Valley National Bancorp (VLY) 26 Oct 232023 Q3 Earnings call transcript

Company Profile

Participants

Travis Lan	executive
Ira Robbins	executive
Thomas Iadanza	executive
Michael Hagedorn	executive
Frank Schiraldi	analyst
Matthew Breese	analyst
Michael Perito	analyst
Jon Arfstrom	analyst
Manan Gosalia	analyst
Stephen Moss	analyst

Call transcript

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Operator

Good day and thank you for standing by. Welcome to the third Quarter 2023 Valley National Bancorp Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. to Travis conference Relations. Lan, like first to now today, speaker Head would hand over the your I of Investor

Travis Lan

morning, of Valley's Call. to Iadanza; and Ira and XXXX Officer, Tom Good Conference Mike Financial Earnings Hagedorn. Robbins; third President Presenting today, Valley Quarter behalf Chief our CEO on welcome

discussing release refer company would can be documents for non-GAAP I begin, everyone measures. website we non-GAAP exclude from supporting valley.com. to make certain we earnings of aware reconciliations reported refer on and our our that measures, which Before results. these like release our to to at When quarterly results, earnings items found today's Please

call and National all participants X banking I discussion cause and earnings SEC comments X-K, remind I'll found encourages on presentation may like those over forms turn Bancorp industry. statements Valley to XX-Q to and refer the this that results actual contain to factors relating and complete XX-K statements. highlight Additionally, the forward-looking would the Robbins. from Valley call Slide our of differ you filings, With for Ira to those that, during statements to forward-looking made that including to of could

Ira Robbins

quarter third $XXX million Exclusive and income per share the income were EPS of net In and XXXX, million of non-core $X.XX Travis. and you, Valley reported net $X.XX. of $XXX Thank of earnings items, adjusted respectively.

model. these sound improved and to not has original of the has future, were asset continue curve, from expectations change reflective business Our deposit have metrics, banking pressures. and an environment, organic current and do growth, said, That traditional models quality not duration inversion control. of anticipated quarterly while results exceeded to challenged The foundational we solid rate the interest for foreseeable highlighted our capital is by flows intend current core we expense been inverted the insulated

external believe we than else slower interest decline and recent the bottom of environment near fluid. Our its in a quarters, that at income while NAI much remains decline all the pace is net equal

initiatives Our on executing our strategic focus remain steadfast.

in last integrations strategic our efforts single channels, required allow FinTech integrating our execute channels, of months for core and undertaking, planning, delivery scalability positioning enhancing a to and bank years unique without testing. expense bespoke with and on during the phase couldn't of first of flexibility has One which the to the team and in is I'm last which reiterate over in to the natural system. be report evolution I This the operating operating pleased the the that tirelessly delivery transform few been environment. cultural traditional this now environment of has transformational project, weekend years. belief massive a was I system the conversion This occurred technology development core technology prouder our on to operating progression extremely to Valley's discipline October, our hurdles. challenging that of done worked complete a of our was conversion of operating an few

evident been in line recent largest players our strengthen support our with mindset, continuously industry. bring collectively have this our to we growth-oriented in has develop in more results. developed which capabilities a us financial We our mindset, To and

yet the execute. technologies discipline to provability our conversion infrastructure now to and opportunities and environment was a new leverage bankers to successful significant another have these additional robust normalizes.Our of drive example Our more we expect as see growth and

platform. our anticipate common both core As efficiencies scale we expense revenue enter resulting XXXX, we from generating and

of a we we're moved are technology associated As with typically massive that the burdened have cloud-based hardware not type infrastructure, to costs with investment.

growth and month opportunities and Mike that, financial I'll over significant.With ago, the we call turn today nimble ahead of more were Tom are quarter's the remain than a results. us to the and to We discuss

Thomas Iadanza

retail you, runoff Slide interest CD bearing illustrates offset bearing experienced We accounts million deposit during strong and products our bearing total mix has on quarter. of total which Ira. non-interest portfolio. shift flowed of transaction indirect growth weigh has declines more the in Slide maturities. an interest-bearing the and diversity approximately Thank CDs, to to of deposit continued but deposit X provides $XXX X growth continued our non-interest pace deposit deposit The detail cost.

national through benefited during specialized enabled us deposits online we our in channel. particularly our off maturing verticals. growth indirect These quarter. in pay our from business CDs quarter, strong stability to in the the strong Inflows and and branch-based were deposits dynamics During our some

adjusted our and reduce significant single with diversity deposits. have No to our base. and commercial deposit X% industry the illustrates coverage and more liquidity.Slide for continued of X also our uninsured of further deposit cash than accounts exposure We quality high granularity

Our has has Annualized progressed. quarter basis diversified meaningfully fully a loan require geography. can X, as of Originations on Slide you across requirements.Now These higher diversity on commercial estate type growth composition. and real our result continue yields.Slide loans. government by is and overview footprint state wider to year-to-date as down year the portfolio new relative our slowed we collateral the during of portfolio efforts in decline origination to remains and new growth the loan spreads our to turning X portfolio collateralized breaks collateral consistently an see

a LTV loan an size an average have million. roughly granular XX%. our extremely perspective, at we remains reminder, From portfolio $X weighted a with metric As of loan average

coverage have somewhat As to have service ratios net interest declined increased, rates X.Xx.

at granular consistent believe The of Mike the origination. pools portfolio.With to maturing call insight to monitor metrics rates of I composition underwriting cap higher closely the diverse that provide continued office to of the to that, absorb over borrowers quarter's continue and illustrates and and additional turn will strong our discipline significant This the slide pass following our Hagedorn through financials. at well-positioned efforts on are stress loans conservative resetting We and rates. reflects testing

Michael Hagedorn

in half in of quarter million was the interest Thanks, $X than Tom. Slide net trends. Illustrates the interest experienced income quarterly second decline XX. net year. Valley's less margin The reduction the recent and sequential income of

improve continue yields asset and costs mixed While shift pricing funding competition drove to higher. continued

net On that we income the signs call, observing interest stabilization. of were second quarter indicated we

interest the income monthly stable level. and the June higher During than net generally quarter, was

to we quarter, XX, with net expenses with in quarter quarter our fully of Slide basis see basis be non-interest and the certain declined quarter levels.Moving approximately we else All a Absent we of the loan can was expenses $XX $XX closer By technology fourth to abnormal equivalent Exclusive capital growth. a quarter. in second partially quarter compared over you Adjusted stable.On million decline million margin points interest nearly associated $XX on million our the that despite with points $XXX as expect adjusted third the from Our net were quarter. quarter non-interest the relatively lower our adjusted third on or modest basis. in approximately an to prior to consistent position $XXX million the fees Other an second few million The XX quarter declined been $X increase to of XX, income generally cash generally core of versus linked income generally months. for our been tax has factors, interest non-core in were XXXX the last conversion. primarily X the income business basis approximately costs the was liquidity effectively quarter successful of remain has to end stable equal, non-interest lines quarter markets line for items, the environmental normalized. related level. expect slower million with generated associated Slide for

consulting benefits fees of a see FDIC to began about through recent the basis. declined we also midway on quarter. the Specifically, and headcount costs sequential outside reductions assessment

been yield revenue We face see on months. early below effectively the from quality certain reiterate, but the cost previously which have common our inverted level XX, Legacy can last period, resulted for controlling Non-accrual to core. XX of previously have loans After delinquencies a quarters. conversion Valley for announced you in flat Early the the to the X the in the on average focus Slide ticked adjustment quarter, wave to year. core asset in we identified continue expenses joined result Leumi new next the on last of is now during growth. to our pressures efforts remain slow trends expect X stage curve.Turning last expense up quarters. the of savings the have well execute To future a and

Third approximately quarter increased somewhat you levels.On declined XX, charge-offs for X.X% is ago. value up recent net and can from from Slide year tangible book a quarter see nearly XX% the that

to us with areas quarter the all that enabled securities. challenges cash Tangible have and X.X% tangible as tangible are has our prudently capital faced insulate significant of positioning for sheet assets impact increased result avoid common associated the to from proud headwind. risk position. the manage We OCI sale in balance related other available to Our to during ability our this a equity normalized to peers

risk-based capital XXXX. slowed, regulatory ratios quarter growth XX to increased As of loan have as and points second XX basis the compared our between

organic to call our to the We operator sheet incrementally I'll back our prioritize that, strengthen in this growth the prudently continue environment managing balance to challenging are and begin turn capital position.With to Q&A.

Operator

first time, comes with question-and-answer from will [Operator this Instructions] Schiraldi Our Frank we Piper session. question conduct Sandler. At the

Frank Schiraldi

of bit stabilization you trajectory upwards? out get of general like from is for In on reversal here. of NII/NIM, in do there you you the the in into higher-for-longer the period thinking get thoughts a a so Just little more Just bottom then talked and Or of trajectory a sort sort along XXXX, bouncing wondering a scenario, mean, your about some just there's I you it of there. higher-for-longer time? trough a hopeful NIM think

Michael Hagedorn

Frank, it's Mike.

I you XXXX, since our we the of we've XXX mid-XXXs of in look at from to been quarter they and low quarter as deposits, you remarks, when first look range were first to NIM XX to they From you'll that cost trajectory up in think and quarter points. XX they at up in that up April, said XX as 'XX prepared third when 'XX, that well. into fourth of basis were notice were quarter, quarter second the

to would rate a higher environment, a that higher all happen and but in the being normalization couple NIM. in both a I So slightly the see we're NIM. in things result cost NII would equal things starting a slightly In think also higher-for-longer

non-interest been rotation and XXXX, product. of of biggest all of for interest-bearing our bearing been into those compression has on NIM the of out and first it's the true the The driver

would I a that some think a we plateau So in equilibrium see place, environment, higher-for-longer some in there's that.

the with forward go stabilizing, and then you off earlier you sheet of as that when that NII will of think thing the least I created year modeling, about modeling, mind assets, that our And at earning be to first was keep as the result all both repricing to in of that our drive, got but drive at thing more current going expansion the will throughout NIM in assets, very the on the chaos we've liquidity is large and a the quarter increases rate you And had the book. as second we fixed repricing a with balance loans. know is, we look of and the this have at bank kind is in deposits throughout adjustable end our build our we rate completely the XXXX failures what book Second, that think specifically quarter repricing that opportunities along XXX. our

expect we So a the of expansion to year. main would next NIM be that driver

Frank Schiraldi

the it really you that, in of follow good broker just as to customer all Mike. some Appreciate color, success balances, guys had have the raising up then And a like deposits. looks terms

continue? do or guess off. you fall the And do out And you let expect how you to so expect to if I here? kind table, do so, look quickly brokered that at expect balances when of as you've maturization roll you these

Michael Hagedorn

help that I in reduction current base. We've And fill when in sheet the using attention we that fill broker not how so book we've duration while that will NIM of that thinking certainly and to throughout the year see balances, paying had of core want very and Yes, loan using expansion growth the modeling our to close NII. used sure the that's 'XX our manage further also used both broker. everybody and especially goals, been stopgap we're but we've one we the make second gaps, the repricing gaps is our our much thing in We've our balance brokerage earlier that in understands the done rate been current higher to is and deposit we've our on measures. portfolio to back

been in a been know a market and very And so I us have excellent They've and to they effectively. sometimes. the for effective connotation certain that use circumstances bad certain very has times,

Frank Schiraldi

able of to much difference at look front market terms of terms as pricing direct? new what in versus you of And from directly there just in here, get lastly new broker terms on is the of, in that versus a you're indirect customers

Michael Hagedorn

the Yes, biggest the curve the that. of inversion impact is probably on

the close about the duration, cost you're If incremental to deposits exactly talking another. would one say of same I is fairly

So point it's but there basis be remarkably XX different. not difference, may that

you So probably rate again, is go this curve. if asking to use case in in want duration, you about, want that and inverted I to think, but both previous to comments that you're duration back for manage that my

Ira Robbins

deposits. us Ira. up growth this was And just the when Frank, we earlier, to the we those deposits, some incremental of put based cost significant would were that piece the of incremental deposits to to as I alluded some these obviously demand think of loan add for about there ratcheted incremental Mike that on of seeing.

for of cost still originating down deposits scaled back for now come those demand deposits. have we we're As CDs broker a actually the the bit loan higher growth, and and have some

as last were think call, the about spoke deposit we this on the XXX, around for time originations XXX-ish. I overall quarter

a marginal that basis, on anticipate on in So on that's some based out deposits loan cheaper products. curtail we incremental blended are. coming than And we growth, to the our expansion as what loan definitely much the indirects coming margin are

Operator

with Our next Matthew Stevens. question Breeze comes from

Matthew Breese

Maybe September can shake point fourth NIM the NIM just you sticking was the across provide with about could is launch into for where quarter the good quarter it the fourth out and a what the quarter? NIM, monthly

Travis Lan

And this is Matt, Travis.

XXX, August with and monthly basis, September XXX. Just on a with July XXX

throughout mean, really I we we the say pretty quarter, was mean it. stable when it So

the September same good that's launch the point. were yes, a So and But quarter number.

Matthew Breese

would And outlook additional loan additional comfortable for some also you feel loan growth. I and then near-term reaccelerating hoping was color on perhaps growth maybe when

Thomas Iadanza

as The Tom. We of XX% over growth and here has on activity. higher the of it's market still fact much C&I customers We're growth Florida so our widening last really service and just grown relationship out the that spreads has is portfolio those year, that related, just the slowed well getting their in the valued want portfolio really I loan driven in piece. still rate customer focus percent just as Matt, real growth uncertainty slowing a the estate down to need grow it point it, and to at C&I they when we continue market the that base. quarter, slower of our would Northeast. the I that be year. the growth quarter be we'll in expect the to a in X% to and to fourth third for C&I, in similar fashion range X% down stable

Matthew Breese

or Bank wishing Ira Valley's your just and and with I then group have, in first sheet light In end your any if on overseas any that, bank deal horrific balance because curious and And acknowledging Leumi's events they and of best the the as just of with will everybody was relationship Israel. impact over the on events private partnership, way? client in yours end Leumi on

Ira Robbins

it's been side. us employees for Bank is obviously I the clients, for a and Leumi is significant a on time. our That said, This very participation partner know of Ira. all difficult

any and people. haven't of anticipate for we We seen a move and continue We going to be yet, think usual. lot as by we're to continue But as definitely to business still interruption forward of not impacted it. difficult

Thomas Iadanza

it's Tom. Matt,

here forth business on usual of back of all on down secured and but very, you really partner based have bonds Just Otherwise in the finance Israeli transactions. conditions, by direct help and economic entities. US flow very little it's it's companies, it's citizens Israel business high US-based we with and and only and working to as net domestic in them loan a but it's exposure done natural portfolio. context worth subsidiaries is slowed The give The we of here. a State small

Matthew Breese

I then some you like And Last to previously it in anything versus into Is plan, planning? mentioned believe identified? cost spoke this else us in cost could give of progress to as over we it you've the execution we additional is matching are was saves? $XX update How expected up of looked there as where million terms uncovered was you've X kind saving quarters.

Travis Lan

running. you as you into I incrementally where will the and some that's think fourth party But first don't In the get half in third then basis we're up Post-conversion, quarter. XX combination next get efficiencies. Travis. it's of I'd we on quarter, XXXX, we annualized got anticipated. additional Matt, which staffed it's the had wave keeping, to XX% a Yes, from resource and of the what I an come say much probably XX% expect of vendors

So the much where remaining. quarter. get first the that's you we to I anticipate fourth XXXX, of of once don't you think half I But what's again, the in bulk see

looking hadn't We that previously still identified. we obviously post-conversion at are opportunities

And there. so we'll continue to dig

Matthew Breese

expense Correct? should natural expenses one that versus the we And of the dollar for one down slows thinking dollar plan and Yes. be lowers pickup as that rate? run

Travis Lan

correct. That's

So are growth on I kind growth mean, back growth of way cost level mean FDIC that just to on digits perspective, headwinds to regulatory numbers expense our single company. these mid-single obviously top perspective level, high from to run from historically take of initiatives. that. kind digit just be these perspective and if high an And you away, we've think, I trying based of expense then into work and inflation but an for a this There we're don't is as operating

Matthew Breese

could of have the How metrics if Last be aware exposure? book? one comment for of don't other I performing? you know just one that should we loan me or do just is What's if it but there? syndicated is not, you you on size Any

Thomas Iadanza

direct have the borrowers, not We're a HLC banks, Yes, deals a is relationships about and there. club with They're lenders, of again. contact billion we $X.X any of all portfolio it in market. in with transactions Tom is The sure, they're group really small don't loans. leverage mostly number Matt, over of spread

Thomas Iadanza

a that. over lead We're tend of of We be also. in to lot the those We bank participant. transactions not XX% lead

Operator

comes with Michael KBW. Perito Our question from next

Michael Perito

any are year-on-year context Just thinking given context about expect the guys kind expense can taking this fair around of type be your as plan hoping efficiency the guys around third projections you're commentary into play to for Is at improvement expense plan it the 'XX the you and kind of execution. provide assuming drive you have of able them all NII quarter point here today? probably of the peak to ratio in NII and out the you the kind of of as us

Michael Hagedorn

any I quarter would that So that don't peak. to think would there's third their bank CFO be say tend

think quarter drive You pushed be There's through. fourth costs peak have year-end I of quarter that the to the some accrual work a might reasons, get expenses tends bonus for fourth in that up. sometimes lot right?

actually So that half the which first but the our peak. then ratio. the it turn our we necessarily the you would quarter, previously fourth point I in drive efficiency to of down vast initiatives, agree remainder I vast in 'XX, before realize third the it's right with that. Again wouldn't that's quarter, Travis's back to If would comments majority, cost of announced expect savings and is majority

Michael Perito

couple supply more demand down Alabama what growth? area and the provide updated that commercial you dead quite beat seeing guys Is just and in helpful. think of we if I similar on And wondering the kind trends kind the are dynamics? time for then New just demographics curious credit, can population Jersey of recently? maybe about still market. Florida That's real estate And on, kind of there York, New just horse there of you're quick dynamics, ones but the a context some are I now, more mean, kind of probably some and there inflow demographics

Thomas Iadanza

Yes, affecting transactions and Yes, also. sure. any higher loan slowing we to usually interest The X.X% of or the coverage. below service on the rates metrics impacts They're are Tom. them do value, debt aren't different. X.X% XX% this Michael is

those metrics. So transactions with generating we're still similar

there's population has into that migration those continued still We slowed, but migration The Florida growth are seeing market. in markets.

a probably Our point But all It out, this is earlier the there, us is for growth I'll continue very still in in market cases. we conservatively consumer in of it half part to but all what down business markets. year. was strong underwrite of

that cap those We We rates. are cap have floors in track rates all markets.

than the other suburban We're big We're We around Miami not spread are in major X more players more X Florida. areas the urban. or of market.

Michael Perito

last the just then for And one me.

context other be next about Just of then to base kind to the here kind that it's similar guys that that, for you for kind lift us and all the commentaries, anything is beyond difference? would be reaccelerating, your once could pretty the again, Or into it? of growth taking budgeting thinking to asset you stable quarters permitting is assuming there are possibly fair point some to that is how environment make a of several

Michael Hagedorn

No, I third generally our mean, quarter, I think Mike. was position you the cash end right, have normalized. it I think of

think referenced XXXX, anticipate that picking of think don't on the that you and would quarter see up kind the significant fourth we I I balance but of in then Tom the changes maybe sheet. type in growth other somewhat any there's

Operator

Our comes with capital markets. from question Arfstrom next RBC Jon

Jon Arfstrom

bottom Slide On kind is the you down there's to Mike. much you, capital markets how fees? line for should being have question capital markets And expectations kind of a markets? to expense income What loan for of fee and there lower then if impact numbers it growth. offset XX, any you curious and also we Maybe tied show capital

Thomas Iadanza

been Yes. well gain Tom. has space capital space. on sale consumer The driven really commercial as swaps markets us as it's by in the readily Jon, for the in

don't to expect expect We be any lift forward. We flat going that there.

other We fourth a the year-end. uptick tax get quarter We have get this have to closed and slight things avenues we business. advisory in by

out to shows trades, FX our quarter-to-quarter, which flat into continue progress we're but and year. build expecting next We

Jon Arfstrom

are note up about you're Anything that Anything should we that thinking there dues Credit aware there? be accruing looks of sequentially. great, some the but path to of?

Thomas Iadanza

out the buckets. really looking [indiscernible] No. consumer is coming it and of at I'm

It's our On a the on there. insurance value cash collecting life primarily side, business. it's matter of surrender and consumer liquidating

be to any loss standpoint. problematic going not that's from So potential

were want abnormally just levels low. XQ On to out point our [indiscernible] side, the I

were about or this million $XX year 'XX still quarter we're of ago. third quarter we of a are third in where $XX in the point, 'XX. We At million below

levels. gravitating So to normal we're really more

So any anticipate don't we no, problems.

Jon Arfstrom

with And quarters, X? X, upper the then mean X the I a in the is that last at what that looks cost and you from $XX chart but referenced increases that the curve deposit Mike, $XX? think that you quarter do or right referenced bending $XX for you all and Slide like

Michael Hagedorn

If the it's bending, it I point still early you'll see inflection sparing is some funding, next is think is into And bearing if from but see funding. slide? but cost deposit ever real see more it migration migration even slowed interest non-interest of for mid considerably, bend slow some range. next from year, happen you definitely you broadly that dollar that in an incremental X-ish liability stabilized still

Operator

Our comes Manan Morgan with Gosalia from Stanley. next question

Manan Gosalia

You loan new fixed that one loans repricing repricing from if the And size could color about here. level the are and on are what the loans currently? rate rate getting Could or more over at At are main fixed drivers be loans high of originations what amount of year so? spoke NIM give next yields over expansion you that will us of of on level the a repricing? due coming you

Thomas Iadanza

spreads class, here. for loans the We or $X.X XXX mid-XXX, about repriced months Yes, of billion spread, in around year. this on This you context. some X asset really the but so the the range. it it's depends of Tom are first Give

We to expect that continue.

the reprices on over X Looking months. another $XXX probably next million forward, there's

renewing spreads mature. be lot that There's those also the a of will expect same. loans to We

billion X that be in tends total. or range to months So next dollar $X over so it the

Ira Robbins

number's have Yes, that little I bit or a bit think overstated, right? a understated, we So that excuse little me.

Average billion years. rate about has to portfolio. a X have we So $XX extended fixed life

to just So one about thing, that rate get think do I mean, $X around of where you're origination and is, about and versus assuming basis fixed a you you higher. just reprice spread. look I 'XX the sitting you you Slide back the new at was, math, right? the index quarter map what you equal, do you're and if if ultimately if X, billion spread at So at other slide the point XXX today go due where And maybe a of at credit forget same look X else the loans look yield just the you'll can you point year all spreads, basis I XXX sitting the come would was

Travis is XXX are and coming to repricing rates on Tom probably the both today So a come higher as basis going originations at on basis those. above to XXX are at alluded definitely where to And on new current spread. points

So next year. the you going there's what's a as new significant be think pickup about minus plus $X or to to billion when

Michael Hagedorn

what just add this And is Mike. I'll to Ira said.

that simple the So third average and finished the month quarter just quarter for last loan X%. quarter X.XX%, X.XX% was the second and of new September originations the was over in it and

just that that to getting we're that both around paid So mentioned, make loan clearly risk sure we're discipline the seeing we and here we're the increases Ira and also of spread then taking. Tom because repricing on new originations, both the for from have

Ira Robbins

a our in of peers are be than the from sheet, think important was our obviously of is but have can were, sensitivity NIM have think the I based overall we what there earlier to that about some balance an we of decline that a mean priced. And going we how managed I and portfolio maybe piece, sort this we just, the tailwind significant right? do on assets the sort When amount coming we've of

there that where So of for are a positive once today, come that's higher from for longer us. to from stable into think assets. whether a be we just significant more will is amount is environment, stable significant that tailwind going or we get it I a And

Manan Gosalia

or XXX on to funding at the side, provide And flip that now, are mentioned the able coming you on just maybe on be you the would side, pricing so that right right CDs guide Also at savings between to your what deposit now? if breakdown and update through and on mid-XXs? are the data cycle coming there's any deposits a accounts around those of

Ira Robbins

a which savings is on yield a have we account category, type also out actually while. X-ish maturing had at for while from CD We're there we savings in a probably in up we about direct special, regular So the you're have channel, low-Xs. high haven't CDs. in mid a accounts, don't but new mid-Xs, the our retaining one of all anywhere And maybe new XX%

So of that incremental funding, going range, in for that's X to just I got competitive, a within little when that's mid-to-low you we've where you the certain that deposit on. but I pricing CD some our it's growth dollar had talked next that said be in earlier of incremental it's more that that I to the think realize pockets are as and about cost when think, coming

I had of bigger strongest think today the new opening. is we piece account quarter our

both commercial. blended a mixed So that on example, shift and escalate consumer a rate And average to bearing though of we month the you're XXX in continuing, an accounts the still significantly. non-interest deposit a bearing, to out that continuing non-interest of with the were of was just as able of number in September, coming it an And grow base. commercial for overall came seeing

costs a how before an are, haven't and CDs what the that we at correct Mike's like funding account keep core specials some ever historically marginal about in those organization, in mind on be think while those we're in what opening and have originating and seen we have So positive of impact looking will still this are.

$XXX-ish that levels. the current blend continue funding interest they assuming $XXX, that is rates on costs at anticipate to marginal So of something we saw quarter we their the for

Manan Gosalia

update mid-XXs, any that? cycle And on through the

Ira Robbins

in I end far already third all mid-XXs, XXXX. was cycle that's 'XX expand quarter but so the the mean, fourth about that up opportunity NII get through We're we've stable of that, the year the quarter of 'XX. to we given and into as in that the we'll it's near-term likely we're above NII commentary into the estimate for factored through

Operator

question with comes next Our Moss James. from Steve Raymond

Stephen Moss

Maybe have and the just additional many on seeing what's of credit dynamic repricing, for dynamic on up or to loan more rate the ratios here cash to clients service project? just curious just a a all you of are the and impact what fixed coverage how loans support debt put

Thomas Iadanza

it's Steve, Tom. sure. Yes,

no not did need through $X.X upfront want just underwrites have X.X, flow earlier, a reset more As terms point a billion typically them. The repriced to cash to modify conservatively I XXXX customer upfront. XXXX underwriting XX% of loans. X.X contractual coverage, out debt any continued of our the we reset payments, mentioned LTV. did payment average on I rate We They P&I of it. with service in on the or our

in cushion creates there So our upfront analysis.

Stephen Moss

just rates given X, that that quite play month dynamic XXXX? but out here still expect And last moved or in to have a the bit up into you

Thomas Iadanza

forward think based million this. I over earlier, I will expect We reset the or another on results do months. a I of today. mentioned that We next different Yes, think X but any modifications analysis don't that there's $XXX analysis

Ira Robbins

now about to us Maybe $X.X sure just what day organizations resetting and billion distinction were. how did said highlighting Tom They how they X, to reset is everyone it And what of something We you're hearing and he we twice want other we and equity seeing And and underwrite and I pay. make one think additional had at capacity significant he the I what today. I just client to clients now bring think a look said what our into loans to said. these come think versus with it. we that's big that's loans at when

Stephen Moss

the Ira, then seeing has know internally, environment? as here on forward but focused we and you're organic opportunities you growth thought in process terms here, macro just And of outlook given going think M&A changed any just volatile the just said or I about are more curious more you

Ira Robbins

more seeing backend, disciplined we're that a our some there's around going on this diligent many we've value with and think very a challenges I the based challenging. regards book be the been to That the think banks deal have. tangible lot curve to and very on have in said, of I definitely very, what becomes environment opportunities more, to work

to So need economics some the of change.

think proud denigrating sitting XXXX, at we $X.XX which out dividends management you something kind quarter as at have management If is value in not I very during $X.XX, to took we go sitting period. had which year that $XXX make we're the forward, this of tangible first as We very, We team this to the that paid effectively track tangible that's back add is were much we $X.XX. When of value. pretty tangible was the that book of. that value, move book acquisitions the doubled you $X.X $X is Say team incremental of of that we're that think a about book sure record. want And same period, potential we we over.

Operator

Our next question comes from Stevens. Matthew with Breese

Matthew Breese

question. yet. like of quite the up events we're feel the from Just M&A woods of one out doesn't intensity subsided, follow March the Obviously but have

Just sure be to assisted love if about that we that or still wanted you come would make when bank on were I organic Ira, M&A growth, would interested about, thoughts in? your were that deals talk versus whole to something FDIC

Ira Robbins

as potential player organically those make that think been but and I to those to for that's I about phenomenal seeing FDIC here is still are we're those variables there that sense C&I change us. opportunities to been that the on, X as that internal that we strategic here. think they significant avenues before something an in said, as growth. tremendous we've today active focused And we us in growth is are we mentioned economic us. been And have has earlier, for deals I think The like have important core

today. still the significant at deposit page, a opportunities up we're mean, $X.X that specialized for If of been to there. organic in has and deposits us you billion for differentiated, there's I look lot

there excited us. from is more organically what definitely look said opportunities something and what couldn't it, I at be potentially here doing So that look while like should about I we FDIC there's for outcomes those an could think we're

Operator

it time. Ira to further now I'd no for at Robbins turn like showing closing this back remarks. to questions I'm

Ira Robbins

time to to Thank today to you the months. just in taking everyone call and you. look our listen speaking I we to And X want forward to thank for

Operator

your for you This Thank participation in today's the program. conference. concludes

You disconnect. may now

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