have a will after repurchase completion the that quickly going future end then dividend. loan in needs buyback completing plan, and second buyback of with very quarter, center stabilization board first right. first with early our will and the little re-evaluating We, soon sales We strategy, is shares. that the sales, of after our a and all repurchases, the been quarterly authorized completion our servicing repurchase assuming our ultimately, board and more We're capital regular and $XX the concluded, the the of and of intention our company. expectation terminate additional filled forward, of by quarter, authorize of sales, activities home the the suspended the Blue the we Lion given

wait our improvement, I If and that But for that But you first adjustments in want to quarters capital. second additional that authorizes the before expect in we and think run went the don't their what what next going through be quarters, happen. about I we the I don't long several will will efficiency we board decisioning. front expect too will to through just

Tim O'Brien

And expense on my question. then turn another sticking with

page like XX, looked shared reduction. on for thereabouts, that about million X.X cost or on page, So it

it, reduction $X I'm right. reading if So million

Mark Mason

Yeah.

Tim O'Brien

the that targeted And savings has are work shared and done they and are these share then cost identified those -- the opportunities reductions? Mr. consultants the they've costs, cost quantified? stuff, and been that from And Davis separate

Mark Mason

I services. wouldn't company, the say that cross of classes are aspects separate, which savings, include would of they many the necessarily in potential corporate

Tim O'Brien

guys I up, might from second then you a range going a expense north/south here of costs guess different of look million timers where ballpark the And sense the finishing non-interest think? to and number ended quarter the total XX and an go you a Do be of that, where in standpoint, way have basis. ex-one expense at kind on like do core foot, extraneous things and you that third quarter? to Is forward of

Mark Ruh

Well, total expense this XX million. last quarter’s was

expect be that So, higher than I will don't Right. number. it

that some the about could think really severance, fact have would in in cost we restructuring, will, these second quarter we for you, that savings we not at company, personnel, even core I speaking warn business, number. related offs, exceed If the on you the quarter am to peak write the mortgage to continuing including numbers. generally reductions loan the non-recurring that number originations, things and is ongoing I and went a to of our that right, expect initiatives.

Tim O'Brien

number reflected XX retention of include million, In quarter in that compensation correct? business the million is second that XX in of that quarter, personnel -- that those that core number, mortgage stuff, and number, did their second the the

Mark Ruh

correct. is That

Tim O'Brien

forward. And can you severance the are quantify going what here that savings from

Mark Ruh

I I on I about [indiscernible] guidance think that had think of just $X give can I don't operations, But forward million similar we personnel. mentioned numbers continuing In yet.

Operator

Coffey Tim from of comes Janney. question next The

Tim Coffey

line, banking the portion will As two rate quarters the commercial sizable composition, run of by lot we it component, with kind up that you on sale like real gain has look a at a look the forward last the for would mortgage composition followed where of is the anticipate estate?

Mark Mason

remember, real think that's of range, the the you think seasonality high is But to mortgage terms range, numbers. going remember, for of commercial and estate running different. the right. is of high retail point to two in efficiency year. still XX% those size in family the ratio the relatively in about quarter second single is The in right? and probably is dramatically our revenues mid between revenue, being be So, Right? right, efficiency operations mortgage I the expenses, relationship in true mid-XX there If

that the the of So relationship meaningfully. non-interest or year, will perhaps during income composition change the

the the commercial loans is and estate gain of in historically than year, the of the second higher Fannie of year. loan year real sales in does second half higher the particular, typically Additionally, sales half are half first the Mae turn in in

can of through so in you the change year. And line see the a revenue composition that material

Tim Coffey

the dollars line? falling that about What to absolute

Mark Mason

understand question. I sure the Not

Tim Coffey

item on sale down? we Will expect the gain line to come

Mark Mason

versus I would of a expect offset it's will it little operations. much think decline. a respect to this be how I seasonal the be And with to at each unclear point

Tim Coffey

in with your stay Would to on portfolio going forward, think can an over And combine a the expectations on earning you then this asset kind the commentary grow deposits? that do bigger part mix would of of flipping it to the of will securities or you average earning teens mix assets, become if low of anticipate loans, the basis? that loan kind

Mark Mason

purposes. for collateral and securities a carry liquidity We

vary. the will you XX% less roughly they of in relation Generally, XX%, if we can, generally so, should to numbers, that XX% balance roughly. right, the say but to vary assets, those balances And sheet around size see around of

Tim Coffey

be then it a will mortgage from substantial thinking correct borrowings start business, average portion would your of to with decline. to And start exit the the that

Mark Mason

the Yes, continue deposit stabilizes. expect grow. to sheet We as to do balance

near for portfolio term, loan deposits that need to continue borrowings. this grow, the and and create a number stabilizes our around assume you reduced other for those will If home advances loan

funding composition see change. should the And so of you

Operator

Our Davidson. Jeff next Instructions] question comes of [Operator from D.A. Rulis

Jeff Rulis

Mark for housekeeping estimate forward, going have an maybe Ruh. follow-ups, do of rate couple expected that? you a Just The on tax

Mark Ruh

rate. Yeah. a what federal statutory it's be going tax to It we as closer looks report to combined like and

XX%. we bit larger where to so it's attribute climb worked have free -- state I again, But mean, going income a less, you're basis, again, basically, quarter income because have the This higher. we typically we so quarters an as to see see. on is you're net portion low to And seen it, net the typically, be was XX But going were we that see statutory we in going was around So to rate. having low. it combined federal tax little we've what quarter. we started that start past it's this XX% you'll converge to when a odd tax and securities towards that earning running XX, is towards will

Jeff Rulis

pieces share a what's math And There's do QX diluted out. in moving some there. peg But you coming then, could the to average count, number? on just some just on averaging the We there? do have

Mark Ruh

have expect million that due Blue the really which far as share only small we're issued I very, to you if generally shares the shares that remember in effect may you you third pretty think grants, it'll it. that can effect immaterial to but mean, diluted that number. XX that would be Lion. as employee do a going that about guys I Yeah, really happened mean, that be there I the see we I of a talked tiny. first won't quarter, again second in quarter, shares to the due to the don't days even -- But bringing count, to to due were X.X losing is repurchased the that is we're on small be be have very

change after that. count July. And drop those our will so will then of days XX diluted to off share So due the first

Jeff Rulis

purchases, the as well market As repurchases. open

Mark Ruh

those finished we're that. done see up Those are with already. June, that are -- in Yeah. those down. you Well, We

Jeff Rulis

buyback in tale There July. was no of

Mark Ruh

in No. June. All done

Jeff Rulis

numbers this just low Mason, ROTC And time numbers to get maybe is then XX%, X%, as you expectation Great. one range, to those ratio out confirm, XX% or last efficiency rolled next those year. by ROA your to Mark financial

So right? I am when that is reading -- reporting, that

Mark Mason

on excess actually of to in it Yeah, on of excess assets, common, be X.X% in just was XX% return specific. tangible

that expectation we third now, Our to meaning is right, a would able to run that get be year in the rate from quarter.

Jeff Rulis

is those quarter of expectation Okay, on estimates? Okay. third XXXX your

Mark Mason

Right.

or sort cut a accomplish you you it's take right? So lag of the action, when the

Jeff Rulis

bit. that catch didn't I last

Mark Mason

between There's Right. P&L. right, and the benefit the a action, lag in taking getting the

targeting. That get happening benefit is things these those the all are we what all of So currently to annualized of things. sort

Operator

of Philadelphia Hymowitz Financial. Jordan from comes question next Our

Jordan Hymowitz

here, your X.X a assets If portfolio loan X.X, Is are bottom number? are just your would and say total billion? good securities you about around that stabilizes XX%,

Mark Mason

They're going low. decline believe X.X, I slightly, to is

be a more number that, should where to quite reasonable. higher similar now. we think We is are I

Jordan Hymowitz

of said just you million buybacks, about for which That's it's let's maybe that's right? it’s So additional X.XX sale say a [indiscernible], saying billion, Is higher. And that that assets. you XXX math EPS number. without million any what in you're X.X XX got on available X.X%

Mark Mason

is The math, the math right.

Jordan Hymowitz

there is [indiscernible] a And Okay. possibility

Mark Mason

just Right. That's math. I'm snotty. sorry, revenue. not to the be That's the

Jordan Hymowitz

correct? a possibility So, additional there's possibility, a buybacks, for

Mark Mason

Yes.

Jordan Hymowitz

fair probably to say it you rid now would candidate business that desirable would in the sell more of that be and in statement you've the rather? you’re of mortgage you or bought got be the a it's And market a country, could hottest

Mark Mason

true. that’s assume would I

Operator

conference would I question-and-answer closing This to concludes Mason our turn back Mark like session. the over any for remarks. to

Mark Mason

quarter. We you. Thank appreciate of all on to the forward call Look your the next today. talking great the the you patience questions to at end and

Operator

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

You may now disconnect.

HomeStreet (HMST) 23 Jul 192019 Q2 Earnings call transcript