BY - Earnings call transcript Q4 2024

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Operator

Good morning, and welcome to Byline Bancorp Fourth Quarter 2024 Earnings Call. My name is Emily, and I will be your conference operator today. [Operator Instructions] Please note the conference call is being recorded.

At this time, I would like to introduce Brooks Rennie, Head of Investor Relations for Byline Bancorp to begin the conference call.

Brooks Rennie

Thank you, Emily. thank Fourth joining XXXX Quarter and the today Earnings everyone, Bancorp Byline and morning, you us for for Call. Good Full Year

recorded webcast with is earnings website, release accordance Regulation corresponding this our is In presentation the slides. FD, along with available our on being via and Investor Relations call and

company. or such future call, regarding future statements from are today's of certain financial part uncertainties factors forward-looking of may make and that differ discussed. statements those that actual or other the We that certain risks, As could management materially constitute statements results performance the projections, caution beliefs, other events to cause

The company's and discussed factors disclosed in its are SEC filings. risk

to remarks reference measure for slides the may substitute measure earnings release. our GAAP non-GAAP the the or most addition, found directly financial comparable of Reconciliation the and can financial but are non-GAAP supplement, be of each within comparable not certain In financial intended GAAP measures. to contain measures, which appendix

For non-GAAP financial and additional and in earnings the forward-looking disclosures uncertainties see release. the information and measures statements please about risks

investors, to reminder call to the Institutions this Bancorp. RBC Alberto With President Financial we now attending the plan for conference KBW Conference Winter Global a As Conference. I'd of Byline that, and turn on the Financial like Services quarter, Paracchini, over

Alberto Paracchini

results. the XXXX Brooks. Happy year morning this call to joining and you, and review for full you, Thank fourth you New Year of to thank our quarter all

and Tom Officer. Fucinato, Credit As our always, our joining me Treasurer; Chairman Roberto morning this Mark Bell, CEO, are CFO and and Herencia, Chief

Brian call joined Counsel. the who's our well. to Byline as new I'd welcome as also like Doran, morning General on Brian this week this

on into to want Roberto? on to get call comment the to we pass few I items. Roberto results, a Before

Roberto Herencia

conclude of with year and Thank you, profitability to and all XXXX. can't a final a quarter healthy top asset for think a to the of morning record best new XXXX, quality better healthy and way full year, quartile Alberto. performance last another the and XXXX. for year successful I strong wishes Good steady for

also to which approve dividend. an numbers the few were Tom ago, happy quarterly dividend, a from XX.X% $X.XX previous you minute. increase for days these distill in increase will We represents a Alberto to another and our

we our excited our preeminent the and of out A commercial and XXXX, M&A feel to environment to to regulatory local softer higher continue build about in to ability continue market. optimistic disruption activity bank in bank the create will approach Chicago. expectation

talking those thrived attract able conditions We talent acquisitions. we're have to on banking execute as smaller under and

consistency a slower albeit with market the a am the valuation. these of the than coupled like is serving believer would banking I of our premium the commercial firm it. results that recognizing is The and I uniqueness our of -- opportunity franchise it

strategy the commercial by of banking been success our people Much has driven make the our and up who those teams. teams and

C&I leadership Our acquisition of following today Trust. Evanston in charged Bank was super lending part core have in this got area we in The First the in place strategy & Bank of XXXX. specifically Trust and & teams First

Byline a active [indiscernible] was was Director and committees the ALCO soft resting can trust a acquisition, was last he heart, to very took in hard still It as away voice him. my bank being who a It and that by would rarely I mind. hear November. to in many, Chicago kindness and community, in that Co-Founder was in he greater gentle find recognized specifically The passed XXXX. retired Bob our had with extraordinary coupled Evanston. you him work and after the of at became of in level CEO Bob and human peacefully highest serving the an

the through Bob friend, mutual banks. still kept putting Center. us Economic First of my at the Financial Paul we an leading and X touch first position banking as in X Jon adviser a Services of of Federal important Bank Byline of Chicago, the member Director National the throughout us as years, University Bank of worked and terms banking when to Chicago, Reserve I served and he University Chicago Club the of the to I career served over spanned Bob's Chicago an a and at together today. of met was XX Club years, started our has Bob's them and a career with

for remembered, contribution and guidance. be and Bob, our friend we grateful his will always remain

With call that, you, the Alberto. happy back to I'm to pass

Alberto Paracchini

Thank you, Roberto.

the with year the terms some will you financial opening XXXX to the up of followed well and up closing back full our I'll today, wrap questions. quarter. by the give In the Tom, then as agenda for I'll comments outlook before results, start and as highlights who to for call the and for for come speak

the for disclaimer a using front. please at we're the And can Investor As reminder, website. you call the today's as always, deck find on to Relations refer our

the thanking employees their work for Slide also for and of strong Byline to performance deck. performance. serving clients basis. contributions to our past our this quarter XXXX. a by to X results start their like them their year daily in reported fourth on like Turning on congratulate hard I'd I'd on for the full again and year

continues in resilient economy through uncertainty when XXXX. election year. decline inherent to an and of market that our shared shareholders. footing and in the year characterized deliver that a the franchise to in profitably rates thought moderate At with environment with an report were for compared I happy time to company that by a the I'm managed expectations, despite solid I an of the accomplished we We prove grow curve this to and good normalization last value momentum year, entering short-term you that our yield

and we Against executed per growth, share tangible relationships, XX%. grew that book well. we maintained backdrop, banking grew commercial by our capital balanced strategy profitability, built had value

dividend. to and quarterly invest our announced rewarded a transaction shareholders First increase We the business, XX% an with in continue with in Security

another to successful company. be proved XXXX productive the for summary, year and In

per million points ROTCE basis up For ROA the was of was metrics XX%. $XXX or $X.XX on under remained of pretax preparation XXX revenue ROA share which with and million, year-on-year. points Returns of basis and strong, year, XXX net of profitability income X% just diluted $XXX

The inland Year-on-year for portfolio of funded points by X%, all which X%. runoff at leverage year, was was and XXX the growth year. to deposits, XX in our drive ratio for Operating by came inclusive down points basis grew which loan growth of the helped that managed positive basis the cost-to-asset

higher with just transaction. increases total X.XX%, capital for strong Inland ratios prior the to Lastly, these reflect ending all the XX%. XX% no year and roughly remained capital CETX and under All the levels year TCE at at at than are

sheet repayment line balances Inland early ahead balance the allowed in with the strength for transaction Our schedule. our of tied to of

were also with $XX.X X. to $X.XX of diluted Turning net income of the for We Slide per million strong, million. quarter on share or results $XXX revenue

of ROTCE the XXX just up X% capital under ROA points. continue with Profitability pretax pretax preparation points a points at income XXX notwithstanding to and ROA and environment. growing prior consecutive $XX.X rate preparation X% million, given came ninth XX% be solid which basis XXX base. of year-on-year, from the quarter up above and in lower of basis basis the marks and returns quarter Revenue was

respectively, the flat Notwithstanding our quarter origination as and net balance The was and deposits point XX the on businesses. revenue standpoint, and almost in $X.X stemming from remained for stood was basis banking higher increase leasing coming interest $XXX sheet From a margin loans gain and sale increase net of billion $X.X and driven end. a from of billion, with the and strong activity at higher commercial increase income sales, by at loan million quarter, primarily income.

Payoff activity a bit higher came line million XX%. up than anticipated and inched at to utilization in $XXX

closed was million with to consistent guaranteed government see with we had the of year. the which business the seasonality quarter loans, Our originations for at end solid $XXX.X the in tend

an XX.X% well Moving and rates deposits. quarter-on-quarter. margin provide total decreased in cause deposit to of our which points as on costs, saw at as current XX color Noninterest-bearing sensitivity basis will the inflection overall environment. the you on deposit in trends with Tom deposits, additional stood to we

and to as million, end. increase due to to to Expenses XXX focus our the quarter increased to up quarter, largely ratio cost-to-asset moved points continue higher $XX.X efficiency XX.X% our for accruals. incentive a remain of Correspondingly, basis and ratio

moderate $XXX,XXX compared down with million, credit also down overall from coming quarter. charge-offs costs $X.X at last quarter. at to $X.X last in continued million, Net in to $XXX,XXX quality declined Asset and came

on The the basis a Nonperformers year-on-year allowance to both ended loans. quarter linked quarter criticized of remained strong and essentially at total and points flat basis. decreased declined points loans and basis X.XX% XX XX

With like to on that, provide will to you results. with Tom, who the over detail turn more our call I'd

Thomas J. Bell

and Thank everyone. good you, Alberto, morning,

we year, the fee and quarter capped off had rate anticipated income, this have successful interest the at different net earnings to than of a strong revenue XXXX. well-controlled start the Our Despite one we expenses. higher growth continue solid environment, a

continue a X% result, quarter, which regulatory we grew capital As all drove ratios to other and we nicely and than pretax greater higher. deliver capital again pre-provision CETX this

our Starting in prior our strongest linked million up flat the Payoff million billion the XX, in originated new from from consecutive and on the We commercial and third teams. $XX December portfolio. at activity increased with at leasing $XXX lease with $X.X loans X for Slide Total at stood quarter. growth coming $XXX loan quarter. quarter loans million, coming

to Line for in due new the consecutive by runoff grew largely to up growth in X% noncore sixth which XX%. was increase portfolios quarter, The was relationships. offset business utilization

remain continue Our loan loan to digits we strong, and for in the pipelines XXXX. growth expect mid-single

XX $X.X deposits. the Total accounts. Turning XX% money deposits by short-term increases deposits year. deposit the offset grew and higher Consistent points lowered X% flat for balances and for disciplined quarter decline in saw to total with at of Slide cost accounted decrease to billion time for the balances our were quarter for DDA in the QX up Noninterest-bearing We deposits market rates, overall demand we deposits X. driven pricing. by in and by of X.XX% basis in

expense the Net was X. quarter, due and year-over-year prior basis. QX, a to of million the This was from than income third X% deposits. consecutive on $XX.X increase quarter primarily interest to for guidance, solid a higher X% Turning lower Slide interest reflects growth on NII up

interest grew quarter. basis up margin linked to Our net X.XX%, XX points

by The on in assets. interest-bearing liabilities, was by XX driven decrease a change earning NIM in lower basis cost the offset rates point of

Fed implies million is a for decline funds first the of range net point the is the income based $XX curve quarter, assumes forward $XX by interest rate income XXXX. which outlook million that to in a for Our partially driven This basis on count. for net day currently XX interest

by income million higher premiums by was increase The Turning or the gain loans to Slide XX% primarily increased in which of higher loans and on due fourth by driven Noninterest a sale X. mix. to totaled quarter, linked quarter, QX. $X.X driven than the sold, up XX.X% million $X.X higher $XX.X million partially on volumes

for with gain forecast per lower Our expectations $X due QX to quarter, million on on sale average, XXXX seasonality. is typical

Turning X. to Slide

of increase stood noninterest revenue-driven drivers which primary The guidance. expenses at the advertising compensation, $XX.X and of salary Our expense higher was benefits higher million, largely our higher and benefit-related in end comprised other of QX spend. expense came

disciplined prudently. continue expense we on management Having remain that, and our manage said expenses to

As XXXX, $XX $XX noninterest our expect and we trend we ahead million. quarterly to between million look for expense

for quarter Turning expense quarter from million million Provision this to to to a QX, primarily XX. by Slide million, $X.X down $X.X charge-off in nonperforming the trends X% Credit in in previous $X.X in compared quality decrease quarter. loans. came at $X.X Net million to due improve. continues to down the

end XX%. by in the of by year-over-year QX. total XX basis slightly a points down the On NPLs to were points The QX prior to the quarter. was of down ACL from XX $XX decreased loans NCOs basis end at million, basis,

XX at points loans, Excluding QX. stood basis down quarter assets and in total stood government-guaranteed previous basis the NPAs at basis points NPL from to points, XX XX

Turning to Slide XX.

to our was and and new and The quarter, yield XX to X.XX% points purchases up of lower-yielding at continued our increase securities driven by basis higher $X.X stood the runoff securities During billion. on on rates nicely cash securities.

Moving on Slide XX. on capital to

strong a basis book points we compared the tangible value year. up share up increased came points last ratios grew and consecutive capital basis by our XXX For quarter, XX% XX.X%, CETX per and to linked quarter year-over-year. XX in fifth

TCE up XX the TA at from Additionally, basis last ratio year. points to stood X.XX%,

metrics, resulting excellent Again, we had year. performance an another and solid strong in quarter

in XX% As our authorized Board quarter. payable a in first our dividend result, an quarterly the increase

back Alberto, to With that, you.

Alberto Paracchini

the Tom. of And to XX deck. moving you, Thank XX on and Slides

Our strategy remains enter and as we consistent approach business to the XXXX.

capable great daily franchise on strong past growth decade, solid for a a the is delivering profitability. Over we clients banking This organic built basis. their made team by do part of possible having consistently who deliver and and a

to us and to We've fuel that culture in turn retain attract developed a talented strong enables also growth. which continues our bankers

in remain both environment. As risk optimistic front well we we operating to of the new and deposits and to win the and business opportunities see the continue start positioned the ever-changing grow year, clients, us loans inherent manage about we're this and new of

With respect transaction, to line with transaction Security First to Byline. look the prior remain time of we early close consistent to in on welcoming Security and guidance, customers quarter. the track the First second with expect to employees our forward and the We

call With operator, that, up open let's questions. the for

Operator

[Operator Instructions] Our of question line Sandler. with comes the Race first Nathan from Piper

Nathan Race

with SBA. like week. that I some Alberto, would Obviously, issues other to notable lenders on reported saw SBA start this we some

charge-offs also in terms remain in quality the would to what you're overall within the have you So hear undertaken of to terms years of obviously portfolio. to several last largely be just delinquencies was see some that we'd initiatives it credit just portfolio. that be expectations It seeing near derisk think of just curious just this and I and terms to of everyone, helpful kind of over in remind guys quarter, great

Alberto Paracchini

course, I to continue we would that see by in consistent question, And are book saying, think business. I I we Of of think just -- start great trends Nate.

I As after we've this . you think mentioned calls, COVID ended. right going pandemic to in prior and know, back the

received. particularly SBA actively been the of borrowers have that given support We portfolio, monitoring amount

support So beginning really been then business in out those coming the we've more was without resuming having how how companies borrowers those place. that importantly, once were ended that were perform pandemic, how of their support to how monitoring and

to saw. what we think we is expected have frankly, that I than we've -- what portfolio we deterioration seen seen be, in quicker So

our We And have be in terms prepared in borrowers continuing just seen identifying for of been you've with is I gradual work deterioration and have continuing those results that. seen to proactive that think the side. we what a through problems and managing get of frankly them the other to book for lot borrowers best to rate as environment a help those difficult was just as can managing essentially to

very So I identified I just going probably saying continued were essentially something we with XXXX portfolio, actively early would that really and that proactive the it XXXX. into manage summarize since that end by think of We we XXXX it's and to on.

question, With just respect our reminder, the to second your on speak. track so part as book, a exposure unguaranteed of to the we

book book around portfolio. portfolio. loan guarantees was just So the unguaranteed if of we of represents that go under just XXXX, X.X% the portion back XX% government to around our that of Today, that

in frankly, that years. over exposure has remain exposure come terms as So continuing in the proportionately to is see the sheet that balance down has future. grown that the And for foreseeable absolute we it's an -- range

that question, hopefully, your Nate. answers So

Nathan Race

Yes, outperformed terms X, outlook, cuts think that margin it guys the the rate that's quarter. of like NII really and seems NII and fourth of gears or kind on of here the changing And kind impact the about next the quarter in provided in you helpful. you guidance of

this year, of year on remains have perhaps think you if growth the for and the this the going that NII of pause how for kind what just can maybe least just implies absent cut Fed in July, assuming at reverts X% to that So or range just impact margin loan back X% trend we the to curious, acquisition forward? maybe X

Thomas J. Bell

It's Tom.

in points to that here quarter. But have up. get basis changes, generally quarter coming Security to it's if balance to that rate the speaking, speaking, this the fourth think to still going sheet, we flat the second lag us what more slightly have the slightly generally in I in we in be a for up. subject SBA But Again, happens no First quarter. the happened with XX generally, flat there's here will

Alberto Paracchini

to know, to as naturally that, picture. you think we an just add asset is are Nate, sensitive. big that Naturally, institution I

scenario. the the So type Tom's degree income certainly, we of expect remain that materialize over would of to coming think the fewer that that in net year, cuts cost be to rates higher point, up to or I course interest

Thomas J. Bell

would really our in quarter. sensitivity from I remarks, we but were able prepared And to have just I also didn't it reduce this quarter my add, last

this attractive point, -- bit fourth something the little So to than hedge it in that's risk more was, early at fourth a it's And do. we'd say, still that to like quarter.

Nathan Race

If just one. X maybe Fed last does you. Got year. pause remain this the And on

to gap you if speak side the have the how curious within book? additional and CD of much can funding you kind non-CD cost Just guys may repricing the portfolio of the leverage on

Thomas J. Bell

this of speaking, that. Sure. have, shares And the But and like call just profile think at to it, kind roughly risk roughly of in we're I remind our generally XXX-ish, interest we repricing average, on yielding X.XX CDs point. total, are at rate combination you,

So definitely an improvement there.

we asset up about loans that in kind million $XXX which points, basis almost the should $XXX about yield, in of side, On or more at call slightly have reset. than a XXX probably it, go

is And like then at $XXX the portfolio million roughly securities $XXX million.

to as there going that's get So pick up you another well. X.X%

Alberto Paracchini

Yes. One normalized we close liquid bit more than that that now, trend a paying attention CDs. quarter curve Nate, to. frankly, this And actually, a making, saw of kind a yield bit is which have attractive also, accounts is of we we're

actually saw money remain moving accounts in the we as speak. of its continues that into liquid the markets. So current such flows more out to to so and shape, To degree curve CDs

positively yield words, in curve. a So sloping other

little direction, see on bit would expect little how which yield We'll think more just terms keep in continues trend a in that shape to bit may of lower. mind, but make behavior to give liabilities give if not the curve the of does that we I continue, upside to may quarter But a something a given that's repricing in today. trend.

Nathan Race

guys. appreciate I I'll helpful. back. step Very you

quarter. great a have guys You

Operator

. line the Hovde of Brendan from Group. comes question next Our with Nosal

Brendan Nosal

see like but didn't down there It's the quarter. this asset charge-offs PCD here charge-off the in just again start were off it rate Maybe certainly look quality. any come to to nice on number sequentially,

just maybe a the where minute quarter. during spend fourth content loss from So on originated

Thomas J. Bell

commentary Yes. loss been where last portfolio, Brendan. we're which I content seeing I centered, in quarters, from our several with is mean, think the the largely where SBA have losses consistent is

that we goes work those what you're those then comments terms And the ultimate seeing we earlier resolution making that provisioned just reserved in identify the loans. early, that through and sure credits. is to then and of And we of appropriately, that

Brendan Nosal

question. helpful. That's Perfect. $XX kind Okay. of the million X Then on

then larger of Just kind for on list to of is internal thinking curious, I was than a perhaps up bit base the And one, quarter. little left punch what's the the threshold? asset that wrap two,

flex just across to keep I'm So wondering year-end? $XX the how much million at have you do sheet XXXX balance below

Alberto Paracchini

Yes. Maybe bit latter let's about then PrEP. on a the take question, we'll and talk little

into concerned, billion So is I is in first asset 'XX of $XX kind guidance still kind of speaking, think latter of broadly still time think half far crossing as now the a that of moving line the quarter XXXX. of from perspective, kind of to we as third terms to the really mark

point, really, it, XXXX the you, other mark Brendan, you at we're looking set not cross I billion apply. this formally X at above before frankly, If thing actual, consecutive is of once $XX call that and tell remember the quarters that expectations would regulations

much of really of So not XXXX, the part XXXX. beginning we're probably very looking latter at the the if

put to in just context. that So

performed go really, billion, $XX assessment a cross things that PrEP complying have of $XX that that apply project we expectations. As just leading both mark. are need the as the or beyond to is concerned, things purposes for with as we far regulatory planning to in actual that of place as regulations have that But would well to not we billion to do, the wanted an We've things that team. so obviously

with on well way We're our that.

general making early we're the And As board came we fortunate of a was I those that was at beginning, in commented counsel one week. have sure this steps. Brian that -- right place on

larger we but we exceed a think we that So to I the work that think will summary, confident able meet, of I being expectations institution. and the only and be will have do well very in to prep is the its work not way, on are

Thomas J. Bell

would a I bit quarter, cash would commercial activities little the also on at I carry we just excess day had last this of of of -- normally add more happened the would because that is end year. Tom. the we than the

So if of shrink we to to balance sheet $XXX need that have we room call million flexibility. the of sort there

that be to So loans, could so speak.

Alberto Paracchini

to we guidance the of just comment add Brendan. security The closing that. X transaction. with is the Yes, And just last to gave first consistent

into made. that we factoring just we're comments . So the

Brendan Nosal

you super answered quarter That's question cash for Tom, And helpful on higher balances my color. the the as well.

Operator

from the comes with McEvoy line next Our Terry of question Stephens.

Terence McEvoy

you. what that you up What on question there? in loan picked noted and Tom, the about which back, -- you take thoughts payoffs, assumptions What growth. or growth talked positioned Maybe earlier, fourth are portfolios then step the quarter. Tom, are for a in you your mid-single-digit when to your are XXXX. generate And markets

Thomas J. Bell

we his As some I we transaction Alberto activity saw syndication definitely mentioned from the payoff legacy in inland and had. comments, that mean, loans

really you So we with were customer if the deposits. those cash, happy we're and fact redeploy where noncore that paid we in loans get some relationships will, can off into

$XXX around stabilizes transaction will point. that but was that inland group it lower over and So will time, syndications down is the slow and probably much certainly the the this at for quarter, million

Alberto Paracchini

with thing terms billion support of this or assets. context, inland own to was very was be originations. our that $X.X to about much so that year, One is able of recycle the fall and to recall, you into that came loan coming that cash that in that this part loans Terry, strategy from as essentially flows acquisition add in Yes. was into to the there, past transaction book

growth basis on and growth to our and capabilities redeploy show able to to an our -- perspective. in measured which asset portfolio. a the did speaks year-over-year it XXXX, in past This just we portfolio, businesses and show continue year, to lending our were cash redeploy excellent job the put sheet. that still ability million that lending to on had in $XXX and into that context of we we in runoff different thought balance generation I

put in context. that to So just

we businesses. diversified from in of having And benefit businesses, of group the a terms

the in market cautiously our we certainly, seeing strong. in for business reasons leasing be more banking the again estate real more or a have you're seeing into good uptick with that activity we there. That's commercial up. all transaction not pick that in business see we're the We're competition driven volume optimistic XXXX, to sense anticipate in to whether today But year the also we're seeing to going our market. So there. cautiously be coming an by We're continues optimistic

So I seeing of in hopefully, that think color where the we portfolio. gives in anticipate growth terms you

Terence McEvoy

maybe through XXXX? Then first as writing something full sorry, was year or a in your I thoughts outlook Was follow-up. of for particularly X Tom, could expense else. run your you that just quarter on time? I'm more the kind interested

Thomas J. Bell

year, I we full guidance million $XX million to and guidance the per Sure. quarter, gave was the $XX mean, for Terry.

Terence McEvoy

Okay.

first just was quarter. than that more So the

Thomas J. Bell

trying compensation taxes. give payroll HR and have you Try always I But some mean, we typically lower benefits, quarter, obviously, if for first the full to and err -- and side year there cetera beat related to and everything. on we're we can et expectations.

XX% is our So to -- range but XX% right now.

Operator

Instructions] from next with comes [Operator Brian Martin Janney question Montgomery. Our

Brian Martin

I thought that the as the just was drag higher the look you we in the Can remind give XX assuming And quarter? cut just question. Tom, year The where the of the what the guess, Was you margin versus exited at X any it kind given basis margin? SBA margin on it than point quarter? at later recent XQ? trending on got us most then

Thomas J. Bell

December, really relates in asked for for a Fed quarter them the lower effective X. January as on fourth the sorry, for I you -- SBA as cut the reset for is Yes. for range, December Terry, in basis quarter. it X% And margin December. the that at is the that prime to points XX mean And

SBA on the in So balance. U.S. balances that's points basis XX the

Brian Martin

And of of given Okay. inorganic and of in in kind market the you the about today you disruption opportunities think in capital in of opportunities in opportunities, today opportunities, and seeing the growth the M&A as adding is as in more terms just more then in 'XX terms terms terms as there of terms of are just this work potential M&A talent? acquisitions. far other Or adding year full that

opportunity as kind look Just thinking you broadly of kind it. in of 'XX set at

Alberto Paracchini

I think things. X

comment that are goes really Any And pick we to call. time we disruption. the to up, see Roberto's disruption. activity is any there think that that because at think I time certainly, type right which the it -- beginning expectations I the welcome is likely any of

So time we an it's or And that. of degree we've super in about able to regional nicely think whether M&A capitalize see is when the regionals, you any transaction past, some effect. on to very that going have been

I So forward we to that. look think

lot mean, As in M&A of conversations, I of to up, M&A. more that's certainly, far picking regulatory as environment talk there's a conducive anticipation a perhaps benign

hasn't What very and stick in changed. are really shareholder quick drivers plans, wants neck For that and M&A. do our pursue is able limitation. which several of plenty obviously regulatory of generation with a we Their in liquidity, factors really age. not M&A their the up now it approval not We've really to base really drive us, favorable hasn't -- Board been the transactions that frankly, are if Directors that a process. third of over past been have, and years and those ultimately getting second, the have There's succession institutions those the lack and is

And I for to think be we to we provide are their think we're think we in least somebody with to well And shareholders. positioned are and liquidity at super that. great a to participants that on institutions Chicago, looking active partner here continue partner

Brian Martin

for the me. maybe And last Perfect. X just

being I someone maybe $X some kind comments the in I there remarks, business Tom, guaranteed that million about in prepared here range kind was think, I a forgot thought government of of quarter. the

XXXX, and income than are as amount about fee think in mean, million a you're 'XX. I set you if lower produced it's kind you Just we wondering, of rate, the opportunity fair a run in $X at what if

we the just business to for kind government be should bit from to that opportunities So give grow outlook side how income there's think of in guarantee kind fee if fee 'XX, about you XXXX? income of the a about that? in fee trying Or the thinking up on

Thomas J. Bell

gain Yes. Customer think gain sale. the potential other on obviously we rate of will market, could I too. in is SBA But as side swaps, are have the some some we help the in And goal income. cuts, to decline well strong. pickup sale premiums SBA mean I fee for of some again, the that categories. example, on grow our If see still we very get offset

Alberto Paracchini

as maybe particularly I what we're to basis a to Tom think, just on I to give is not would we where really when said a what concerned, business on we're sale guidance sense it. is Brian, mean, giving and far quarterly we just gain trying add is expect SBA as we're you do the

know, We more you the on the what in tend market attention that are kind a year-over-year as paying We thinks. really really the this But of These And variables we the originations, are to are to regard, pricing. volatility. on look focused keenly control, at control don't what not we're assets basis. that worth. quarterly we

the that at which level certainly, So these market conservative we been the try a can environment rate higher assets assuming, create assets and/or degree to we the is more in mix some originate past to in positive premiums that the than values regard. has what to because But the the that of higher estimate. variance be of favorable in we're that to case the

mind. that just keep in So

Brian Martin

in see maybe elsewhere some help performance fee trying No, of government income. guarantee other opportunities that's sounds on thinking if some the helpful. trajectory It given the there understand said, is to there's full and like to year, like I a on business I'm better-than-expected was that -- more increase some just -- and potential just out. to

Operator

comes DelMonte from question next Damon with KBW. The

Damon Del Monte

is I doing hope today. everybody well

to little . year? bit fee I the gain coming just outlook. loan appreciate little on the you have talk bit the a guidance guys here of you fee-generating that more the in -- sale on just a SBA some want up income. you bit Tom, about ask see a Ask in maybe other about about opportunities some and little categories Could

Alberto Paracchini

pretty commercial I broadly think just bank. a speaking, we're Damon, traditional

in the a past. that invested treasury So the fees charges, service to. you an amount attention like things we've like this that we're think past that's When about management area year, paying fair

We that continue in invest to area.

to see management want we fees. in continue So to driver growth

example. So an that's

team have very area base. leadership, management new new have coming That's our wealth we a we off is business. a Another in that low

over to a to contributor fees. I management see we be time, wealth want higher think

So to. that's close an we're area attention that paying

happen really business that client overall more a serving we fee revenues. the focused base. obviously that's where part be an But grow doesn't overnight. that As meaningful commercial We're area have category you that proportionately on to and our of and know, and want

and is to et like I with the rate cetera. doing also probably fixing terms conducive rates swaps, derivatives said, of think today environment in customers doing more Tom And

that So our categories category we fee I are to think where drivers income those total see inch general up. in

Damon Del Monte

basis Got think charge-offs charge-offs just it. XX were net color. we appreciate provisioning That's net year, guess about And the and secondly, as helpful. points XXXX. that then in I I for upcoming

that to Or you level would of feel in loans that move Do basis like that lower upper XX a net charge-offs. of there's peaked should some do think generate kind and more something point you to we kind range? elevated you've start still see XX through the --

Alberto Paracchini

I think past, in think don't with I Damon. the our I -- guidance consistent --

of I in between XX that being kind on a points, like to think normalized somewhere the still basis see somewhere we there. range basis, XX

some to transactions. going PCD that have tied volatility you're they're came to from that to know some of resolution loans degree, prior Just

around give charges bank. happens what think we system, of quarterly of of So marked on we'll to flushed as meaning, terms we basically coming so that you speak, are to it excluding clarity are through work continue a acquired a to that that out and basis. normalized But we've on I the the try loans in from resolutions that provide where to disclosure

basis number I is point XX still to XX reasonable. think that

Damon Del Monte

Got it.

just And tax lastly, update helpful. 'XX? for outlook Tom, any then rate That's the on Okay.

Thomas J. Bell

right Very now, consistent us for Damon.

Operator

next question Our comes Hovde Nosal from with Brendan Group.

Brendan Nosal

Just quarterly outlook for of and is stand-alone on X that first to follow-up security? that the point include expense million $XX Or million on $XX guide. basis? a clarification Does

Thomas J. Bell

at this It's stand-alone point.

Brendan Nosal

it. Got

Okay.

So that take Fantastic. and security. on layer for

Alberto Paracchini

Yes.

closes, that of end of Tom by on call. is basis. I -- belt, a under terms run bit the have the time in of probably more quarter at second give But the our a I'm quarter you second the and rate once Tom a the will -- we what will think go-forward clarity sure we transaction do certainly

Brendan Nosal

perfect. that's appreciate Yes, the clarification. I

Operator

call turn Alberto Thank Mr. will the you any for questions remarks. now today. back I closing your to over for Paracchini,

Alberto Paracchini

all for Thank look call in we in April. you, joining for thank the forward Thank operator, you today to Byline, and you interest again. and your again speaking Great. and to you

Operator

you, for may today. us lines. joining Thank everyone disconnect now This call, concludes our you and your

Byline Bancorp (BY) 24 Jan 252024 Q4 Earnings call transcript