Bank OZK (OZK) 22 Oct 212021 Q3 Earnings call transcript

Company Profile

Participants

Tim Hicks	Chief Credit and Administrative Officer
George Gleason	Chairman and CEO
Brannon Hamblen	President
Greg McKinney	CFO
Cindy Wolfe	Chief Banking Officer
Ken Zerbe	Morgan Stanley
Brock Vandervliet	UBS
Timur Braziler	Wells Fargo
Michael Rose	Raymond James
Catherine Mealor	KBW
Matt Olney	Stephens
Stephen Scouten	Piper Sandler
Brian Martin	Janney Montgomery

Call transcript

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Operator

Thank you for standing by and welcome to the Bank OZK Third Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] As a reminder, today's program is being recorded. I would now like to introduce your host for today's program, Tim Hicks, Chief Credit and Administrative Officer. sir. ahead, go Please

Tim Hicks

Q&A Tim Thank Credit call you in expectations, In and I'm forward-looking focus for about statements this Administrative Bank participating our today's session. question-and-answer OZK. for and our we Hicks, morning. may results and on outlook Chief filings vary estimates Officer morning risks session, Good refer joining on the information those Please future. release, that the or such more cause our earnings implied to management forward-looking factors for and or comments projected in for statements. to and from may actual our other outcomes public by various

Banking Joining Chairman call and to McKinney, the me Hamblen, Brannon your Chief President; Greg on and questions Officer. Gleason, CEO; Officer; Chief are George Financial take Wolfe, Cindy

open your for now will questions. lines the up We

operator to Let our to Jonathan for in me questions. remind ask queue listeners our how

Operator

comes first Stanley. line [Operator question Ken Morgan Instructions] from Zerbe from the Our of

question, please. Your

Ken Zerbe

everyone. done of just costs, curious terms deposit Starting I was the of kind Good job in reductions from down cost time. interest-bearing deposit those is pace great bringing a what interest-bearing off over morning, have further of guys here. you of

get you I is basis even points another in mean fourth possible? quarter, Thanks. XX that if So

George Gleason

volumes we've slow, document, the got that think outlined there. have several those do been pace big gotten improvements quarters somewhat Ken, of I gains in We at But our the had is more obviously, CDs going of some to we've it. good higher is reasonable have that really - in rates. of as

environment less a and Kerley strategies the doing deposit we environment benefit rising retail is be and aspect be much on people than to we more betas the our a get and of story non-interest-bearing to the we in the come. And seen whole in last rising really and there They will Ottie think other accounts. McClennon grow - if execute environment. important gains should Cindy are that their I work Carmen rate when experienced that that in of teams rate working the more deposit core that are our longer-term should rate rising probably

hard to the quality deposit working in just the the performs to of and run base, long we're in the get short next in improve so improvement that further So it run better cycle.

is I on that So least. think our at view it

Ken Zerbe

And Okay. then follow-up helpful. just a you. question. No, Thank as it's

made pace I higher seem terms expense, this In the you of slowing lot their ratio a of release reserve on to this least guys a justify the of of provision at particular reserve a would in in that day CECL sustainably one closer CECL progress know that reserves your definitely you Are quarter, be ratios. seeing banks go-forward basis? than quarter. ACL one portfolio anything a reported to getting they lot day

George Gleason

for in always create issues risk and the shifts supply not forth let change uncertainty unintended uncertainty I'm a and and trying of Washington cost incremental many unintending and keep the is done social from there of labor in now to consequences, But the the mind Brannon Washington are that in policy, availability I'll look consequences different labor in yet, in a your this so that chain of and lot the country increases to you the policy and program. program be projects push there so Washington in that. and infrastructure many except for challenging is seeing lot trying big No, and policy, Kitchen is factor in do can't our our conservative. in in is material in anything of for you structures massive is disruptions our an to landscape market a it that big we have when many of to at as and point Tim monetary risk push disruptions all supply lot do chain a view having fiscal Well, is aggravate anything, a and much situation. and got example, There directions, There the and and trying a on of from also Washington just already see that as economy. infrastructure comment in people you on as creates for

to out give play until So an us we're conditions a future some us to on unintended things direction these develop that view see greater confidence consequences wanting of that going tip just conservative take the don't some fairly just see economic in adverse and we cards we're on more back economy.

Operator

from comes question UBS. Vandervliet line the next from Brock of Our

question, mute. Brock, your you have phone Your on please. might

Brock Vandervliet

Just Ken's deposits, time. question deposits goal I do one, can time if percentage have share you on appreciate I want following on particularly don't and but guess, the a goal with the for of the get an us think to remix you that looking at category can it's billion have go, nice where if $X a could one you to if insights? dropped so, any that you wondering or internal you even have think I'm that you

George Gleason

goal don't we specific on Brock, that. a have

is everything just remix do can to continuously that goal and improve mix we reasonably the Our of and realistically to that.

CDs lot higher product, remix particularly somewhat or public loan rate fund a our or lower those of repayments the a to negative ability had lower recent is let little fact, our cost of of part no in lot quarters. a loan are or brokered in even in and price in we've that growth at obviously, a CDs runoff, CDs Now, - a

we thing positive do, augment our So need growth to probably some growth and which in as we'll to to accounts growth is with in core think hope CDs. do reasonable a we a get into more much environment,

in tolerable keeping is favorable that a a get growth we're we achieving some in relatively downward rate our it's do We're lot of at constant that CDs. on a also a the think that don't I add the rising rising but we balance way deposit book, needing So that, environment, core assuming get at CD same in mixing betas to sheet a and good our rate environment. adding we deposits when that time, a trajectory hope level,

So we're we probably and hope get where will but working specific we environment getting occur. to have lot book when of will don't hard in realized it an mix a some a growth, we we we're every grow the degree day, CD which loan on

Brock Vandervliet

fully Yes. on about done the And at it's changes that just you've there? follow-up place execution deposits. point? of there And terms in Is as gathering now the pending more - lot refocusing a on just a template are branches this or in core

George Gleason

Cindy? question take Well, Wolfe I'll don't Cindy let that mind. if you

CindyWolfe

Thank for The question. in is you the Sure. place template broadly. I'm that. happy to do

that put we're playbook a the George biggest are So, now, to in to the fix place pieces seeing things nice don't that. mode story and now, that the term. really The are we said, foundational of results the have as place the refinement goal things, we in CDs from right of bank be but some retail in position aren't us quick for a and course, all things mix, in the long tends is, it the of in or short-term they're we're

the those, we'll are lot but place, biggest new a in to recruited. So that refine continue talent pieces of of we've that the including

expect the in service of we mix but signs that happy having So the early the that of mix for continue. and and success the trend just charges it's only on effect we're to the not

Operator

Timur line Wells comes from Our the next Fargo. question from of Braziler

Your question, please.

Timur Braziler

was was out Maybe that the quantify a pushed abate pay-down pace that be activity XXXX but some a management would And starting quarter. comment is that quarter. third seem the activity were fourth in the on in guess linked pushed into of of out you're There of little RESG, still it letter match and you to fourth a quarter? to quarter. expecting the quarter levels reduction bit fourth I still I know much the how to in can the payoff it top in if

by can expect further payoff activity you now that how you to quantify XXXX levels, little bit we're top the year? So, a into much

George Gleason

but portfolio Hamblen payoff predict to does big, number around is to February to and we're in moving going or are an because going or loans I'm will you, tell able Tim, exact take let December that is RESG you, chunky month our question, and unusual not it these or give a occur January precisely to two payoff. them to I hard a nothing in a be Well, going that is it Brannon make

is a of give all movement, Brannon there can that. Tim, So of color lot good but you on some

Brannon? So,

Brannon Hamblen

right a after now. of people lot of origination active quieter to Sure, sure. Tim, lot are but guided is morning. for the a thanks said, closed for side, our the George is chunky news answer a to guess as I accurate, get the in trying quarter, as and year there XXXX. transactions good and good loans quite and pretty That's quarter are from market question we've George's

not I told it's be to final of if matter going the to around move you is. thought because loans I unusual loans it in QX that what the even some what and are And size of could the of off, paying really for can - so I result

going It's don't be, that's to But that coming we've lot before I and our the believe, XXXX, don't trends are affect just chart, is the I as of to that. year. our vintage, and achieve get move origination we'll a trying numbers it's any pushing, guide to the be the will again that of XXXX. 'XX on we I So that it's going trends points and unusual rate, in loans going there - I've us accomplished. think as those nothing a repayment transactions pretty guided, to and said you marketplace in to around to to have those timing sort are we this just vintage record point much push going QX you well into of at to

Timur Braziler

that on - wondering quarter. kind there forward on near-term, pull quarter to that here impressive then Okay. production and side, that quarter side kind at was right if the into the I'm in is rate third and that any comments of $X of the billion-plus? of I maybe just reasonable a on that - now, pulled for market the active on those the fourth color. production appreciate that any got enclosed And production from the other least equation, your was the is

Brannon Hamblen

that to and I volume heavy timing. is out origination fact the transaction of affecting both repayment there the the alluded

in that like new we job really with really healthy that a portfolio. and and in this and guys done phenomenal getting really Our a we've customers type, like business got new expanding market product we have markets

anything we I we've a It's originations taking to and payoff if happening. longer QX. asked affecting forward what and pipeline. I close very in the beat in got good it's affected you healthy far would did into that predict too think to QX. originations from but that's a lot won't I transactions and that in of a future, generally QX I we've pulled I don't meet see got shot tell you think or

criteria. looking seeing good forward, good we're So fit volume, that our loans

give So there. that's you the I would guidance

Timur Braziler

balances I the as book the if portfolio kind Okay. officer a your And the at portion see that the the guess what book like when and the fourth you. of thinking can this bond would then bit? up how I maybe veteran lost comments little one and about of securities? a quarter a be from on total investment to indicative we of should more I the maybe outlook then we adding getting and assets? And that especially think just quarter - securities you'd Thank pairing with guess for is is that be quarter to bench, some looking coming third where of back

George Gleason

Tim That's a We take will purchases. almost and had great question, that. I no

are duration be was quarter it right, ended $XX the in in I the exactly portfolio of think with lot number bond quarter a the very of million and not that short may even in course, mortgage just it backs minimal the is in short, purchases flow. but the book cash one purchase and pretty

to with of seen So in was we reinvestment. which bit quarter lift closer is book area the us, compelling you've a the us recently, reinvestment the that Certainly, do some bond more getting rates shrink could given than an and did in where little opportunities. fine less

business added to team known our done pleased years, a quarter. veteran have and in team XX lot with has another to probably. very I've for investment of the This him are guy We member experience.

forth value think investment, to real a niches horsepower in investments. and understanding I more we value so into unlock gives research where us some some get little So, some to of can quality requires more the of some the that that appreciate and

team toward we'll So a like it in situation with purchases, to on last QX year, portfolio that member then getting in or are likely depending new new see see conditions next portfolio, we saw quarter. what our a and of that shrink more some trend forward, QX growth if increase does are market we seem than more more positive QX maybe in not then and the but

Operator

comes Our the Raymond Michael Rose from next James. of from question line

Your question, please.

Michael Rose

my questions. taking for Thanks

expenses Just are wanted up they to touch a and on bit. little

you're inflation in hiring some areas. You cited and obviously, wage

As just of the Thanks. could you we talent there, those if would and what That and that would are at frame can stab else think about kind next investment you year, take of options both great. some be in look like given terms of out expense growth a anything initiatives?

George Gleason

Greg, want to take you that?

Greg McKinney

operations, going personnel. significant what XXXX. George line rate do need the can, for move having our what we Michael, to items the across customers. the certainly We've there process future our and increases to think our to need of then our that to third the do I and composition quarter growth, the much see provide what - support we completed nationwide we in We've commented is annual to our need quarters. the into to to benefits pretty somewhat have worker of be we salary color. in evaluated business, our every - us Yes. on we that shortage is to expect our Clearly, run included. we've some we expect provide would as - country, impacts company that indicative we support our of service add - through effective entire for the be We

slightly You're maybe $XXX right above or million. the at,

our So, I - 'XX. baseline a as about pretty move as into think we the that's thoughts good we think

run the its have including we the is need again everybody of positions we to QX least is mix a P&L, would salary year. run fourth at what cost that ability indicative as can when are, may way that those cost quarter rate this to fill certain year, effectively of I our customers next We salary in as on think trying part business. feel of that we to impact The expect fairly the into we and but into positions our sure make serve run of our rate first our that some move even and timing

that the as impact So I look I shortage in that the and worker those you've got mind, our to would hire to the in think, certainly, then, at keep and just have how net - replace we might ability needs. and

George Gleason

a started more give and is July a And earlier on color Greg little week. Michael, budget on, it salary spot annual just give I'll on with that. but you I'll little process completed We our detail. this XX

early a wages reviewed for rates those is have effective predominantly to team of we various the of those department most supervisors, - in were company reviewed situation, and year. were as been of every to we XX-X other what setting of is heads way or pay In in and the September. August, units finished rates rises. in process, XX-X in through units reviewed of employee up lot August, What are X-X that all year XX I September going were next those be most early and the and/or last effective with shortage individual that personally weeks the of in effective couple we worker the now in next member down July, rates the So the in the the light

sooner days cases year shortages there we the and by would process previously. made we rises So, than we those XX effective to escalation labor accelerated this have many review conditions about in wage and market and respond to

wage increases So QX. you those see in some of

and - a our them redemption in line had $XXX,XXX about up related expense document comments we see we subordinated notes branch cost rate You'll July of dollars mentioned, chunk that our interest X. item, QX had QX as early higher of in course, million cost non-interest we management closing the of of on couple paid in a in to and

could non-interest the to need $X we plus that think expense, close the in in and were the wage to quarter hires atypical impact us there give that probably was created Again, last drafted seems they to we're a or of quarter of he already the little of But this the people, salaries, We comments wage filling lot room sort sort in QX. a So forth. point of management that it his language on million comments, $XXX in hire next items that. of starting wage It a good a recognized and those close and is quite or it to positions our looks of for There But the unfilled million says like pressure a so non-interest trying we're to little to plus Greg minus million and have said so increases for impacts number and expense that timing good going rate see and bit all a in the pressure run out there pretty that QX that absorb few is $XXX the two. QX. that. in like

Michael Rose

a looks little the helpful just very tangible. X-X of Stock are of more That's guys. follow-up, George. you used XX% still here And as at a than buyback, like about

move think that we us frame how help utilizing Just as should we about forward.

growth loan Thanks. given should just about up it we think picking - Just it. is appears how and

George Gleason

really one how over - managing first to fast new on what car, I'll last and go and done, and it conservative want how will to, ever like don't steer we've you time offer know going sure, buyback it's to quarter, to it a our Tim, operate. that the you then turn a first it's to driving it's program is see it since approach was that fairly it's comment when out where my took that us. we And approved I'll who Well, it was for is comment

goes. you about that give our can where thoughts So, Tim,

Tim Hicks

quarter as and we Michael. We quarter, the the making we active Yes. it on for quarter operate be all quarter. opposed expect go do part outstanding going well. just the the we of clearly, would to we'll the were parameters quarter but It's sure that be George's price stock and dependent Thanks, how point, as have were to of more this our last to to throughout it aware full as

stock we what to dependent active. be number in we'll price do number you So quarter going do to of but reacts - to it's how as QX what hard a be predict it's the and give our a we're plan because go throughout on

Operator

the comes KBW. question Mealor from of line next from Our Catherine

Your question, please.

Catherine Mealor

Good wanted next the encouraging origination really up morning. think I I on just question about which to or level that follow quarter. see a something to close a and the same is level volume, we'll

As that about you with those the some environment there loans. you chain? liquidity in think supply do mentioned the headwinds think close timing of to time we funding, taking today environment it's the Brannon, for in kind is the the guys that's about originations how - of and the

to it looks the what past kind in is been a timing and like? this in environment, about has the should of wider maybe new is that gap So Thanks. think timeframe we - from than how funding, origination

Brannon Hamblen

to to the would today down conservative the tying land sources loan closing, and the relates of Catherine, of material that really last how say you some do, of are today, is question. not larger in this more funding in the than seeing players equity there given on some it against see are is be in Brannon, a whether the many project to and XX, wanting down more are the it that different especially would loans, of which make an a is sit are funding things XX there you product pencil have very a loans mix value loans a market of impact and we're those there. to loans of lot here tend close we when the the some moved those relevant I as project depends a the stack, initial degree may on have lot of or thank where a as of - There is others we sharpening months. today those lot that numbers that when impact you of the they sure markets equity and as we the real are material that to question, they our timing the Good over tell delay a well. tightened contracts, lot question. of on for on of I costs, whole,

certainty So quite but that's not that are could issue as the fully. there being locked of of impact playing and around George predominantly into funding. here and more have understand. supply And yet one we're noted also have answer call, as of delays don't now things the in has one timing a to around contracts further your got there future, earlier the slower that's the is had are some things doesn't and but those chain But in in it's closing material effect, lot question watching of I gives you've we stand today, on that that that know discussed timing you about

We and loans. we've make of those in great which have always hard also contingencies, sure do want things to we reserves got and work sorts our always to will and all that

it a but I so the So this we're say impact, post-closing, is watching seen it. much if point it's to time, hard haven't yet bottom at material in guess line

George Gleason

Catherine, I would...

Catherine Mealor

That's helpful. you. very Thank

George Gleason

that the they've really mostly year experienced delays loans last are comments, two. costs a because in pre-closing and because before on of the costs seen new those working to in far Brannon's they hard close we've are not post-closing people variability On lot so down or tie

said, Brannon So it already the chain you them you get things totally supply things closed. have done to they've have closed, as to seem unexpected the to track. work it's on unless disruptions. just keep Once And harder the making get

Operator

comes of Olney next Matt question the from Our Stephens. line from

please. question, Your

Matt Olney

about yields. more want I to morning. loan Good ask

fees by what the normalized were more miscellaneous think about outside I'm of in higher third I levels? that and normal. quarter were quarter, heavier extension of versus talked then of than interest these PPP curious even we levels last levels fees way fees

George Gleason

in describe the unusual carve tell around to on normal degree bounces apart When fees it's the specifically the we is But disclosure place, fees have our we in all of Matt, something and of level is. a hard elevated of what levels QX typical comments, QX. minimum that short-term over were normal extension PPP Yes. in other management think would out than what QX more penalties, interest, the you, prepayment I fees more you of the would from

So, that nine there the in number PPP bounce or around loan I sort will and for the X two need quarter and yields. than the particularly our that any basis elevated the not first you net other account think both was to year level of for impact months that contributed of about interest of points, our or

Matt Olney

then to also Okay. And rates the and Great. rates. That's Bank's helpful. interest sensitivity ask to about want

is Fed I now late like year next should think, floors moderating. we some of be it kind prepare great interest I you tightening is disclosures next rates? the to sometime the market and for loan anticipating What looks year level else Bank think guys loan better and provide the higher floors of assuming over around and the

George Gleason

until on more our and those there closer the the to and of are before been steadily has But the keeps loans newer you've have to the increasing. those been three the we as adjust payoff those attention get actual years our are and much fact the to means replace loans at and loans and floor Well, environment ago on have get loans rate that and to rates loans which seasons that contractual higher rate - at floor - hit adjust higher loan floors them, interest trending the the hence I rates the rise let rise. floors those off get percentage if noted higher rate to the more paying ability originated were and older current we floors down graphs - loans rates, rights, all levels, levels down current newer loans as time look more that the rate raise to and appreciate the newer quickly we the up portfolio will impede

makes we sensitive in upright So every quarter it rate here, stay more environment. an us

off in the the the to actual So adjust to it floor. call that rate Dead the be would kill the until that is the the formula Dead we Zone call loan the dead between rate we're floor the today difference where you floor working Zone doesn't because hard loan, on hit rate what and a difference, and we ignoring

and Dead working hard Zone have a continuously giving the we're quarter, favorable. of mature to we and off loans up in gets as every So that reduce more they kill in renewals yield situation payoffs without combination

point with for be environment, So of or some is it's think wise occur a the be that preparing high to and of rate monetary we rising tapering level stimulus particularly the to deficits future. at fact in the necessary likely

earlier, really side. that the side, also, as Cindy on CD So it's about a but hurting prepared well we're the working the loan quality of and as little bit deposit to hard of to the be for that. talked beginning base deposit into And not extend just base on preparing duration it's

to mix So try environment. in we're nibbling to away on all of initiatives a rising rate improve those that

Operator

Scouten Piper from Sandler. from Our of Stephen line next comes question the

Your question, please.

Stephen Scouten

quarter like maybe be projects George, new or projects. seeing more you're it are And a for product more projects this wary your some you I is mixed? in looks any where back Can you as the did to and types are couple about on it condo, color call. comments give of been banks Brannon more question about? this guys here you that and coming nice. of mix, it of types have circle Is the there a office, office? are wanted - projects RESG, the from? guys some of taking what around, what know kind a Is Thanks but those I new But those originations. well of hesitant on would on

around color some just there be mix So, great. would

George Gleason

go Brannon, ahead.

Brannon Hamblen

I question. give sure the can for thanks you color. Stephen, some Sure.

you projects in a telling not we strong, in we the many more loans you, by been top lot we the were list. more multifamily there, pipeline sort market had big lot you volume largest probably to mixed-use Those in we the the QX, than continued and a at seeing dollar noted the would in strong come Southeast Northeast, were a as then the of and South, So of But great also and as have big, West. originations of a more that multifamily of was three of diversity, again, components. Midwest part that of a was from also what expect activity perspective, market but and it. office, And

opportunities. across guys the good are finding platform really So the

to box of we're you're haven't we sponsorship fits that there coming what stuff as of a second terms just good the already first are deals lot said, right and guys, that great getting think finding are of finding working that to job with those doing on the of the have sponsors that phenomenal in In them a sure got that loan some new and between done make we're with to market that and we I of make the our done out wary and continue and this in sure right you business getting deals on one. market, there

and it will looking who there, in world. to type, who that a product carefully is that and as obviously, everyone's it building a program, at Again, seen see is, it much it. expect watching it's careful, we're hospitality where and we're what is I it's it would not by So, that we but product haven't tied is needs some

Stephen Scouten

are maybe maybe then lendable and being sense. picked these getting were that a started formed an a are Or and today? new real of seeing of becoming extension makes of And that, guess projects like opportunities ground That out I the back coming up projects you today lot of is lot coming pre-pandemic?

Brannon Hamblen

projects these of put guys and course, tracking our and long size, them so new some our fact are and of asking years. literally - been Well, take what's a some things of again, time together, is have of to but yes, these the you're for the guys of matter about

space And we'll makes have we've by to year. so migration such more than this waving it that trends you to new but trends, So seen forward. a things geographic to Manhattan new have it's Obviously, Texas build come extreme. that sense say, perhaps more not are that together, has, on apartments us, just then those bit move

demographic are that So they're projects well. trends new hard very responding as to definitely current

in you everything there. a of little So have mix the

Stephen Scouten

while. just have question it's indicative trending service there anything that really were the for progress your strong and a there? And is account growth? deposit and for is last deposit that way to note one Is the me Or quick been mix of you with charges guys just quarter unusual maybe in made

George Gleason

take you that? to Cindy, want

CindyWolfe

Sure. indicative of of in really It is shift and unusual. the anything There core. the isn't quantity quality

COVID income fee know our and service with down the usual a the you or is as and is focus be there so and and OD spending spending central of variant. in in Although to of, charge it up it, NSF not the follow movement will ours and strategy but NSF does terms OD. strategy, go our

changes the the we so is going the And increase, of in of sustainable that but as part that the movement of charge income a to we see question. good do fundamental Appreciate real of the forward. some function underneath see full some simply that service that of just we're the disclosure, economy, growth the in

Operator

Brian comes of Our from line from next Janney the Martin Montgomery. question

Your question, please.

Brian Martin

Good morning.

But of one have production finance, ABL gives and of part you on teams the lending this is equipment Just you one the put on Brannon the of production, from can I to kind guess, just not initiatives other much if of the what George. how or sustainability you, production, about. any, guys it, in new new really the the that, that, and from kind last was and you, question, more contributions place for of confidence new it ones Brannon, you've follow-up the continuing? quarter guess the this new I talked maybe just but It's on obviously,

George Gleason

Brannon Brannon, ABL then minted. to respond which new our add QX progress team or additional guys closings hopefully, we've is not or yet. have to both seem and I'll some that contributing let some growth let looking QX not any things we me and at be quarters, team, either and that's our units in making But leasing yet of Those good in out but hope freshly seen color. they're those or to

didn't that gotten Our work competitive. guys model, very new indirect which continue environment this to mention with business has you

I positive but up still slowed positive, to buyer our we're a guys that next spent that - days having on we're to that So indirect a growth net portfolio bit ramp negative few in net it's quite time their we XX and up model a will phone last to growth and over week get the making the tweaks their those adjustments with think of year.

Specialties growth community you and year-to-date there positive groups on the of we a closing. of PPP But and pay community effects months at So bank, net originations been those PPP, a last momentum have things the if positive of now have negative positive our Business little guys our all net gotten to our out bit out for RESG downs those and great some nine Corporate can net & And slightly bank of out quarter momentum looking the when if full quarter, net expecting you that. in bit is this we're the Group take positive paydowns. got pipelines bring little

generate reasonably to to fronts across our we're in growth multiple XXXX. positive So, ability loan about feeling continue

Now, QX but up our a I really put numbers to will be believe, quarter optimistic decent about ability XXXX. in pretty we're challenged pay-down some growth

Brannon, add to to add that. want whatever you So

Brannon Hamblen

Well, I would just it. with agree

CBSG the Brian, portfolio the on even some but, the You the to to as origination RESG I some Group in our groups for yes, other I'm the referring in to George side SNC all ABL hopeful reduction see was hit these the just quarter. an starting guys bases. from numbers included said. are traction and before, have

think I some things got good we've next year. So again, coming

Brian Martin

No, that's helpful and or last just follow-ups. two one

it seemed all little on quarter, the just may kind about of growth, in about just guess, or but positivity changes? a quarter focus. has don't any I you've know, It for M&A the ago, that - stands organic mean, you're a things today, given that how maybe be talked I loan last like a dialog with I thinking that front where more being bit I Just on, been know Tim, of

Tim Hicks

No changes.

pretty predict be financial M&A, financially in to Certainly, it to going still we're doing make very hits want hurdles it's our very interested and are conservative hard to We at sure when we disciplined we're deal. and could those. We're looking a do be very can continue looking we're well. on robust at to in have do do organic can as we levels, active can we those we do in add interested M&A opportunities. will M&A. and But and looking so lines business growth, We certainly capital

items. So on all we're focused those of

Brian Martin

then one and your of know Okay, just about was when of there? And in - earlier. last there is wondering change last maybe and talked just it loans we you've when non-purchased the it quarter you is kind to there able just peeking that's If think on any kind outlook may out the if I sounds the was like pressure be the stabilize. out talked there, margin.

George Gleason

having in row think of core couple improving interest quarters quarters about good Yes, a trans in mass and our certainly our we of five in margin. I for are results net a spread, now,

originating, are real be a with this. paying We're off straight are the that of books we're noticeably on and lower We loans rates today. loans at you about are going originating the to than lot that

although book is lower as loan that bit deposit how gets pressure much some yields those improve is as there, harder that. a to with future on on deposit there that we can of wildcard buyer. cost, get and cost. impacts investment to going But So lower downward continuing as We're all we our a of that mitigate

lower of loans can the bit environment bring go the blend But NIM yields in a out spread, originating to in in top, can pieces. core there we start today, that where get are we of as short of So, at next a were lot funding or loan our run. current bit as the year, a near improvement forward. moving We are on a we a the probably more they'll

Operator

program. Gleason, CEO session back to hand conclude for today's Chairman does question-and-answer remarks. the This Thank you, George to and further program of like any I'd you. the

George Gleason

you forward attention for We look quarter. you. a in we today. you days. Have and thank you being Guys, appreciate again call with on about your Bye. being great Thank and the time to XX

Operator

your program. conclude you, Thank for today's conference. participation in This ladies the and gentlemen, does

You now disconnect. day. Good may

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