- Earnings call transcript Q3 2022

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Operator

Good day and thank you for standing by. Welcome to the Amerant Third Quarter 2022 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] Please be advised, that today’s conference is being recorded. to Investor conference Relations. like Rossi, to now of Head would hand over the Laura I Please ahead. go

Laura Rossi

Thank you, quarter Tanya. Chairman our for today’s joining Chief Good are and morning, everyone, to call and Amerant and Chief review Financial Executive Bancorp’s Carlos Plush, Officer. third Jerry XXXX Officer; On us results. our thank Iafigliola, you

the today’s statements within forward-looking we please Securities Act. As Exchange contain begin, note call that meaning discussions of on the

Please made statements, measures. In the non-GAAP refer Plush. for addition measures. also over non-GAAP a to forward-looking to be I earnings regarding to information turn Jerry it reference as to for release GAAP of now financial measures company’s financial Chairman will our CEO, will as and statement reconciliation well and

Jerry Plush

everyone. the you third thank we Laura. But Thank on here for I pleased Southwest morning, for you, Florida. XXXX do quarter I’d impact to to to Good results quarter. had Amerant’s today our am acknowledge Ian be call. the earnings like Hurricane before that, on joining report And

affected everyone been a to report seeing our portfolio. from loan prayers unfortunate thoughts to no in most storm. the support by several have to to communities Florida on involved we Amerant, there significant forward are out we look impacted their feet. From have back perspective, recover we Our affected business At been fortunate and efforts those impacts event actively go identified and in this

remarks Directors XXth dividend the November to quarter, payable October of share approved this on Moving per Board the year. of XXXX, $X.XX on XX, of a our on

over the third quarter it we beyond. I into And ourselves and then the to to I overview of the our will for took hand Carlos now the steps essential details. to are shareholders. provide a component previous in in shared to to provide calls, will I As year position the dividends paying balance performance and our an of value plan greater get best brief of our have outline

So turn slide to three. you if

you Here, third our summary a see can of quarter highlights.

company up loans, on driven by recorded higher investments. on was was in we net quarter yields attributable increase were as higher by quarter-over-quarter. as But Our costs and $XX.X the average as net quarter-over-quarter. deposits This increase expanded advances. offset well higher balances to partially points the balances a significantly to on X.XX%, XX FHLB million, income These third increase our net in interest result, and the income an interest and average as margin basis the primarily

with assets Our XQ $X.X $X.X million, to billion access the million up this $XXX XQ were continue capital billion, strong of The minimum high $X.X were total $XXX balance XXXX, to of sheet quarter, total also XXXX. Total historic compared $X.X an billion $X.XX to reaching compared billion, compared year. company’s requirements to point deposits of in third at XXth a of as considered $X.X the grew loans well the September well billion, of levels in in gross as significantly during be close capitalized XQ increase in billion regulatory be XXXX. to and and

dividend per the paid also August $X.XX announced share During previously quarter, we cash the out on XXst. of

$XX.X We $XX.X previous was will XX%, million, PPNR up turn slide can and the that to compared our see to quarter. now you four the nearly reported core million in

net believe provisions we and As revenue essential excluding company, items. of slide stated, non-routine this the consistently have we is the growth to show

on this what non-recurring can slide we clearly quarter. items my I were reported see and power. Amerant’s key can quarter significantly fewer last XQ five during in And remarks to you XXXX. We So the the to turn cover compared quarter, earnings can happened there as now core noted items third

assets. our work to our percentage of increase part non-performing to to commitment total as continue loans assets on reducing we of So earning

QX, of to million, NPLs of focus future declined to driving on XQ to periods. intend NPLs down $XX.X continue in million compared XXXX. $XX.X to We as As

report to of month York month, pleased sale October. also of are this that in the estate-owned the We so New the property City-based closed real

coupled of non-performing level with this our drop in significantly NPLs, non-- the reduces So assets. our

retail As for continue I have to to while stated others. markets new and consolidate expansion when into discussing for continuously network, our we key looking look opportunities

business So market location. location look be Florida, to during in OCC the as Hialeah, open in we opened to location a our by Florida Florida are Pines, Biscayne, year. end Pembroke our received for of new We last closed announced the very third a next of first Key new quarter, we in We excited approval do the quarter and quarter.

location Additionally, our now the replaces XXst, over will current close in the expected our new And South October location. same of with is XXXX. location day Shepherd the Houston new it will opening our moving in the open sometime Place while Downtown customers University location Miami early to

personnel development to team look C&I Tampa Palm specifically fill. our South Beach Florida team with production our expand in continue County more in we to Regarding XX to both we here have now we in add in four openings to continue to and loan development and business And key members, added Tampa, County. to business also and office, Broward plan

turn to will We now slide six.

compared net key and mentioned It’s was just margin, metrics from improved improved outlined have quarter. our we interest here see profitability last I as and clear change performance to can operating X.XX%. outstandings higher You their

efficiency this to from improved, and improved can significantly XX.X% here you quarter. Our see ROA ROE income ratio the net as compared to higher quarter. XX.X%, Both last

and we in underlying one-time easily for see again the quarter. and more the so quarter footnotes, For ROE the can excluding you ROA, performance items any show consistency efficiency, the transparency, metrics three of non-routine operating

QX, on of transactions We Mortgage On to had increase Amerant basis, Mortgage. income to $XXX,XXX, as standalone will compared XX% $XXX,XXX income primarily Amerant a slide with an banking the a which now turn result seven, mortgage focuses net from or of Bank. of

company includes Amerant in $XXX million October different quarter applications the the the basis, has million a place of for in consolidated shows loss through process pipeline of currently Amerant with general. purchased in the on of approximately or business XXth, third the loans channels. from with connection $XX However, million operations originated loans in The a headwinds net purchased XXXX, line in as Mortgage, in which Year-to-date for we $XX recorded $X.X and in current Mortgage million Mortgage.

So, in who with that for through said, I quarter turn detail. will now walk over our the will to things Carlos, results more

Carlos Iafigliola

Thank you, good everyone. and morning, Jerry,

begin discussing eight, slide investment portfolio. to will Turning by I our

the current $X.X to recorded the in conditions lower securities to was Our portfolio has down investment duration rates. our yield speeds of mortgage-backed quarter in years balance the previous When in provide has longer year, compared extended quarter achieving of the portfolio to The the reward on prepayment third compared due XXXX. focused of portion third securities and right investment better The prior portfolio interest five both light increased XX%, rising to XX% duration between to duration, floating to of compared investment quarter investment as balance previous and assets. strategy our year. market billion, on

sale. As valuation the securities like rate a of to I I would quarter, the discuss last did available debt take impact on interest minute increases of to

need $XX quarter residential to at X.X% ended result limited, the considering relative As ratio our of are sensitivity about the It at of after the quarter, end of This in million compared of tangible of of loan come nine, record rates or important growth third At the September, the last slide on also up increases valuation reason interest changes mortgages. direct the driven end consistent than year-to-date. our origination the in total and comment market million CRE billion the second changes tax efforts this after $X.X at gross portfolio. to with portfolio. was very the no decreased common loans Continuing any there a equity AFS our portfolio value $X.XX loan were was and that the portfolio impact talk to of billion side temporary credit let’s primarily the by XX%, and is compared of to quarter. is our The why These to end exposure interest investment analysis. rate burden. other $XXX single-family

loans were Additionally, had during the million the $XX Mortgage we $XX million, commercial with totaled solution loans. held third in Amerant that Loans financing offsetting sale in quarter. primarily Partially announced the of production purchases equipment million to totaling million, this complemented of white-label for with quarter, last third Also, $XXX quarter prepayments, we end loan compared as the as quarter originated through of XXXX. second from the increase was parties. $XXX the

indirect loans. until sale consisted in have we for available for retain. investment to held residential loans mortgages increase the of or an to transferred approximately CRE this were launch X.X% loans of as loans, as to hold of This million loans quarter, a previously million -- September us the represent yields third Consumer yielding now quarter-over-quarter. cost ability category, as which accounted maturity $XXX move to tactical for new We includes $XXX million, sale funding higher and the continues intent costs. of given As XXth $XX or increase higher

quarter, indirect lending purchased consumer the During program. the we under third of million $XX loans

We which replace purchases. intended consumer to is indirect loans fintech-enabled our new $X progressively and also program, launched a generated in million

let’s XX, credit Turning a to to take look quality. closer slide the

previous million increase and of the at quarter. growth. was There remains coverage quarter the end loan of quarter account was a third The to the for loan sound end of is for allowance Our third the credit at $X from reserve losses the the an the in million, million losses $XX loan quality strong. provision $XX for of X.X%

portfolio with any our time, may haven’t $X.X Hurricane reserve a approximately to those Ian’s as Amerant’s collateral of from our losses million now the current portfolio. $XXX to During we the further pending exposure identified $X.X Ian. million, impact million. be such significant pandemic At This to associated third that quarter, in this result immediate tax to generic was the allowance is as accounts reduced for reserve. the COVID-XX identified generic

have the team $X.X with $X million making Net been members charge-offs have visits totaled in quarter. quarter to in been compared third contact the well. these the as site and million, during borrowers Our second

company third points basis non-performing second to quarter, XX% $X.X related million $X.X loans quarter decrease the quarter the and third of XX% assets decrease or a loans. the was ratio down $X.X a quarter XXXX. consumer $XX to XX XXXX. million in to at down quarter totaled million the Non-performing compared to million of the third of XX of the and assets of $XX end of commercial points, second connection from During multiple XX XXXX, compared of XXXX with and or the third basis total the off points two million The charged from assets of basis quarter

the to increase to non-performing result earning last X.XX%, quarter commitment Our to our compared X.XX% as to down loans to a total total assets loans are of assets.

and recorded the to interest-bearing times X primarily at end which by the that driven ratio up was at OREO of result of X.X ratio of times, asset non-performing or the from from Total of loan at $X.X XX. quarter we growth customer were the this transactional X.X%, of the closed sale million up further from decreased New last to loans the accounts. times mentioned, third loss York compared we This $XXX the deposits were of coverage ago. In as accounts, third demand Jerry the slide quarter quarter year As up from million X.X Continue previous -- the quarter. was the reserve to a loan the a month billion, for closed XXXX, $XXX non-performing October. end

via large As sourced the during company additional obtained providers the home deposit period.

efforts the decrease domestic to by of reflects billion quarter, deposits, rates. lock which offset of our total quarter. in rate which lower end deposits also the million $X.X in was retention million by interest increase of to total time increase highlight time account our light increase to in $XX deposits, X.X%, in order rates compared market the elected $XXX The slight million environment. for in third of or Important to rising deposits were now customer a up We interest $XXX totaling this XX% previous that Brokered XX% or as

by the totaled deposits $X.X to previous account compared $XX Foreign slightly of X.X% quarter. down for deposits, billion, XX% total million which or the

which core -- quarter, increase which million $X.X versus second accounts, increased in versus million $X.X deposits, as quarter, increased billion total included and $X.X of deposits, savings $X.X in which deposits, billion $XX $XXX core or quarter, money versus $XXX deposits, $XXX billion billion the million were $XXX the market previous deposits interest-bearing Our in an than consists excluding million all quarter. X.X% The the up previous of the in non-interest-bearing end compared which time of deposits more Q. demand $X.X the of were third previous billion to the

net Net of on will quarter-over-quarter. driven I was net margin average income income period resulting and by; Next, interest million, slide million loans $XX this the $XX higher short-term manage on as total funds. a well reporting interest This to was the deposit or via discuss our floating for points up rates higher cost XXX XX% and interest rates; XX. specific real estate from interest average commercial of in increase and residential investments the yields of increase being in basis loans; handled as pressure in allowances changes balances single-family

continue rates product managing rates. in disciplined increases increase, our to As we are in the

control betas. As increases to certain reflect in is of deposit the rates. products mix market and adjust and interest relationships value leverage we we partially differentiate the last explained lot sensitive quarter, product rate pricing There to a to

we beta we navigate interest XX deposit quarter, rate the period. During during the saw help current points, mix, basis the us which a observed to approximately increases based third of on the

Moving third the in Jerry the to quarter. as The XX points was mentioned, at NIM the of X.X%, an primarily which increase was change NIM by interest points basis up margin, quarter loan is the of net yield now driven net the versus interest by quarter-over-quarter. the previous income our in and portfolio, XX increase basis the X.XX%,

QX, As our improvement a reflection NIM asset in sensitivity of the position. said I is in

within XX, to having see year. sensitive be XX% balance about loans Moving you our slide to rate sheet of half structures can and with re-price asset floating continues our the

These decreased to office interest assumptions updated compared more scenarios a deposits. are in beta Our competitive deposit the to quarter gathering. last has rate interest-bearing of profile consistent light for changes sensitivity environment with on NIM

interest X% the scenarios we up This in quarter, X% for the approximately net of months. XXX potential are showing a increase two income and

remaining for to in We of bank our XXXX. to actively the portion manage interest position sheet expected rates balance rise our will the continue best for

totaled securities derivatives portfolio. banking absence The fixed of income under quarter. customer’s gain of partially net asset offset million quarter equity non-interest down third from of end in valuation end lower increase of of the higher marketable of an the given market second million quarter; was was a which the an comes increase the $X from $X.X income our fees, trading negative $X.X the total side the of versus Moving the coming by the increase of in from The to X% on slide and X.X% client in in the XX, income fee million as on positive mortgage valuations income million quarter, valuation $X.X million third valuation the third lower the the of the quarter billion in $XX by; income quarter, in brokerage of increase in million second compared $X.X $XX primarily million, holdings no quarter. previous in up was $XX $X.X XX% million, from Amerant’s unrealized from and to advisory million as by derivatives; second management driven or second driven and securities markets. quarter, fixed $X.X surprise the

XX. Turning to slide

million, quarter XX% or non-interest Third down was expenses $X quarter. from $XX the million second

on there announced we was a considered reduction non-routine as earnings item. expenses. previous significant million our in call, We one-time a $X As

an charge OREO and by salaries $X.X expenses Excluding related absence new decrease primarily New to with from year. in million. of third $XX valuation expenses items, the related non-interest The higher ratio million, in improvement the the expenses XXXX, offset million the the third the the quarter-over-quarter XXXX. closing $X banking and engagement million, was $X.X as connection million consulting I Jerry million the third third compared the as quarter by of of now York, these quarter remarks. XX.X% as XXXX, net by to decreased closing transition XX.X% expenses driven quarter. interest million, well in quarter of $X.X core ratio The was severance of to and well was expenses $X.X driven to in connection were quarter decrease the quarter efficiency with in million in XXXX. the in center, partially a compensation impairment in previous advertising Core higher FIS upcoming fees in resulting by third The of FIS. income, expenses during and in in by hires primarily XX.X% with last XX.X% XX.X% lower quarter will second non-interest to The compared lower quarter turn call for $X.X the as the by to was other $X.X back to lower of efficiency third

Jerry Plush

loans are just headwinds there to non-performing summary, remain to initiatives net our executing from continued in just in non-performing a capital prudently and seeing and in reduction and solid quarters, strategic members on Carlos. we gaining growth, our of the post want the have as strong quarter higher we we the further team while the Thank end recent made expansion, our strong market clearly you, the in share. closing, and as given environment, state loan In net focused stress ratios. of economic that continuing on a margin team are I In interest well income, that’s and assets recognize in we benefits build decisions to additional continued resulted efforts deposit significant reduction

look our Q&A. have. finishing the is serve the I and that, to Tanya, and of any open answer please you choice in Carlos With transformation stop and the will for will Our commitment to unwavering. questions we becoming Bank markets I line

Operator

And Gailey will from Brady come question Certainly. our first of [Operator KBW. Instructions]

is line Your open.

Brady Gailey

morning, Good guys. Thanks. Hey.

Jerry Plush

morning, Brady. Good

Carlos Iafigliola

morning. Good

Brady Gailey

million So repurchased. $XXX of mortgages roughly

third the in think I amount you was the what quarter? year-to-date, repurchased just said

Carlos Iafigliola

on -- asset was There that we sources plus bought very the to had the was deal quarter. from the we $XXX duration, it’s an that additional production it class from a now. balance coming third mortgage million In that now close has see that quarter, right the we and good way between probably it

Brady Gailey

Yeah.

if that out, So incredibly mean, you back I even growth loan robust. was

talk head you the little about what outlook a growth into can and loan as is where we the are seeing growth So bit loan you for XXXX?

Jerry Plush

Brady, it’s Yeah. Jerry.

the quarter, pretty and build Florida, have in the the additions Texas in a referenced strong business the that pipeline quarter. out of I development performance had this headed think Tampa of we we that the second continued South on in call both and here for good the teams, in have we with into

saw estate. in growth I think strong commercial you real loan

the that But quarter happened note different the have production. to pipeline think white-label gave also the think and in high some past. kick about continue there in We information was good continue finance. to And program start as we going we changes do I even to see activity. we of in that with very we to going said repayment really strong had a geographies. well I’d C&I do a we on I were what equipment The to

a You white-label just indirect can that the fintech production. for we Carlos started see that solution replacement referenced as

So the during contributed to all overall I the quarter. these growth of think

Second…

Brady Gailey

And you made…

Jerry Plush

Apologies, Brady.

is, different strong the very second look of lines in You all question the the asked to pipeline continues which business.

I we to think deposit be loan the growth. growth make by biggest in record what needs comment that is, about I’d funded will

to the deposits sheet. a emphasize a to We commitment balance that organization grow strong have way got really first as continue to as

the to So in in we time. while at have deposits also the the several we could that million same point we need may quarter, possibly dollars hundred grow grow

Brady Gailey

Yeah.

you efficiency Okay. the targets, basically hit ROA in just on ratio X% an and XX% XQ. And maybe ROA update on

do happen can there? It like on on efficiency XX% timing quarters, thinking at And you of will the kind of you point. just keep are then targeted that? couple doesn’t an ratio update next some how in a so have maybe update I you So know timing, on an that about you feel it think

Jerry Plush

Yeah. No.

can I go-forward. the a think around on in continue to X% and we return be on assets

some even costs think so of the we fourth with here margin sheet we deposit that’s balance I in the and strength the quarter rising should see in expect to that again the going help. expansion

prudent say capital. talked what tangible future to percent decision with to point, think of what we want We we to in -- that, be we equity on the think right? that really add kind is it of personnel keep to out common and continue terms question, ROE some and add opportunities because your made to happens our back but think people. I that to biggest ratio conscious XX-plus at the eye continue XX%, growth, is for use achieved in be we while the right, a So I to to beneficial see I terms add an of the sure the make of want returns, business quality again going I me a think, the development we I heard sharp

have in continue We We openings in to want Palm Tampa. some Broward. the expansion and

it bringing look our relates in We are new on some business, for bankers. continue wealth personnel to private as

to going are uptick core build value long-term the be doing for all think these in I some to the personnel there’s So line, the on too. expense expense, be the to franchise. specifically But things right

we And will with next goal I so as XX%s think, hit as quarter, love be the in in getting of there much the low XXXX. the to to continue I’d XX%

Brady Gailey

for for a little And little you in run then, active on It has doesn’t has the under guys it X%. Okay. appear me, where know guys been historically at under the were TCE I you a buyback. quarter. just finally

mix? So that in or is should not here buybacks we expect from the

Jerry Plush

we we Yeah. we in consistent capital have Brady, it think pretty return prudently saying, it. is, the need need way think, to I to about or we been use

focus dividend. in now, it the out a got our we the return right is, think have one use is item of think opportunities consistency I to I that and other paying

year just we continue last authorization successful will Right a quarter. by think from what completed grow quarter what that two do into have going quarter completed we forward. thing right pay dividend in the another did do standpoint look very we third and not out now fourth here did we programs. to what then asked quarter in is We end the buyback in the think first When to more. the to going of the we back I for and is you into that of evaluate at the which base, first

Brady Gailey

guys. Thanks Great. Okay.

Jerry Plush

Yeah. Thank you.

Carlos Iafigliola

Thank you.

Operator

of One will from moment. Raymond is come Michael, line Rose your James. And our open. Michael next question

Michael Rose

Hey. Good taking morning, questions. Thanks my for guys.

Jerry Plush

Good morning.

Carlos Iafigliola

Good morning.

Michael Rose

Obviously, here, of reserve Can you and come story to on good down a maybe be of ratio just Thanks. your give but Texas general Florida just credit confidence, continues quality might how a markets kind some a kind your of definitely did us do bit. overarching credit the kind seen build really little bit in gives maybe of because others have begin to little better, we what and thoughts you quarter? reserves this

Jerry Plush

It’s Michael. Thanks, Sure. Yeah. Jerry.

of keeping the solid did that add in on on and an did record foremost, But bit we NPL quarter. we In little half that process, consumer in first to I the was portfolio, are eaten totals, of gives we up seen, feel that the say portfolio. reserve terms guess, rest continuing how on by that uptick we and charge-offs the right, There NPA eye across. some the pretty now the an are all have see us the We to we terms improvements reserve. that I performance in that, definitely confidence. the and of direct with provision the would and of a was

Jan date, will year. economic to be that there factors place calculations, course right, to that P&L but an adjustment comes equity, really the see, obviously into during will this plus will about of we those on production are go note, that all the And I will out going I also X we as the booked we you think, think it’s important of have again, for we CECL. the will see the take call, be talked that a that you yet naturally just adopting because of adjustment that haven’t

expect, expect I going reserve our in to addition, the monitor But because go I portfolio. So up and that, obviously everyone of closely -- would fourth ratios think, think in just I implementation. CECL are are it’s quarter, to going continue the we to should

Carlos Iafigliola

that a quarter it I the think range versus implementation. Mike, progress you will one as decreased we on would the CECL the the be, has -- will day disclosure There -- -- previous range find implementation, the you for which on about is

million based we a to it’s other incremental due $XX million now the over be adjustments on $XX will And have mentioned, the to there recorded Jerry day one So as different implementation. production reserves year. that

Michael Rose

just broadly, going of any updates was have of like just have -- what the gears deposit for to That to and about that more everybody. my follow-ups. costs And can international Thanks. to fact switching rate Perfect. just interest the be at cycle? end up deposit through Do deposits, September? then chunk you just you talk costs deposits. Maybe given your Obviously, one of changes my decent you interest-bearing were guys a the strategies move higher or number

Jerry Plush

Yeah.

the Let me answer second one first.

saw quarter. segment just it the to, Bank was in business, grow reflects $XX quarter, I have We I side. nicely that that contributions growth from been had private to think this note, every the we in it’s really alone. the of very from believe, It’s particular growth line a up the really that close in important note that the doing very, we deposit million in build

rate out lots obviously with have that There’s people so, hikes. are -- these offering very And there. pretty some are all competitors focused strong of rates

as which that don’t given want ourselves up where -- And so, to high we go have rates but players at time the got build and to give local or right, where We XXXX, an trying we at fairly right or are navigating time as of are of. through that environment well shift non-interest-bearing a either lot of period back where run to players, as long-term same a some basically national offers now, you interest-bearing to a money aware somewhat had I well in, around because of too market. want the to, you think be range, know And in on one such will XX-month work I we side, point to candid. time locked we flexibility be money we over time, from probably alternatives the deposit cautious A, very CD deposits money had with lot for look in as book,

So costs think, everyone going say, on it’s for Carlos some else. are safe like to us, for clearly, you which comments up will I cost, going they are deposit up the give just

Carlos Iafigliola

Yeah. ones comment guess that least other There our allowances been has on that the on from sensitive. it’s believe be for to being published. funds. first would We interest are of institutions. adjustments was at will to a that are believe lines it’s be being provided Therefore, these they increase we the that deposits, rates on there the different on, that the interest increase cost the to or certain steep and more important more case the deposit I the interest changes in case tables stages rate business of increases, on rate now there rates

on we beta, X.XX% fourth and was we on be the quarter, Our call, we the in will that X.XX%-ish probably as beta. quarter-over-quarter discussed expect the

cost side, XX an the the international of expect should you So to incremental they be continue case funds. basis of close blended, to as In a the points.

the However, having also pressure they they international are starting as of on and well. local are paying we pressures that they the the that banking are aware markets to certain rates customers from private some side in are see

beta. is the change. signs the X.XX% see we ones are are So of the X.XX%. to for But of very increases. -- to would driving reflective went the deposits the Domestic about you were starting That we from I X.XX% most interest-bearing part. say, see stable International most of

Michael Rose

for Very Thanks my taking proper questions. answer.

Operator

you. Thank

Jerry Plush

Have great sir. day. you, a Thank

Operator

moment. One

sorry, Matthew Matthew, Olney from come will Stephens. question of next Our

Your line is open.

Matthew Olney

morning, Good everybody. Thanks. Hey.

Jerry Plush

Matt. Good morning,

Carlos Iafigliola

Good morning, Matthew.

Matthew Olney

big there, I the about of Tampa. more local Florida, question, South picture thinking markets a guess

that read dark could think or the markets about Anything dark same clouds similar we is different Florida stand country? a metro I read be or the clouds see in about that it across other across you out for country most we somewhat it all headlines economically.

Jerry Plush

Matt, -- question. strong We demand still housing. really see We No. great for

have think, We in and inflow Particularly got the here Florida, the continued so Florida and in continued. to Tampa. the operate, state still South of we sales particularly South There’s in have two scarcity inventory. a which markets I

with. and costs across no always much little rest biggest that, with country different higher living, I pretty cost the to think the that headwind the seeing were we is Board higher we of think I just, begin cost than particular, face, happening We a in right? is the of what’s the are which

So of are going season, But for positive into which very there’s there. is we terms definitely hospitality. the pressure real I slowdown, mean, right in

We full are restaurants. seeing

of We assure are traffic. there’s can still seeing you -- I lots

And bullish you, as are also we see Carlos markets. tell well. to pretty visited these Houston pretty and So continue there had I strong I in about recently can it look still that and

do think because desirable growth I high So in are markets. very are we we fortunate,

yeah. pretty will I us, think well that play for

Matthew Olney

basis, guess, the Okay. the I quarter, appreciate as it in an income non-interest like And on we far pretty that. third the adjusted looks then, I on were quarter. flattish as,

talked you potential quarter a about the last think I rebound in XQ.

around curious look puts what and about takes and the saw you what the So quarter, of quarter into in the fourth then as kind the Thanks. you the fees? of third are some

Carlos Iafigliola

Sure.

those was the we we So have this that last in that, guidance change derivatives quarter, on customer that coming the the particular income from quarter. provided the

the hedge probably risk, was We be quarter that, quarter. remember was quarter. but in to a continued -- interest demand record not that we loan the believe that customers have order solution offer always next demand to same to into rate help that during coming the may We there production. Also So the be in will lower. probably this seen

So of helps there from In that related a activity. the brokerage case the the but instrument. with was was type of AUM, also that surge,

on side, income space have fixed as to the can see, you customers, income they of the fixed rates, level the invest. go now multiple interest On options and

in this we quarter-over-quarter. around which has source. income in well. Mortgage, quarter is I fee items of refi very stable. that other fact of are the created of believe the and Amerant QX created pretty Mortgage case the rest also in the In described just three as The active case Amerant’s be is is the that activity and would And So decreased changes lower. that the most that lot a production

[ph]. expect the year, of should have the quarter that income this So we the similar is on that to we fee speaking third one about quarter

Matthew Olney

margin could rate step-up on And for call, should then on that like that sense assumption it bps. we fourth see moderate the Thanks. sheet that looks color and purposes? and fourth and growth on in you But of another step curve balance than My that. stepped can the mentioned, the more and quarter up the $XX give also makes in margin improved quarter, and third the fourth sensitivity. up guess would degree the given be NII interest you the for be step XX quarter, NII more expect I Thank Any color sequentially the in we million earlier Okay. forecasting would any in us of that. the kind the you up

Carlos Iafigliola

on quarter. completely steep It as as Yeah. No. wouldn’t That’s third case. the be the

and something As income anticipated the up interest X.XX fourth net to X.XX you for are we faster starting margin deposits to can the betas That includes process. the simulation in on a aggressive financial more quarter. see, catch

Matthew Olney

color then, the in single-family, lastly, growth looking back or And just Texas. helpful. to Any growth loan going color looks the more That’s the multifamily was the just on this that growth at discussion slides, growth, guess, it of earlier the at all? was from part and I Okay. like any

Jerry Plush

No. Yeah.

multifamily big play You spreads, is more these and type of part just the a which a for obviously, particularly it this good make for us think growth, a of we hit to We was with of thought with it units. it’s right, we it. got the those have quarter. demand, smart loans and kind -- secured It’s

Carlos Iafigliola

rate. floating have they And

Jerry Plush

Yeah. Exactly.

Matthew Olney

Yeah. Perfect.

Okay, my for guys. you Thank much taking very questions.

Jerry Plush

Thank you.

Carlos Iafigliola

Thanks, Matt.

Jerry Plush

a Have day. good

Operator

Janney next moment. Montgomery come Scott. from One Feddie our question of And will Strickland

open. Your line is

Feddie Strickland

morning, Good everybody. Hey.

Jerry Plush

Feddie. Hey,

Carlos Iafigliola

morning. Good

Feddie Strickland

down you sounds funding take have forward deposits. you will be or think to like do loan-to-deposit deposits, to will core to able you of road? additional FHLB to down continue think the guys it back think going ratio you stay XXX% Do below you the bit a Just can grow little going on you

Jerry Plush

Feddie. Jerry. Hey, Yeah. It’s

to a every in talked like momentum we this really out have I little that quarter. think, the deposits my in the about we come range. I first. -- and team XX% said, We day, change. think, are in I is the is, But about and diversity single and around interaction our obviously just team the have. mouth all that we wanted every it’s sense hears I my My XX% of at of stay the the lines than higher growth business of

feel good continue to to that here I got grow. great a So opportunity have we

teams think basically momentum and a lot. these help the I all the to of is really additions teams the us of going new to in

have got to We the growth deposit to hit have targets funding to with stick loan order get our that got deposits is loan to that growth to to in the emphasize and we way so want. do the we

us to in think the comment to hard order to ourselves really below, XX% see we about I stay of I is, kind between that could staying range. us this earlier. to if try obviously, and push live But I our pipeline or XXX% made we I mean, target. That stay in to want trying that. So do said, above continue we

Feddie Strickland

Got same Do like it get growth for you further? it. And some be to able in deposit division. management some should additional line, wealth opportunity the there’s then grow think you I sounds guess to that along good that there good

Jerry Plush

Yeah.

so. continue to private I team has think banking do an job, excellent our done

the the add was to continue making team. the the in counties. That growth reference I We have to look actually to was about

have value adding back the us Tampa marketplace we looking add the to in is and marketplace. someone a also with our are started well in as while do banker first and that We Houston private

of to really that, teams coming also system really making. big leadership and retail coupled excellent had retail, an contribution those in So are that that’s shift the with, I and a I much a a that through positive think think on I side change we more our making think, sales culture that’s

We outstanding new seeing that are treasury added and we more day. excited and team every quarters, is and really doing have just I have think also this business I we I the in more management, think, build prior in job an and

the was past comment decisions of off. So the that what, we that I about the investments quarters made made in paying again, I and have think, the kind

competitive higher think are that pressure also loan side, on that’s be I feel in wise why just super some deposit we side the benefit so time, environment. is for I that really that to from be about deposit on and do point of good very show had in to about numbers the benefit Banks the I reiterate, there rate costs. referenced doing. the question expect looking But the sheet at that and to book All are going the their do balance given going offers. starting to the are of team to want before, capable the I’d we going said, it. mix rate to no aggressive out I same be There’s continued what see and are there’s from investment building the

Carlos Iafigliola

Right.

Feddie Strickland

That makes one final all No. it. then And Got just sense. modeling question.

come expenses the I to up fourth quarter. likely core think mentioned in earlier, you are some

there what just should closer Just is than it the magnitude as higher far would the as is to expect run $XX magnitude, was something increase we the curious that? rate million be? that kind or of I of

Jerry Plush

itself, add because recognize, tick can in to to the Yeah. there’s is we with personnel. do the components quarter One Look, again, quarter. up couple think, and of incentive are going there’s that obviously we well have comp continuing to be I how a be that going

the expenses. to going there’s be also some on personnel So pressure

a $XX you see is up right? in to $XX expectation there our million to in are tick expense So going slight that the million, core

Carlos Iafigliola

million. $XX.X

Jerry Plush

Yeah.

Carlos Iafigliola

It’s…

Jerry Plush

have lines. think you to probably just those thinking I mean I along be

do it’s have the to support are also the have make to invest ambitions continue looking I But prudent bit got be that that, into to to are have continuing very and decisions We you right? to we people, mean, little think in take always growth to add something be we -- to a the we are we to And we I account got. are think -- add going not with we to I also so there. going

Carlos Iafigliola

And that expense. be technology so are clear, or total million related guidance, is $X making would -- we may There of of that be combined a that on expenses. the as will transformation the to the that just side to come core

Jerry Plush

Yeah. Yeah.

it’s great think Carlos. I point, a

safe we to that, it, it’s to have call transformation. think will some continued, are relate say everyone going in we non-routine I items that for

I and have both So core timers will non-routine, us we to report pointing some are as report that the think, you continue to the as see have think much what love out we one from. are I where going and we they not

Carlos Iafigliola

it’s Definitely, Yeah. small...

Jerry Plush

It’s much smaller, obviously…

Carlos Iafigliola

Not…

Jerry Plush

you noise couple quarters that all saw the in saw …you past. of that a

Feddie Strickland

That congrats and Appreciate guys Yeah. a quarter. the great it. Got makes clarification sense. on

Jerry Plush

you. Thank

Carlos Iafigliola

you. Thank

Operator

like the now to would back remarks. conference Plush to I Mr. And you. turn for closing Thank

Jerry Plush

Thank third quarter in appreciate continued our Have a for support. call. your and Amerant you, you We earnings Tanya, and everyone. joining everyone your day thank interest great

Operator

concludes for today’s Thank participating. all conference. This you

now disconnect. may You

Amerant Bancorp (AMTB) 21 Oct 222022 Q3 Earnings call transcript