FBK - Earnings call transcript Q4 2024 | FB Financial Corporation

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Operator

Good morning, everyone, and welcome to the FB Financial Corporation's Fourth Quarter 2024 Earnings Conference Call. Hosting the call today from FB Financial are Chris Holmes, President and Chief Executive Officer; and Michael Mettee, Chief Financial Officer. Also joining the call for the question-and-answer session is Travis Edmondson, Chief Banking Officer.

Please note, FB Financial's earnings release, supplemental financial information and this morning's presentation are available on the Investor Relations page of the company's website at www.firstbankonline.com and on the Securities and Exchange Commission's website at www.sec.gov. Today's call is being recorded and will be available for replay on FB Financial's website approximately an hour after the conclusion of the conference call. Instructions] [Operator

FB federal comments, securities presentation, statements constitute may the under laws. Financial this which make forward-looking During

cautioned Forward-looking to statements other Many forward-looking are not forward-looking expectations are achievements any assumptions results beyond cause recent most and put SEC, undue results detailed based are results of or of of periodic on control management's subject such listeners actual predict, Financial's implied differ differ FB XX-K. other risks, is such Form actual current to reliance on FB FB the Financial's including to expressed Financial may and statements. factors description uncertainties materially performance FB or statements. and and from and in factors to to may materially cause are more current that Financial's ability A contained or expectations from with risks reports and these and that such by filed

FB future disclaims obligation a otherwise. presentation, Except as contained of forward-looking Financial this any or or required information, to new revise whether result in as statements any events law, by update

FB of the www.sec.gov. at Financial's Holmes, like morning's and at supplemental presentation addition, GAAP this floor turn now the to over In may non-GAAP A website certain measures presentation, most defined measures which Relations are is company's the GAAP remarks comparable CEO. Financial's information by a G. release, and Regulation to to directly FB include as comparable reconciliation page the and and financial SEC's earnings would on financial SEC measures measures financial of on these available www.firstbankonline.com President of I website the non-GAAP Chris the in Investor available

Christopher Holmes

in Jamie, and Financial. the you FB appreciate right. interest your call this Thank joining morning. We always All for you, thank

we share. $X.XX EPS the per For reported $X.XX and EPS of adjusted of an quarter,

net $X.XX since of annual our per AOCI, grown our We which share, tangible These XX% compound rate Full $X.XX, driven million impact basis, a the basis, managing of were banking full increase year-over-year we $XXX.X year On adjusted XXXX. team's by a adjusted have increase. core sheet a year-over-year growth our a IPO EPS XX%. EPS which at XX.X% balance on our revenue million of and coupled pretax year or expenses. results optimization of represents or on relationships, focus of growing value represents continued was $XXX.X pre-provision in book with our on an excluding focus reported

reflect million approximately full growth For about the $XXX or total the emphasized over liquidity through balances and circled $XXX.X X.X%, foundation, of of past themes by continuation results our funded core efforts. several momentum, positions, including strength and has the X.X%. earnings year, this quarters our assets our quarter's while deposit the those around or of we operating solid grew our maintaining The I've million of capital

quarter's earnings GAAP return XX.X%. average of This average a common and equity X.XX% on on return assets of resulted tangible a in

ratio CETX assets remains preliminary capital total position equity sorry, preliminary XX.X% XX.X%. tangible of and common Our strong, capital reported a XX.X% very I'm to we of tangible of -- and primary as ratio a risk-based

peer results Our company, distinguish unique and the which the year group. fourth continue among of reflect full strengths us quarter to our XXXX

customers personalized line of provide breadth the size to resources the First to which allows with among intentionally to our authority those, us we approach our top and technology while model, community company banking and having services. market still local a depth have a built product bring and and

our and continued in in franchise. we've customer high-performing seek in to region is as our our model not this While interest base, And seen we've who it bankers is and result, experienced to unique theory, banks join new larger. size our growth a from

Second, geography. we operate in a desirable highly

to geography continues attractive novo opportunity States presents places United for organic an of in our de growth, for expansion. a nearby As advantaged the wealth growth experience Southeastern

metro opportunities as And to banking capitalize footprint leadership have of market to a a then capability growth both Our throughout experienced ambitious entertain and evolves. on the unique community lot lastly, landscape team. and opportunity options our and gives we an allows us us

has mix forward-thinking the its right team and phase that's of required of take into next our Our experience to vision company growth.

relatively meaningful relatively and continues peers, a to long-term for shareholders. franchise is success customers This our by which our gives team, compared confidence history power of us in value. our and produce opportunity to the results this Our generate younger young to team of staying team the

and business model, of combination for stage leadership future. ambitious track Ultimately, record our our performance geography, our our the an sets the

into looking expect us. us from the to can Well, expect what actually and of more So you XXXX do can same. you

focus has deploying and That's to create not continue been is changing. share to to earnings Our be going grow on long-term capital and value. shareholder per

Hurricane is and we're expanding into step into and are Alabama, new We're announced and Helene we pursue a as Carolina, Asheville rebuilds. markets we at pleased bring Asheville, this our new in our the through we're move continuing and This pleased Our to are for total aim eager Carolina. The expanded North to businesses priority and and retail to that growth. on also both quarter that serve and its always are organically contiguous revenue-producing into today, first with bankers. footprint. market this history, expansion to model our markets Last it has the commercial as market XX in quarter time ready we be That's been been focused expertise we and and resources as to announce our this this markets we many a our that and to addition capital for we X unique with into lives businesses. first devastating, growing will take of there rebuilding We community on metro into our has on community North of of remain organic quarter, their the banking and impact Tuscaloosa, that year.

much to other rebuilding coverage our media cycle, provide of to look and being part the and permanent on the stories helping of efforts part moved story, news the our views in the much forward soon of team as a on Asheville communities, we In and has strong brought While needed production with community. in markets. those be hiring we'll those teams and investment for establishing a leadership, begun both both Asheville capital roots presence new Tuscaloosa, this local of we physical in

additional in You proposition can on expect expansion investment down value us to existing our continue doubling both markets. and by

that is and opportunities a We and customers, deployment capital We're that more that like have they for banks right operate market accommodative geographically themselves. the we're with share organization, building headed well with combination that both priority us commercial in -- in financially. routinely many, fit relationships community present serve compared second align community-focused when footprint. and acquisitions. remain interested like in look opportunities they bank retail We into and meaningful our believe, environment operate when M&A culturally, existing a branch Our

Michael of financial go I'll I been what stars, have can our another a set goals pass year. we to before to quarter Lastly, our it assess successful in When I and now forward ourselves further performance call and to our look against XXXX. we over team over XXXX, you to we that love to for all on ambitious I'd for appreciate together you. every into one I strong results. the accomplish congratulate Michael, hand the rock

Michael Mettee

$XXX.X was expense $XX.X basis million in million. an after million net on year million $XX.X was adjusted or a $XXX.X income interest we our adjusted on basis. $XXX.X to All an $XX.X year touch basis. provision Reported a Chris, was adjusted income or facilities-related at on $XX.X nonrecurring through was or We was million an net earnings adjusted quarter's in reported Reported $XX.X first in or came Thank basis. on adjusting $XX morning, for adjusted I'll income and came million interest the reported on income you, noninterest basis, XXXX. reported reported our $XX.X year good $XXX.X $X.X minute was net walk for $XX noninterest income or this net take million On quarter. Noninterest Full million full an during on expense and $XXX.X noninterest quarter. of expense at million, and provision an approximately basis, million $XXX everyone. million outlook and million. income $X.X million of million. the expense All-in, in, full million, million for charges

was Net excess interest the X We interest-bearing the contractual large on due in yield interest-earning overall points, on part was dollar XX X.XX% rates. decreased for quarter. points quarter. of to basis change from basis growth repositioning a in increased $X.X a margin on saw was couple million of from rates margin to basis in drag which to impacted decrease benchmark our income an and benchmark loans interest to asset base loans cash increase by the contributed interest-earning points. a net benefit due securities in XX the balances. third quarter recent An securities to resulted also basis impacted due $X and in the The interest still the income was assets of our basis, due by first points in On somewhat XX the decrease full in quarter, securities million of to at guided rates, previously increase quarter. during within overall interest Looking higher yield carrying basis yield point the cash down to X.X%, largely range, a net but the

liability X.XX% shifting decreased cost deposits our prudently X.X%. the line our interest-bearing on the environment. with we executed points interest deposits manage market to in funds to side, quarter, in in targeted interest of to rate we of bringing as repricing On down of Cost deposit cost basis aim total XX rates the

as the our we balances growing year organic previously, higher anticipate will a quarter. basis will remain our interest small percentage market decrease decline, to balance, in prioritize quarter. off that X.X% as Brokered the of with portion deposits that deposits balances deposit run business, noted We over means of core cost continue. reflected on XX.X% the as referenced deposit Chris deposit As in this rates next to and a annualized our up these an continue

growing to the continue of sides both we'll XXXX, balance In sheet. focus on

and net interest the As expect X.XX% land in and Chris quarter. margin between first our to mentioned, we X.XX%

fee to quarter, Amidst strong services slight increase our income Moving We over a company core the which million and maintained quarter. adjusted mortgage, of levels in investment reported previous fourth in noninterest reflects swap noninterest the through slowdown the during $XX.X income a seasonal the income. fees quarter.

expenses. at Looking

of our and technology Over we for investments few years, the made past phase team prepare our we've in next company. growth a as as

into to move capitalize we investment. that As XXXX, on we're prepared

align drive taking to opportunities Our is enhance teams, increased directly investment profitability strategy revenue business new XXXX the or customer as to the organization, for with ] capital banking in such opportunities [ expense to units, experience.

third compared accrual the segment resulting to the core efficiency quarter, short-term prior to core to quarter. in tax decreased the XX.X% In compared a the noninterest onetime Banking expense decrease attributable Banking XX.X% of was efficiency and to ratio rightsized incentive of The $XX.X $XX.X in we core resulting in expense in our within XX.X% to quarter. in benefit compared the to was in noninterest as XX.X% prior the in quarter, as expense The a segment, adjustments quarter. our million decline million a recognized concentrated franchise fourth in primarily close year the ratio

charge-off specific quarter totaling a call discussed million. established relationship of We a in to C&I ultimately and our indication fraud, long-term this systemic business In services to X% to near quarter led It's when XXXX, borrower $XX $X.X grow anything million. a of land first the we to anticipate expecting and the driven were our bankruptcy. deeper and to $XX specific the credit Specific These within about single were second execute licensing On this expense expenses the not that relationship elevated full levels underwent noninterest reserved the in employee grow an this continue challenges on charge-off the specific previously and to we the X% at to we banking circumstances of we're book. banking industry which range of reserve. loan XXXX, to our to as quarter, series vision. in million credit, by of

nonperforming approximately expected, a reach on and did drove charge-off As call a ratio we rate credit this net loans in loans relationship, with of line Absent run annualized which rate. was our quarter. more second communicated The and in ACL we as to points, normal in the the the basis our quarter total decrease quarter our impact by during charge-off is resolution year-end. overall fourth X this

and to $XXX Our updates loan ACL on million mentioned new total $X was held year-end Partially offsetting on growth a allowance balance reserve primarily modeling. for due or of X.XX% at million, the investment. our build loans of was decrease reserve

and maintain including assets capital, continue of equity ratio XX.X%. XX.X% strong total ratio ratios, to On of preliminary very CETX we to a capital an

remains the value. deliver consistent over I'll deployment mentioned, our turn focused in and to back earnings capital tangible book call Chris long-term team of As on that the to that, Chris. growth now With

Christopher Holmes

we'd and quarterly in right. year. proud operator, Michael, progress the color. past We Thanks, our To with year FB made year Financial. you. that strong to of line for open Thank to the over company at a XXXX forward like and for progress we're with questions. poised the you we're a your full for All we're sharing results, pleased that this and believe the in we've conclude, all again look time, of as And for interest

Operator

Sandler. And [Operator Stephen today first from Piper from Instructions] question our comes Scouten

Stephen Scouten

a more bit the a were on presentation. this X the there. the talk could think quarter detail new you and there just little year. I said out producers you hires, we called X if met maybe mortgage guess, little And in XX elsewhere I know I about

So just would feel maybe to and what can the think viable kind would for of a disciplines continue as in new they're be give that target you you're on where next those year of bringing us of people? focused for terms hires maybe you in bring you a

Christopher Holmes

C&I about them it's Yes. -- not I frontline know, In -- as would mean, core we talking is call an we're as organization. you complicated general, what I we're -- bankers.

or in a pretty there's sort we terms and organization. -- titling a group a producer, an manager of so direct of elite call it's not relationship it's And in our what of lot number a

I say pretty else [indiscernible]? What it's core frontline So bankers. would much besides there in C&I that? is

Travis Edmondson

No.

pretty pretty It's It's X X not the lift diverse of this that's geographies. it's think as had, I geographically majority just we well. in quarter, in it. where also, of out And diverse a location.

Michael Mettee

we XX revenue the what we're we finding These all And about people to recruit things target right producers. fit. right to do. right. fit a go It's about more that's set as Stephen, think to Yes, XXXX, going that and hire out years take opportunities, the we

they to some East. as kind build in and well mortgage come the the people happened we that you to as come a you. added for the that's team. so And what been area We've while, they of in of then we out Nashville And added we've and as then recruiting couple in a

Christopher Holmes

'XX -- we And as I would say Recruiting this beyond. is about process. a to look never-ending forward and

it every do day. to have You

lot so -- and mentioned reason gain we the even there's more noticed perhaps to -- to momentum that And and we maybe the you that didn't getting we because market. now use mention inbound opportunities, we disruption a very as in expect much, are of continue but

on I you based so having optimistic would tell just geography. And that conversations we're that pretty around our we're

Stephen Scouten

release, this more seeing that makes what And is up That seems coming ramp-up you guys there growth and around the this optimism that growth Yes. in all into what for a that talked leads give sense. building optimism you to next to hiring as you about now you're year? year? signs around expect optimism kind other be Are of deposits to here in the

Christopher Holmes

Yes.

is forward quarter, So fourth as robust a X.X%. growth look we we the traditionally loan in quarter. And had most of net which

what we've we through hiring there's just anticipate normal, I'll geography, is of which As year, which next organic talked growth I'd in folks. talked say, geography, that prepared advantaged normal of the what from remarks. the a year our about little I there's of then about And this an bit call

that their we when time place. as by really strictly type that especially to volume little to it's restricts and come abide of We takes they something -- for and they bit it's a those folks bring very calling. have begin those it have those some in if when less of So those -- on are

ones been but stride. begin be expect And so the that close the to have we have and do -- to to to for we those that really really hit a some folks year, here -- them now folks

And dependent of not growth, totally it's so on that's that. but a portion the

of acquiring well. our be expect roster accounts relationship managers We existing out to as

Stephen Scouten

it. -- The got

just lastly Yes, that makes maybe me. for then And sense. Okay.

Sorry?

Christopher Holmes

because and up, say up thing think would you have side, I -- deposit the the bulked wrong other X bulked I deposits, on term. mentioned probably we there that's

at grow the to side. a pace continue We measured on deposit

our ratio If notice, some. shrunk has loan-to-deposit you'll

relationship next I deposits. in they're potentially core would as retain not we cost some have that so also loan we on deposits, And we may maturing but but look at relationship, quarter anticipating or into core may relationship. maybe but some higher could the -- their relationship depending growth, not say not deposits that

through say, quarter And so. so also that, in the managing first or we're

Stephen Scouten

have to Nice sense. that flexibility. Makes

for or thing because saw kind deals the months. than Chris. me, But a past, you've that needing to year M&A, maybe approved around if know, don't around might like. your could the patience time X in look last X know in talked line maybe of get some about get Just X deal approved comments I you you more just than less what we deal have

decent some size. So

you're slightly what -- it deal, might So deal, at Does I still think seeing be a but B+ and and kind does you go it about, there all? it's hearing, this be mindset if of might okay, environment? aggressive an in to change your it not does after lend more A+

Christopher Holmes

the does where it our changes view was much it alluded shape somewhat it way to. and of Yes, from you in

were was deal think regulatory X the I in I XX-month at mean in under an you previous place, leadership looking period. that

point. you you And got cost as over yourself quite to into think your -- because as think great. think judicious could important be had skis long and you the get what that's so I don't opportunity And about I an be I

think and can as with that, are ] as that going do manage as transaction then think long you I agencies want don't your work more get way. rate you for the parties to acquisitions, certainly skis do constructive it in you [ well, I a a to your long As over yourself

And as be just you remains said, we fairly get so -- approved seen. But deal a to that quickly. all saw

transaction. I relatively to talk that you quickly. And those folks think regulated have of is we'll think that [ additional hopefully, as risk that transactions a I Reserve there. because just was and length approval it as know timing, time sign was approved But Federal on get done that come the before is that ] things time, that's transaction, risk, of

the And so improves time, in it the shorter picture. risk

Operator

And our Rabatin Group. from next question from comes Hovde Brett

Brett Rabatin

credit. locally building. that you and I pretty ] Wheelock Tower, significant wanted of seems obviously, to be to Plaza Parkway at Deal [ sure guys I'm saw And on [ And BAC start Philips Towers sold discounts. age the theme common there ]

And age only had for ace you how of on just any any real the of or properties if in kind office I average about office guys estate you see so [ guys for just ] median portfolio. X% the and see here? if to Nashville, any and But know is the wanted market thoughts you guys had commercial you portfolio

Christopher Holmes

question. -- And did see good couldn't Brett, it. And we that. miss we Yes,

So X transactions place of office they were took -- where transactions time buildings loss, the both at to them some place took at we a did a bought they have that ago. sold loss. When

of they bought even them pre-COVID think substantial pre-COVID, I maybe, were one loss. a

of you a think look I -- Brett. couple that's things think there, have I at to

we Nashville on with I economically, to zeroed Tennessee, in be let's First, transactions. or mean the man, first say? need where I we that think fundamentally, Middle is these Because market question think that's does questioning that the is,

have answer are growth lot And inquiries say solid. one, The so with things going there that that is a the those still relocation Corporate there solid pipelines fundamentally? Chamber to in things occurs. is the migration are no. still this ECD. In And still caused I momentum, have place. something of Nashville and the on are would still to

of quite lot And so that's still are those positive. what's the things growth. And driven a

X that -- sold if On particular about, know that one, of those this mentioned at a also I Every first the loss the properties, mentioned some but occupancy those don't the properties. city Nashville older suburban buildings talked those, in older were X X that's had X you those properties and were of you third or were that auction. total there was issues. of downtown center think properties, I properties you X Two

town they have in. and -- of had a town, noticed, fund if matta [ And were you were the out by so not that coming ] for acquired best may they knowledge

way, see the not so as those by weren't locally financed And being And unusual. either. I they

the that then one it. very And -- auction, entity financed had one, to suburban on it at but sold the a sold small that loss

at week foot for per As sold way, that those $X,XXX was got $X well square square on another a And the record matter the under of one. that that X sold that on a -- XX,XXX the million terms at by a their on there sold auction, same flip out Broadway side, foot, of $XX lender in property so building the million. fact,

-- so open, have you're like you need I any especially in the when market, no you to and eyes in ours go And your is think your business, estate with wide real different.

Brett Rabatin

an interesting those, to to an But that properties on -- might me, XX, they was, seem have to was outliers. Okay. maybe seem old Broadway, saw and question I the had that indicate were XX But I But issue. that question to years price. also that be the

commercial just your an it portfolio was saying curious median average see was, if question sounds but you age real anything you're don't really for wise, the or the guys for estate had office So buildings? like you

Christopher Holmes

markets. We have do We our fingertips. Yes. our office remember, right at do that financing. we don't And our any don't here city-type much in office of don't center portfolio,

lot comparable sold -- And was don't have we discount. here of so a at what's a what to

Brett Rabatin

Okay.

is, suspicion loans. that i.e., to cash ask The using could Maybe wanted of around I it in and a by large reduction to the is margin. improvement the be driven talking part Michael, quarter. And just was the question about fund in first some a other my liquidity,

year, just see deposit guys interest quarter? the on as if Just if to it, what wanted that's is the assuming the it full changing first other case, that's in outrun any Michael, can the still you static, then hear, thoughts And local keep market kind maybe of rates, would guys drive not you the Fed robust? for margin to just the pretty

Michael Mettee

ratio. Yes, that Chris Brett, earlier, mentioned it. loan-to-deposit nailed XX%. down we're It's you

So or could we And that So mentioned, cost the that off they relationship. to Yes, done in deposits higher also, perform the margin. an happens don't -- in the as we the right? our tend loan moves liquidity, of run some a we be And has as either like rates if rate XX floating, at better portfolio kind Keep so the we we noncore methodical rate. team excess environment, or and deploy of job Chris it have as renew of stability institution interest good more on mind, deposit in days. and half side. have in gone is within down their

If you the in a little of interest loan rates bit side. peak a on get down

so curve And see yield things margin we we'll expansion. stabilize, as think some steepens,

Brett Rabatin

Okay. Congrats Fair guys the appreciate solid color. enough, on XXXX. a

Operator

Our next from question Stephens. Gunther comes from Russell

Russell Elliott Gunther

follow to earlier. growth the on loan want discussion Just up

good XXXX. proof an of around optimistic a lot have points guys You

up you've into past, little able double of over the about still seeing the I'm case being How the rates the if if you just in rate that's puts back think the the digits. accelerate I that the on growth transpire a talked are year? caution course in to that? or wondering

Christopher Holmes

Yes.

loan at see rate growth digit we're -- things as momentum Russell, continued high look type -- we and of double continued single looking digit, we're we is high some single XXXX, targeting. low digit, low what So in into some double-digit that good

pretty it's and but that target. that's feels what far, we're it continue to easy, good, going feels so far, And So never to good.

Russell Elliott Gunther

Understood. then Great. gears bit. switching And a

very You a guys are excess in capital, excess reserve comfortable position.

that M&A in pickup as XXXX. the as via growth use organic on the touched to You to well in put potential

securities repositionings in opportunistic 'XX the been and also buyback. You've around

thinking of capital kind about mode So how you is Or levers? are it build M&A? for those

Michael Mettee

in Yes. Chris change table. that really the better options no us mention like here think what from necessarily But and say. always performance, we heard We will materialize on they're about restructuring talked first on We capital you've those didn't But which is that X XXXX. buybacks. has the

on restructuring and they and/or opportunistic secondly. quickly. certainly be securities this if buybacks on then as But on materialize point, M&A opportunities focused So we'll share we're at don't organic

Russell Elliott Gunther

Got it.

I growth are improved Okay. for efficiencies core mortgage the me. the the you the commentary, expenses bank. thinking Great. within any vertical commercial How Last expense one within there? appreciate rate and about

Michael Mettee

Yes.

got mortgage we've X positive contribution. all, of quarters of First straight

So the exactly mortgage business. XXXX year wasn't an easy in

improve. the proud expect there. the the had than expect And want market. to to to we to kind We of to With we better operators. regard better So of continue be be them mortgage, they turnaround

And so we'd expect in ratio. efficiency to them in to that improve XXXX continue

and 'XX. I okay. We've housing rate going that's lot we 'XX, the operate just overarching allow did more interest mortgage, in did don't of and think market efficiently years efficiently in XXXX blow to 'XX but a is market to and peaks for out valleys mortgage and of in operated expect taken we in the more than out in than we

Russell Elliott Gunther

it Guys, right. that's for me. All Very good.

Operator

Mealor Catherine And from our comes from KBW. question next

Catherine Mealor

lot thinking we curious stronger? to becomes those 'XX, costs And growth costs just and 'XX? just to I But put start think an betas if a you of talk cost figure for been deposit better so so of little to how everybody Just in happens what to I as what margin. a wanted about about deposit cost? out see thing bit deposits, kind could maybe far. the as think X as that better on have we're I where on follow over course -- trying to new up you're deposit average growth is want see deposit as the And kind are industry deposit of you

Michael Mettee

Catherine. morning, Good

noninterest-bearing a it's these bit also interest-bearing advantage some deposits. quarter, of you saw little taking We of still As where of late rates. alluded Especially move actually from a to were competitive, kind higher-growth in right? to, some shift in of the into expensive people markets, it's

have you excuse me. though that had earlier would even -- thought So happened would

of have And X.X%. in We're not competitively. it's some markets, we're of seeing seeing In CDs XX% be to that at going we're Still on our of we're deposits. quite community XX%, funds not as pretty putting above but to kind more still bad here but some still new to get kind area, that as of aggressive. our CDs Fed the in that of -- markets, we're rate, Tennessee middle seeing in you're

that it going that's so on. know where We on to not much And they're that. come we expect cheaper to than come

relationships So you're deposits, to of we've year to trying competitive sides work a the sheet. it got both will and be balance grow and when

Catherine Mealor

the you expectations then new with But expansion side, you and Great. just would that given are better? for seeing you're seeing in flip pricing, on on growth margin still where your pricing an loan be net to say

Michael Mettee

holding XXX-ish say steady. I'd seeing ] new expansion, loan of kind on it's We're origination. pretty -- It's Yes. [

basis if it's kind so about margin that, in And XXX XXX that spread range. spread, that margin point to of you think

are competitive. loans So also

things have loan pricing slowed, as aggressive bit well. that for, bit a slowed and tad makes a As little more guess, growth loan modestly I

So curve. or they're sure in to price the challenges make that's competitors loans. how we the sides far, both middle The the get short loan work priced as of curve some to mentioned each yields there. I if off we have have held But of the and kind of the create can so why relationship, of end deposits yield steepening the

well. our got that we've so regard maintain as discipline to to with And

Catherine Mealor

move holistically, kind if then doesn't look of a in And -- at just higher let's X the maybe margin, kind Fed more we Great. the of are on rate.

environment. you So can the of couple years? next a longer still of that higher expansion throughout in rate we're see continued kind believe for you Do

Michael Mettee

Yes.

or a balance sheet. naturally X expense of quarter, right? If the we you're basis I a just think repricing should point see

but not move And to over higher we'll modestly gangbusters, so be going it's time.

Catherine Mealor

just maybe just other Great. question, margin from the Okay. just then And growth. on away X

CRE you estate? 'XX, where to C&I low commercial kind making versus today. you're be could from curious of are is customers. just you As ] you [ pipeline just about this us If in double-digit opportunities talk year, of seeing us, The opportunities real hitting think may as seeing about single-digit help high more your not XX-year you're more seeing nervous growth in that kind robust growth what but

Travis Edmondson

opportunities seeing Travis. in growth honestly. is This Yes. both, We're

space go the the C&I We CRE have regulatory some any going -- concentrated have not in going to last work more forward on And thresholds. months. over but bucket, the we over we're XX

going to not there. we're but grow there, headwind a gangbusters have really don't we So

our really lot see net We marginal in the but growth new will primarily those portfolio. some [ in the C&I of coming good We areas, care relationships ]. We're work in are relationships a the taking opportunities. CRE from existing of

Christopher Holmes

say of would to see just relationships actually don't pursue. And a CRE lot think we it fair Travis, I that be we

Travis Edmondson

Correct.

Christopher Holmes

frankly So distribution -- a we I I I'm pursue because portfolio opportunities, we a mean not certain to X get and take don't any relationship, that some advantage see sorry, of to area, out there's a lot be concentrated CRE maintain overly of the but that. to CRE we are that say lot able trying we're still of not just of of don't in there financed

And to strike just balance. trying so make right the sure we we're

Catherine Mealor

Great Thank right. All you. and year. quarter great sense. Makes

Operator

Instructions] comes [Operator James. Raymond Our next question from Steve Moss from

Stephen Moss

asked questions answered of on and want have just just been Most up, here. my But to clarification a credit follow here.

of was With the the Was guys charge-off, the reserve. ahead ] this this reserve provision you that driver noise specific low quarter? the mentioned of Or specific quarter? for [ that

Travis Edmondson

the for The prior charge-off specific quarters. reserve was

Christopher Holmes

quarter, the In established second of that Yes. the second was in quarter. most

Stephen Moss

Okay.

other specific quarter of the then credit and [indiscernible] maybe? a reserves growth So was this mix

Michael Mettee

for was loan drive there the baseline and yes. then specific worse, credits Generally other which that reason And forecast. No, marginally wasn't -- that, growth, any economic it to. worse was got modestly Moody's

Christopher Holmes

there on a And as of on bit charge-off was well. -- cleanup that little that

that reserve, amount, not a lesser slightly on there a provision. little was bit charge-off that was was of a material of it if think but cleanup but was over that it where that piece I specific

Stephen Moss

goes thing just cuts, more of that? you year, margin whether sensitivity upcoming think Fed curious today X on rate Okay. additional the kind Great. And the -- X, we'll just for more balance terms positioned where Just your get Fed of here, or then than you sheet but is where margin? X the about for see in how

Michael Mettee

Yes. no range fine cuts in -- is this We're sensitive, sticking slightly with Steve. rate asset Again, or me.

will of wouldn't we X. positioned, rate got steepening least of the see probably I we be slightly tougher we think a Makes China but -- well back today. sensitive which here curve, on We cuts if have a how benefit year. be And there's should things it hours, of a surprised balance the develop. at year XX is this them there sheet. asset especially couple yield as XX, every mortgage recently, little half But kind the side, bit

to and what we got we've does, expect So to to be no the so. Fed operate do matter able

Christopher Holmes

get we in feel a significantly. it was. capability would have lever rates But we in mortgage down really the where So if went if and good that stayed up mind with way. Keep -- pretty ramped surprised it would get the pure we probably we've got

the of so -- position. we part so that's And

Stephen Moss

really Well, today, color appreciate Great. the a guys. nice all here quarter, and I

Operator

comments. at at the And turn question-and-answer closing to to this I'd for of gentlemen, Chris today's like ladies over we're and any the back session. floor time, end

Christopher Holmes

All always again interest. for right. your your will would the again to Thanks, say to call. appreciate Thank Jamie. like participation, joining you. forward look next thanks on We appreciate we joining And and We everybody us I just to quarter. once

Operator

we'll presentation. and thank We ladies conference gentlemen, ending be and do joining. And for today's with you that, call

now may You your disconnect lines.

FB Financial (FBK) 21 Jan 252024 Q4 Earnings call transcript