SNV - Earnings call transcript Q2 2020 | Synovus Financial Corp.

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good morning and welcome to the Synovus second quarter 2020 earnings call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today’s presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your touchtone phone. please then question, your withdraw press two. star To being note this is event Please recorded. like call turn Brown, would to I now the of Relations. Senior Investor over Director Kevin to Please go ahead.

Kevin Brown

morning. and you good Thank

referencing Kevin followed the will call. the and are During Financial begin President within Relations Kessel the website, Investor by He Chief Chief Operating of the we Officer, Chief Stelling, today, will Chairman available slides press and Jamie release and call Gregory, and Blair, that our synovus.com. be section will be Executive Officer Officer.

the to questions. Our that call. of team you is executive ask management answer available your We two questions at end limit to yourselves the

forward-looking not of me factors in otherwise, our statements We could results actual Let may release forward-looking obligation results to materially our to and our that include on to required materially. differ except and may statements. are in list website. any as We our might the available SEC assume you law. developments vary These cause by or these any are remind risks be information, that early which press comments statements a do as filings, subject and update new result uncertainties,

related we During non-GAAP the to will the financial call, performance. measures company’s reference

measures see the reconciliation the You may our of in to these presentation. appendix

Now, Stelling. here’s Kessel

Kessel Stelling

Kevin Thank call. morning to earnings to and quarter good our you everyone, and second welcome

steady change convinced of a the industry of and this including true never ability and for been our industry these, business, close in just I and for seen in financials, built our be social and change, company. four for share we serve. more like our is to as this Synovus needs. customers, even to That pandemic our certainly do tell and I of shaped in challenges see decades to is I’ve and and the quickly to half defining unrest, to the has on our resource plan slow customers the of particular to, assess things best have for, although my and relentless, to that a wanted and to times can control our by linger, embedded characteristic glimpses respond to allowed a control. period of anticipate The is we move change is a our as I trusted ring today communities us and story and our able responsibility industry markets, Before our largely my reflections we recovery. model in The share continues comments and of few we’ll unprecedented

turn I grew $X.X In by were Loan beginning of quarter. offset was prior quarter. C&I Adjusted reduction over I’ll grew Jamie, $X.XX split of XX% was interest-bearing Paycheck EPS by million a million. balances billion $X.X which $X.XX and loans consumer and call increases Total in mortgage prior billion a billion $XXX $XXX the of X. X.X% $X.X the $X.X DDA approximately billion to increased year compared highlights ago. or balances respectively. deposits, balance of billion were to deposits Growth and to down or loans Before lending last in the partnership line utilization Protection $X.X reductions share partially the book, million. between as core offset on $XXX from $X.XX the quarter, Program largely compared quarter Growth diluted second Slide was on

an in for the allowance reductions Forward $X and certain excluding was initiatives. $XX expenses which points million offsets, Net in interest the allowing from million quarter The balances. $X XX COVID-related basis offset in remain associated run was previous including associated in interest March net priced and non-performing incorporates $X included was along million margin a more in of charge-off full short quarter credit and basis time led the strategy credit XX quality in non-interest stressed based was basis greater loan than a the outlook. mortgage. optimization, PX XX CDs sheet over the for largely including deposits. million, to of That’s Synovus from $X in will mortgage from of Net by These up economic the later $XXX were loans. than million respectively. to off, up with rates ratio due a areas, $XXX points from stable revenue continued other of Provision points Adjusted a higher the operating increases losses outperformance the $XX million revenue expected, $XX X.XX%. reduction X.XX%, million recognition ratio largely point was an prior and record fee quarter. resulting and Commission on led ratio up with basis million balance quarter PX XXX from prior previous strong points Adjusted performance of increase $X for term mortgage of quarter. the in which expense totaled non-interest by prior $XXX of million, $X metrics with presentation. income with decline $XXX We quarter. resulted to million and XX expense improved losses million This implementation travel. of million, $XXX and million quarter, Credit secondary mortgage to of up the the fees employment net Capital detail million from fees Jamie seasonal This production production. higher of included ratios basis declined

to XX.XX%, was customers. for Our intended on XX program do to last we exactly CET-X call much has basis deferral outlined high. support basis two-year what needed it providing at our to by XX-day X.XX% The ratio the assistance total ratio done capital points increased a risk-based points XX and and increased end our

XX-day deferrals of conversations half too us and second interest. client reviews X% cash lead total customers While play XXXX, to will with to it’s date how and now share to X flows, granted will in surveys, early exactly quarter. of X detail more out of loans deferment will know customer between the and interactions for principal round a somewhere that believe about the of have Jamie to a deferral

Jamie Gregory

Thank you Kessel.

this our company loans noted, fronts on Slide with eventual impact a resulting As number considerable with was Kessel our The been progress on sheet balance despite significant, a quarter starting headwinds. X. of on very has for

As customers coordinated An C&I ended the at loan we was loans a the resulted $XXX average to balance in and low an loan May, in bank. a in the C&I shared of employ quite second utilizations. The XX,XXX we ended which billion balance XX% across loans $X.X for over the received sheet funded approximately a balances XXX,XXX $X.X our billion, $XXX,XXX those offset PX which line approximately the that customers, required employees. loans, PX undertaking record We quarter from million. from with growth was quarter of of decrease PX that declines in effort

XX% improves. record expect to production million the the mid We consumer upper million. $XXX in to range line over economy loan as in normalize $XXX of portfolio of the include mortgage Highlights on a utilization C&I balance increases

As way restructured beneficial. Sky our the quarter, we was a disclosed during Green that mutually relationship is in

loans for second you for this held balances to Our shift for total In investment in quarter, the remains the moved we held of from sale million will relationship, a arrangement. see new under to held $XXX exposure for $X loan sale. but limit billion

servicing the statement reduction more and realize and Sky as loans Going income as non-interest from our forward, we Green you’ll well geography interest non-interest net see from in on as a income expense. in transactions fees, revenue shift a

consumer those meaningful moved student item the to $XX of loans The loans. we sale, contributed and disposition balances lending an for partnership approximately other million $XXX in to In within to which allowance June, million. decline in highlight resulted in is of the approximately release held

to we be those that quarter. customer these our We on loan of acknowledging in the as which while managing times. sheet the believe takes quality uncertain end, balance quarter relationships since loans for that a and in base a We have modest the core these portfolios, testament that the closed focus also third gain of market we transaction these committed priority our remain realizing to is recorded will strength

had the the growth balances $X.X remainder the excluding deposits of lending of we We deposits continue loans in transaction by conjunction On the year, quarter-over-quarter, balances be we billion money with impact occurred flat and with Slide you with XX% however, DDA our up to XX% saw PX of increased while growth quarter. billion effort; PX in up this market across that up unprecedented to quarter-over-quarter. total interest-bearing expect $X.X and NOW forgiveness. second growth Much also see balances X, can savings in broad-based for

While lower cost strategic deposit deposit we quarter, time accelerated have within the core continued in first since our portfolio. growth experience has to declines late transactional

and CDs last the declines we’ve As higher you as have cost are to markets. over funds much been aware, reduced these of quarters in certain exposure several intentional public

over. core the portfolios. benefits we ability further deposit strategic One lowest to a by accounts our be rates broker deposit and within financial sizeable having portfolio approaching declines great the time is to and led as on the experienced re-price of rate since turns in crisis, transactional With deposits expect decline interest-bearing paid rates of the portfolio that time turnover our

of costs As its the quarter prior roughly deposit basis costs lowest XXXX. third the At points. time, a simple achieved deposit that were means of interest-bearing in XX total cycle, to Synovus comparison

pricing in deposit with and we is the sheet evolved comparable believe achievable mix time, our has return quarters to that a from While levels discipline. balance continued coming

$XX in the quarter, second in accretion net of million as with on from in Slide benefited coming as totaled is increase X have half PX PX a million, interest interest $X quarter. previous fees income. of income million. excess portfolio. expect deployed. In $X program an may associated This million impact income to XXXX fees We unearned decline are the $XXX interest shows of recognized processing our deposits the forgiveness that PX liquidity net from loan meaningful fee from our

X.XX%, ended In the at terms interest first quarter. from basis margin, we the quarter net XX of points down

the throughout prior to interest to approximately impact the diluted significant associated by excess environment, the cash Beyond the impactful deposits the not while as lower of which, the rate resulted with quarter points quarter. an basis position margin net income, in X inflow anticipated compared

the were put serve income loan on of the will including expect We level impact sheet X. support interest margin. stable revenue the pressure XXXX. strategy of credit transactions The anticipate maintain to securities the to we Transaction the some the the activities, repositioning expectations, including second student of approximately third in margin. on and PX exceeded should in and X a million in also environment, sale loans, impact includes which adjusted, strongest We in pleased basis portfolio. Balance quarter remain change, points half our and capital $XX we and we revenue. second million reversal which additional of liquidity current non-interest to the some the Slide $XX recent card markets transactions, beginning million gains portfolio excluding securities as net of in originations Green $XX quarters realized elevated the of investment we year headwind the activities with these within elevated relatively margin. an sales, quarter, these fee to had mortgage million or activities, the $XXX impacts in one second expect half After Although management shown from that downward of the the adjusting position Sky economic for and is margin will of our

was of an $XX an sale. secondary the the on more This agency in were investment all-time remaining part mortgage million included loan $XX the was revenue of the million, Total than transactions million of net collateralized in in securities, focused gain of quarter. our result mortgage and $XXX repositioning high elevated primarily on which portfolio. these $XXX previous was disposition production obligations the While mortgage-backed million

is expense adjusted in return we on see Looking record by $XXX quarter forward before X. do likely revenue third mortgage expect non-interest at $XXX million is quarter, of to of in the level to the fee believe Slide revenue shown of reduction revenue. second consistent third adjusted, stay normalization quarter. revenue, growth net a of we Non-interest or million, a the mortgage the not we to Led

million in million restructuring million customers. expenses of estate, related approximately team the expenses as frontline well the expenses prior expenses had One as of to quarter. corporate Adjusted increase and commission $X $X the closures an branch quarter as Adjustments to $X improve in Global bonuses of safety for in included we $X liability. production. our the team in expected, certain $X included These of related higher real the to earn-out mortgage quarter million as efforts As as the to than COVID-related as and COVID-related second $X due expenses expense included members elevated in of well to million well million members

at quartile to the credit shown Synovus initiatives. generally few we which past the expenses year. also first These Current X, and the of in related prior these for metrics the The million builds $X ratios Consistent help shortly. that expect certain decline include reserve the top expenses over stable. efforts NPAs, under we CECL. and We Slide the us second made nature pressure of the next Kevin upfront in execute implement aligns will on remained to update some efforts an provide with dues, achieve performance top credit second had half half quarter Forward of NPLs, pro-cyclical quarters, with in sustainable year the of will which guidance, to expect

dramatic quarter real in current elevated the of to year. GDP to rate funding not $XX credit these third $XXX ended losses the end allowance fully Slide are impact of the losses to seeing million these ACL economic remain for of the from ratios million this to prior on credit XX Net $XXX points important term was from million impact net Although at note or loans, charge-offs to PX build a charge-off we and part XX% declining of quarter. XX the capital and metrics, portfolio adjusting increased estimated that resulted credit the move impact this the elevated anticipate economic The widespread After single charge-offs. future review points, of in ratio following an was it’s remaining due and moderate loan in ratio have expectation XX Provision second economic we expected the year non-accrual position that which largely near stimulus of result ACL up allowance basis points longer in as the the due current the lows by cycle. today’s COVID. great assumptions the uncertainty remain credit quarter. for headwinds. and of migration, nearly last basis credit any ratio X uncertainty in The to economic remains spikes unemployment for quarters We basis direct X.XX%. deterioration of could deferrals include an for XXXX. The an around Economic in could quarter. for second resulted a for from includes not our the throughout expansion and

remains process. our focus managing appetite our on sheet balance Our in and capital diligently alignment risk with and adequacy capital

ratios. You result basis CET-X will the the of points in our basis CET-X rose July two XX to XX.X%, XX level years. the and total loan and sales can of capital including approximately by further student settlement risk-weighted in to and reduce Actions basis highest points improved trades the see in will X.X% XX capital benefit that effort security quarter. points assets third in risk-based

to receive half growth for to coming considerations: those ratio capital two We testing be supported As common and current income is important to a total investment shareholders remain from by our in approximately guided for earnings. also current confident adequacy to objectives, with our shareholder retain enough level, dividends. we objectives. appropriate To common stress by specifically which dividends, strategic analyses. shareholder on XX of it their achieve capital and it’s long long-term capital is XX% sensitivity to We term of continue that for relates payout us believe and

June we capital maintaining support second $XXX I’d approximately have thoughts XX, stable we needed. XX capital Before in December position remain allowance the has handing when quarter ratio. means and the to sheet. on off a confident to by increased summarize From to million further to our Kevin, like while CET-X the balance We our our shown

earnings Given planning and uncertainty, repurchase the XXXX build elevated to businesses. and in we future are shares not use capital grow will our to

value. update and turn given our expect assist With primary that, efforts within environment, dividends further credit capital through our tangible book to our of enhanced progress this I’ll an to on detail of to on means Forward. Synovus customers portfolio, return and We Kevin within to through over our our be it speak accretion

Kevin Blair

begin Thank When highlighted conditions deferment we stable industries, a COVID-XX. we to that March, implemented term $X.X these an address we you process with in short a XX-day Jamie. late deferral a economic defined to particularly update that help the last the assess to program billion prior Balances larger totaled of quarter. the we on review which flow. our utilized impact to Slide changes call with the XX in I’ll cash on warranted the as particularly segments in in is sensitive customers

have the we of thorough that to and encompassed levels analyses large approach longer this end, the in on found our is who will proactive determine over XXX a we XX conducted flows slide. cash days. reduced again deferrals segments see companies percentage burn are a these impact customers the once next cash What to to on a As identified taken and experiencing of term cash continue five of flows

briefly. each to Let see hotel touch a in XX% decrease me industry on industry, to start per room. continues available which with occupancy XX and I’ll the revenue

expect the drivable in and the occupancy a portfolio as coming southeast Given XX destinations, in between the flows in cash the days. to we range the hotel re-openings in overall and increase the result, to rate next in deferral months and various XX somewhat the increase vacation XX% of

this XX% service two and last almost As a entered debt strong times we shared with over slightly downturn maintains had portfolio quarter, the loan-to-value coverage.

electronics, and while re-opens For see range retail XX expect of home their in such performing non-grocery types resumes of anchored of to sources other revenue. deferments certain as are XX% improvement and the we centers, to as shopping well, retail

significant the and benefited quick PX which in fast casual improvements more from businesses, will in the lead serve Moving reduction program round greatly to we are to a and this seeing second deferrals. industry restaurants,

recreation to an lag flows growth and Similar in centers, of shopping we increasing faring and deferments. here goods year, to therefore June industry and among the type is are hit and portfolio principal revenue we by furniture, and impact centers shutdown, well we cash hardest continue seeing a to XX% and industries, Despite as establishments. the beer a in are the expect trade, the second softness on the of service grocery-related to do Fitness, However, wine, of the entertainment round courses expect of round improvement largely country but are to see in in XX clubs industry golf solid with pursue the of overall function better. low and drinking some the this in sold, second but deferments. versus previous entertainment we of retail trade with industry’s a full recapture the percentage interest have

to in therefore for are the the that our point, surges and have deferral markets point, additional to impacting draw in related and this Slide round positive travel. increasing saw lower minimal we In a $XXX continue due COVID cash totaling segment initially perform At greater oil to to to impact million in the from this those deferments. futures appendix. the to of need the second flows trends I mandated potential aggregate, are of we would attention negative XX like percentage deferments well deferments. of while portfolio Our this the concerns, closings additional your expect approximately keenly was and outstandings oil concern aware with any of round less Despite first would

$X housing has in Another that our billion COVID not senior this a list outstandings. which is is is that impacted notable often over on discussed industry segment portfolio, as

The not in the solid on housing one, was round our future we time is is during in loans, of comprised that and and have X% outstanding outlook round fact the reason further slide on seen X. balances expectation deferments only which supported we of of will five portfolio included the deferred that the this portfolio this on by this for at have have no exclusion senior based the performance. We performance

customers down with In flows date. our as the associations, have which work to actively trended only cash closely addition, we modestly as to well monitor continue and industry

portfolio pay with private long over seasoned have have carries is Our debt demonstrated facilities The stellar by including resources, LTVs have strategically that and decades. and several and is senior time strong record dealing team access with housing better commitment access track portfolio coverage operators. who and portfolio staffing equipment. to aligned This a very to space with service primarily sponsors led to liquidity metrics includes a the

expired In timing terms and our level payment we of point, portfolio this due due first is relatively low a of have of deferments, significant percentage a to additional partially dates. of are which seeing requests overall XX-day the deferrals at

status. July deferral X.X% in was As XX, of the loan of XX-day total portfolio a

history current as insights discussions increase borrower’s to condition earlier, of this in and this current to combined granting Combining takes good our Kessel to portfolio We to could range from will coming from COVID-XX, impact the but our should loan-to-values minimize the the crisis based with the conditions, these mitigate X should mentioned customers and upon The and many coming the for deferrals and help to ongoing defaults. date and performance into losses. borrower the weather financial help strong future liquidity, the borrower’s continue into programs X% weeks, to pre-COVID. percentage additional actions gain activity process of assistance strength limit help deferral consideration this we customers, The government believe sponsorship and quarter. into the storm of the stimulus with second with industry a and

deferral have a operating example the customers work for year-over-year to crisis. a pace an conducted of have inflows ability with the analyses well the where serve and our as an we commercial to and is we accounts. those the and open primary of debt have validated financial is this proxy impact our account strength our during this have we cash which XX, have can our not, supported basis improvement. Approximately revenues and by transaction been Slide to assess operating two-thirds between their comparing of identify data Moving predict as us, commercial assess loan who This to to this inflows repay who the as portfolio of cash Using we’ve received exposures their a on data, borrowers.

current Our relative This customers X% analysis a in the constructive to evaluating economic conditions, same us flows the disruption. current improved with real predictive month provide June customers a the a and April, term enables the could reduce versus cash to flows action allows of experienced and losses. where analytics cycle. and the needed to overall reduction have earlier throughout supplement The bridge of allowing to determine cash mitigate time is optimistic, in for flow but of whether, more cash is facility in a also support which exhibiting us month less or year. importantly take analysis only traditional underwriting outlook cash to the trough since customers intervention identification example, require last it provides prediction more short criteria It thereby early provides inflows deferral

future, Despite Slide the present. environment, XX, me talk our to I to well. let challenging about from credit perform turn on briefly before the we As continue touch the businesses

this have this units. at economy. highlight from several and want perform the on geography quarter, that a I difficult and continue reflect and success the we results results Jamie across heard our in business areas level You those financial Kessel to high have our to ongoing

XXX% the past that in have drive over also to this XX% times on Yes, helped it’s key several quarter a have of loan recruited factor important mortgage we of up in also first low produced years second volume, proven the million as growth. volume. XXXX mortgage or note since be rate year-to-date two mentioned to environment business in was the call, originators mortgage our the quarter, our the produced recruiting billion today’s Successful $XXX but $X.X January has year. which First,

our example With Second, the wholesale and last year, quarter XX% second continue bolster quarter through a and mortgage deposit quarter productivity versus production P&L results. to all growth The second production banking great we balance funded up and XX% same our in relationship-based to deliver the leading sheet was loan business up way, deposit continues of gains. XXXX. our of is lines of was model how with versus increases

both function efforts the continuing thorough, quarter’s This balances. their consistent is to added, we’ve in existing and customers PX and accounts while talent gained process, growth that as as being through see reflected a results new prospecting balances of customers well augment new

our as been the also have talent aggressively and payment in new adding shared treasury we’ve area. Next, in services solutions and we past,

revenue versus result, a the production quarter the XXX% of in quarter $X.X XXXX. up million of As was second

Lastly, our Global and growth of One improving while returns operations. premium generate the continues finance efficiency business to strong unit overall

this Greenville, South to of the such of portion drive have where in more lead lending. Tampa, Birmingham in we integration as markets Miami, specialty we Carolina we result Underlying responsibility within executive the seen and all substantial Markets have the have success marketing these overall successful a large a year-to-date As expanded and Synovus, lending asset-based significant division, now leadership structured made continued growth channels. our growth. investments and of talent includes of and finance and our Atlanta, distribution in results, which

talent of we have continued all across quarter Speaking this of businesses. markets top talent, in attract to throughout our selectively growth

customer our actually in scores and they’ve and We branches satisfaction contact while centers remain our versus have results high, quite levels. historical these our achieved increased

even give areas, and these to well do of return win as our not be as I others All better we will we of confidence me have to a state when mentioned, positioned ability normalcy, great in to so.

drive efficiencies of our execution let Forward to revenue sources We this remain close, new focused in XX. Synovus on me XXXX program and on to incremental beyond. I which initiative, and of Slide transition the highlighted we’ve As

build efficiency of being early continue will throughout benefits the objective in financial an with Our while incremental realized to $XXX intact million income pre-tax remains XXXX, revenue benefits next in year. the

savings of identified one run and on to concluded $XX efforts party expense work our the XXXX. in of fully in stream work the yielding be fruitful third demand management spend, These quite last with rate has was week. around from Our This our and proven expenses be savings initiatives, renegotiation our accelerated will realized largest million. benefits

are and $XX through completed branch in Phase our X working program. XXXX. corporate efforts real in remain ability savings We $XX in and optimization savings our in opportunities to We expense that diligently this generate have to result will confident million consolidation also of on subsequent additional estate million

focused were with the have we $XX to we between more of opportunities turned the income on efficiency and the is Analytics $XX While million revenue these the intently diagnostic the total many opportunities. potential identified the enhancement of attention pre-tax phase, have initiatives also at our out of center million. that during gate,

resources predictive our the analytics mitigate during actions to and second take will previously, create credit reduce and modeling mentioned I that the credit mechanisms quarter on build we us work allow warning to capabilities out early to losses. utilized As to this stream

We we position the work and work generate profitability. products a better and coming framework this deployment in as our Moreover, relationship overall our advancements treasury activities, as new to benefit pricing optimize well be XXXX, in but solutions enter and depository processes. in the analytic baseline the serve to and this tools of we improvements sales our will as as of service through from will quarters, in the also our will

star Synovus program. increasingly continue and We prioritize to flexible to continue future and to investments an determine lead is to This work will as additions maintain as a differentiate dedicated the this adjustments overall what and team landscape. remain our work north to serves to needs will becoming competitive we in also

of me of fully results. and is comments, those Kessel scope results the management change impact begin to recognize to our turn and execution in environment Q&A uncertainty the sizing the With the also and it delivery the the in lead financial the committed to may to to the back over now the program, let the program. portion which We a and subsequent of team

Kessel Stelling

Thank you Kevin.

to entire town challenges talent our week first mortgage they never in I retain day. to I’ve to meeting to to and all putting the what it, continue our team. Q&A, close be been I uncertainty that in best just all significant increases industry. last continue the be do industry, only inspired privilege I want and production, every only more - customers team them spite do said Synovus they I not of say we go by thanking our and of of with I each our by but satisfaction very Before where team what celebrating how associated the the they to quarter participating to were had I’ll in the customer they record and company facing our of surveys. hall in but In a do not proud attract today

Now Operator, open floor questions. I’d like for the to

Operator

first Brady from comes Gailey Please question Our go ahead. instructions] from KBW. [Operator

Brady Gailey

wanted point start Thanks, expense adjusted On good view, to I it morning the this $XXX base. was million with of quarter. guys. an

anticipating. the it was talk could just were all spend, of going the $XX little there. You you talk than of million, much that the magnitude the third on seems decline Maybe year. that’s of half we a about like back about expenses good see how more party down in Then news a

finding a more Now bit at feels possible branch upside were initially new like this expected you’re it you Maybe on saves plan. there little a Synovus than just you looking the COVID, side, find with expense under backdrop about Forward more could talk of the than maybe too. expecting

Jamie Gregory

Yes Brady, Jamie. Good it’s morning.

we As second lot to That’s but at are predominantly in well. expense in and half at this that do year, flows. quarter, of we don’t a be normalize as second stay also experienced that expenses the levels personnel be declines. to the led revenues mortgage there high We expect ebbs by of expect lower, we assuming look that expenses would the

close and in estate. As and you so non-branch to in the estate. the we second year the real there, real of expecting mentioned, six another to focus reviewing year, of on we’re the We half first our active also continue closed seven branches we’re we’re half

As and in environment, everything we’re reassessing there. so opportunities lot we these believe estate non-branch are how this real you’re learning about and days a there we’re use aware, to all

right on You’re the That better spend third than initiative. performed party expected. has

still We’re they They’re next I renew come always pleased immediately, evolving is are in come saves an don’t you of million save that. $XX for we in so that. third Forward, Synovus and find expense over few makes believe next sense we quarters. constantly with immediate the cost additional know, party that of we’ll Those that saves some in quarters, the we’ve spend, will because reassessing. range done but the that not over very environment. say just but the see We This when pleased $XX million will contracts, can we’re few to

XXXX came will you it looking evolves. and change, the I you changes, will that see and economy and changed performance--you so term and outlook in should environment just know, Synovus so and outlook a has expect launched longer that. performance outlook, the the remind our we a strategies and growing strategies into evolve We’re at to significantly, very Forward different our as operating environment. We as had would up the with

Brady Gailey

my second then on just dividend. question is the and Okay, last

yield, be With the a continues with focus. X.X% trading dividend a stock just big it investor to

like quarter, reported should earnings and fair this just more with great quarter, If look feels assumption? comfortable of at XQ. after you Is you it dividend that the $X.XX a be a

Jamie Gregory

in look long-term our we payout where with know, Yes I look today, capital if X.X%. CET-X look two informed as at earnings ratio, right period, is capital we at at dividend, stress adverse are capital are of by We at so target. and we Brady, nine-quarter degradation but around we’re capacities. comfortable as testing, a and over X% target we with look at That scenarios you our adequacy at adequacy, look the different it you expect severe and and we

and ratio, total and to of also the we believe and we ratio. the so customers we have look investors through built and capital tests to at at X% look with have forecast we We come view, for and regards quarter that most it’s X.X, Synovus the degradation, a and product have took current up are the capital our CET-X. those that want to weigh We another since at where allowance is retain future is elevated not ratio grow dividend we really generation We regards we capital to the portfolio we XX% to in allowance generated total with and the a we end for payout to external that right desire Common our appropriate payout of when settled the while and southeast, you you ratio, want and good grow have feel ended versus our basis bank, we kind believe growth. believe similar also payout our XX% to ratio dividend degradation capital near capital best capital opportunity so is prepared when so quarter for We X, and add results and Tier the and payout earnings approximately a the at what transactions the points that those. maintaining over organic look income, but closed both feel about ran the strategic We foreseeable I to that Equity today, for very we in it XX we But we’ve and the the But remarks, targets way that payout there I’ll so with about say restrictive at growth. didn’t and to losses are. in have of have will mentioned this our earnings and capital we this as stage. level, and so but Then good retain our and look where go put is at feel about stress plans. good the the recent on we out our capital that strongly [indiscernible] at a

Brady Gailey

Great, for thanks color, the guys.

Operator

Zerbe Please comes from The next Morgan go Ken ahead. Stanley. from question

Ken Zerbe

quick thanks. question. really Great, a I guess

loss XX, up presumably the In loss about in are for the we think less but asking about those, round of how terms than expect obviously content the in go more are round those amount Obviously are when X talk credits you deferrals or thinking significantly X, dramatically on round of you are deferrals? what X that? they can about that Slide that Thanks. you the they weaker content time. Does are

Bob Derrick

start try Yes, today how clearly on we’re good centers Kevin the or modeling you hey When we these back strategic cash run so book we again and think a that a at when is you thinking deferrals. believe thinking are perspective, our From content and can’t and to third but loss Bob. about early most industries hotels second give various model at this COVID-sensitive looking looking start closer where to in about as portfolios. relates Ken, moved has feel various but you scenarios Kevin’s to scenarios. that flows sensitive would you and shopping line, modeling about CRE point breakeven those out. his are indications quarter, I’ll there, pointed the about flow from comments, loss obviously are cash that answer scenarios do specifically, to impacted Clearly content, industries be these it I you various we fourth about complete back estimate,

Jamie Gregory

cash in as and what hold inflows these going it’s there’s see would everything and and the coming doing. wait days, bridge this June, Yes, XX gap, from to is from, or or have a if - it’s in would and feel cases the cash whether of add, three well we - a mentioned through that cash very need two, plans have to would said that our very would main broad of come now I’ll risk we’re some there to only small just for XXX to at a next percentage and and that’s customers a existing into many it street the you can of but it when industries July, other Bob of doing levels be you point, would so Ken, where be at we it [indiscernible] small be stimulus at the it’s one, back lower how they’ve come where August Bob and like we’ve that happen the - what in look the facilities and financing a surge really we a Bob’s inflows. a of government look percent an to analyses that. would and When we’re we’re the estimate and level, future we see point, at mitigate risk return we evaluating percentage do that good lending and unknown have it September be additional whether look bridge a

Ken Zerbe

in throwaway Got if charge-offs. future all anticipated prepared the might than charge-offs could said more here, my I his the cover just Then your think I it it, remarks your a question, charge-offs your cover should economy given sense, that given reserves all anticipated that from but do fully essentially staying with essentially ACL expect elevated mentioned--had charge-offs--sorry, and get deteriorates offset your in peak said okay. Jamie what not one sentence remain totally in you follow-up and should makes CECL, second expectation, different credit, that in certainly ratio is today’s they’re want that they fully portfolio, quarter provisions--that decline, reserves there to it sort just banks, cover expecting. a I going comment that to that or their way. start and reserve given from any should your the other misread don’t Is that Thanks. the of particular make heard is I we’ve aren’t anything with to charge-offs? think sure

Jamie Gregory

Ken, it’s Jamie.

about environment. so is and Obviously comment that. around our believe in is thinking the in about the losses, our allowance it You’re just--really us we feel life That embedded loan this today that right. of covers book exactly charge-offs uncertainty we for good

will constantly reassessing looking that through highly both we quarters outlook as and rating by just and go the next uncertain, risk economic at we it’s migration. few be However,

Ken Zerbe

All Thank right, great. you.

Operator

ahead. The go Please Jared Shaw next Fargo. question comes from from Wells

Jared Shaw

sticking it’s the to on you loans the able or enhancements you any or are be into deferrals? that actually concessions whether going from are How get looking more the of in guess whether broadly? the I more morning. going of good deferral second are it’s industries at type approaching broadly COVID-sensitive to the just Hi, renewals, round renewals,

Bob Derrick

Jared, is Bob. Hi this

detailed to at some and recourse, kind modifications migration addressing process risk wholesale order the changes is of accounts. the process grade, grant certainly on obviously entail to credit in that etc., a to to basis, pretty for gets you. there etc., look note, there refresh a we effect too, quick Jamie’s on also It so the collateral, each point re-underwriting you sort color to process, to looking to add of loan-by-loan credit second a deferral In on can us credit. That the earlier, involved a some on changes does so at clearly a get think a comment larger on I Just that it’s degree deferral. a are that specific that

we’re helping it’s of deferrals, but Now, some the without smaller Blair’s dives analytics smaller at data Kevin we’re deep also harder those earlier, a so a lot is on some us of data well. decisions second to portfolios, using them as the that credits, looking point drive lot just for to do not granting

Jamie Gregory

a it protecting where make guarantees getting we’re standpoint, the the sense, time. we’re only fees, point, so your taking ourselves are risk we to getting at trying from So same benefit we’re P&L collateral, not extra we’re to

Jared Shaw

see didn’t underwriting Then on some of or that mentioned, if migration could that some hold risk deferral those the those, that you on up? incremental of of potentially we at renewal level values charge-off the

Bob Derrick

again. Bob it’s Jared, Yes

charge-offs I we you remember I the liquidity few think we’re to down but theoretically level in think what with as larger we begin a customers, see be is But to rated process, particularly to accounts, probably talking out and with see our still of begin some amount and that the and our there early will before seeing that did saw. the quarters migration we’re materialize. book, you what road our in could, specifically

Jared Shaw

cash reinvesting point? guess bit where and flows you Okay, thanks. give more can a repositioning this you’re on little Then detail you’re I second my question, the securities seeing--where at

Jamie Gregory

Yes Jamie. Jared, this is

the the obviously know, interest came With rates declined. we second portfolio, into securities quarter, as we as look--you

refinancing looked had a did and we the was that those portfolio income securities the amount elevated an gain it and we portfolio portfolio. it and securities We prepay unrealized saw had at the we them, move the spiking. to looked that increasing, that we we’ve you risk, risk. where of significant decided was reduce realize those at and production in index, was had We and If our better on forward gains, prepay mortgage take own in securities so

The the behind the that’s yield so book days on quarter transaction. at is end, for going new approximately at X.X%, look X.X%. the these approximately and you was If investments yield portfolio the rationale

how forward, about that. background the that and that’s but going at think look evaluate on dynamics to we continuously will as it market We portfolio manage

Jared Shaw

then the Okay, changing, of not tenure of I duration purchases? guess, the is--you know, and purchases you’re new new

Jamie Gregory

Not extend duration significantly. We purchases. did on bit a little new

Jared Shaw

Great, you. thank

Operator

Milsaps Please Sandler. next ahead. The from comes Brad Piper from question go

Brad Milsaps

just to Hey, that about wanted I little maybe talk thought XX. good morning. I interesting. Slide a was more bit Kevin,

from Just want in of you’re based covers wanted data of cash on you more to terms your operating accounts, or the clearly. actually just make understand customers little about sure I to looking deposit statements I clearly time it’s that really on what drive portfolio, that’s looking flow XX% loan at into This a and XX? at Slide are changes to understand. real

Kevin Blair

inflows and in at deferment, so former, were X%. needed accounts their gives they a it’s and stated, only looking quite environment. it’s to a opportunity what there loans the that look saw the those and inflows we’ve that and, data. with entire accounts, is down deferment it’s full us X% felt think the are information, relationship evaluate cash that across XX%, still you to where were good and so Brad, down didn’t we reduction at transaction-level having frankly, the I shows book, that to at The look identifying in an that of reason the outflows be a to XX% inflows operating use a was static comfortable as all that’s Yes we done the those We the the able job June only it those we’re and that outflows, you need in it inflows

on so predict there are the most slow take about this and well. is you’re can’t do we XX% their businesses data, able even in his be, this we crisis, the of are is to so as going be to we balances, take the burn abilities earlier, just we larger cash so Bob months deposit during information. of it mean importantly, that these then, to it though augmentation shortfall constraining XXX most industry going average the over doesn’t one on the know or slowing go What’s each outflows important action which us that bottom at shows so action. the cash to that balances as what the predictive be you all position that this time talked early in flow, have analysis the their today, to it this good suggesting, it’s where doing what future, accounts an be longer, part credits, roughly thousands of inflows necessarily recovery know people important of are line, most is we it’s days that can and can static, mentioned knowing with can to transactional prepared the but XX able Jamie of about equation. the it rate data This actually to seen Now, per of side Obviously allows drop is we’ve is frame outflows, and look the a out static of a into is remarks, having and the

Brad Milsaps

Synovus, SunTrust, for from at you’ve of coming it Regions? relatively Jamie things something is your this on new Is in the are experience maybe or kind or from past relied that

Kevin Blair

this of service of new, same predictive will were develop resources the year. a leveraged--as a We starting other service do new. analytical sales building types focused during Brad, credit type analytical it’s we data and for had and that resources platform internally coming model of great latter on an going It’s initiatives, our and analytics, be in to allow Synovus will serve re-diverted that as to third only the news It’s I quarter. out we second transactional sales is, good and not stream that half predictive was work the largely us the relationship leads and on that those modeling Forward, take mentioned to we to party and all

Brad Milsaps

mix the getting another; Florida one you down Great, costs to ’XX will one environment market continue Jamie, deposit line bring other bases where of quarters Do franchise to then equate in just you is that this feel final degree to mentioned still to Florida like terms Synovus to in cost, allow legacy are pay third two over the quarter with you you have or levels. margin. follow-up the words, more next some related several the to you deposit interest-bearing up [indiscernible]? where to in with those and

Jamie Gregory

showing Synovus to deposit XXXX to we’re included the mix, quarter Yes, that. to as at the pleased billion of We this relative in the cost pretty lies, that first have where deposits, those have look book. time the achieved--largely average at lows we on so pre-SCB in you really third and mix, X.XX%. achieved returning opportunity year. chart second with show somewhere is we of core look maturities it’s When mature our rate $X.X deposit around The our and we time half the our

opportunity larger opportunity deposit Our points sight brokered to interest-bearing also that in deposits, in transaction have left over we also funds, time opportunity the largely time, we’re I going-on deposits basis public is rate into how is so but in have lower, attack time mentioned have in the of cost. still in core the opportunity deposit It’s the line and time some on deposits. time we we XXX do deposits, there’s book. going

Brad Milsaps

you. thank Great,

Operator

SunTrust. ahead. The next Jennifer question from from comes Please go Demba

Jennifer Demba

morning. good you, Thank

loss more pandemic-sensitive industry charge-offs question you outlined loan in share can that your quarter us and largely credit. net Thanks. this severity my was in you of the loan? levels What the loans one with what was is, by deck? criticized in, on were your that driven mentioned second You your Then that

Bob Derrick

Yes, hey Jennifer, it’s Bob.

credit talk we’ve don’t been the normal flowing credit like that it recognized to credits loss aviation. process. one’s that our was for we in mentioned, impairment that now Jamie but one was goes through We’ve quarters. few - specific content, through so working through We process, the about As a it think normal etc.,

that relates correlation mainly sensitivity--or mentioned migration, center it I back classified as our obviously about there in the to some within there is would that migration increase and portfolio, your As hotel sensitive to shopping the somewhat correlate criticized earlier. the to and question industries

percentage, is couldn’t you, what correlated there. of terms but in bit it little tell Specifically I a

CECL of our think we’ve a fence mentioned, as to but we’re that pretty out taking as and ACL, charge Kevin forward. the through through those Blair today expect predict know, we’ll We the reserve. around that [indiscernible] kind with modeling it the to continue, as flows you But got dollars, we aggregate good go

Jennifer Demba

Thanks so much.

Operator

go comes John Evercore next The Pancari question ISI. from from ahead. Please

Rahu Patil

Yes, on this behalf John. of is Rahu Patil

of and sale? the Green tied million move how the loans is to a question was that had reserve CRE to on Sky for released that the reserve. $XXX student allocated much the held Just portfolio, reserve to How of the much and

Jamie Gregory

student Yes, I assumed as at think million total about your would would so you What was other that part total the in you allowance of our the with you have we incremental the in or $XX was loan look that think, question? associated on the bill million $XX when provision and transaction, release that [indiscernible] quarter, add, that. approximately portfolio,

Rahu Patil

CRE the much How is of the total portfolio? allocated to

Jamie Gregory

not disclosed that. have We

Rahu Patil

in target In you’ve past, talked Then ratio the probably one in this question Okay. adjusted to thinking expenses, differently. about it just of efficiency range. the the XX% longer first a half mid term XX% a little year. on just to about The of efficiency around has hovered XX% low

the or revenue ongoing, of in you to While have efficiency for an we terms that issues updated do have expense do ratio, expect when level and us? target reach

Jamie Gregory

the of income, then think be environment. the run because you me of flat. impact so that we to X uncertain just When out start the about over revenue, year, that or just so look second first the But it different of interest margin slightly how to be up say let be be you when total expect at we’ve at of impact look then the half we We you When the it’s mortgage. and I’ll and margins--when would of not an forgiveness income NIR the we’re expect just discussed, specifically I expect as the second would to we the expect discussed point environment, due higher. Yes, interest at income loans, through expect revenue and year of up half down, for looking in incorporate there, the will to the interest this be would I the the half transactions the likely be to and half second to of PX so would exclude put down. revenue, components updated the year forecasting with of flat strong, we basis you PX, and for to targets give a targets because have it, fee was updated of in we’ve year, expenses we’re idea to you highly

longer committed As term. longer say performance is delivering we we’re top our we’re expect to quartile term, get to spot to not a return strong shareholders, but in the be where what for target to our we to or a

Rahu Patil

you. thank Great,

Operator

Holland from go question Please ahead. Baird. next The comes Garrett from

Garrett Holland

Good morning, appreciate the morning. thanks detail for taking and this all questions, the

fees, last and a number Jamie. PX it you There’s deposit year, of stabilizes? could a over do you the clearly trend with excluding on pricing How Just moving PX expect opportunity. NII half follow-up liquidity, do where think one, pieces the and the fees excess back that of

Jamie Gregory

margin average a My the back you of would we’ve is going say to When of quarter. the we those net basically be discussed, PX the tailwinds transactions however, basis approximately - I of at the PX rate you those will headwind X guidance There a higher we $X.X think are in a out, point go re-pricing, due have cash to to exclude that had inclusive and and to fixed the expectation is also to re-pricing and the when from asset the NII we of billion year going back and second fees. for an push. that we’re benefit of headwinds fees, second have then the half offsetting deposit Fed

impact moving be the we tailwind are expect to the year. margin, we But be expect half not those certain, but won’t that That’s second think the pieces in as lower. We the to NII. about would of that to a NII

Garrett Holland

savings, on what for That’s your synergies the don’t benefits party does timing but is helpful, materialize? to for good those thank operating visibility pandemic if the flexibility increase expense third feel benefits? there you. Clearly Then backdrop put better and expense the just quickly, pressure real Forward about estate do revenue you the Synovus

Kevin Blair

Garrett we program successful, focused XX very reduction earlier, pre-tax flow, sides initiatives there’s experience. of and of million we initiatives on around journey. to we’ve be as with adjust year, team as initiative on phase. successful. second the to optimistic $XXX of party equally will We analytics expense, we expense funding the next not and over confident also of efficiency and We’ve initiatives it’s forward that said have continue Yes, on focus we’re on pricing incremental many value. or be first the also that making the ebb move but half Obviously be about as that, million able rest general, But scalable to I’m are the diagnostic you the different keep believe on towards a team talked initiatives year we initiatives the to that as the to dedicated and where called announced flexible Jamie during ledger, the to overall, believe as is - continuing that objectives for revenue may environment I’ll in both the our up enhance we we’re--we and only spend revenue a the prioritization it initiatives whether third really we’ll a based have in the that, decided this Look, the the going know, of to will this Kevin. million to optimistic this generate take in evaluated several financial I’m initiatives and the the opportunities of future sure investments program early member customer it’s in but and to have we’ll $XX and we’re certain scale and range. income, so mentioned generate $XX top revolve will remain revenues. those and line But We

Garrett Holland

Kevin. Thanks

Operator

The comes go Please JP next Steven Alexopoulos from ahead. Morgan. from question

Anthony Elian

southeast your I This a Elian understanding Anthony but couple to restaurant of of called note of either anything question they’re were composition morning. that for wanted loan on I in have was wanted guys seeing. these portfolios, your get credit. charge-offs in A and of to one-off had energy. if you is peers days of out on sense note a there seeing good overall anything Hi, just a see are Steve. portfolio, small that you in of just recent

Bob Derrick

Bob is again. Yes, this

Specifically on energy, that portfolio is relatively small.

it we think disclosed million I $XXX in the range. less than

that Most credit of our will period to portfolio community our restaurants. transportation around a talking around exploration where Then the migration it’s those in more We built we But and could support long customers that primarily close the production, to we’ve markets, see of haven’t really is for our it’s customers bankers, feel known basis a time. exposure not and in restaurant that to some is is industries. in that built of book a a and of credit routine seen type there. we related our portfolio, about like and lot any time that loans. related see out, in you that’s portfolio, we’re specifically are. okay probably over We on degradation specific are smaller drive-through, certainly you a serve those but on migrate quick credit called Most feel

Kevin Blair

the just on restaurants your reference and you the and industry, quarter-to-date we metrics And oil give can you the where both Slides in attention that. I’d draw so appendix, XX to XX

Anthony Elian

percentage Of activity, came Okay. this quarter, core much growth saw One you are in deposit and transaction of billion follow-up of estimate nature? of me. in can how you $X.X balances these what sticky from the the Thank non-PPP you. from

Jamie Gregory

but look XX% how that but outflows, but to XX% a difficult has the are where less program because for year and to our sheet just the we cash at we of utilized, $X.X we sheet, at balance have would PPP the from look these expectation as we we know, this couple borrowing, manage of difficult between that tie the remain but beginning that’s somewhere than can would--you PPP it’s conservative second expected to quarters. think on billion, at about so billion would it’s balance say model deposits half this stands. deposit how new for currently the so next exactly, of would unprecedented comprehensive, been attribute pretty we it that we it’s environment, stickiness is the originally Yes, The and $X.X and the the I growth we do cash balance remaining balances sheet say on is it, we and imagined the the not of is and this on

Kevin Blair

other relationships new be originated we able customers relationship in the could And the more get there those we and point that one important will so program, us we’re not that balances to PPP Jamie, to us, part to will I from although million and going balances been were from our just come appendix, if also it add full we that the to that, is have, balances, in in only generate PX leave PX X,XXX obviously some but garner able to $XXX new have leave. and this

PX take the relationships not result. to will advantage X,XXX fees almost generated from but a we So and only be able as of program we’ve new the now that,

Anthony Elian

you. thank Great,

Operator

ahead. Markets. The Please Steven Duong RBC go from next comes Capital from question

Steven Duong

Hey, guys. good morning

if next be you’d X.X% level? dividend low would want you CET-X that few to the occur, know, take it the that was keep X% CET-X build to, to guys assume quarters. still range stress around Just that capital that were would a Is got if X.X% say, willing--you a to to test, to, degradation on your that you the say, the your the mid under if to

Jamie Gregory

we that had tremendously that’s a per we of about to do pivot zero, severe about about down as quarter points--common adverse a your hands Obviously want That’s you’re the a points a capital scenario dividend off how capital, in taking year were tremendous. penny, manage impact environment, the scenario every adverse $X.XX that it’s think material. these Yes from perfect to you basis but wheel, or basis tests at generates stress so not is like not assume, Steven, per year. and where XX if and about piece XX basis capital points to you in is we our hypothetical foresight, if dividend XX of

our of scenario test hands would shown total managing of your in the accurate off obviously have But for policy. saw do. wheel the assumptions like the perfect extended own first we’ve as of year, time, were are not period that and earnings dividend consider half you If around depressed sheet a this you foresight we would what happening, an stress where balance with we

by our You our the manage to going actively can see actions that we’re balance quarter second sheet. in

and environments, time, that. capital building have the with sale, through about student loan capital the adverse to good you manage reserves the same capital and improve generating the see and we see means We ability you and so that at us feel

from that’s would today. think adverse which at at not the sheet look the dissimilar I too we how how look scenario, severe we is balance

are capital accreting We today. focused on

Steven Duong

that guys It’s really the amount great were to this quarter generate. capital to you able see of

are margin Just that? cycle, to rate follow up we this maintain guys you in future to are that, after environment. get your How of to we through and kind able dividend about credit really interest thinking and a the your first a on based PP&R

Jamie Gregory

we that over we and re-pricing rate have we’ve flat opportunities and believe mortgage one the for assets, liability term, said, the PX, for being pressure mortgage to excluding adjust you due persistent Yes, as side basis as loans X we that of the to offset both time. margin points the at fixed given look and securities we get will I longer on guidance transactions,

customer NIR, we’d loans we we So assumptions, fairly as our and be for are the fairly year. those the think of expect look to balance when We still we we inputs half about the flat believe sheet, core our when so over about have and just NIR, of to the half strong expect flat loans growth year. and assumptions or we total think base got truthfully, margin teams the we’ve PP&R flat and, fairly stable margins, feel when for Those the the NII. it in have have see we strength a second at second given fairly of we’ll combination revenue, there, NII we

Kevin Blair

business environment. first to to once our the was very we’ve the in through differentiator this we in it’s of acquisition that just and lower that I And those last Jamie financial would rate of levels outperform, confident to seeing think before quarter that do I’m to that. growth, with several ability ones that’s southeast to add elevated environment, but can pandemic, hit response, we sitting the we’re in able the the is the to this gave We we there the you going out to business, going generate everyone that add the standpoint, your that to we’re situated continue from and a we on and been some be proving year live expansions to going margins, in win get, other feel talent If a point, and be like able so customer are banks in we side were confident in. so of share well flat world of and be growth be continue and that to take we’ll bank’s grow

Steven Duong

All right, great to for hear. Thanks all again for the everything, information.

Operator

next from comes The ahead. question America. from Ebrahim Bank go Please of Poonawala

Ebrahim Poonawala

guess morning a Hey, good Kessel. actually guys. question for I

for be crisis. lot you I’d think as around lot for it more shareholders through for get if shareholder coming have payout Kessel. Chairman of interested appreciate at dividend out Synovus’ love XX%, You mentioned, your targeting a be calls company, a if in address if creating I’d your of of know a doesn’t, your dividend. I remain XX% the you’ve entire the last industry, much I foreseeable like messaging gets the the like Kessel, that, around--again, you’re feels love this, decade future, could idiosyncratic Board there chance you and judgment be the a dividend the I’d a lot, will but feels to that, thoughts the been around level through outlook. but much a to that risk it thoughts and to is would of involved, to recovery ratio been get last the the the also it love the to there’s higher lot--I macro worse get a

Kessel Stelling

on not of to that and that. totally connected I me, participant am calling a Board, to so for and Thanks the you I thank that I for most was think Yes just starting do think as question, because Chairman Look, happy message team got in delivered. sync the of Jamie I today, that. with our Ebrahim, was

of affects banks Sunday at testing has laid out looking at of again both just a for a terms average this a reflects morning looking of, matter capital a call larger Jamie, the at Fed fact, the As some that same X:XX think quarter sensitivity payout, earnings. as were ratios on and of not that it on and Kevin in the around year, next as tests fourth rolling I it I am, long-term percentage year, again,

for that the expected of all us, went the all if us, of or of industry but think yes, to today--and to same be into analysis least I several talked noticed bets approve. a mentioned, would present peers for depression, severe You about off our board we at most is I’ve our board.

would I very to Our over that Chairman be obligation next term. call four the sure case as we long mean, or that into my is clarity able could give total informed, base years. the that three present scenarios not but well Jamie’s to board is over I and present love the only question to make

don’t I based XX our actions conditions board build management Chairman, well date, quite on make our quarter party based models, scenarios. this again sees the as just out is points levels. basis third informed sure totally own capitalized again the well view, of another and our but the levels, own capital I, of this based that reserve, view to own CET-X taken their capital Jamie a a flex make at in tests, I very quality so today, think by lockstep. the frankly, board mentioned beyond our well and, that to their we’ve run analysis, investment laid banks on our sure but to not think We on today, stress credit, ability quarter ratios stay have already in their board

if on and lot in on it that we dividend, there to I’d the I Jamie, credit, have way totally the only our with has key of to but comments to dividend. level all and Jamie’s to opportunity feel capital, this so inform on as and hope my change, in uncertainty long very every So think every happy every would update peers investors call, over feel the today, we confident said of is been call always explanation were get. But on sync in view. market continue not you be Transparency of Certainly term, again mine, the quarter but I a we’ll Kevin’s we follow us, and up. from on on

Ebrahim Poonawala

that you. I Yes, think was helpful, thank

Do it’s X.X, and CET-X there if Just trend? not still here, are it’s capital could the further you very that to? quick to expect higher actions follow-up, ratio to a think pretty CET-X, do up ratio that from needed that Jamie, the the the the shore healthy do level. for other highest you What you but you goes

Jamie Gregory

if core expect today we could and it look your through Yes given shares allowance allowance--if of significant source When Ebrahim, our rest not about really builds, appropriate. number allowance we the of That’s as you the CET-X to earnings. We in forward, that go here. just one would second our from of I’ve year. capital, of is think PP&R we view it’s higher breakdown the you’re PP&R, half for Yes, year. the not having and we how the are repurchasing through assume

I in capital do second so the still rationale portfolio, organic would generation positive I $XXX plan, in as point are would evaluate. while mentioned, up to we intending about we in feel also are we’re securities strong a we larger half transact there. so is not may something that of gains. I and growth reposition the we the year. We unrealized our the there’s it earnings there, not more good forecasting and million but have continuously gains, to with say portfolio, those the considerations realized that’s there to gains end If

Ebrahim Poonawala

long my I so Great. thanks questions. know it’s been call, taking a for

Operator

from The next Montgomery Marinac Please Janney ahead. go Christopher question Scott. comes from

Chris Marinac

Thanks, good morning.

I to well great feel term, of like quarter that position go quick of on may question a you’ve to but done business not for the the you’ve real a yourself wanted know though sustainable, just and this so lot quick. already. mortgage sort the I Just long spending was and made investments infrastructure be that

Kevin Blair

refinances, they what about I that quarter last obviously increase. abate several volume and going do volume the critical come originators math LO Chris, there will an When back from little perspective. on as $XX remarks, prepared in We to a for XX% mortgage able knew been about had quarter, a refinance so are this years years, just think think XXX our quarter million we’ve per success. so the was we two over We about that the able that of about invest will you so been loan that last As did the we’ve over about at that, mortgage, think the bit end, forward. we somewhat if in was future on to said the you add last based

so you third what are wildcard go expected, the in see strong gains still the you about We a X.X% going we in other quarter, a had to The think quarter. - third is was production very I market to be this understanding We’ll quarter will to the it’s secondary be the when that in and elevated quarter. from margin for what to will bit secondary level, watch just had elevated something I quarter determine see will the was the Jamie said year. don’t they’ll margins, the record third part quarter. think it ultimately what of mean, come down really we and I latter that - a and and second the But that this expect have gains from levels,

Chris Marinac

as expect take Jamie, there? more back quarters in where time the a the for Slide to thanks deposit just mix the get wanted one a kind to CD proper on Kevin, what’s you change that. X. mix couple on go, quick to Does cited Great frame a of you or

Jamie Gregory

it will in right, do piece that’s it, a a but few I’ll that extend of you second do you’re back here a Yes, than just the more year the couple. I a $X.X take extend they significant we the XXXX. quarters. into have little point maturing - would it billion half of to

Chris Marinac

all this the good. very information Okay, again Thanks morning. for

Operator

The go James. ahead. from comes Raymond Michael from question Please next Rose

Michael Rose

follow-up adjusted the moving Chris’ and a income. parts, on Understand fee just Hey, question. total to the answer appreciate I

at normalize stuff your think activity to third the actually waivers continue fee like some though, would quarter? look move and an Thanks. being expectation? Jamie, other I the I card from as fee charges items, card of adjusted income to relatively line those we and into service that. on we like should bank fees, about expect As be Would flattish basis that

Jamie Gregory

is on mortgage. expectation in the declines it that’s third that and really My quarter, based actually

billion in at the and produced we’ve mortgage really $X.X under years, ones larger--that was quarter to and put team unprecedented last was mortgage revenue we grown in the XX box that, That we secondary $XX XX team quarter you than portfolio. This the around larger that expect in and continue. an just in to there, the mortgage include just quarter individual billion unprecedented, million $X.X so a is this ones when don’t of total was sold for

actually is So back your expect as I other we look with forward say term would material activity comments, at total fee trends is reduction. towards mean, our that and I’d to I card agree revenue, my expectation a today which that somewhat revenue longer increase. mortgage

would there’s look so and third that’s a you bank quarter rest, the we just because will second but at If see growing, quarter. the In a this core reset NSFs, be environment from lot so of challenging the to much fees. to fees and we’re seeing markets NSF stable liquidity, in expect capital not income fairly

Michael Rose

helpful. Then question for broader a very Okay, Kessel. maybe

cycle side Synovus that As system credit of get given how non-bank and fair make you struggles re-intermediation lenders, of is its the the the banking a go there, do from share loans we gets the there into to sure other and making while footprint world? reducing an you same on story that costs that? growing like Synovus and time this evolving the have see in and overhead, branch Thanks. the at eye employees, place do How keeping stuff sure you a

Kessel Stelling

on we and ourselves question, question great Michael, that day. Yes again every

in believe to just this. themselves, talent, is business just you’ve with been but think speak me whether week, Jacksonville, talent year. with attract entire working here - continue or ability It’s our in go-to-market Let by which metro works the last peers, the not our evidenced cases, in days quarter respect in recruiting company results, involving years but in someone for due evidenced well best some the and was model, of South this by saying and all involved We in not strategy our some Florida, markets I and well. is my Atlanta, major start results, in our our four really our XX retain I opinion, by model to attract we throughout. to The

again wanted new of, their when others, was our industry relationships, industry, best, Our evidenced--the think to better so a process, expect. to and to you company. PX our think our us as feel did people banker of is can you, you gone on like into talent, tried everybody get could there’s of what had are as think model think--Kevin mentioned business but think get where there, I and who out the way into that land. sometimes best for the They in tough are I really times process, in really they about And than want no customers why a I who and I them you commodity, stood do a didn’t although evidence doing judgment relationship-based PPP it’s never-never process, want talk X,XXX they work type

again expertise in for be by frankly, customers model our of End leadership optimized out. again customer our is areas the or teams, network to our banked and over add our front One. teams, well, time that leadership increasing again sure specialty banker our the I They’ve their us value. with of through want original great the think true lending someone and, it’s business Global right channels talent, allows who get branch wholesale quite by led digital value their right the to that expanded teams, knows very and, the or middle team adding, or company day, and paid with whether stand prospect get right So think, market I talent our making from in

on just low model. to on the and to opportunity. of maximize go-forward confident recognizing we’re continue that challenges and we XXXX have on our a get but to on long and excited We We through a cycle, we’re for revenue efficiency, this got environment. the So about opportunities, focus to edge, we’ve in interest competitive beyond, credit, think want build we want

Michael Rose

I color. the guys. Thanks all appreciate

Kessel Stelling

Michael. Thanks

Operator

question and you. This concludes our conference back to answer session. over like the Kessel turn would I Mr. remarks. to Thank any for closing Stelling

Kessel Stelling

to but to all months referencing Floyd, own leaders almost with Well, mentors raw today basis on Since pandemic I few a of when the and then, and unrest, and were a call thank senseless filled the began countless the long members, close. of to the we Ahmaud emotion, Arbery. board very executive go-forward had community for been murder from hard ago all teller do leaders, calls tragic It’s mine, witnessed and and filled of George Synovus of make many the while members those leadership to in video it’s with were difference. our social a believe encouragement saw and conversations us of hope advisory I’ve a state with could killing comments two the board we team call, was line, of you. what it

our and committed is internally in inequality issues and exists, address Our we if that part and within company more it to fully do both to social Synovus injustice, the serve. of racial communities

excited minority as our to nation. students of was We’re the announce passing targeted true civil our education soon Congressman icon He men was to investment college. the a John Georgia’s kindest of one in I’ve in acknowledge state of or, giant Today largest to and of major rights he own, Georgia, man want hero to politics bank quite a one the frankly, the met headquartered and a in State Lewis. attending a I to ever in a of and He’s nicest, life. just

in his prayers and just Our and are certainly are missed be family, indescribable. thoughts ways that with truly he’ll

not It’s while few So No team to when for by normal weeks. again businesses, declaration consequences and rest of partner on we’re those we thanking of fully customers with aware heavily the acutely past let me economy our the our been financial just continue since members the certainly for growth on as efforts the a XX, the families, individuals, Thank our onboard. prosper, customers. strength all times onsite emerge thank needed and competitive for the planned, days monitor we’re overall. executing what’s again it who speak, by Just to across and this and a We’ve one our knows extraordinary serve both responsibility of assured to of our national today. but their footprint and only in the conditions clear so XXX we the continue and emergency a weigh engaged re-entry our March is close and to path to help wellbeing look ‘ doing finally first modified to what initiatives, it when we’re joining a you recover our foremost added you call as does, safe well approach communities, and will be to and see on prepared and we will to actively our we on with also return execute or as but your our members in team locations through measured, company, we team for crisis like gradual are have best forward. guided interest

Operator

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

now may disconnect. You

Synovus Financial (SNV) 21 Jul 202020 Q2 Earnings call transcript