F.N.B. (FNB) 23 Apr 202020 Q1 Earnings call transcript

Company Profile

Participants

Matt Lazzaro	Manager-Investor Relations
Vince Delie	Chairman, President and Chief Executive Officer
Gary Guerrieri	Chief Credit Officer
Vince Calabrese	Chief Financial Officer
Jared Shaw	Wells Fargo Securities
Frank Schiraldi	Piper Sandler
Michael Young	SunTrust
Casey Haire	Jefferies
Russell Gunther	D.A. Davidson
Collyn Gilbert	KBW
Brody Preston	Stephens Inc.
Brian Martin	Janney Montgomery

Call transcript

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Operator

Good day, and welcome to the F.N.B. Corporation First Quarter 2020 Quarterly Earnings Call. All participants will be in a listen-only mode. [Operator Instructions] After today's presentation, there'll be an opportunity to ask questions. Please note this event is being recorded.

to conference like Lazzaro. to now would turn over the Matt I go Please ahead.

Matt Lazzaro

the morning, to financial report and This you. non-GAAP Commission everyone, Thank with Good statements non-GAAP and our forward-looking financial welcome included reported in our be the to accordance and of and for viewed operating Corporation often contain GAAP as with measures. conference to F.N.B results earnings our GAAP alternative GAAP. should directly an and not of measures files the addition Non-GAAP it financial in Securities to Exchange materials Reconciliations measures comparable our call release. most measures call. and prepared are presentation earnings in in

will in our related materials and our Please be of corporate refer to the and these reports Services April Exchange will on non-GAAP with link contained & our Relations call earnings website. section and XXth Commission replay webcast presentation our Shareholder of be and corporate the A in statements posted Us, available Investor disclosures website. the forward-looking until this About filed registration available Securities to and release, statement and

the President Delie, to over CEO. and turn Vince now I'll call Chairman,

Vince Delie

I'd to call. our morning Good welcome and address On like today's three earnings call, to topics. key

begin our customers, communities, employees, by how we the supporting while are update I'll providing First, on through and an pandemic navigating our COVID-XX business shareholders.

few first points like initiatives revisit our programs. financial strategic a I'd And comment like about and on finally, to key Secondly, several to briefly performance. quarter I'd

team through develop continuity our escalating XXXX, at collaborated and and to crisis. a the this plan. pandemic pandemic ongoing of a business Our pandemic went company's simulation management response exercises stay plan to to existing Dating our back team formal F.N.B. pandemic front preparedness with enabled

place. was thoroughly formed plan the of comprehensive sustainability the currently process, ultimately and foundation evaluated in this During

banking options commitment able their played in were who ability for technology convenient not to a our our digital to invest our Additionally, to our role critical provide customers ongoing in leave channels and homes.

us establish XX,XXX business week's applications to handle one investments in technology Our build enabled just automated process to time. Protection an also and SBA Program for Paycheck the in nearly

in efforts processing of loans. Our $X.X round those representing funding applications and approving in first billion XX% the of resulted in

anticipate applications the round We of second processing remaining the during funding.

mentioned, both available I setting tapped called appointment and F.N.B.’s one when began. into had customers COVID-XX of Phase to specialized keeping communication in As of previously able audiences established centers. solution employees, quickly of are clicks-to-bricks our for and We our online both and the technology channels offerings make any we contents We introduced updates. initiative strength informed

to resilient response attitudes professional, remains has financial each employees’ and a communities as other, bright health our the while ways They're health, Protecting their safety in we our navigating and our been of positive, these times. health Our compassionate, light the to exceptional. helping employees their and address been have to find unprecedented families. critical crisis customers or being well any of this impacts

paid caregiver For to with program. expanded leave existing lead paid also up F.N.B. days example, and team our our XX provided

continue provided Additionally operations our hardships and any who payment from a employees with that coronavirus, areas essential to ensure the assistance frontline in on financial assist F.N.B. our to the resulting receive working possible financial customers vital services. special to

work to also of investment approximately position. making half about our speaks remotely, which XXXX we remotely This to the also working where accommodations infrastructure. give workforce We and colleagues infrastructure employees have technology appropriate. and our IT by capability in IT to largely leveraged To-date our ability non-retail represents

our benefiting in F.N.B.’s our clients began food $X Many out to to providing has provide reaching researching COVID-XX, vendor of COVID-XX. our foundation employees headquarters As response the we million and and focus supplies. essential F.N.B. and services been relief process our supplies on and to vendors, assist communities, to our new our vetting banks using quickly medical medical committed communities to management combat to County offering provide in team Pittsburgh that Allegheny support

we appointment-only our drive focused capability our enclosed branches, within up respect are With on platform. setting lobbies by which reverting practices have our appointment clicks-to-bricks services, to retail the supported to

As can XX/X challenging to and of imagine, you a in monumental commitment sustained team the our this required operate effort. employees leadership environment

I'd while the to abide for actions taken execute commend they've measures by our our continuing like employees and to operations. safety

priorities briefly our key these me let performance. actions in first place, on and comment pivot With and quarter

performance Given all this remained happened in quarter, our core solid. underlying a noisy

to provider to approach maintain cycles the our clients. economic and varying is serve philosophy as Our our risk management through capital to primary

many F.N.B and F.N.B. difficult crisis. the will to actions reduce our This economic well be we risk like position philosophy to balance taken have a sheet environment. While move should we and banks through strengthen current subject the as

to the and COVID-XX EPS quarter’ and included CECL of and GAAP items Looking reserve under significant results, from build of the adoption at the these at conditions. bottom-line $X.XX $X.XX corresponding related macroeconomic implementation primarily impact

March, by our million results saw Average of deposit top XX%. were pick than grew $XXX loans as commercial strong fee-based in to revenue growth or increased businesses. line with The activity growth positive X% solid and million and driven loan in more particularly we as up $XXX results C&I late across

increased an bearing the average Compared first to to I'll was average of balances leading growth impact of with anticipated improved deposits note deposits funding mix. from XXXX, to X% in liquidity X% there draws. quarter limited non-interest

quarter. to were X.XX% a margin expanded total trends million higher the of revenues record the in with fundamental capital growth, strong strong improvement point to by The in cost net markets interest prior non-interest levels $XX and loan another quarter. basis first of income funds The seven supported setting in accretion compared

more quarter the with up than non-interest million forward. income income mortgage interest pipelines excluding mortgage XXXX totaled valuation, banking servicing strong underlying and on Insurance the from mortgage our significant the moving in of XX% rights, also first changes $X.X performance. in income Due to had rate includes environment, million significant impairment banking MSR $X.X shift of

core as this beyond the basis, detail compared of the stable to crisis. continue Gary the a disciplined details Vince and and expenses and expense move more a will remain management on and we financials on fourth quarter will top CECL their implementation provide to be remarks. On additional priority

to With call turn I'll the Gary. over that,

Gary Guerrieri

everyone. come of and remaining We out Vince, with satisfactory good quarter you, position result that challenges portfolio have current as Thank first of a the morning, in midst global credit closed of in XXXX the a COVID-XX. our the

credit adoption are in and also CECL the marked review the also and we book the brings manage the metrics. credit I is communicated quarter which changes the borrowers of meet to risks which first last monitor continuing additional emerging of to the accounting standard, reporting our of communities to quality will the operate. we taking while needs steps the quarter The our

temporary review quarter over A The level a our current. and quarter included at already the now up majority in which first of brought early March basis delinquency points X.XX stage. prior Let's of XX results. totaled XX uptick percentage, been has

PCI new totaled points This does increase former to non-accrual basis but NPLs linked the not in CECL moving point and OREO reflect nine increase quarter. and reporting standard. from accounting basis XX deterioration the pool rather credit changes

million X.XX% annualized. our stands at million for up adverse relates XX a million The end. build NPL day Provision macroeconomic Net of XXX% XX $XX reserve to $X.X conditions the reserve quarter to of coverage CECL which points charge-offs totaled low expense tied basis points $XX or at for at for the remained compared reserve one providing X.XX%, to basis ending COVID-XX. quarter quarter of

severely reserve DFAST XX% adverse scenario that period are of our inclusive of XXXX ending worthnoting It's represents unamortized loan discounts charge-offs.

credits, tracking teams Our COVID-XX been government-backed several working have with lending metrics, borrowers, performance response and administering over programs part the our as to last the tirelessly weeks of reviewing crisis. meeting

attentive in of part philosophies a to with credit that a our balanced asset core consistent portfolio aggressive and and mix underwriting, our workout, have you We proactive due before, entered with large entire the strength crisis I of spanning our management footprint. including discussed in position credit risk,

currently taken have economic lower years several and profile over last our actions those book we are to risk similar position experiencing. We withstand many conditions to maintain to adverse various to cycles the a

industries sold loans years, books we to these able portfolio. de-risk which to three million last a of at we the in to financial off $XXX company. historically move our the four balance to sensitive very the limited approximately highly that large exposure leisure, exposure Over portion remaining also and were were acquired have travel food with totaling risk benefit sheet. A like We've proactively our to loans industries only the loan higher energy and of low, accommodation and X.X%

totals we loan and payment approve As plans were to to portfolio. teams to for which of borrowers, mobilize programs, approximately review qualified relief it credit X% able our quickly relates deferral our date, to

PPP securing daily the a set volume to have these developed performance response also we backed As metrics to our an borrowers fully SBA programs been key through that preferred small SBA. reports support business in monitored diligently in of are working COVID-XX. relief by is The and for specialized lender, financing

to been line are product, which further utilization credit broken loan allow our down we holistic and Using assessments, credit geography, daily rates, our and deferral by industry. impact activity, loan volume, tracking portfolio monitor borrower systems, PPP to of have us business,

expanded allowance stress and loan analytics, portfolios. including we to frameworks testing and to also leveraged existing our have analysis conduct In scenario addition select DFAST

during the to we through a of environment draw past customers this on bankers all, All of actions moment challenging We'll of continue all today. and to to and faced and credit support recognize dedication cycles. the for like communities their by and meet teams taken team this manage manage our the leadership banking of I the needs and us experience through to time. conditions have Above help will of our take in industry credit credit help challenging work our to the challenging would hard as staff

turn Chief for will Financial the Officer Calabrese, Vince remarks. I now over our his to call

Vince Calabrese

and everyone. Gary, quarter and an first morning, I'll for update our the Thanks, environment. good provide current the Today, results cover on

of tables in TCE EPS on in noted items $X.XX the reconciliation basis $X.XX points reflecting projections. after-tax items. which piece first XX related impact another items. the and significant totaled the GAAP million quarter for COVID-XX are evaluating of quarter. XX adoption The the of first points includes used during March macroeconomic build pandemic recessionary ratio X, significant the biggest reserve These X.XX%, being driven $XX the scenario a with of We ended listed basis at million Slide CECL $XX As

Slide average the balance on X% month annualized March. increases Let's includes commercial the utilization X%. in less of The sheet of related in attributable loan or point million start totaled with growth one occurred for of consumer Linked-quarter average that percentage and growth $XXX COVID-XX growth line annualized growth review commercial of commercial X% to XX. the than

$X.X up Continuing linked-quarter On seasonal were relatively a average flat, is billion balance basis, basis, X.X%. were on the deposits or balances. average sheet impacted on a average year-over-year normal slide, outflows deposits

liquidity overall liquidity standpoint, attractive our accessing spreads comfortable an From holding very February on the markets XX. debt position, with raise benefit $XXX of opportunistically million to including the current company we are capital in at

portion a executed back of shares prior also X.X total our our share previously representing We outstanding. buying repurchase announced X.X% of million to shares March XX, program,

net CECL up now driven growth, by solid On are environment. totaled from income that seven basis statement. last discount funds The accretion points expanded or margin of the million $XXX to average Slide interest loan Turning levels cost X.X% $X.X XX, interest net X.XX% higher lower a million, in and we income quarter. to

the rate accretion decline given end of During in discount yields short the quarter, pressure higher the curve. the offset the loan variable the on significant first

points cost of bearing as to basis borrowing deposits. and cost of total interest On decreased a funding funds the in the basis shift X.XX% mix from in as the lower costs point X.XX%, XX seven a reduction side, well reflecting funding

expense. and continues and Slide for provide There a and performance banking, in income as as mortgage non-interest insurance XX whole. strong as be capital details non-interest well XX to markets, income operating for trust

noted which from rate volatile Vince the helps are diversifies our and interest base businesses impact positive we contributions revenue consistently As of a environment. earlier, to fee-based mitigate receiving our

in interest impact last due MSR the $X.X the at first million, given from quarter mainly million to a X.X% rates. from the moon decrease income quarter, Looking impairment the non-interest totaled down $XX.X

increased a million with record XX% by $XX.X of $X.X strong Excluding million fourth volume. the non-interest the or origination driven impairment, posting from quarter capital increasing markets income X%

rate million COVID-XX, associated Turning branch compared basis This on to affect do to to expenses changes $X.X and slide stable a but program fourth expense quarter $X of run grants the XX. Non-interest excludes remains for provisions do consolidation of with our million costs levels. affect under recognition of not long-term related million cost new expense in of incentive $X.X total retirement timing. that expense the grants

in recognition state bank of million, tax and franchise prior the the reflecting credit increased a levels. XXXX Bank shares year $X.X end taxes quarter million higher $X.X capital and

offset out-sized increased XX% efficiency ratio other percentage other. The three to While by efficiency the or ratio other as equaled each points. unusual essentially the quarter's XX%, compared increases over decreases and current items

is outlook length the of to of the given we relevant around the recover. economy guidance, overall Regarding the shared COVID-XX impacts the pandemic no time uncertainty in and takes it January on longer the

However, our know we XX our for in transparency on we XXXX is into through. based the on today, which of of the forecasts, what second providing fluid to given change short-term Slide spirit outlook very managing directional we current are subject situation the are all quarter

second reflects current full to from decline mid rate net interest as income impact the first the interest quarter expect quarter of margin net digits We interest levels. levels single a quarters’

of of reflecting from during the expected phase XX billion PPP higher expect program loan that to fund balances average $X.X be quarter. We loans digits mid-to-high single initial and spot the are the to March balances up

The would be second figures. additive these program of to the phase

our to to strive that accommodate we As all customers of want participate.

to from $XXX expenses core level expect be of million flat the quarter. We this

We services. due COVID-XX to trends expect our and impacts products core on with continue in to the quarter first solid to service levels expected charges from decline certain fee

be expect XX%. We around rate tax effective to the

that, will the turn Vince. back I call to With

Vince Delie

throughout website on are deploying digital stop Thanks, that setting, Vince. several of out shopping January, new In a we our our experience. and are robust strategy ITMs our Online that network of us, account digital our streamlined interactive to clicks-to-bricks just few affords move that opening mobile touch designed and process XXX forward. functionalities with creates machines I'd appointment like interactive the a as XX nearly one we functionality winning a launched enhanced interactive with stand combined ATMs and teller and footprint application. award initiatives

March of limited the physical positioned critical Mobile last channels. online economic of platform, multiple meet to well in channels and service a is to challenges. which are year in XX% deposits time provide the our and and compared We've more invested first of our levels. the distancing continue customers needs time during up are to during operations period and pre-COVID-XX this We to weeks in social than ago their through heavily quarter two mobile

deferral digital to F.N.B capabilities may first we communities Protect program was will announced develop a our financial continue to build are by planned. directly to COVID-XX. as support and enduring and our F.N.B. impacted one and previously economic several from banks out disruption, be customers the who of structured hardships measures customers

Furthermore, to outreach we activated instituted and of an during program units needs their business thousands across contact an initiative crisis were all outbound customers ensuring the met. calling being

We COVID-XX their Federal also Program Protection our relief previously mentioned programs determine for communities. customers evaluate to participate and in and Paycheck related to continue government other the suitability

levels, current stressful scenarios maintain to a continue our our all constituencies run outlook, like our our Under are scenarios, under of conditions. threshold situations Regarding to financial overall and conditions demonstrating consistently we position, the liquidity, conditions. for liquidity support appropriate economic ratios we tests severely these capital stress variety above and able including remain to adverse capital ability have of economic that

environment, the challenging As evolving drivers on we continue expectations. key clarity update will and gain health more and we this you resulting pandemic on to business economic

need. In closing, express proud ways to I'd with This our new difficult identify and of unprecedented time those time and in nation to an efforts am during connect like this our team's our to for creative very I industry. how is

has the Our serve. communities of improve in been always we mission quality the life to

by crisis. than this work Now to ever, we health those together impacted must more support public

in navigate all this say through As and difference serving thank our to together, again making our the who we a want communities such, you as are I frontline to those on employees

Operator

Jared Securities. We Instructions] begin session. the Our Wells with comes question-and-answer [Operator go first from question will Shaw now Fargo Please ahead.

Jared Shaw

Good morning, guys.

Vince Delie

Jared. morning, Good

Gary Guerrieri

Good morning, Jared.

Jared Shaw

pressure fee guess through you what the margin, through offset the $X.X of some on or quarter. that growth that PPP, the as with the rate account quarter. anticipate the then those have you walk there? that the second for in I fees for NII? on some us fees maybe out PPP you do second I would would of First to you parts accounting moving strong And the is think in into blended billion look on those that are

Vince Calabrese

I comments, Sure. a make can few Jared.

the interest just the through for kind going walking of net outlook forward. So income

month talked in prime income changes we've one and a on As the about in impact significant interest net LIBOR the past, have and margin. our

projection the was you quarter, for was this X.XX% X.XX% projected quarter. couple look LIBOR the last quarter If the it be on quarters at and in second where fourth average in X.XX% and to the around first for average quarter, for

and loans based. have $X.X billion in LIBOR-based $X.X prime another We its

moved projected the So impacts loan portfolios. those obviously down,

fund impact, second our the to you We're continue as interest program bearing that X% estimating the about. as offsetting the basis spread is will reduction basis quarter. you'll another on first of point we from this our we're and we've in points. is benefits rates we kind quarter rate reduce have, from mentioned you billion, the XX costs fee how quarter when levels PPP average go talked Now The would The out calculate the projecting is XX as tiering. deposit around through X.X then we have

the in is we're way and for it, for all going loans. to of kind put loan two, by quarter those of account So loan around you is The loan. system, a them two on kind an margin

And created income the time. So would in then are point year bring the over interest in into the and in fees you remainder once off, forgiven of period. loans it's two that paid at

environment CECL versus on last is would the had of and that running quarter we I comment environment. the piece the this lastly, just a then accretion And kind too through pre-CECL

$XX fourth quarter. up $X million the about about this it is quarter, from So was million

quite to to level, factored get CECL that, I that don't of that variables but pre-payments quarter, in under accounting, into contributed I know, a first the lot because expect the don't and being function a be the quarter. with contributor. second a it's that it at big with prepayments So more there's that

just high be So expect quarter, I at as it second quite that still as in $XX contributor a the meaningful to not million. that

looked of reasonable subject you running and it’s points to what basis on based prepayments rate If quarter points change were quarter. at third the XX accretion probably XX we a to last basis run last during year, from fourth with happens the

Vince Delie

the on loan Of of average in points A couple $XXX,XXX. XX,XXX have that we PPP program. size of Hey, we in, other originated kind of Jared. the brought about applications

end we're size. of So spectrum on the in lower the of the terms

more have are We on small about still that we additional XX% available. some are coming $XXX would million That we processed once fundings the there. businesses round pipeline. to be We funds that that that and of are ready through in two totals expect processed top And still have out that.

already. the spirit of about funded in We've Just billion the also transparency. of $X.X XX%

on they're So the closed books.

Jared Shaw

growth or growth the was I there On utilization he X%? loan that was X% of that utilization Did did this you line was quarter increased say from went only line hear right? up the

Vince Calabrese

X% No, it on was right. average,

in utilization So that later would have had. March the we occurred line

on balance the of X% mentioned, average, average So that that the X% growth growth. I

Gary Guerrieri

add Hey comments there. Vince’s Jared, I can to

know, We're running It under was already to down COVID some XX% prior usage XX.X%. Our XX%, businesses built cash little peaked at around to positions. the as just over back you XX%, impact.

point. to at it's normalized really to level So this close a getting back

Vince Calabrese

balance funded portfolio. don't was tremendous to We exposure large our that significant back commercial that a corporate on liquidity of amount offerings. to sheet in really have have either essentially of amount we don't or up their put paper up But a

others have So lower draws the would much what reported. than were liquidity

Jared Shaw

– X% me. Okay, that's Are And loan any of under are category finally deferrals, loans geography? concentration then deferral. either just for of in total you said or seeing great. Thanks. The you in sorry,

Gary Guerrieri

we're now, right at Yes, about X%.

at pipeline pipeline the with to a X% have. X% touch that based over we expect the about or We just be on

small In into lending our that tourism. terms books we've those strategically, restaurant, we've talked from a deferrals, of we're travel, in really as the industries are the expect, on perspective as those seeing focus Those past. would that had not very in space you

concentrated really of there. kind it's So,

Vince Calabrese

X.X% loan deferrals, of size portfolio, it's of dispersion X% the the pretty where types at it's it’s right. look around you it Gary? – pretty percentage in similar is. if – of across much to all terms mean X.X% is the of I the And ranging

that particular So we're it's spike pretty one area. seeing a in not consistent

Jared Shaw

Okay. Thanks All helpful. right. That’s the color. for

Vince Calabrese

Jared. Thanks, Yes.

Operator

Please Our with go next from question comes Frank Schiraldi ahead. Sandler. Piper

Frank Schiraldi

morning. Good

Vince Delie

Good morning, Frank.

Vince Calabrese

Good morning.

Frank Schiraldi

the any Florida of testing? around guess last on, stress detail, the sort XXXX, outlook, back to I excluding think at legacy about every, bank. loss the curious coming is Just give more If how you stack expectations can if baseline to Gary XXXX then? cycle we up

Gary Guerrieri

of would the and coming over you to the that I what the say I off levels proactive changed. has earlier, last balance months. like Naturally, charge off very we very the over Frank, strategically mentioned have Yes, years and have number sheet last some XX been world de-risked solid we're

that the expect a in consistency all go We that underwriting on play time we the front we talk forward here. about the meaningful with as role you end to

And those all typical standpoint point. of from our terms charge-offs, our any In under this in charge rather well one a this scenarios. and expect as fully to to are adverse deterioration capitalized execute we stress last test, be downturn. business In plan at credit able remained banks to severe off going experience is is

are CECL forecasted at that that conditions this the used extent to than March XXth at the economic date. methodology conditions are point we the under worse And COVID-XX

movements using from we're this information on current would any some levels to expect point reserve in So potential from normal very modeling. based around We our time. occur COVID build

consistency well we've from with the But underwriting. now perspective, about losses perform that we're as in possible as expect we to the cycle talked we're dealing we loss through So forward. do based on portfolio a as the forecast going the right the not that go to

Vince Calabrese

go that. and back comparison Florida exclude over that could page our offs Regency net deck, on the divested. historically. loans does Frank, performance, in maybe average you charge we if Gary, XX the a there's F.N.B.’s comment to portfolio mean And I on you it

Gary Guerrieri

Yes.

those we all years the see of experienced exclude recession did basically you cycle. XXXX through performance This On the does is in today. page that Florida back to portfolios industry it place That ago. had than a core as us do And and that will exclude in allow better we now and as At the XXXX, a this of company's Regency in F.N.B.’s underwriting we it balance that perform longer are then whole point through bank. back expect cycle great consistent XX, that part itself. time, the no a number So, – sheet. that remains as moves that

Frank Schiraldi

And just any and range Okay. sorry, NII does enough, Or margin back include the then, have to left I guide don't for enough wide XQ I'm know, that NII you Vince, expectations? in I'm just yourself there, accretion curious?

Vince Calabrese

include, about kind points. XX of it points XX basis No, my basis to would comment earlier

the more. be at look normal that have function being pre-CECL. end kind again. next quarter, to fourth run I a though. of expect you and of would rate quarter up right. which rates, high were Again, kind it's If We would more prepayments, third run of Repayments

And that truly of kind So XX our reasonable quarter XX kind that's itself know into I kind But plays until I say there number. it's definitely of Frank. the to there's quarter. second That's baked – number in kind think of for won't a would I out. you

too, of two the clarify the $X.X should activity, I months for that also quarter. the PPP we billion then that's the mentioned And on in books

target. X.X, to just have have number And into don't you the So modeling the standpoint. that's from X/X included a of that two in you

Frank Schiraldi

wouldn't guess the months. are for in I is they what the be only late it's guess Well, I two course. on if books included But Okay.

being So some the that have in going accelerated, you forgiven, to be from don't stuff anything of as is like X% XQ? nothing the because

Vince Calabrese

going that No. just June you is forgiveness to XX. that timeframe. going going There's be… No. through probably to it It's probably normal include within – get accretion It's to would what process two-year

Vince Delie

expect would would beyond get Frank. you it I XX, June

third go you'll starting look forgiveness with probably the there to through. So event items quarter at the

Vince Calabrese

Yes.

don't kind to my So period. of that in accretion fee It's number, acceleration normal I any just have for two-year Frank.

Frank Schiraldi

steady And here? it then of this LIBOR, is expectation is just your what sort finally, and from guidance, for state just

Vince Calabrese

we’re in mentioned my projecting. now. earlier kind I high basis that, of XX I right the, Well, we're in comments what is XXs I points think the in mean we're

we quarter quarter little the started average, a for So higher. the on XX bit

So numbers. that's into our baked what's

Frank Schiraldi

missed you. I Thank you. that Got sorry.

Vince Calabrese

That's okay. Sure.

Operator

Our Michael go next question SunTrust. Young comes Please with ahead. from

Michael Young

Hey, morning. good

Vince Delie

Mike. Good morning,

Michael Young

into additional maybe, Thanks. went up about sort I just used Gary, wanted management overlays and start, arrive the that Can weightings quarter. you assumptions just you assumptions any or Good that, morning. reserve number? this the macroeconomic COVID-XX of you to at the with put that to talk of that

Gary Guerrieri

Sure. can significant economy a slight of with then pandemic We're where government our around economic programs we account not I modeling. the the an year stimulus in you a the that. later any in throughout into We're give up improvement overview and our in using recession front deterioration taking see scenario continued weakness of analysis, XXXX.

So from there's no benefit any of that.

confidence, of around that driving as That’s portfolio. Dow, our we such GDP, variables we models I'll continue really few consumer always housing, and are give done analysis the We will a DFAST those and the to include examples the variables scenarios that unemployment like run what’s have in the review examples number modeling incorporate really about levels, there. just the you and a dozen a and we’ve

Michael Young

assume of stamped was would I of kind end And that time March.

since on if be bill So commissions if just a quarter maybe bit then, little we potentially to of require a next worsened we trajectory have more would where we stand. little since that bit similar stay kind then on reserve

Vince Delie

just as the our run run Again, albeit a Well on difference we're run run simulated as XX days motto based these And slightly, on of of We've data, with the them not based our was most last but really we of recent continue scenarios. as material material it's March timeframe. couple recent update. the running. that nothing as models updated to the

Michael Young

there you've watchful collateral? particularly that Okay. of cash of may less more COVID And be areas I you less whether than any it on here or impacted breaking the sensitive et a great be more industries, should cetera. severely out think all done Are think, slide the risk that Gary, kind job or we liquidity, others, term have near

Gary Guerrieri

very naturally being These did standpoint in a decision assets book lending the got was space some acquisitions. the years right are a are some industry severely very I good X.X of past hotel from and clients restaurant from specifically a severely now, a spot we tough Yes, ago. and in an to we proven some the energy, also small that be would as – restaurants talked have Energy we've are impacted. is into one. good stopped hotels and We strategic It impacted. say it's impacted. Hotels that the categories, the

lending not that portfolio in We being all. and have de-risked that at into active and,

those I As see perform a as customers problematic all I and continue would to we are concerned there energy for here in still few industries publicly that I the early the a an not and very sound potential we're be a got we're entities mean, the with a can Those facing. at as well. is that the have stages as that the are initially But lender, by about pace. that more to you become slide deck, uncertainty well traded everyone mean, faster energy,

cycle. for And that's time positioned small to we've self to very us maintain going made move over I pay strategically, think our we dividends and through this Again, as decisions portfolios there.

Vince Delie

there our And back when disclosed energy years downturn. I Gary, was exposures related we ago, few think right a past a in the

think years it four maybe three, I was about ago.

Gary Guerrieri

Yes.

Vince Delie

We've cut half. exposure that in

these been mean, active it's evident think, I I that in we've pretty areas. So not

you as exposure retailers. it's comment in many well I for current should mean, because look the environment, difficult at on operations think the I retail as you

perform, side granularity a are book the are in as there's number at look going them right? the retail of some here. you well retail our segments continue there within to to of If that Grocery, on

Gary Guerrieri

of gas well, think makes that an thirds book. grocery, because as key concerns naturally Vince, up retail C&I important there there. that The point station, that's our the here, of automotive, point are two I Yes,

a it. those that's number industries industries. So heavy dose of essential remained opened as A have of

retail economic coming feel as well spot as, soft we position its an the of good through this, here So, fairly into about standpoint. a our working way book, from

Michael Young

Okay, thanks.

Operator

question with Please Our go Casey Jefferies. next comes Haire ahead. from

Casey Haire

morning thanks. Yes, guys. Good

Vince Delie

morning. Good

Casey Haire

that assume is book second earning question deposits relates the first assets on were track balance quarter the securities because we growth flattish should loan and – guess here, as I just the it was to down. sheet, guide

kind get to a to on of trying the sense we balance quarter? expect can sheet second as Just what

Vince Delie

probably little just reinvestment. the we portfolio during actually quarter be that lighter will because it than a given investment the Yes, shrank

million almost we first think $XXX quarter. million, it I during $XXX the reduced

XX is guess flow that cash billion over my So is $X.X on the months.

So I flow. run of I kind would investing, prepayments. the function fully there, reinvesting just expect a from of that a to doing little some again are cash we down mean not bit

little lower So than. earning would assets be a bit

Vince Calabrese

seasonal. depository want I remember think balances, are us to for you the the balances

Casey Haire

note. a make I’ll Yes

Vince Calabrese

course Of yes.

time. build it over So will

Casey Haire

Yes, had towards understood. asset I that's growth, know end on mean quarter. $X.X the you quarter draws X% is, because in some I loan just billion mean of first line here. And And the I of the base the earning the

core in growth on bleeding has what second that down. loan you're the for, a utilization positively basis expectation sounds So come like into is the and quarter. But it

outside loans in for I So of core guess point a outside quarter? the core – What's the book? expectation PPP is loan F.N.B. my second the of is what

Vince Calabrese

think move got to a of don't at really to mean solid lot a in little tell point. I We're a movement. game. customer think I is Yes, eager we've it's think I I this base. at anybody tough this not good the seeing stage

today would we I would the expect expect – pretty I us be So, balances to that to solid. have

still standstill of number we business of a prospects. kind we're pretty in like the good, you for because a pipeline I is that said, in I know think winning reasons. the visit but really that are can't I marketplace

on I to up XX%. a seen. on customers XX% of we initially. was We new it opened rate when I've had our PPP capture about execution We think alone new customers our to had what customers good, relative extraordinarily

pretty been has comments the have been and good favorable. execution the So

would settle want after Gary? – I what this So to all later acceleration I I activity. add anything else in that know know to year if to starts be down expect in don't don't the an you there'll

Gary Guerrieri

few right base. they off, a half I Yes, good, and have specifically that and investing, A mean, a of are planned. investments still I some mean, those we've month had certain seen temporarily some so. held month last through pretty lending business last activity half some we've or the our client steady seen decent month, around throughout from they them but the

Vince Calabrese

impact be careful financial the we're on have because crisis and that could you obviously understand it's we And the midst in borrower. the of have to of performance

we're through as positioned side. on pretty well being cautious. we're I we the move But, crisis So this think, other

Casey Haire

on some XXX that is you could How ratio What ratio that TCE put know a guys more The your at go? low Understood. a I PPP quarter, ratio appetite? it – willing carries at you levered ratio. bit but the that little and that pressure that get to than on are risk zero let most waiting, are

Vince Calabrese

supposed growing we're that. Well, be to

prior strategy crisis. our was the to that So

in I think, to risk our capital the I the relative think we're is portfolio good. again, – position

mentioned. think a including we've mentioned, scenario I our that we've in variety position scenarios the that of Gary pandemic capital stressed

an So fee I terms us in quarter future, we the expect, I build income, capital about as I in see would really be will good third the to helping requirements the of forgiveness move in will an people out pretty comply the out. into not feel laid but think, the that be of yet, acceleration laid they're that see in because, out. that. hopefully and benefit acceleration you and will on there as loans I these with mean

a TCE you and or So good anything? don't want us keeps place, share that to perspective anything per know I I Vince, book all a if pretty value in add think tangible of I missed perspective. have from

Gary Guerrieri

basis mean, expect was – ratio couple absent a Yes, was that we on impacts to I point, building a would PPP add just it your the be that I quarterly would to solely building. things.

X%. sheet. that strength Phase would from now to And Vince the then The far the I just that you it's went million all under happens $XXX as temporary whatever $X.X remember as the impact of and But the comfortable funding, for So us million. brings billion there. in basically brings the $XXX mentioned with reasons that you think That's of two billion important $X down to of We're kind from underneath. down balance bring that. incrementally

$X points for XX or so basis it's about So billion worth of those loans.

and And ratios but affect the again, don't as TCE do affect the at they you temporary all, they're ratio. regulatory know they

So go books. with back then the level and loans from kind rebuilding temporary we're once comfortable those off that there, of

Casey Haire

Okay, thanks.

X% sense Just to back that reached a line your – the us from at is your that modifications, a this a the one Gary, script, in has me, – peak, similar of the down? can and for – last on and to I but draws you sense, trying forbearance. pace the missed give if they that Just forbearance that just came apologies they has peaked get

Gary Guerrieri

now. at mortgage has X%, through to to trickle slowed we slowed continued the dramatically borrower going some slowed this as the that Yes, about just working X% that we're We're we're pipeline just a point expect anticipating point. today. And with right this perspective. there, at Casey clarify it get but over has At a still to it's commercial touch it we But has also from portfolio do of sit dramatically.

Casey Haire

Great, thank you.

Gary Guerrieri

Thanks Casey.

Vince Delie

Casey. Thanks

Operator

comes The Russell Davidson. of question ahead. D.A. next Please from Gunther go

Russell Gunther

good guys. morning Hey,

couple a Just of follow-ups.

Gary Guerrieri

Good morning Russell.

Russell Gunther

Gary. Good morning

follow-up the hotels, the share out, I the as coverage anything then to for be back you energy, So called that debt performing. mentioned stress are COVIDXX would on you internal you LTVs could And to perspective service circle wanted stands? tests restaurant, you, appreciate where from underwriting and granularity, you exposures an all of just sensitive

rates would curious buckets risk three well. Just be as you assuming loss of to at as type within those

Gary Guerrieri

LTV XX%, that's of second around range those fairly the of LTVs And around XX% terms to portfolio. going speaking, industries Russell? in consistent from going Yes, the across our standpoint, question generally the low run an What you're piece to a see was spaces.

Russell Gunther

within Just the in of in of you at risk the Gary, your comments testing could more some rates loss portfolios. and internal that share, stress terms you detail any mentioned assumed

Gary Guerrieri

Okay, Vince going to cover is that.

Vince Calabrese

say put we that Yes, to wanted I would there. that mean just Russell, I XX% out

Gary's was what note. restate to just in So,

include our last adverse charge of XX% end XX, quarters the March that at from reserve discounts, the stress So unamortized severely test nine you loan period the did. we over offs if

to severely, every against But a disclosed And perspective we've and is different what those hit charge really Just the scenario in very we loss it. done time that that different offs. tell adverse put we of it's it pieces you can the hard it all I significant in reserve rates. have haven't

Russell Gunther

for Thank my questions. I you taking guys. appreciate it

Vince Calabrese

Russell. you, Thank

Gary Guerrieri

you. Thank

Operator

KBW. from comes question next Collyn with Gilbert Our

Collyn Gilbert

Thanks. Good morning everyone.

Vince Delie

Good morning.

Gary Guerrieri

morning, Collyn. Good

Vince Calabrese

Good morning, Collyn.

Collyn Gilbert

to deferrals if to that you so of guess Gary kind Just seeing stick – right terms I XX? in in kind we discussion X% know second, I of in included you the are assume classify for now, credit a of $X.X mentioned of Slide that's of billion. roughly how deferrals you those you of much of $X.X like that? Do guess loans would be billion sort sensitive COVID

Gary Guerrieri

total the and lodging. is Yes, is IRE million. about loans lodging the accommodation $XXX of in And in a the book the $XXX The let million terms and find million, retail right million. about it's $XXX deferred $XX retail food of at about me

Collyn Gilbert

guessing Okay. granular just numbers. just And then the is rest I'm smaller

Gary Guerrieri

That’s correct Collyn.

Collyn Gilbert

just to numbers make that's sure clarify on All these right, right. then, NIM, Okay. helpful. wanted to the And just got just I've

if quarter So compare that the quarter? fourth saw million like actual we to you amount you that $X.X guys dollar in saw this was the guys accretion what,

Vince Calabrese

million. was $XX million, $XX.X it Yes,

Collyn Gilbert

Okay.

a a out fell core XX? bps NIM Is would that about right would maybe at core the I on core quarter. then first in so that basis, Okay, NIM NIM is four imply it – settle guess that like

Vince Calabrese

right environment. of we CECL excluded mean forward if I Yes, there, as in it's that, the into all kind go

I'm million, Yes, guess about… $XX second. think hang – on the of So a trying that's to I

Vince Delie

[Indiscernible]

Vince Calabrese

to That's points about is $X.X margin. – three five like three is what points be six million of basis it would about basis

So yes, or basis so. it's points around five

Collyn Gilbert

Okay, got it.

there a come of kind just a pipeline there's flowing obviously some you thinking lastly hold in it guidance this And into of sounds And the just should But trying that lot it I sounds of based levels like your of quarter. mean markets, on to screeching you activity those then expectation capital in Okay. markets on Gary reconcile also have comment still about you're I this loan of, yet quarter. still discussion about – and But to – a guess activities the through. kind obviously kind that capital growth then quarter like is your great had kind halt. has customer that the

the reconcile start a So just thought to I there. that I'm to meaningfully guess visible slow seeing understand would would maybe that that say there trying activity pretty or trying to to just cause pipeline you're you there's

So just why ahead. to – still trying go have understand you

Vince Delie

big at Yes, interest And impairment. I huge. mortgage to bank the fee with I'm Collyn, I because – pipeline not don't the think is what's happen income you anticipate look in is rates. took their have sure – to they total, going

Vince Calabrese

Right.

Vince Delie

forecast. I their that But would don't the to would quarter I next in income want fee expect significantly higher. be

And into SBA going then a lot PPP this program of then of pretty the outside pipeline activity. situation. have you that a the solid And business had there's

pretty geographies. March darn for of The from us perspective were good the first months two across an origination

would that I can't what level, continue to expect perspective. a we continue would would there I deals a at expect that several it and are that are next fix I activity would were their because of through, quarter. like but capital number predict companies markets working that syndication's So into to debt from there

We'll shakes see lot a what looking of can it there's the pretty do going to forecasting, uncertainty. all we again happens with were best trying into this. we So, but We're the good out. as

Collyn Gilbert

great. Yes, that’s

guys. I had Okay that’s all thanks

Vince Calabrese

much. you Thank very

Vince Delie

Thanks.

Operator

next ahead. comes Brody Stephens Our from question Preston Please with go Inc.

Brody Preston

morning How you? Good everyone. are

Vince Calabrese

Good morning.

Vince Delie

you? Good. morning Brody. How Good are

Brody Preston

on just PPP income back Yes, the to want recognition. circle good. I

period, understand pushed better beginning eight-week and be which June. sort Because most to an I you the to weeks accounting accrual activity here of why guess, out did would, XQ? of the the second from early perspective the beginning, then So just I in gets the just want there's to of us quarter

And you forgiven? what's you would so as XQ? in have for at XQ and least that one, think that accrue why just sense around what so wouldn’t for been a I to And June opposed would by utilized so

Vince Calabrese

still on that They how to guidelines as to work going out Well, have process. there's the forgiveness is put to Brody. a process the

with every They guaranteed. loan single that percent get to hundred are all know that forgiveness. going not a will really you're So certainty

or standpoint risk and fee loan loan until un-accreted is the a bring kind from of But you're forgiven a un-amortized there. from paid covered can't you really in standpoint the So off. accounting

it come why. those SBA truly don't process, it to of you in. until and to be that since would really off doesn't going some defined but the forgiven all bring you the And So, XXX% we'll of go with know is that's still paid when accrete in, in full they certainty then amount are loan through be the

Vince Delie

say, our through, of size funded I under the $XXX,XXX. given coming And last I'd batch mean that we was client the

think to be I bigger going there’s a that So delay.

brought small have through We that more businesses here. we

lower way there. many than is out average Our

that the of prepare So mark. big on the is timing we in when information the question get to queue forgiveness they process that don't the a the yet have

a us maybe So So sophisticated, aren't going it I be think as customers right? slower little to for it's a them little might take because the longer.

Vince Calabrese

Well, plus that. there's that's an eight-week into period baked

Vince Delie

Yes.

Vince Calabrese

follow then it's out You have lays whatever as weeks after far how to eight going to is have till and first that as the you to process wait the work. SBA

So June you XX. through that that gets

Vince Delie

Yes, it's quarter. into the third

Vince Calabrese

Yes.

Brody Preston

Right.

Gary Guerrieri

up fee it it the the matching guess, up. the yield, show a then they're baking Yes, with on I so into kind loan loan per will of basis, and

Vince Delie

got okay Yes, it.

Brody Preston

you back expect right, Right, helpful. just you're that's then on And get now, of given Gary, pipeline. the to up go X%, right to about in wanted what's just loans to deferral All at said X% okay.

$X.X So billion. that's about

are deferrals mix give like taking some you could are it that on maybe borrowers up slide these maybe are XXX some color type I borrowers all, but you of the want for the a advantage pretty deferral a go get and expect for in you have just Do You given that’s you or seeing, to guess, FASB some customers, to the that periods. XX-day extra borrower of are liquidity? to with loans regulators deck, guess starting the strong, way days sort bulk if these I deferrals of need actually you between and of there seeing the

Vince Delie

And seeing full only borrowers, Brody percentage the is can tell you, essentially of offered a are I – We deferral. significant a to principal significant commercial deferring interest only which payments what of that. the the are piece we've or

We only of are side equation. very on the interest that heavy

of to XX% just the of the are principal. So pay interest and the the time borrowers defer choosing north

deferrals the here. portfolio that think for of borrower speaks the quality I and looking So the that's to

are they for cash looking I preserve think and deferrals are available. to

advantage they're of that So appropriately. taking

support it that need additional days the XX as is As XXX far an concerned, for we days. borrowers will

those as be borrowers need with industry industry would be we potentially So I that restaurant additional well. would as XX industry forward. hotel will go days an the as would that expect an working we

So, going primarily focused I think be they're heavily to there.

Brody Preston

great I'm you your higher. accrued for trying receivable – item, gauge I'm accrued a I'm of I is reason based the line XX% IO. fact assuming commercial move increase that or not see are to That's receivable you color. interest just significant whether to And are which significantly continuing expect guess expect Okay. that to like, would don't borrowers your your just see on asking the interest asking in

Gary Guerrieri

capitalized No, into don't too. I be loan, Right. want Right. the don't. no, to we

Brody Preston

Okay.

that interest where loan wondering, accruing like interest, because borrowers, of maybe the I'm into – like assuming not on necessarily that the end, Just capitalized it, guess accrued get I receivable you're the that but you're back will receiving some with in these or into maybe balance would I'm flow Correct? interim.

Gary Guerrieri

Well, not if it. you're capitalizing

part capitalizing the you're If becomes loan of it, it balance.

Brody Preston

Okay.

Vince Calabrese

funding it to on end and loan. the packing of the You're it

Gary Guerrieri

That’s right.

Vince Delie

a higher Accruing of period interest over time. balance on a

Gary Guerrieri

That’s right.

Vince Calabrese

what's happening. That's

Gary Guerrieri

small. It's

Vince Calabrese

value, but is higher but it it a It smaller, is piece, small but it’s has okay.

Brody Preston

be the you And XX% – loss mentioned would current the XXXX scenario. the reserve severe DFAST, of the Okay.

over doing spread multiple that that stress math. loss of year the test? fits a just one that Is million years or that to $XXX scenario, out So about that loss in severe sort is

Gary Guerrieri

over nine quarters. that's So

Vince Calabrese

test. The way stress the you do

nine cumulative that's So over period. losses quarter a

Brody Preston

reserve PPNR on dip Is based wouldn't is, fair run just that the say? and what losses. PPNR just need like would rate into that sounds more because it the cover to that to So given the than you even

Vince Calabrese

restate I'm you not can you following Brody, I'm that? sure

Brody Preston

your to wouldn't adequate over necessarily time for need that quarter that into Like every you PPNR at Yes. if level losses, provision you than reserve. levels are where those more the dip it to cover

Vince Calabrese

what Yes, see on you're it well how… depends saying. I

Vince Delie

out. How it plays

Vince Calabrese

economy plays the out. How

Vince Delie

Let's hope that.

Vince Calabrese

Yes.

Vince Delie

Yes.

Brody Preston

big mentioned, interesting deposits weeks. last is stat, Alright. And Vince, that's And in up the mobile but being situation you fluid, two number. I that know XX% an then the a pretty,

there you wanted of behavior mobile in thinking previously branch understand month and or cutting geographies better surprised where any timeframe, your considered just I to are now about last in terms this so that's hadn't maybe during you has adoption you has the it? how footprint? or Because And customer changed thinking anything are so happened about you're

Vince Delie

Well, we've of cut a branches. lot

the What perspective. this we're from XX% would of what's leading down in had branches cut up volume have normal interesting finding still the we open to fact left we already In probably we – I'm path. XX seeing a that is gone about them not transaction the

it's what were remote and we mobile capture to the end-to-end, is device, increased mentioned, device telling so while me So to people of to and in mobile there. the their office, that's going that capture their that's use like people checks using that branch remote small I through be more permit willing limits instead their flow could using to businesses,

our up I have number of and and a would that using what products signing older customers for may it. expect that we've online now mobile witnessed weren't been are is

branches. So, we're walking them it through the in

of We've significantly So accelerated. I reduced those branches. would to number expect be products the adoption of

is conversion those good. branches the of where point the to getting we’re think I

And to if at capital of begin this without channel, cut will sort to continue investment some ability our grow. rate it we delivery erode in the to making

we a be That's in in looking it I strategic by accommodate may think, new evolution we're closures. to that a consolidation, I we have is So facility of can build we’re two requires what where at the to and to about are, closures. going We mean have out that. area And branch an take spend. CapEx but where

Brody Preston

Okay. a And one… quick then couple real

Vince Delie

we in a uptick transactions, I saw is other mention obviously. also will the Well, ITM significant thing

interactive weeks. the HR equipment, increased well branches think, for which several machine, these utilization, Again, They've the down comfortable it cash human the to lead of utilization using bend. from check bodes the a efficiency have – in being, you an can devices So, could the on the more last future teller we about terms where become I XX been the ITMs, actually and a in more has in consumers speak those to perspective. to a

look So Thank and good But a it. is this to you. at question I appreciate there’s ways question. the other

Brody Preston

the from on one I if the assuming last you said I one me, buy just sorry, then hold, am are in backs capital And that with Yes. script.

Vince Delie

buyback The on hold. is

Vince preserve think of acquired to his prepared million comments capital. shares the worth then $XX put in we in floating on mentioned it we hold about everything, to prior I and

Brody Preston

very All right, great. Thank you everyone. much

Vince Delie

Yes.

Gary Guerrieri

Brody. Thanks

Vince Delie

Thank you.

Operator

comes Martin next Janney Our go Montgomery. from ahead. question Brian Please with

Brian Martin

Hey good morning guys.

Vince Delie

Hey good morning Brian.

Gary Guerrieri

Brian. morning Good

Vince Calabrese

Hey Brian.

Brian Martin

minute PPP – just But been I’m has – stuff Gary covered. my sorry. maybe the maybe of on Vince just I the just or guess I of for a Most back a

you about when you talk talk the thinking the X% just that. $X.X understand guys I are is just on lot you about it or so or rate about and you're you far If benefit given the as there's not as what to how how it, the about were – do a realized billion, going of talking disclosure

through was, of can If spread and or fee quarter it level quarters kind $XX are talking quarter? not second how thinking guys million couple give for flow would you you million are much high today in just in take the thinking next kind from it benefit and sense and the the part, third as third you you're or perspective on and any the about as part recognize a fourth just how what of you you X% that about, of $XX – you of

Vince Calabrese

Yes, in years, once over it then would come accounted two for left. whatever it's loan loan. would is stuff, the bring in by forgiven you Brian, It's absent

be, two-year loans, state the math the quoted it gets loans, of the guess say. to you should just the spread over of which the XX-ish, what life out So life just basically I would the which period, of is work figure I is the

that’s until get saying And you they On paid forgiven loans expect quarter. it bring are bring is the forgiven And get during we each would third way the would that would going to third is not into the into off. process quarter left. you we work, earlier income the be that then what we were when loan whatever to then

Brian Martin

Okay.

Vince Calabrese

is X.XX% kind quote the of what baked was I second for like that in yields kind we it all would of So quarter. a have in

Brian Martin

you. Got

capital really guess guess, and on there to And mean, the as guys something years. you are it over that's Or here I relates just would going the that then Okay, thinking any you is you are you of the the Gary, not sheet that forward? something thinking helpful. you Is asset balance now loans today? consider, about guess, other the I I you the, sold couple last about sales is anything, assets about – talked

Gary Guerrieri

Yes, at said, looking at always point. being we we were constantly in all selling looking we we any anything have That at this mortgage at the sheet, that positioned have the interest balance portfolio. And Brian. are don't

So normal be but if nothing than would just be that. type sold, other of there would anything, would it be that cut mortgage a pool

Vince Delie

would sold be challenge. a portfolios a it more And mean, those robust we during time. I

but Gary were credits of they the instances. certain made to large was many decision revenue, classes, those and the pressure past strategic back and in were – classes, able in get I reflect hospitality we I think to were grow sold, And exit asset cases tremendous component I on know that of calls. to we go a most at So exposures a I those loans were back, out premium. under

of apple bite management. the a of taken we’ve think I risk out So big terms in

we of portfolios, that and at could didn't hospitality narrower. from at a Credit that the gain the look have we sold there looking appetite we products you if mortgage that spreads time. get other and an Regency, And packaged the because back, certainty in areas more sell, them at out you acquired for portfolios credit time were was that heavy concentration decided moving And we had sold. away when on a certain sale to getting

Gary Guerrieri

strengthened seeing books add off over around today. And assets the really books. Brian years have doing work last I workout tremendous other team. the We've been X.X and we The we're our it two, continue of thing that moving off that, some they the won the course that would is

from well. as a are be. that's core the focus something that we that And company So to is of and continue benefiting will

Brian Martin

Got you.

looks Okay, I And a as said, that's it like no helpful. great move.

the me last one just for was on income just the part. So fee

down that? the And kind would also this if go saw that, of you about pressure, two Just business thinking you conditions, color were service charges just know expect right, the I quarter, given questions. on them gave you down I any to hear but just you already further? that's the you of seeing how comes market wealth are if of the of you are any trust today, under some Did

Vince Delie

back forecast. to part Last go and I'll the

Gary Guerrieri

ahead. Go

Vince Delie

four weaker number, not some mean we waivers, of mean $X expect big that less that I All except than I – what expecting from – Okay. would we is say, guess just noninterest core right. this. weeks have first I million in, increased the seen for stable a where Yes, seen the can of guidance I say, there we've we service we've charges. do kind be I income were to the

So just impact there's there last And there. then is some activity.

So the to service the weaker expecting was transaction. see on deposit comment charges that

contributions. looking what's in capital income all versus kind year fourth So still noninterest out and markets quarter continued growth nicely. we've commissions, We've teams we run fourth versus against up the a I strong deck, mean those was securities insurance, the other that the slide for very ago quarter in very both businesses. the We're strong. happening mean build the I could trust, you percentage first that at invested and up And is year-over-year in of there. look to the quarter movement we businesses. When have will the see

have very those important – are So interest mitigate impacts. I contributions to been think rate the

in quarter, come level number second of a would to, expect without quarter. we good, back we And normal, impact this MSR would then the an to to expect that mortgage kind solid

Vince Calabrese

overall But perspective be Right. speaking material. from you to net declining expect because not or an that meaningful are if of the decline, about earnings market asset I would values

on be So I'd not it's to an say material. earnings perspective, going

Brian Martin

appreciate release Okay. all color in the I guys. the and the today. That's all had I details

Vince Delie

you. Thank

Gary Guerrieri

Thanks Brian.

Operator

closing conference to the This like for to session. concludes our question-and-answer management over would any back remarks. turn I

Vince Delie

exposures how what be. have the the everybody our questions. could of hope first could ran like all, would you I were on to our I additional information our Well, we tried everybody of model, thoughtful run information model, or thank for understanding better the we portfolio found to potentially using valuable. that credit We a to provide so where methodology

in place. good I pretty think a we're

safe. and time. that look questions. everybody appreciate And I I to next analysis we'll everybody's hope see And just And you stays thoughtful

quarter hopefully on stand we’ll economically. we more have next clarity where So

So thank you very much. Take care.

Operator

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

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