PEBO - Earnings call transcript Q4 2024

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Operator

Good morning, and welcome to Peoples Bancorp Inc.'s conference call. My name is Nick, and I will be your conference facilitator.

Today's call will cover a discussion of the results of operations for the quarter and fiscal year ended December 31, 2024. [Operator Instructions] This call is also being recorded.

If you object to the recording, please disconnect at this time.

commentary statements call performance regarding events. that or contain or advised forward-looking other Peoples' be in will this projections future Please future financial statements current These on expectations. based are management's historical this which involve in number and and Peoples' risks detailed of forward-looking Exchange statements The Commission's a are not filings. statements fact, call, and in Securities uncertainties are and of call reasonable assumptions on believes forward-looking their of Management knowledge based the statements are made operations. Peoples' business the during bounds this within

may this differ disclaims required results from as However, these update Peoples it actual legal is be statements. materially any these forward-looking possible requirements. may applicable by forward-looking call, to responsibility statements after except

will is Investor this XXXX this included call the of XX financial the Relations. facilitate. section be end earnings Relations presentation Earnings Quarter prepared of or measures earnings archived and non-generally minutes were accepted Fourth I the at on accounting peoplesbancorp.com morning conference financial this available This available year. issued are the will comparable during principles measures discussed call directly Investor for GAAP followed of a under A webcast People's and which GAAP question-and-answer to reconciliation include An X release of peoplesbancorp.com will period, most about the call commentary, by in call release. at

opening Bailey, following Financial and questions Treasurer, Officer Participants in will your Mr. today's Officer; available conference. call will may be begin for Tyler Chief Executive and and Wilcox, President Wilcox, and Katie Chief be you each statements.

Tyler Wilcox

today. and Thank you, for Good thank joining you call everyone, morning, Nick. our

of full was earnings $X.XX fourth $X.XX the was diluted and quarter Our XXXX. year per share for

takeaways. to want we As at look I note some XXXX, key

to interest in to our net X% outperform X.XX%. grew industry XX%. interest XXXX, at net margin income improved income Fee-based compared most Our our and continued

Our efficiency stood XX%. at ratio

per XX% share $XX.XX [ value to $XX.XX. improved per grew to our share ] book tangible X% value Our and book

grew Industrial our relative Real Estate portfolio in had portfolio. mix We to Loan and a of Commercial the Commercial our Loans as favorable shift our

our and Commercial XX% growing Estate Our declined increased of Loans portfolio, as $XXX to XX% to to Commercial million, Real XXXX. XX% Loans Industrial from XXXX from XX% from

to loan-to-deposit XX, December Our XX% XX% declined at XXXX. compared to ratio

Our criticized Commercial compared stability at portfolio. loans capital XX% total year-end the to our demonstrating XX% of risk-based for XXXX, to Loan improved of our

deposit had million We or compared of balance XXXX. X% growth $XXX to

to to $X.XX $X.XX Our and were X.XX% compared ratio we diluted tangible X.XX% to consensus year-end equity full quarter fourth beat tangible to for for XXXX. the of at XXXX assets estimates, continue and EPS year the improved which for

total overall was our for quality as allowance losses far at X% credit credit our year-end, As of loans.

Our provision which for fourth quarter. credit was reserves for in the analyzed individually we fourth losses a reduction by charge-offs as for offset loan declined partially the quarter, had

the by annualized basis to for charge-offs, the points driven basis quarterly of the rate. charge-off leasing Our quarter compared points points quarter. net was comprised XX which our This was for rate XX linked basis XX

For charge-off was points the basis points XX full basis year, net compared to XXXX. rate XX for our

XXXX. business the XX Leasing basis rate of Our points annual for drove

strategies quarter. ticket quarter. small quarters guidance the previous drove fourth of guided charge-offs peak an our to charge-off the We of during which the aggressive into credits brought approach forward higher as quarter, these charge-offs took fourth rates an net the collection with last some the in anticipated in We charge-offs have X fourth business, leasing elevated provided in the the and regarding quarter these

anticipate are gradual charge-off a improvements expected towards the quarter our to of X% fourth expected, While we decline from peak rate X%.

rate X-year charge-off rate, for net X.X% small our X.X%. on leasing net charge-off to around [ the current reduced our established was To the ownership. prior Historical the from average the small previous over had prior rate charge-offs on impact provide quarters, of period many during leasing which within for credits to some We to these ticket credit ticket went losses around provision net quarter. X.X% ] XXXX historical of the and to during reserves our fourth perspective portfolio the

yields Going charge-offs continues X% strategy between X% and in XX% origination forward, be, with to range. the XX% our to with net seek to this business

made We levels. expect that origination credit historical in average to returning the us and are net adjustments we have the charge-off focus

For more small information on refer ticket leasing accompanying please business, our our slides. to

X.XX% asset and accounts that expected assets proceeds million which declined non-performing at a from the the non-performing third Classified we we canceled on for similar fourth our due quarter, range in were levels were quarter. call had the in policies. $XX loans year-end. year-end. cleared accounts We up assets and administrative back at of at Our relatively and were during those to premium quarter, and finance normal The our of last noted end past were awaiting carriers levels total lease of majority Criticized

to as considered at Our portfolio compared our year-end loan current XX.X% delinquency portion improved of compared XX. to XX.X% the link-quarter-end, the was September at

concentrations, portfolio quarter. no material fourth loan our changes during the to relates had it we As

commercial was Loan Our exposure at XX% XXX% Commercial our risk-based and to billion total our capital. $X.X total in investment of of year-end real declined estate portfolio

our of to metropolitan experienced We growth average or household markets. of of growth annualized quality total X% areas Collectively, to focused portfolio at growth of are X.XX%, rental with areas core multifamily be million income growth loans pleased job metropolitan our year-end. X.X% median of X.XX%. and These on rate $XXX continue declined these metrics, population are X.X%, that loans which within

in specific comprised We development, at balances including continue concentrations, X.X% loan X.X% which office at and exposure lending hospitality at X.X%. land year-end, minimal have total of to

quarter. growth during loan far fourth annualized as As balances, X% we had loan the

up million quarter $XX Commercial end. our were Industrial loans real to compared ] estate while Our $XX were up Loans residential over million, the linked and [

was result which real balances declined estate payoffs within and growth. the $XX which million, sales the commercial outpaced Our of -- new loan portfolio

originations declined business. $XX our with at quarter, balances ticket the small due lease in lower million Our charge-offs coupled to during leasing

call of Nearly end, XX% which turn our were rate At with our over loans. owner-occupied a our I fixed loans the quarter the remaining of rate. of were for variable estate investment to total comprised loans year-end, were XX% performance. discussion remainder Katie total a At while XX% will at XX% financial commercial the real estate. real now of

Kathryn Bailey

Thanks, Tyler.

and quarter, declined X.XX% quarter For to Net net was by net the the lower was quarter. and driven accretion interest the interest and driven $X.X margin points basis in income to for income. accretion the million to linked compared by X% XX to X.XX% interest fourth for lower margin which margin was the compared basis compression fourth totaled compared The third $X.X linked million income, quarter. points for added XX quarter

quarters, the expansion of margin core basis net fourth third excluding On interest impact points. we the basis, had accretion a of X to and

During of costs the basis the lower reduce points, deposit by we as our on all were fourth to quarter. quarter, saw during categories rates our able interest-bearing we deposit X

paid borrowing We in our costs. reduction from our the fully also the borrowing Bank off to short-term Funding contributed Term which Program,

income increased full the interest interest declined net year, net and X% margin points. basis For XX while

As the loans we have of mentioned occurring to interest cost timing our previously, to compared was our repricing increases due net decline to margin higher slower deposit XXXX mostly our of rates. the in than

generally we are risk interest neutral position. a rate an perspective, in From

profile income changes to and net Our interest is insensitive rates. in interest is relatively robust

in million This was by We income. quarter. loan which had mortgage was Moving our fees declines higher banking commercial linked by to nearly and driven to fee-based growth partially were swap X% increase offset on income. $X the compared of up

income full the and and grew of and as year, the Limestone well full XX% the For was improved fee-based impact of result insurance investment the trust income, lease, as year merger.

based owned real fourth $X.X assets. loss property estate we property, which a other on received on an value. million recognized is appraisal During in recognized our regarding non-performing loss recent a quarter, is included the the This

quarter. relates this to increase expenses quarter. the increase an due was had majority higher expenses, corporate recognized of expense with it X% our we compared reductions in expenses, other As to The to non-core net interest in coupled linked of non-interest last

as the operating full XXXX. experienced up higher year, from partially footprint was was non-interest For expenses offset acquisition-related X%, lower the during additional from Limestone expense by which costs we

compared ratio was reported linked For the XX.X% quarter. quarter, our XX.X% was for and fourth the efficiency up to

net linked was fee-based Our by efficiency outpaced interest resulting to higher lower income quarter. the improvement and for quarter in ratio compared non-interest increased the in income expense the

for improvement XX.X% lower year, XXXX. XX% full in ratio the to to acquisition-related For costs efficiency an our was reported due XXXX compared

at Looking year-end. sheet at balance our

end investment portfolio our ratio and compared longer investments locked the at loan-to-deposit flat was in securities. We we in yields held-to-maturity our the as to quarter stood XX% and quarter, for linked Our during growth both duration those had into higher some putting periods.

quarter, growth our our in we the compared during million were deposits XX. As to noted up which September $XXX had accompanying in slides,

deposits considerably, also governmental Our interest-bearing September At XX. deposits increased. declined to compared accounts same our transaction the grew our noninterest-bearing time, while

first are deposits seasonally have quarter we As previously, of year. higher and the third noted each during these

our quarter linked the as to compared brokered grew also of while CDs strategy. increased part CDs retail Our end, our funding

view available we additional brokered before, in as funding been source rate recent than FHLB at mentioned a [indiscernible] have lower CDs and periods. an we they As have

We fourth expect as deposit cost for continue our the decline quarter. they did to to

CD at compared X.XX% year-end XXXX. were between and at Our specials XXXX around X.XX% year-end to X%

fourth of over XXXX Fed While period. X.XX% through X.X% from XXXX, only deposit quarter time our same the funds the increased rate the year-end rates increased

as at quarter linked a percent deposits and end. quarter were total deposits XX% were of the consistent Our with demand end

and deposit deposit XX% total deposits in of linked noninterest-bearing composition balances, the quarter for our quarter deposits end end. year-end, XX% in commercial included XX% XX% deposit Our small to which grew at retail businesses, compared to At balances. was

was Our around average our relationship deposit client $XX,XXX median at retail end, $X,XXX. was while quarter

outpacing of our linked capital from earnings quarter our capital to dividends. and on compared improved Most benefited to the position. Moving ratios

to Our due comprehensive and tangible available-for-sale declined in X.X% X% at to securities. increases the assets related to other XX accumulated our to investment our equity ratio compared losses tangible -- September was

and and book value X% XX, compared value XXXX. book to improve Our December tangible up to continue and XX%, respectively, were

a yield X.XX%. continue our high to a capital dividend managing return levels, While shareholders with yield current we to provide our of of

closing Finally, to over Tyler the call I will for his comments. turn

Tyler Wilcox

Katie. you, Thank

of we to achievements our move into XXXX. I'd XXXX, like reflect during some on As

We meaningful activities as and our to through publications, are our recognized top continue and competitiveness We within to presence us key market and to our ways, markets. donations, in including to top many programs. talent. contributed by employer volunteering retain a attract These scholarship allowing be our communities

We Administration continue surpass the banks assets. investments were Small We billion to in X(a) approved the of being made Business to in in to have as nationally the $XX loans. leverage top XX% prepare recognized we

for expenses. our are full excludes of non-core XXXX, year We guidance reiterating which the

to We leverage for to operating have XXXX expect positive compared XXXX.

XXXX. in to to have improvement our return assets for XXXX average We on compared expect

during Assuming stabilization of an in between an anticipate spread additional our X% the of Reserve XX-point rates in we XX a over year, months additional -- the -- and Federal margin X XXXX X.X%. the interest reduction first from basis assuming net basis point

or X X interest In our points projections XXXX. high in rates in income point for will fee-based to single-digit XXXX, percentages each in net basis our basis of believe compared growth reduction to nominal XX We to a mid- results margin. be the impact

We for expenses we recognized during be to similar expect quarterly to the between due the $XX quarterly be will expense each annual year. anticipate our growth first XXXX. XXXX. third to to second, noninterest being with and the credit for and compared We of and $XX XXXX loan our first between the X% XXXX XXXX million believe rate quarter to provision fourth We for million run of quarters higher quarter X% typically total be of losses

XXXX. for charge-off of rate the we of modestly to the also net experienced XXXX year our be expect rate than for full the lower We year full

call call our you. Katie into back Tyler Q&A commentary, joining concludes questions. Financial is for the Bailey, turn and Officer. the is me Once call Chief open session the facilitator. I our hands now This the will and will again, we Wilcox, our Thank for of this

Operator

And Instructions] first come Brendan Nosal Hovde our with today [Operator question from will Group.

Brendan Nosal

end Maybe there earlier would growth. was or the just dragged average start driver end number but it and seemed average? quarter for quarter. was healthy, like of what the in curious, timing off that between there were average the quite be that of payoffs Any helpful. I divergence curious, to I a bit. loan kind down on period mean down kind of the the was the the of period just is color I'm just was

Tyler Wilcox

what I Brendan, your you're that is just question, the to understand of asking? kind relative first Or... so X quarters,

Brendan Nosal

the of I average up for they the mean, or X% annualized whereas look couple guess if X% was quarter, annualized were a I of I end for at quarter. period down percent loans,

Tyler Wilcox

Yes. it. Got

-- I portfolios I of a and think borrowers it across our timing just December, was done getting deals was all our in production continues as well. December mostly would timing demand to a of issue. lot say strong be their But

Brendan Nosal

that I base. curious base kind deposit think maybe that deposit of points But how that own much to turning others. beta you get for basis long Then that Great. more squeeze retail-oriented and on out to the timing you out kind to a of get more to your you Fed the of it takes guys base of on XXX pricing? just more the have than of

Kathryn Bailey

I the ahead in so cutting Yes. quarter we'll little continue cycle a of first mean, fourth through think the the into I been and and quarter. to we we are in even no if started September, it actively cuts the do managing have of quarter, experienced first rate the Fed

Brendan Nosal

last Perfect. for me. one Maybe one

leasing quality, asset of outside I outside and, on broadly solid. I numbers really, the especially Just mean, book. of guess, leasing look really

you're what seeing broadly So and on more just credit I'm both commercial consumer trends? curious

Tyler Wilcox

quality assets A the for of asset overall, X classified basis a is reduction strong. we incredibly to The said delinquency thoughts. agree year Brendan. percentage book of in saw full rates as question, commercial We the couple positive saw the kind norms The portfolio the you. that points in last we down. nonperforming kind a with Yes. of and And of Thanks contribution trend. charge-offs. capital our was -- XX% as quarter, the is for of I criticized of the

We monitoring to credit of the both standpoint. a our and loan that quality of credit portfolio kind the continue of expect because diversity the execution of quality from

also charge-offs charge-off a Consumer, value we've trend elevated seen of in portfolio slightly from indirect each being from year X-month And from incidence an kind and the the then this We've decline individual of in of charge-off. of -- Consumer about in there a talked and rate.

So those we fourth into And as about markets, profile rate indirect charge-off XX in deposits just the portfolio. overall deploying quarter low-cost the is the down came basis borrowing points Commercial generally, on the mentioned. quality side

overall so degree portfolio. the of a we high feel And confidence in

Operator

today Switzer question come KBW. from will next your Tim And with

Timothy Switzer

of have are a My you of you first all is question that remind on Or loans longer set some that the that is -- lag? does us, Can XX% rate. guys quarterly? with repricing of bit variable a

Kathryn Bailey

Most of is quarterly the that portion than it it of and very with monthly a -- small monthly. later is majority a portion

Timothy Switzer

And CDs of course great know over great. shorter-term offsetting Okay. particularly you then pretty what are given on you maturing side? I That's you can that, your have deposit are neutral, sources funding are, review some that like year... guys the the the

Kathryn Bailey

I'd book -- say call, we the and I'd our say, pretty speaking. less months, Well, FHLB. we source use Brokered retail generally overnight Right. is relatively in X a generally year. again But primary nature, our again, then than CD short short, X, deposits, as And X, through [indiscernible] the stated sources funding those. tenures, in

Timothy Switzer

with different deposit at all like some expectations have Okay, response your a expect about to could talking up I got come bit? little change how across maybe already, And you sources there? you. been [indiscernible] And that provide you guys bit you Fed but details on have the you customer do fairly lowering broadly rate to rates

Kathryn Bailey

all the I lowering gotten just CD some out based But that the in repricing of quarterly seeing it. haven't we and our mean, ahead rate started you it as we've it prices think quite item term been of we're again, with we've on I saw step line we last the I still results. of growth of in -- those. mean And Fed, a were special Yes. little

a seen We perspective. haven't from customer a big reaction attrition

think serve. I the that it keeping fairly within still we're markets competitive we

Tyler Wilcox

example, yes, healthy largely focused saw in we're growth, although some we commercial. retail for And there,

as how are in the well, terms of for reacting. keeping speak the kind competition so clients up So up results keeping themselves the with of

Timothy Switzer

question of in borrowers a but early of Has even a And different it of at will yesterday. of from a last where tariffs bullish. little the kind seeing in in for bit this, and your impact macro you like industries the be for any some me, they're sense. outlook it maybe way? more puts the takes might that impacted and Okay. C&I certain loan Yes, with administration other little that your rates where occurring go. change makes There's the the and result lot caution in pipeline any direction all? Or on Are

Tyler Wilcox

would as are if say, clients that you some may C&I-focused you was our generally a data, -- certainly would are certainly and few days. I I of and collectively the it spike high what in optimism. by business throughout there our degree impacted And some in have takes. reflected say, Yes. puts overall, the believe I we tariffs. some clients that's huge We from with kind look optimism at be national the But markets. is small there there's I of last think hearing business a index tracks of

optimism I phrase And how it. so is would cautious

Operator

Your next come question will Terry Stephens. McEvoy with today from

Terence McEvoy

couple that expense? Maybe you closed questions just to ago, almost a the quarter. of see I you much small I pop press, on outlook? over quarter? in And Limestone expand is XXXX how consideration in just start were in then into Could called And the curious out from acquisition-related the those was fees, with taken the swap X years mean, which up. just the your that

Kathryn Bailey

Yes.

the then legal million the cost, related acquisition. loan Limestone inherited the So in quarter, that relates quarter. that for settlement that anticipated to compared swap represents fees, the third commercial about it is as about a as And of relates the to it to with acquisition a $XXX,XXX was lawsuit we the that contingency $X.X to

land like necessarily quarter in would but customer around somewhere be that to in think million the Again, $X other don't each seen might say the that's at range, we XXXX spikes times. year demand, all anticipate I and we've -- that that. we

Terence McEvoy

quarterly could headwind do you C&I portfolio specific or markets in the Any expect And was continue then down a that whats manage see. the growth kind just North nice paydowns Star? follow-up, Will the you from -- leasing contributed to of or CRE industries to growth? then to XXXX? the you maybe And

Tyler Wilcox

Yes.

take Let those sequentially. me

the like. all C&I growth, area no broad-based of is I that we particular on what kind So which out, stands would it say across markets our was and of

was -- these compound i question second slow, -- Your am questions Terry.

Terence McEvoy

runoff The CRE paydowns leasing? of and

Tyler Wilcox

we kind Obviously, dive maturing that. million of of So CRE a done CRE about we've paydowns, into XXXX. deep in have $XXX

strong. sales by As financing, has than on been previous has activity by driven we But this is sales. the calls, the in, that quality a look it testament demand it's year investors sales we're the paydown And high particularly of markets also just purchase, but think about to been multifamily previously, that to very the particularly projects. talked I not heavier as as permanent market those

your question about small Star then me, or remind ticket excuse North what, leasing was me? leasing -- And

Terence McEvoy

Will you in you've I manage fourth to shrinking it we believe quarter. talked the continue portfolio. some down and the past, did see runoff in about that

Tyler Wilcox

Yes. At will likely about year-end, and that stood million, that decline notwithstanding. at $XXX

a little color up We of worst expect bit. originations is we give just us. Yes. that on And behind you to a pick bit overall, little the to believe

As do. there's still up to we some portfolio, work the clean

returning high, that not back look year we're just X% closer from we under but we X.X% -- from low a to X% to over went net too charge-off probably charge-offs. ramp X% over down historical is the over perspective, for So and to too clarity, X% was

portfolio continue on of will hope will pick little up. originations, we that that size, So while a pressure bit

Operator

Raymond will James. Tamayo from Your Daniel question with next come today

Daniel Tamayo

neutral way kind you payoffs if sheet repricing more be well? kind [ you're balance range a talked on maybe and how to Or this just of Katie, guidance, X.XX% think given already, deposit sensitivity goalposts? a by the it of thinking those down it the perhaps. have seems specifically, little in thinking X% curious budgeting like of will kind is of and it Curious fit there like the but driven betas of about that guys the on about that's were ] You bit just margin you the how process. as And goalpost the if so, about

Kathryn Bailey

Yes.

would around $XXX historically to as been the it proceed somewhere full XX million, ] within has as year, past, a moving million the on anticipate $XXX basis that quarter the points, getting somewhere that that -- does to range us. be in year. year, the we've [ guided closer income we range And include XX down probably clear, of we through just accretion for staying half to So to first the just the for and slightly as

will have And reduction that we the -- again, We said, to is do cost deposit that half the to point, see to is we proceed no of through first we we price quarter, the the first some -- expect slow are of said the to some call, insight we that your us, the in there as I into as betas. deposit continue for those cuts or reminder, as rate if -- rates. think were Fed year. were Again, in we even a as and we raise in

loan So a you're -- little some to bit a of it's lag over done seeing of has pricing the that what the cycle.

-- slower track So than on down, it's when were started guess, the still to Fed cutting. we because but -- just rising, back we're I come

Daniel Tamayo

then maybe credit. And of kind on high-level Got it. thought just

where You to been. bullish relative sounded pretty you've

think You've leasing think moved the the I the tail beyond if kind credit that and say had biggest typical a that being Or on and guidance is just risk a of you the Consumer XXXX it's perspective? you it leasing cleaned portfolio? portfolios? you kind Commercial there's from of focused book in now to got to mean on Is longer more area one up.

Tyler Wilcox

Yes.

more That a bit small-ticket-leasing I the think is that's particularly vulnerable. do. has one the we more probably rates because increase from a -- that and that a credit are of little what concentration start-ups little a on it inflation for perspective, the and in depends in businesses bit catalysts Danny, -- of saw

have kind point. year, one we at one consistent, you up, and down, this stable, few but that's downs expect and think criticized as and And the quarter of this on will ups classified. I the relatively and kind what Look, always of quarter saw we

losses. that expected notwithstanding the more have high-quality towards overall, in confidence the a leasing think is ramps just I So And ticket I it degree loan credit overall of diversified realistically portfolio. small portfolio. a high down the it's

Operator

And Race will from Sandler. your next today question Nathan Piper with come

Nathan Race

context kind Question forward yields of the just going guidance provided the going the you of on within forward. trajectory loan for

Assuming the least quarter on hold over next or X. at Fed's the

are in new of perhaps Just days? curious on pricing, these guys seeing terms what a average on you weighted loan basis

Tyler Wilcox

ended year a lower. leases. there our at I Specialty loans is the On get the portfolio, number up X.XX% the little including average. for our sure and a -- we year make basis, bit has the Consumer Commercial that yield about right, And across little a been at bit X.XX% full and blended Yes. entire positive Finance businesses drive higher

yields are there. So with consistency competition comport but strong, kind following the And or that we we expect to remain terms not goes don't for think of our it rates I see into business. also you'll when expectations any

Nathan Race

provisioning quarter. And peaked the it leasing in back guidance credit, as segment I you the relative particularly appreciate last just charge-offs, level going at a described, in to Great. around sounds fourth Okay. to similar the year. And like,

goalpost the So of just minds this the relative by if any get up maybe you terms reserve back in loans? -- where curious year see of to to end of guys have kind to want you

Kathryn Bailey

and within Yes. up basis we've we audited would institution. expect so range I now But place in for -- think handle, think, X.X, and I are I X.XX, being the I X 'XX. might few a that where a one good I is played tick is think stay historically, mean I think would points. we But we reasonable, an that to X%

Tyler Wilcox

can is over some of kind in forecast been mentioned. it's it an perspective, consistent continues years, results. factors the Assuming But that as unemployment has from as our think to drive I Katie forth relative economic the so and the provision formulaic

Nathan Race

it. Got

income Any expectations income year. what on can Just a in expect the thoughts this accretion of XXXX? terms housekeeping maybe we on accretion question for in

Kathryn Bailey

$XX And I We'll the from that. be in $XX 'XX at basis XX of in say a high of the in that for probably will -- that XX. the I'd start to Yes, million that's end range end the accretion we the low to at payoffs. end million normal for assuming a year think year point perspective, of income expectations. of But expectation is kind

Nathan Race

one you. me. Got last for One

feeling hear to any increased be terms or Just magnitude light overall or the of M&A front curious talking what in to of optimism curious that's the number the -- you're increase some XX unfold just everything days those if conversations? you're and are any last seeing partners on of seeing so? just of of guys the over you And in

Tyler Wilcox

Yes. Nate, thank you.

-- causes the case. -- window, there's to there's poised talking be on would customer have larger community that optimism larger know and disruption you As that think that we combinations that disruption that a continues advantage banks of they The to of partners, conversations discussions there. space, optimism well active I lot of advantage take recruit among we're us and lot is about to poised very I that a would an talent. and often the see may a are client of potential as regionals the we I and be just as in say going aside there's out of take to to the there's

But question. that your really wasn't

for of active to we reach conversations. strategic patients. lot a kind of continue and but yes, potential say, would optimistic, ourselves that partners I We're So to

we'll or We have deal in still preference a active a from take larger of strategically the over kind mild been fine perspective, fit any right in that. we'll line, if we immediate it and And headroom. doesn't continue come the don't take time opportunities we've size opportunity for be passing to if along, of on because But kind to that have XX. it. comes along us we'll soon, do And

opportunistic would say. what of is to So I poised we remain be kind

Operator

next your Davidson. question D.A. today Novas come with And will Manuel from

Manuel Navas

more picture to that for see more positive big year leverage or next -- big you as What wildcard the Just positively picture. operating biggest negatively? target do

Tyler Wilcox

that certainly of the us. for the and Well, loan potential next about kind would drive -- outsized possibility, is I control some feel positive result into positive I a year. for expense growth our going

a So see that real potential don't risk. I as

Kathryn Bailey

this asset of see think feel Rate No. interest different we we the happens deposit said think from than where we relatively institution. base. of we're right about one ago. but our to were think, good We I I or neutral features what X I attractive rates, That's perspective, neutral we'll now. that's again, mean environment, Fed the months

likely that's today it's and our that we'll about where good sit control think out something change, feel to manage. continue of we monitor So just to we but I but

Tyler Wilcox

Yes.

to threats wildcard recession things the or those downturn more the -- would be are drive think risks That's activity. inflation, types external where persistent maybe lie. that economic economic there where I or of a

Manuel Navas

into dive you Okay. That's more same Is up noninterest-bearing you because had? color come strong don't in Can just Any more just general? on more think little was. C&I bit I the time? exogenous that it's that? the that. of the What was kind a how the it DDA at I drove growth appreciate up trends

Kathryn Bailey

as conversation seeing part I retail in true encourage of for through look that think well franchise I that to an we I but sales as Yes. And base. too. commercial the holds deposit I as the think the the And we're benefit continued the institution the business. deposit in for come only loans, have actively also client the force engage not mean to their to

the in think in you're come the growth quarter. that's through I fourth So what seeing

Manuel Navas

was that, growth that retail saying well -- that some that as And operating growth you're as accounts? DDA so of

Kathryn Bailey

Correct.

Manuel Navas

to deposits of tick ratio? Awesome. X% And there in do Or be a you higher you're keep that the X% expect will getting a of little growth, bit if loan loan-to-cost up? kind to

Kathryn Bailey

in growth saw we X% 'XX. deposit think I

think beat bit. our expectations that I little a

of speaking, a year. deposit think, growth we X% I generally expect

the on some So growth. would help expect potentially put with see we to borrowings loan I'd --

Operator

Scott. [Operator next Cardenas from And will Daniel Instructions] come with Janney question today Montgomery your

Daniel Cardenas

answered. my questions asked of and Most bit of little cleanup. just have a But maybe been

quarter, in charge-off how terms in reserves look in was fourth the by was of covered versus I what the taken at specific much levels quarter of As provisions? the that

Kathryn Bailey

$X covered had that about fourth Yes, specific quarter. up million then off in X.XX with the was were reserves charged that we at ] [

Daniel Cardenas

And those are to the related all portfolio? leasing

Kathryn Bailey

Correct.

Daniel Cardenas

reserve closer maybe be can scenario build by do we level, loan would up? kind X%. But at is difficult a X.XX% kind you end that that -- little how of of to said envision I to you it of a that of bit do you where back envision your know than higher year? And -- you maybe it to want the where the kind see

Tyler Wilcox

I factors the enabled thus far specific no, reserves specifically to our where been putting to subsequent leasing. on and quarters. predictive the the in be very fourth going us put we've say would Dan. able to some has qualitative And we're think on some be I'd what we relative say analysis up quarter small-ticket

And So and high I of our that will analysis fourth have in internal expectation think I confidence throughout of charge-offs of the kind quarter book proved the think how cascade potentially degree out. year. we our really of a

Kathryn Bailey

been, Yes. would that in throughout just And add process. levels the the opinion, my have I leasing we reserving small-ticket historic at for

specific elevated earlier the QX reserves with and some that again, So in we that year.

in we don't small related the I to ticket go big So expect leasing the increase reserve a as forward.

we rate, I -- carrying it historic in quoted X% the that been think we're to would we which we've release. in X%

forecast. under is another [indiscernible] Again, the as factor well economic the reserve, plays you're aware, into that

the But any against of the my in meaningfully dependent. again, looks, I extent meaningfully in good happens. To ratio right sway that happen opinion, have reason reserve So now. in could data that, believe it's that that don't quarter will kind that to us, that but moves 'XX, pretty

Daniel Cardenas

it. Got

in? in that of pickup of the noted, just additional then have individuals kind I Have a And either Okay. activity recently. with you're in there talent in be of here been or or that as mean, you you result seen want acquisitions, terms in teams discussion into a bit M&A to markets

Tyler Wilcox

would with I Dan, teams. less Yes, say

our historically view as what acquisition not basically we've added it the we X acquisition kind XXXX the across in talent as few our if about core front. particularly in that kind quarters, are done past We we want is you of have on Southern on footprints outs, the Columbus Ohio of would are future Louisville of numbers. example, Ohio to front I and of bankers and additional And to corridor, the commercial major general Cincinnati, kind and of which say, in baked into their we the production, kind for but optimistic lift call active kind as of Kentucky

will investing of expand network So hires. to well. to lending our investing as our that yes, businesses. We're businesses also opportunistic continue in leasing We're we indirect be those with all in

because ultimately of in kind all that results. are continue be we so drives on talent to will acquisition And and our

Operator

time, questions. have At closing this do any there you are Sir, remarks? no further

Tyler Wilcox

your under the to our I'll analysts Thank Investor my want none of the section. a everyone you that, interested Please call including Relations call, on result. will for for time, in presentation were earnings at and that great the disappointed thank with am earnings morning. release conference have and this I But I of Buckeye's this opinion be call say joining day. that our a webcast peoplesbancorp.com remember our archived

Operator

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

You may disconnect. now

Peoples Bancorp (PEBO) 21 Jan 252024 Q4 Earnings call transcript