CVBF - Earnings call transcript Q2 2024

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Operator

Good morning, ladies and gentlemen, and welcome to the Second Quarter of 2024 CVB Financial Corporation and its subsidiary Citizens Business Bank Earnings Conference Call. My name is Cherie, and I'm your operator for today. [Operator Instructions] Please note, this call is being recorded.

I would now like to turn the presentation over to your host for today's call, Allen Nicholson, Executive Vice President and Chief Financial Officer.

proceed. may You

E. Nicholson

and us Cherie, the everyone. you Thank quarter Thank to good review joining today XXXX. for our for of you, morning, financial second results

Executive Dave Joining morning Brager, Officer. President me is and this Chief

of The comments claim and included the safe a Private click Investors was the copy, on Our information visit the our To released in will the the earnings Act refer contained financial speakers today provisions website call that in yesterday. Litigation please Securities announcement protection of on obtain this to at XXXX. harbor tab. www.cbbank.com the Reform

For Form results risks Item to the for December ended XX-K a company's and statements, and actual from therein. materially may the our the forward-looking particular, in year cause discussion forth more XXXX, information differ set complete XX, XA, please on uncertainties in factors report of risk see that annual

the the call. issued harbor complete more safe disclosure, company's a connection see please in version For release earnings with of company's this

will Dave? to turn Dave Brager. the I call over now

David Brager

Allen. Good morning, you, everyone. Thank

and the $X.XX XXXX, $XX share quarter profitability. For our of XX.XX% of net We quarter earnings produced quarter share, or a declared XXXth to $X.XX we per previously a of reported second second return of a of representing representing XXXth average for for of of XXXX, common dividend paying our the second million We the of quarter on quarter dividend consecutive our return per tangible shareholders. consecutive a cash equity on X.XX% XXXX. average assets

quarter per The increase quarter the $X.X XXXX, per $XX.X was in due $XX of million a $X.XX prior million or for first decrease million first $X.XX of primarily expense. the to in compared share year of share $XX.X or noninterest with Our earnings quarter. the compared million million and net XXXX to earnings $X.X or $X.XX share for per

the to assessment. the impacted Net quarter million. noninterest XXXX, first the special cost expense first the interest when a $X.X in FDIC in the the quarter related $X interest Compared estimated to X.XX% change the declined X Earning from for second Noninterest to in decline of by in expense XXXX. margin X.XX% compared the to of XXXX. our This income by million resulted quarter quarter net first was basis special from quarter decrease declined assessment by point increased to assets of positive going funds and quarter to shift X X% with our improved prior we the remained had first a X% the average second yields quarter income by in from XXXX. by asset compared Federal quarter. at deposit quarter. stable Reserve in the of assets the of earning asset basis basis Interest by grew $X.X the points, X yields million as of mix Earning investment the prior prior points for on compared to over balance

interest-bearing by point the The increased million to expense point X of primarily was liabilities. in increase quarter in our the over increase prior a our of $X due basis of funds. increase funds XX Interest cost in cost cost reflecting basis

the in funds prior the the interest-bearing which XX XXXX. to quarter in second As interest increased with point greater to XXXX. quarter and associated deposits for basis wholesale deposits, second increased deposits X.XX% be XX noninterest-bearing expense increase This XX% to point a in due from the increase the cost non-maturity quarter of continue total of was of quarter-over-quarter than basis of X%

million. borrowings quarter In terms costs by of wholesale $XXX funds, declined borrowing as decreased second average

second continue total deposits greater approximately in in decrease declined Non-maturity XX of quarter deposits our our deposits increase including average, million, XXXX. XXXX. $XXX drove noninterest-bearing increased first broker modestly a increase million $XX noninterest-bearing point a second deposits for by to for $XX million However, the basis million quarter the compared deposits. than deposits time in of of the $XXX average average total Average a be the of to deposits. XX% by quarter On cost

repurchase $XXX and and XXXX, a agreements total increase from $XX.X totaled includes March deposits the XX, total from addition brokered XX, customer increase The XXXX, of million in December time billion, June decrease At $XXX and end in deposits. customer $XXX a from XXXX. our deposits million XXXX the XX, repos of million

$XXX the million XXXX, These compares to were during higher-yielding was million XXXX. assets that of liquid second moved quarter. $XXX Citizens Trust approximately first of $XXX deposits X funds invested during notes. as months million For in were to transferred This the such treasury including

points Our quarter XX points first of cost compares second XXXX. XXXX, to which of was quarter of basis the the for basis deposits on for average XX

from Our to in basis cost 'XX non-maturity points has deposits December grown of of points in basis XX June XX of XXXX.

December deposits our of X.XX% While from to cost XXXX of time grown X.XX% of has XXXX. in June in

basis XXXX, XX Fed From by representing deposit the XXX through of of Federal has rate our point the increased the cost first to the deposits during in current beta XX% Reserve's of increase compared of cycle. funds quarter second a points, quarter the XXXX basis tightening

was of and line of the year-end, decline declined loans modestly discuss $X.X from quarter XX% at utilization from million The the the XX, December estate $XX from a a decrease XXXX. the real XXXX, utilization XX% livestock end June $XXX rate fourth were end and commercial Total in The let's the XXXX. decrease other in loans. loans. dairy X% XX, a at loans at by billion, is end decrease $XX in end utilization rate the the XXXX of at the million or led loan see and quarter-over-quarter which in million of to quarter June compared XXXX. first All XX, million included from the Now an decrease Dairy livestock reflected loans. first $XX of loans higher quarter decline categories

Commercial real million estate loans from XXXX. declined December by $XXX XX,

the been weakened, loans. XXXX than loans in over which June we in less than balance has the million seen $XX by though loan loans production. minimal XX%. by loan compete XXXX months than even CRE production million X.XX%. impact yields be originations, utilization have new XXXX, our December same rate high for our loan same loans generally we has period to XX, have X considering new originated over by to on new estate newly more new the XX, higher of in to generally loans C&I very first line real declined construction growth declined have from the XX%. period demand commercial the can $XX As XXXX lagged comparing Construction XXXX. period as selectively, experienced when of balances of Even This in credit C&I average on X first a quality continues quarters at of loan We loan reflects greater relationships as the XXXX borrowings

are period Nonowner-occupied either best and in our focus total than their loan them owners, loan small in products been C&I X-month or on array XX% the originations XXXX compares higher to the providing continued that a banking XXXX. medium-sized less have has XXXX XX% of same new originations, to for full in in of loans resulted businesses loans. Our owner-occupied percentage which of the

we our continues optimistic even classified increase from growth continue demand of quality have to to line though about experienced utilization and future in loan and We asset be be pipeline remains than C&I Although nonperforming years, strong, loans. past an believe our slower we loans.

Our credit as June $XX allowance XXXX. for approximately losses same at XX, March million totaled the XX,

Much or defined second assets, compared were year. $XXX the quarter. second million nonaccrual million percentage loans Classified in $XX.X as in for $XX.X was the At nonperforming other has estate as X.XX% for basis of to million XX in total been at charge-offs plus million compared with quarter classified total of end. Net of million compared $XX,XXX quarter loans quarter. to for quarter owned, real assets. with nonperforming quarter end, $XX.X $XXX the agricultural loans this of prior points the in loans were million associated $X the Classified growth were lending. loans a first the The quarter prior loans

downgrades of resulted from a and milk Widespread for recent the suffered combined in industry impact in costs. dairy XXXX, in feed But primarily losses deep customers XX% our the prices in downturn XXXX falling milk resulting dairy lending by lower supplies. cost The and doing XXXX with feed in high in down be recovery to appears industry rising a underway prices the portfolio. the bank's

experiencing been has pistachios. Land value farmland. ag prices market from of commodities beginning due of production to lower supplies higher almonds as losses also to reflect Additionally, lower appraisals and such are

of Allen to to over additional aspects balance call discuss the sheet. turn Allen? our now will I

E. Nicholson

morning, Dave. everyone. Thanks, again, Good

X.XX% our on million XX, ACL compared As to of XX, XXXX. losses of of $XX.X XXXX. the loans to total June for was ACL second the end At XX, X.XX% allowance the was quarter, March as equal of the credit March XXXX,

for was specifically at million ACL million, including XXXX, $X.X reserves identified Our loans. nonperforming $XX.X December XX, of

loans reserves of for a provision quarter first quarter. of Our or in XXXX. have second first specific did the end zero the been We not since the record

be Our economic blend multiple of to produced continues forecast forecasts Moody's. by a

XXXX. on multiple of is continue slightly unemployment to forecast stay The forecast The with less weighted largest Unemployment risks second rebounding XXXX. continuing then X.XX% until of be X.X% growth XXXX. declining weighting averaging XXXX X% for forecasted the individual of of first We unemployment in forecast to than increase in to forecasts. real XXXX. resulted and scenario of forecast quarter elevated Moody's XXXX in baseline the with have higher before half all XXXX, to returning for economic X% to among downside to for resulting and late is to in is be growth negative the rate GDP all GDP

The or XX, portfolio $X.XX generated $XXX from million cash million end. XX, securities, at at the AFS first this HTM Our the AFS of by the securities available of year. June March Investment not approximately quarter XXXX, declined quarter $XXX from by sale approximately $XX securities total $XX to approximately billion portfolio million increasing the XXXX. have loss June flows held by maturity, by unrealized XX, been and from billion end investment The XXXX. Investment XXXX. securities as $X.XX of XX, from XXXX, portfolio or securities, in December totaled the approximately for totaled during prior portfolio declined from million XX, $X.X The HTM the from March impact reinvested Including AFS XXXX. million by declined

investment entire the the The on of was tax to quarter portfolio the for prior yield X.XX% quarter. X.XX% compared second XXXX equivalent for

daily value we of was executed to $XXX,XXX late swaps, of million continue the have higher a on rate weighted interest positive hedges received pay-fix have the quarter fixed $X.X year. related X.X%. We this approximately to June a than XXXX. We which recorded quarter of carry fair the swaps, income in average of these second We SOFR on in these which first

a had value million as which hedges Our fair $X.X a reflects of prior the flow market hedges, with increase value XX, combined of XXXX, from our cash million quarter. of June $XX.X end the

$XXX cost rate in X.XX%, cash the May borrowings approximately in FHLB million $XXX and of in quarter. $XXX XX. a million $XXX borrowing advances $XXX at the million XX, from Cash FHLB Funding Term of with XXXX. maturing an by advances of May, X.XX% in of maturing totaled during declined May and of $X.X while a added the to of January XXXX. include from $XXX totaling million XXXX, X.XX%. March average of These cost XXXX end Approximately second the we mature at million BTFP million $XXX at equivalents advances Borrowings June These matured quarter second Bank million at Program at billion at

core Bank interest We and and principal anticipate growth of additional be borrowings Program may borrowings additional wholesale and/or deposit payments sources our from combination through Term repaid cash, existing that which our the of broker portfolio, deposits. will security future consist new Funding funding a

certain portfolio. of sale pay Another our the possibility BTFP to with combined portion our of the investment the investment, targeted of borrowings buildings we of source a is sale own of funds off leasebacks

We a buildings leasebacks a we have certain handful unlock marketing started to sale own. value process from of targeted execute to potentially

our within these to utilize losses gains portfolio. AFS selling some from expect to from offset We securities sales

sale-leaseback of than million. greater closed in days transactions gain first resulting a of a The these ago, few $X

securities are sales. in the We gains sale of expecting third XXXX not or quarter material material of AFS from leasebacks levels

X.X% million equity Now common and $X.XX by of at X.X% At position. XX, turning tangible our company's quarter with XXXX, $XX.X shareholders' The the increased June from XX, XX, XXXX, was XX, at fourth June March December XXXX. XXXX, to the XXXX ratio capital to X.X% compared billion. equity and at

our Tier capital X XXXX, regulatory was total are to Our XX.X%, risk-based and equity XX.X%. in continue At highest among capital ratios the was grow capital the and common ratio June our industry. XX, ratio

of Dave the discussion second turn now to earnings. I'll call quarter further our back for

David Brager

Thank you, Allen.

income. noninterest to on Moving

income $XX.X for noninterest the compared quarter of XXXX, prior million the for second quarter. was with Our $XX.X million

card to fees, deposit international by customer-related Our increased the $XXX,XXX including banking quarter. merchant prior bank approximately services, and when compared

In management by increased addition, wealth trust compared and to approximately prior quarter. fees the our $XXX,XXX

due $XXX,XXX. Second benefits death miscellaneous quarter quarter-over-quarter, $XXX,XXX first BOLI loans value ago in related to cash totaled exceeded than more sale quarter in surrender we that building income to charged-off second the the decade the had receipt a primarily and $XXX,XXX decreased in by that Conversely, of than more previously quarter. acquired the a income

$X.X In the with expense due million expense primarily the XXXX, $X.X quarter accrued The of $XX.X the quarter special $X we $XX We ago quarter with this $X.X second million XXXX FDIC quarter. and quarter the from first the to was million the a expense me, decrease with $X.X in for million of first addition quarter. the assessment. associated of million quarter in $X.X of of million quarter XXXX. Noninterest the -- the $XX.X second total, the expenses. expense regulatory assessment, supplemented initially which was million was XXXX year Now of decrease quarter-over-quarter million for for special increase prior the fourth excuse assessment million in over compared for accrued

our The assessment was of first losses its quarter cost and decrease first of paid result the on quarter benefit costs the decrease the taxes quarter of reset from initial revised June $XXX,XXX This and caps estimate this XXXX, increase a Based bonuses. the accrual this on estimate a failures last bank FDIC's XX%. year, second $XXX,XXX in was in decreased the $X.X in annual FDIC salary of million year's as in the accrual. taxes further payment of upwards resulting by received in higher Salaries employee annual quarter-over-quarter. of revising in result payroll included payroll the the in of

this The by decrease higher and offset the legal quarter, prior increase of compared $XXX,XXX accruals Expense expense. due professional was for by year. compared in the to bonus in a payroll taxes primarily increased $XXX,XXX quarter profit-sharing services to to first

we or almost in of than first $XXX,XXX donations $XXX,XXX promotion by also invest by this year we expense increased Marketing more quarter-over-quarter and Software increased management XX% compared by expense and quarter as data continue technology. to the as increased to $XXX,XXX.

$XXX,XXX compared unfunded recapture included commitments or to in XXXX. XXXX in no of quarter quarter for the second of provision The recapture first provision loan

with Noninterest second for expense totaled the X.XX% X.X% of average assets for quarter. the quarter of XXXX compared prior

for This the the efficiency Our XX.X% with for XXXX. was second quarter XX.XX% compares quarter. ratio of first

This concludes presentation. today's

I happy you to any take might questions Allen be Now and have. will

Operator

will Matthew our with And of from Instructions] line first Clark the [Operator question Piper Sandler. come

Matthew Clark

the the Do a just you at margin Wanted average month the deposits here June? sense end get of the margin the to in have June and related outlook. and the of rate for on spot

E. Nicholson

You can.

in at -- non-maturity breakdown you June we further, $XXX were points also basis deposits you if cost repos look and Matthew If the you'll the time $XXX a have interest-bearing IP, deposits was showing can you see million. by that look month our IP, at XX of deposits of and million

that will sort finished end quarter. So we where you of at of give the the

Matthew Clark

And Obviously, I that. then interest income Okay. What just going anything quarter. forward? few this there's your get a drove basis Was that? if see there, to they on were reversals? didn't down of yields, loan points sense that a just unusual And trying

E. Nicholson

that year X Nothing what look the first loan over Matthew. half would things volatile our the loan points. months can of can I of little I those penalties, yield prepayment up mean really a unusual, we that There's but significant. discount go loan at this be into Those reported other about was call when core nothing fees, accretion. yield, the things quarter-to-quarter, -- XX basis

of generally X So month. -- X . basis point but the increases underlying trends core per to been

Matthew Clark

move late, in you just year-end? might updated whether done then something And or given be might something Okay. and what on not -- the whether M&A, seeing capital of be before might to able on get be you bank or not stocks thoughts

David Brager

of bank do think sort in in think just prices little by was have I stock to that But are by a year-end. all, conversations could rebound helpful. that that still hopefully, even I there to the remains anything but of the Well, losses if be be going math There we'll Yes. on. are a take. problem, the unrealized able done something, be first able year-end, get something don't the March we'd still to announce the we

And so how we that. we're look disciplined going at to be in

going are on. there that So are conversations

externally talk for give we opportunities thing. and do do and are us capital about It those lot that's we to internally. to flexibility continue of a both those, different good us, evaluate some and Obviously, things. have a There and does

we deal. of capital to really love forward and our kind do we'd also are other sort management There GCE could things We little going a an of bit of M&A get down. increase up So third to consider in risk And that from going TCE of ended wanted perspective. the to we we a -- And sort X.X% is the us. for a spot range there X% quarter. good that of past

to that So there things talking point, at but are this definitely announce. nothing about, we're

Operator

One the line with And Andrew Terrell come moment our will for that question. of Stephens. from next

Andrew Terrell

you're sale leasebacks start year? the that interested preclude potentially in that, to valuation you you kind securities are around be the but would minute, back to of the from just point in Maybe they I what preference a get on contemplating move in Does capital guess, kind repositioning. we buyback in last half doing kind and of there? of of the incremental

capital the there. on thought Just maybe a discussion little more

E. Nicholson

They're as securities that, X, reducing is on capital we really show -- going continue well I But opportunities sheet want X the and as of from every to our be definitely aggressive portfolio. And the pretty in have the quarter, more combined be reduce we accrete of already level terms think pretty is we'll some next bonds M&A focus capital ratios. to buybacks. Andrew, we the strong. to whether I to the X, compared that strong fact think with quarters, at balance to looking the over

like M&A XXbX-X a point. put will it's some whether a we'll I But do in slow, see think Board place. the to little the at certainly evaluate want looks -- market still if we back what So -- that

Andrew Terrell

Yes. Got it.

Okay. leaseback And in longer sale occur? that time Is can $X of quarter. the you so transactions the the back for there think leasebacks, the sale something which those is or us transactions? then maybe a to on like third kind to the Can of you year? point I million that mentioned the half of you've tail completed the just line complete looking frame primarily guys in Is in

E. Nicholson

things So of X are them. get if want, we you've doing at not is the And in are these we properties. focused transactions what price can out sort we we sell the time. a a [indiscernible] market we don't -- of to properties simultaneously. These maximizing don't seen lot they're We're selling get of on

certainly unknowns. some So One sold already.

market I But the think but be still of total, a at this depend more whether to want. cap know. we don't will it's there's it in possibilities handful most, rate us couple give but really year, a on conditions going we

Andrew Terrell

Okay. X And more in. if Got could it. I sneak

of are has seen that seen kind nice some rates? start like specifically CRE this you've Inland real kind what vacancy lift whether pretty in commercial that within Empire couple in estate in market a rates specifically Curious guys any the changes in you data out industrial aggregators data portfolio, your the put seeing Just a vacancy of of year. to notable the

David Brager

So a couple things. of

that I footage vacant, X foot X% at a X but size data vacancy when latest you or type saw, buildings, a on. million a X% the goes or we're it's impacted, square is rate the that X% and square of the concentrated from not or think have it's X still that's increase, greater large larger percentage vacancy million lending or deal that building obviously, when X% rate, million you go to I very

our haven't how disciplined in underwritten in we seen it. the really with customers. any very We've changes very, industrial been So market we've

put our -- it office owner-occupied. quarters -- is this Half in the more it of time investor is classes, related whereas in CRE around about a anyway, half the presentation portfolio. lot last did to historic few about of all asset we've detail We put only

detail, origination asset loan-to-value So from there loans a in size each perspective, our the both that of lot of is more we the an have classes.

detail, and more is a The at. and So portfolio loan fully I in our classified you than amortizing with a of a look operating industrial downgraded made. XX-year it. really others largest lost loan it payments does experiencing we XX% provide a We're have for value, bit money little it. to less all The lot not loan to company we being so think,

experiencing very come good the investor any significant the things I I but feel level. credit quality. in obviously, up, mean, So can vacancies not at about we're portfolio industrial

Andrew Terrell

yes, I extra color appreciate And presentation the it. on was the Got it. helpful.

David Brager

welcome. You're

Operator

Kelly moment next line the come One that of from question, for and will KBW. with Motta our

Kelly Motta

Thanks question. securities the more dig was leasebacks potential bit repositioning. the offsetting sale for a and in I hoping the about little

we thinking some managing a wondering, Just used proceeds that to an the to the borrowings. sounds at of looks portfolio how stage potentially if around size down what size we should will kind there's securities are as portfolio, for balance thinking about about optimized sheet? particular you're you be this the of of a shifting or -- Wondering pay it of securities cost higher be like

E. Nicholson

don't target We a per I'd have, near-term say, se.

is paying anything. more more debt importantly, our think more I than focus the down

play. And the sheet come obviously, into other so of aspects balance

as obviously, obviously, side think other wholesale years shift term, a sheet. many the to out, funds to percentage long mix asset on of of the objective higher our from here away balance we shift I is loans, the

a general, se, term, portfolio we're Kelly. think of of So maybe to some with But we investment strategy, accelerate I per the But it not course. in -- it's leasebacks. want targeting that is these not targeted number the near -- long-term sale

Kelly Motta

put cash the how weighing sales then you're that if we CD the wholesale with wondering point? if or need at the costs? flows as position of wholesale to CDs And you're you a and And other that helpful. versus add follow-up what broker support you looking potentially on, this that That's Okay. security

E. Nicholson

some on plays need of out, of will Kelly. we One, The funding. the combination those case, wholesale whether in least we couple whether the be how risk. what's to numbers borrowings. we that's a rest managing brokered, side we little more do also the bit look ways, the things, is of interest how a want depend That sheet a are expensive, most. balance rate be to But it If it to the our the extent will depending of on position

we So a one we to wholesale those we swaps the of what one asset among of pay-fix side now, way to mitigate others, put sensitive we to select And fixed put it, And on. some on ways right bit is manage. on particularly try debt. is little that the are because is

Operator

from with of Hasan Davidson. that our And for Ahmad line the question. come will moment D.A. One next

Ahmad Hasan

should like Hasan Ahmad the Gary growth would loan in to know line C&I pipeline. be of loan And on of touch the mentioned thinking Tenner, pipelines and and how terms It's the just the on you half about utilization. all? back I loan we year for I

David Brager

Yes.

definitely I look, the are mean, slower. pipelines So loan

amount C&I of funded large commitments. are a on borrowings when We we this seeing a We've There been just opportunities a those loan. hasn't large commitments amount year. do great of

been different grow end that doing still the can is whether commercial a But obviously real loans through owner that we struggle. than of believe investor. the or I And year. estate, so that's

rate some big of X I as believe first some evidenced people our The loans. of as do loans. prepared the think we the But I don't grow sitting months that impediment there an doing on comments. are And is sidelines. can I think to thing by

aren't little bit things catalyst had should do. that there's other the side passed on we're a start if a lenders things seeing we improve doing lot are more, a going on things break activity because at We've aggressively be deals But other bit have a some And that look to of or or err to credit a more we there. doing quality more than of it more to would little either always. lenders opportunities little

sort end That do of feel year, low growth confident our So the our the the of in of we is the goal. sort beginning still at of talk I had at that first single-digit quarter.

are be good C&I to we need to able other We for the ways. little we we don't pipelines borrower. in thing real Treasury guide for solid just specifically, is bit there. loans monetize keep about the wouldn't company those the And getting doing, it operating do of we're all but an they're bank investor that full lower, that executing on relationships international, but card, relationships and that things many management, doing and an really commercial we're estate

Operator

[Operator Feaster the next will come Instructions] Our question from line of David with Raymond James.

David Feaster

Good morning, everybody.

quarter headwind a quarter a NIV maybe curious ] July? think deposit the saw, it's especially [ I'm seasonally the been trends early deposit you late through could into if some into on the core and The start has pretty the balance deposits. you in what quarter. migration us Obviously, encouraging. but with is Let's just and challenging front the of help

David Brager

Yes.

deposit have stable. think saying this So remain look, I very for X overall or operating If -- at I quarters X deposits a challenge. noninterest-bearing been that good be operating deposits. higher to rates are be bringing some or that rate maintain relationships, I on do they high. for might think it model if very movement been to companies we that XX%, I've But noninterest-bearing will easier. If remain down, there's continue does deposits our can stay mean, allow longer,

running we but pipeline the into been So of prolonger. the still has the deposit are headwinds higher solid,

saying, "Oh, some a little still that are bit people are earn there surprisingly, more. And I maybe can

thought trust. happening as to would moved by that have of that's system. still But through that to degree would most run a the have money the evidenced You

even the I if So quarter, deposits. think Averages I on we execute feel But about were that maybe second but broker have can a it, Normally, little noninterest-bearing. about that operating that maintain the -- stabilize obviously companies. we feel and bit historically. we that so bank to deposits a start more, should generally acquisition. see we in any We we I have pipeline of good I do deposit flat. grown -- good level should high up we mean relatively were notwithstanding

David Feaster

of And you the I'm Okay. size probably preparing think the maturity BTFP That's the It curious how especially to the just maybe sheet. we're will sheet. balance kind back sounds shrink -- then of -- balance basically going to about with like helpful.

But bit that it cash some in sounds probably to shrink that sheet up built and deposit the to mix. of kind a of to maybe that. of think? funding your the have growth, way advance we You've optimization Is more balance the extent like expect

David Brager

Yes, generally, right growing you're term. in short without on track. per share think can necessarily grow the And the bank we I the earnings look,

is something definitely be goal with we exact But right term. that grow think to occurs We want and the of with building ROA, the we're grow I there the quarters. do the But the some now can EPS grow Our BTFP the long capital. bank. bank to that improve few next could circumstance the cash, do in over that,

some the amount -- the mean want us All going we've sale targeted where And borrowings. and couple we're to leasebacks, been I to over of hit last we're of those the to things we saying quarters, be to with just should the get ultimately. reduce of singles

as balance EPS we even the size the obviously, of of of definitely so do size run, I sort sheet. can think grow balance size in we short the total we're of if the want all growing asset bank the well. not the to grow of impacts that ultimately, But sheet And but the

if you anything that. So I know, have Allen, to to add don't

E. Nicholson

terms the deposits, of sheet balance we but reducing other Yes. as core core will shrink help near frankly. bad grow in could to certainly, up free a I additional in the sheet, certainly aspects borrowings, assets I've about total talked the want and balance in loans, capital, on thing, of the and not return mean that term.

David Brager

rates. selling at have a an low cap at of equity occurred sale-leaseback And We're properties These just looking have these to Xs with the and cap Xs been lot firms. David, you that our at give best X% selling idea, things private rates. these high below at worst larger properties transactions

properties able to get, unlocking don't those more And or we'll single but get the want we're we're to here those we there. another we be to don't that if going -- how hit and we it. properties, value we the sell, of if then price of we're So doing sell

thought that's of So a sort process.

David Feaster

That's great. [indiscernible]. been to And maybe and a switching the mean, all as gears you've service benefit huge able maintain just relationships just clients, that's to I that. been

on underlying of are trust seeing some trends Here the you're the side.

David Brager

make just you heard sure Trust broke little I Citizens up underlying on the on to you Well, Yes. correctly. are -- I side? trends want bit. just -- What the a the

David Feaster

Yes.

David Brager

Yes.

in look, So go had deposits of for I million there. we $XXX mean, last year -- total year, the

deposits we million X had of $XXX first months, The go there.

do and definitely I customers -- they it's still mean, to they But So slowed we wanting have our smart down. what customers, earn can are earn.

we work to And in it and keep so with the them we want family.

earn to that relationship. something. going ultimately, those are losing not excess So deposits relationships, there we're potentially There's the

assets is keeping I And from family in it and billion The our key that's to administration is $X year. billion-ish And management think just grown the under group in Trust -- which Trust the up has $X.X about important. thing. last

continue relationships, many definitely assets but we'll that, that's think, a bring in cases. we're includes well. of I working to And little slowed to on still those So bit which as down see trust new

continue continue but see probably We'll at do that. we'll -- to it, to So pace. slower a definitely

Operator

do Motta come And we a from line of with have the will question. follow-up Kelly That KBW.

Kelly Motta

I back me jump for outlook hoping Thank point growth. to you was letting loan your about your much just clarify for so on.

reiterated second for wondering growth in you're if the half? you balance single how that year or about the thinking I or was is net of mid-single I the think digits. low

David Brager

I didn't loans just definitely to this low single-digit say I in think clarify. point. do -- I think digits, mid-single the the balance just year, from grow can I range think we Yes. for of that

mean, -- couple And at or we utilization are them. to I these point, X% to I that some of loans X% mean, people C&I done have larger going a some start this money. that about utilize on of a have

what on seasonality sort been the the advanced. any and fourth of normal pipeline we've the think a if quarter books, I'm just hasn't of excluding sort I Plus already and dairy. improvement of with in in So it combination put the there's really

can digits that grow single we excluding point do I in think low So forward. that, the this from

Operator

at would further Mr. to Brager remarks. time. I this to any like no back the the queue I'm closing now questions turn over showing call in for

David Brager

paying of continues owners, all best Cherie. of quarters quarters our consecutive remain by more medium-size than banking Citizens and to highlighted Bank and environment. their cash operating our cycles. small Business challenging or businesses focused dividends. consecutive XXX you, Thank economic XX perform We of in through and consistently profitability our mission on a financial years is Solid XXX the performance

our to call. if additional Have and I'd thank you this our quarter. appreciate and customers great their have I to speaking for look and Allen our you day. us know in forward and quarter third We Please loyalty. your joining with a earnings for like October for associates Thank any you interest questions. XXXX let commitment

Operator

all concludes This today's you for Thank participating. program.

disconnect. now You may

CVB Financial (CVBF) 25 Jul 242024 Q2 Earnings call transcript