SBCF - Earnings call transcript Q2 2020 | Seacoast Banking Corporation of Florida

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Operator

Welcome to the Seacoast Second Quarter Earnings Conference Call. My name is Richard and I will be your operator for today's call. At this time all participants are in a listen-only mode. [Operator Instructions] Before we begin, I have been asked to direct your attention to the statement contained at the end of the press release regarding forward-looking statements. Seacoast will be discussing issues that constitute forward-looking statements within the meaning of the Securities and Exchange Act, and our comments today are intended to be covered within the meaning of that act. conference recorded. this also note is being Please I’d Mr. to turn over to the call now like Chairman CEO, Hudson, Dennis and Seacoast Bank. Mr. Hudson, you may begin.

Dennis Hudson

for Thank all joining morning. this you us

As Seacoastbanking.com. second reference deck we we can XXXX which at earnings slide provide the found be comments, our quarter will

we influencing role changes this years know our Shaffer. and this is expanded Corporate is Jay Walker, of success as position. Treasurer the confidence role and quarter Director is, today Chuck CFO are in the a several Controller ability roles With across has and of He and as Strategy. held with has Chuck many Corporate Also now leadership. I our quarter have in new President and executive recent me announced his and Seacoast formally has in has every in you and roles who organization. now Tracey As our his for years role instrumental as been new new COO the Dexter his been and

navigate, share work you months. Jeff of always has the quarter. Officer. this Credit to the challenging to Chuck, on I and their our Officer, period. customers over Houdeshell, well. David but our views express us Chief their proud challenging Digital to through communities associates turn four the environment efforts Lee, very our am Chief Joining like for incredibly hard performed and to team sincere serve your I'll second it past appreciation our to Seacoast The my to pandemic I'd our over proven are

Chuck Shaffer

dedication service on Seacoast sincere also express and team their I successful to for this keeping Dennis. period. during Seacoast my you, focus unprecedented appreciation for Thank like steadfast the entire to their would

remain such, continue our with across During remains downturn entire underwritten We credit customers and vigilant And the ample of to of entered And resilient. open of as and carefully uncertain state. position underlying credit the the cases strength number fortress impressively increases COVID disciplined we'll well a for we state business, and sheet, a navigating the position, an the conservative cautious businesses environment. organization remains portfolio, quarter, while in of are significant inclusive this saw performance maintaining economic diversified and capital the culture. balance liquidity from a be robust

of over As years. the built operating a Seacoast is result the the last team five efficient model,

significant detailed types and originated in medium an supportable that deterioration. cash Since revenue paycheck slowdown a requests deferrals a of have for payment payment loans loans the in in made with by XX% primarily ratios launched are requiring customers such cautious to in clients reducing quarter's asset and reduced levels, in credit, debt And focused performance disciplined extending X.XX%. and tightened pre increases This $XX.XX. and focusing pre in prudent despite service value required increasing industries tangible value limits. provision resulted coverage We've criteria, also to tangible remain long-term over ability far. due saw the return assets to reserve April, to came adjusted quarter, on We [ph] PPP tax, nearly continued on several [X%] to share grew deferrals book during loan on and million. current further and projections provide for per of as And credit July we program XXXX thus we've XXX and the sustain that protection demonstrate flow

details conservative ratio the reflecting will by We provided the and for ACL scenarios our severe further posture more shortly. quarter, Moody's. provide coverage our continue to increase Tracey adopting economic

generating to and turned further growing customers. new is fee focus income deposit Our

economic mortgage volume, impressed performance. the team service with AUM substantial returns despite wealth see mortgage in further breaking delivering figure. their business level the to We were hit and breaking Our to wealth grow targets with to banking strong followed businesses by team record and increases QX continue a outstanding customers, in from continued record very up our while improvements also

customer nearly Seacoast. center introduced lastly, a the and and continue business by saw customer XXXX when and also customers business We XX% lead market over acquisition call new And compared increased new retail our service availability standards. prior to to in the second associates to quarters and quarter

Digital company operating non-branch Our to well conclude our and over call through should capital the XX% efficient levels year. weaker our turn over now opportunities post pandemic across transactions been during to of players service consolidate call center us And delivery to with maintaining to state standards share time bank Tracey, of book will our increase last on perform an market value wait is of while channels large the tangible per organization, level protect continued this this results. is and call on cycle. to I'll develop. center Florida in to and who of liquidity And the have will and strength build through far grow proportion outperformed disciplined those goal times walk financial and a excellent. capitalize manner to focus position continues robust allow period, the share, this our usage

Tracey Dexter

this net net purchase the Directing second Chuck. to basis of results, points loans second from basis interest commercial X.XX. second acquired effect and points you, margin let's on the everyone. The XXXX XX of quarter your Thank on earned basis levels basis discounts were points quarter interest points margin X. increased accretion million and quarter. Slide of turn The first attention loans, interest quarter. is interest points on effect X.X morning, sequentially. XX to decreased quarter of basis the second margin interest XX fees income Net on to the Good in lower The of in XX in PPP The result in of X XXXX XXXX. with accretion a net quarter of to prepayments compared lower

basis XX loans primarily the the loans points. accretion decreased second in points. cost on the quarter. in of pay on March first actions liquidity levels XXX acquired not in in the interest decreased by loans. basis quarter decreased high first affected Reserve quarter. also decrease XX result noted is balances in fees downs as rates unusually in decrease basis we PPP that the first margin lower loans did XX full quarter. lower of on in additional in growth on we deposit quarter Late basis from yield on that rates decreased the second the decreased rates were XX quarter first The deposits the carrying substantially points points. of and the accretion points to acquired Quarter-over-quarter, reflects The with deposits basis the conservative The and Excluding full yield and quarter, lowering XX of in quarter, securities action. points basis yield and That the of second on loans, second by rates that quarter by aggressive interest in the and and overnight lowered benefit in interest reflects the XX fees first Federal recur PPP excluding loans the basis after on on points The net

than we circumstances a Looking providing market ahead, in conditions warrant. we other maintaining posture say margin the will interest remain as guidance anticipate given net cautious dynamic to prudent on

quarter. X.X prior of year X.X this a from was a Moving was previous XX.X Slide or the or strong of basis, quarter X% to million X% million, million non-interest decrease an quarter. the non-interest On decrease income X, adjusted from income and

another market banking in record which fee X.X continuing focus refinance housing vibrant income quarter Our on and mortgage million increased the strengthen to reflect generated Florida fees the XX% residential and market.

other in lower fees Through under in does with other declining quarter. from management quarter sales another this XXX quarter first to help Service that them the team, with late to on second and profile XXXX quarter X.X better to million all Interchange wealth in to management. the the This where income nearly for our Security the of higher and the robust CLO deposits the through was not new decreased in repeat quarter, our generated pre-pandemic contribute income was declines we AAA payments included and waived The the we to results and quarter in of assets a quarter customers period much FDIC to second flat portfolio, X.X lower the of quarter quarter, not financial deposit and first record included levels. replaced NFS implications comparison, manage credit offset of Also in sold with balances increases revenue gains. first the charges CLOs. also recur. of CLOs strengthening compared million X.X April when each by in overdraft later and revenue translating second purchases did compared with rated the recovered this million quarter million rated A single charges. investments,

quarter, prior salaries to benefits decreased year a an which million expense of to non-interest million Adjusted X. the adjusted of from Slide X.X totaled merger to On and increase X.X decrease X.X the million, the quarter million charges, compared by related XXXX. XX.X first excludes compared of prior quarter. basis, combined Moving an

and when higher staffing Palm originate of were to were large loans. a the due adjustment of the and were earn PPP deferred so contributions, first XXXk with by those we the first of as interest as a driving this also those These drove after of you second costs salaries health overtime result of portion First Other in taxes loan originations eligible deferred, quarter fees, during As quarter. primarily quarter. decline salary the costs and the on quarter the those factors expense insurance costs we additions, costs expenses and we acquisition offset identified our payroll were lower loans, a decreases know, direct related seasonal Beaches costs. a quarter reduction Bank Salaries million lower to an along recognized typical X.X income that represent

results now with X.X Processing million staffing, lending the included by approximately a unprecedented our the expense the as PPP and expenses Other since second X.X associated were costs increase support call and credits. with began. the quarter in PPP costs center X.X higher costs effort. has temporary all also FDIC been the quarter higher second volume million, assessment pandemic expenses resumption applied for in in available of the Data were program there associated unused reserve the to million we've were Other include the Additionally, commitments. costs of higher related our which by

amortization approximately XX.X million, including and third August. the of the adjusted we're For of in non-interest to expense million million intangible approximately Bank which the XX.X excluding quarter assets, X.X Freedom per of to acquisition is expected XXXX, quarter be modeling

generating to improved in and Moving the continued highlight of like operating growing on first to our ratio non-interest X.XX% expense quarter. X, assets in managed overhead XX% year ratio efficiency the prior to X.XX% to quarter With the and in the revenue, dropped and tangible leverage. adjusted I'd focus to to success Slide compared a X.XX%

control cost proactive continue a discipline. We our emphasize to commitment to

XX, Slide outstanding to billion, portfolio driving with XXX increase, the PPP to X.X in Turning loans along loans million increased other with origination.

the Looking end at million commercial loan XXX the conditions. XX% quarter, our from approach conservative economic was pipelines, of to the due anticipated, pipeline production resulting as continued to our down to at

Given XX% market to Florida consumer, refinance vibrant the the strong stress. to significant million, will in be uncertain majority we're mortgage residential support up XXX were can reflecting with impact a strong and the that million, by is in liquidity outlook, still pipeline a sold housing relationships category secondary XX of significant higher market. balance the market, X% a volume focused and of pipelines the on only sheets residential In the

conservative production to as Looking expectations third manage lower outstanding forgiveness loan the begins and continue carefully declining posture be forward, to PPP our balances process the with in quarter. we in lower due to expect line

Slide to vigilant robust capital and culture, credit credit to manage our we position continue to highlighting prudently. exposures our XX, Turning further intend

posture entering environment are this conservative well. We us serve our confident will that established

portfolio portfolio producing commercial estate XX% distributed various outstanding, of equity classes, The have Approximately with of estate is portfolio our by Our loan that of value. estate commercial the by is XX% broadly average of the secured is stabilized portfolio XX%. and portfolio. in XX% real occupied asset lower borrowers XX% owner represents real LTV commercial of to estate comprises real the their meaningful secured and estate investments residential income real represents across loans commercial real

represented to and than managed land XXX% and that portfolio in a our capital XX, We our and conservative have peer regulatory based real XX% At estate loans respectively, keep position well risk group. development most loans and construction lower of below commercial guidance. June

broadly across loan an commercial excluding portfolio and distributed is average of diverse size, categories Our loan PPP with XXX,XXX.

average credit an an score residential consumer portfolio our has portfolio Our and XXX. of has of credit XXX average score mortgage

of Our the is score HELOC an portfolio lien average XX% credit of our The portfolio has LTV first average XXX. position. with in HELOC XX% of portfolio

PPP at looking we're XX, loans. Slide to Turning

As adjustment XX balances, loans, size XXX XX loan size loan of fees we million an deferred PPP of recognized quarter, average recognized at we and X.XX%. over median in recognized have of that million, net XXX,XXX totaled XX,XXX. costs of the are of of Earned as and the loan. In the end to the the with million second we net over and loan life over of quarter, an of XXXX million specific expected net X in yield interest second contractual yield a fees X.X and million resulting totaling

expect recognize and change pace result over of But process. the year. this of We fourth fees the majority this could forgiveness to as third quarters remaining net of of the a the the

short-term nearly customers status. deferrals to months. there in the XX to regular in billion closely and Slide April. second deferred At payments the to with quarter of to in currently in June deferral in year, Throughout programs quarter looking the March, Turning with three fourth third offering the of quarter. X.X status. on XX% the We're our the loans industry, XX return volume these We and are loans with deferral XX, XX% processed on payment along deferral loans second XXXX of peak the scheduled began of six the in are deferrals to loans supported payment we and of into monitoring half discuss

which office XX owner our The and other care, been The these have health average more position this in Diversification AD&C of only engineering, loans program. XX%, the investment is taken size stabilized climate. XX% as veterinarians exposure This our is portfolios of advantage producing office our loan look aggregated industries has largest construction the in representing when type Slide of XX% XX% portfolio and for types to office Turning occupied. well is the critical classified as buildings at collateral portfolio and properties. in and is XXX,XXX medical, tenant XX% income a this a of professionals. across strategy, includes remaining primarily portfolios. deferral a CRE of and CRE portfolio. detailed should average portfolio payment is light of LTV The accounting,

Multi-bay is XX% located status. typically tenants. mall X.X total is shopping of the loan XX%. is traffic segment of entertainment retail average outlet venues, in movie payment of or geographically, X% variety with This representing local on centers largest estate retail second shadow characterized have name LTV by our healthcare that of portfolio has average or a does or provider are million is loans theatres, these portfolio and malls, other size centers. diversified The brand larger the anchor, real The centers or the retail Our bay in regional not deferred large retail and is main highly shopping portfolio include a area. complexes, multi

service million and Our amongst full and restaurant serve limited exposure is XX only is quick restaurants. distributed

hotel to with portfolios real and estate XX% hotel restaurant and an X.X Our loan of The loan value primarily only XXX respectively. XX%, are of average size portfolio with there's is average an million. million, secured

XX our by and Slide for net exposure look commercial marine a represents financial to loans. companies largest is detailed in And The X% individuals at worth Turning only of this and owned high aircraft payment X% of for of and holding vessels. commercial payment multiple above industries financial concentration status. on total of overall are on and loans loan with deferred deferral. no this is The the XX% segment spread portfolio across is remainder XX% more

casinos direct the the line We amusement cruise park exposure industry. have no to industry, or

XX Turning for portfolio. XX to securities Slide and the

on rates XX declining this faster by backed down are mortgage and yields points. basis payments With securities, the quarter pre

sharply in asset asset credit quarter, multiple of some at values of Lack in stepped in and the second our end in In including of to in quarter. Federal recovered liquidity March bonds lower the first significantly terms the valuations, some led classes. purchase Reserve's CLOs then which increased classes, spreads of to the market

holdings quarter, AAA and proactively the also selling We second with holding. credit A during CLO book composition of improved the replacing them our

support AA a XX% and and broadly loan. our book as now Our collateral. CLO bonds. down The AAA graded and breaks investment significant grade CLO All credit comprise XX% has portfolio syndicated

is over a and this value credit market remained book. reflection of expect We values believe to CLOs holding period. the risk significantly, While not recovered recover is the these below

outstanding in XX% Turning our million second deposits XXX XX, increases to In saw deposits, or XX deposit with quarter, quarter, or Slide up XX% the base. total prior increased from the in meaningful deposits sequentially. attractive we average reflecting XXX million

payments up franchise, and represent with total at XX% of individuals, quarter were Non-interest unemployment increases of associated PPP the XX% of compensation. from up end stimulus from last deposits deposit the programs, higher including bearing quarter. represent accounts last from Some deposits the support demand transaction now XX% and of XX% government

June Turning the assets X%, of non-performing historic loans remained respectively quarter Classified to and down million, to Slide this XX the XX% lows reserve of were loans been based XX, charge risk The increased not and status. XX, at at offs and given to PPP total only X.X from estimate last guaranteed slightly reserves XX.X quarter. at allowance quarter level excluding overall during capital X.XX%. is criticized June million X% and the assigned which have X% at

quarter. allowance of coverage is total the X.XX% X.XX%, from loans in Our prior up to

extended businesses scenario and of happened more not could economic be a As by consumers again, recession might provide and elsewhere downturn forecast the has a reopening more SX the and Taking baseline the to over a negative sustained period. during in which weeks began characteristics unfavorable the June, a estimate increase in reserve build be of you additional moderate that quarter, and of This to conservative significant of to the captured for weight which Moody's led in the COVID-XX the gives slowing last slowing because term. to Florida economic know, continues for late cases caused this approach, the of our two that scenario. many consumption June Moody's allowance

to will on As manage our the allowance accordingly. its continue impact economy we pandemic evolve, and the

Turning cash had the liquidity to totaled billion. in lines million and March lendable of Slide of value XX, credit XX, XXX showing of of position, June lines collateral the XX. company deposits from increased conservative available given increase XXX million our notably under unsecured At credit X.X

PPP available company under X.X and potential liquidity that has borrowings pledge are funding and PPP to Federal program. the for collateral billion loans totaling the securities Additionally, Reserve loans as ability the

capital quarter-over-quarter. asset at capital our and highest our XX, equity has Slide positioned Tangible our to and year. tangible value was sheet for group. maintaining was current of strong. increase Turning $XX the continues end, was to ratio The ratio To wrap tier common to one environment. ratio quarter amongst fortress XX.X% in tangible book balance has a us standing XX, And XX.X% up ratios peer XX, XX.X% June commitment of increased Slide be XX. long risk The the position is to ranked each per resilience the total on an XX% prior at these over share the in based capital

to arrive, progresses have as a take as Seacoast the opportunities. rate back and Over book of well conservative to first. well to value over We opportunities turn XX%. and Chuck Driving are us look per call will shareholder intangible the compounded of the that recovery we forward posture I'll last advantage efficient years, growth those Dennis and questions. ultimately your positioned is confident established share annual model three creation, achieved operating serve value our we

Dennis Hudson

be to And take questions. few pleased operator, Thanks, we'd a Tracey.

Operator

Thank you.

Young. first will Mr. And Michael line begin comes go from We ahead. our on question-and-answer session. [Operator now the Instructions] Please question

Michael Young

some a you impacts income just kind benefit interest like statement. the to the off the cadence start for PPP on expense Maybe of with would up. just wanted back and wanted already of get to of the also to how income feel guys started trajectory then accelerated ramp recognize on looked It a

Tracey Dexter

take that. do I

with we've in we've expense. in out, quarter, of estimated originating As we million of associated and the salaries had loans that X.X pointed a costs number second some those

other occurred you originations So future would think a would in that deferred can just recur about if whether or period. be

over million net XX you based initial were PPP come of And we of the to of fees earned the on judgments, million the terms the quarter. In earned year. that expect loans, during second rest in have in which can mostly our on earning rest X of

XX% So earned we've XX got far. the total so of about

Michael Young

maybe with know guys loans the you to the And they're kind those jumping of more walk were when beyond if it kind or to, and I timeline might of thanks. you deferrals liberal just maybe a guess, October how additional you Okay, from on and into they'll that back plan on any over make I a little handling just through return allowing could that to that you're appreciate are normal modifications able, come period payment schedule, but here. just deferral.

Chuck Shaffer

Yes.

As got on XX of and days in a to deferral sense seen their customers cycle. the last XX, reserved first July assist a of aggressive have to something to we talked number early you and We we we're to therefore still we've making challenging the way in. took the had bankers those deferrals the working billing about, our it through about we've returned of well another out call, loans payment status XXXX XX% and customers in period are XX% through through our give of was those remainder those able executed payments, customers. To and payment our the July, were through reaching are of offer to deferral we what

you if give that So where helps of sense some that at. we're

Michael Young

head XXXX, -- just levels to That's were into would for to low get Yes. you beleaguered do some kind expect maybe there you year? the I any if something look guess credits. of this And helpful. digits, to end down a single would just feel like of still that as of come to or TDRs kind we trying deferral

Chuck Shaffer

we together how se feel status, if down but we those to encouraged the pretty quarter. XX first the to be we've But be coming in doing that on And would the quarters. fairly we'll they exactly should largely very just with how time strongly come what TDR is have where overtime get We heads and are right, of do depending over haven't projection we're we're on will evolve days, the significant move decline, see a things put the you're this thus economy anything, Based far. seen to borrowers that fourth per the to here. where by

Michael Young

be on maybe one place early. mean, of And one do to capital, the as medium, think your quite maybe would to would even be term, that's But when And high, what you this look I I a and longer to capital how give you or those are right may at about return you we last more more But to confidence, some kind too levels? levels guess obviously, of very just capital good now. -- to normalized start a level. strong, start

Chuck Shaffer

make a capital capital as through any options around and buybacks conservative Clarity to key our capital, our There's and The will continue remain late year That's, can said, I XXXX. biggest on on. we'll emerges this decision dividends. the organic period. be will is tangible environment, book we this in for think, M&A think focus posturing value as protect if and well us as including you into in focused number of thing growth that help in current and Clarity be grow most I capital. important And to build And thing the

various but the consider And this like into Clarity emerges, XXXX. as doesn't later seem it'll that so, occur likely options we'll year until capital

Operator

you. Thank

Please Moss. Steve ahead. Mr. from comes online question go next Our

Steve Moss

with activity just business want for off I here. you're seeing kind what start of to

what to interchange pre pandemic levels return in You income July. of that seeing or for June you're mentioned guys wondering kind

Chuck Shaffer

we don't I anything have on Yes. July yet this think week.

have came at of at pace and are operations months June, significantly doing yet. data last customers, fairly reiterate definitely conversations on successful to them the the open and fully they're happening, orders. here home consumers of Florida the business focus rapid did out business are assist state fairly maintaining We they we're doing to stay in But focused us this that of for the business. gotten to five activity haven't cases are being back businesses the We May a COVID Obviously, with saw things through increased and we through in as opening still up continue period and in on working pick our that. We're out weeks.

things back, happening, pre so they were not levels are but the come And have certainly at that pandemic. things

Dennis Hudson

So there's with cases individual declines. certainly in with customers, as been some improvement, saw the talked I've we increase some recent

think in So seen revenue don't speaking, in I some generally But I've we've that. declines restaurants. heard about

three around weeks. Florida kind of right or so the optimistic if right and the now, number last see. over we've new to every down the municipality increased response the last And just they're interesting. the cases, walked to weeks every close now, did two to across about in are of pretty public And where that's in what we in wear seen requires state of We've way two we're state you'd And about begin folks the areas. in seen, the when it's county cases masks not state now stabilize the down and number deaths you come

So now information Florida. things in are stabilizing that of it's encouraging that perhaps suggest kind would

Steve Moss

really you comment, it reflected of costs. healthy Great. numbers. your obviously heard of decline PPP That's helpful. have And then, on the a [indiscernible] the I here, was funding noise. that And But in outside a margin in lot

to, as maybe ex-PPP, how guys the forward? margin curious about of you here kind were Just thinking going

Jay Walker

Yes, bit on Hey, have asset we add-on some do the little see side. kind room you of loans, and if more rates. on Steve, pressure from But would dilution just Jay levels take we probably similar here. funding accretion assume I'll securities I a that. side, lower loans think from on of the

have of half some the retail that brokered We we back higher balance would funding rate as year. CDs we'll some expect well reprice that to as over roll sheet off the the

there any to think effect I funding overall, rate securities we're So these liquidity book. higher into as and the wholesale rolls liquidity of excess off sheet balance some the is less a of deploy looking

you of under expect ex-PPP, level second kind this roughly the could So I be maintained core scenario, at quarter. margin same to exiting saw think the you

Operator

from question on ahead. line David Feaster. next Please Our go comes

David Feaster

growth expected. organic just loans Loans prepared a commentary bit I than remarks, ex-PPP. get more on to the appreciate but the on thoughts wanted in ex-PPP decreased any

strategic Just landscape. curious utilization, tightening down It you're but trends, was some commentary trends just this and of pay you're credit pay-offs competitive like the the sounds on C&I box, seeing. where any

what's for Just new demand overall the credit?

Chuck Shaffer

Yes. you're like pretty quarter I a is would describe will quarter second across probably it thinking look the much the lot third modeling as businesses. the about

estate We Refinance very remains expect as this. real been remain well strong strong. resilient to has as mortgage toX very all surprisingly residential market

there like And And our we and second quarter. would our practices. out thinking mortgage in so as underwriting I remain expect well to on It's is say there side, path marketplace very we really now. out pass in consumer the so demand the to look credit as commercial quarter a expect quarter. thoughtfully a tremendous our strong conservative, And quarter. about remained would provide it going think you're very I I any right hard will picking if cautiously the but a businesses look guidance quarter, and like lot second in not for lot the business the very prudent the we're third to

Dennis Hudson

done around continues some selection Borrower like we've selection and that a we've forever this time where as loan selection, critical. know, focused, the borrower been today. very is of that's in work and And you

So --

Chuck Shaffer

turned business quarter-over-quarter, mortgages the the a new business. has from from aggressive the thing other by. and compared the and hard community drive encouraged just to is customer is large to almost on the banks revenue, taking difficult been mention, that. increase poorly on the to And we with And out was there advantage access which for deposits. I side that's just banks bankers very been in acquisition which performed And in of is, We've when ways other We're PPP saw marketplace remain into very outreach customers. our also I'll standpoint, national banks and availability XX%

So a environment, in while to it's ways, some for it's challenging the grow provided franchise. opportunities us

Dennis Hudson

Just to the I have large be bank mega their of of many many offices many competitors the fully. and closed banks clear, here, mean,

Chuck Shaffer

Yes.

Dennis Hudson

call hard into having confused. anybody a So They wait some they've problems with the customers getting with as had time, and are like. talk are real or centers, times and said, Chuck

helpful been hopeful, out dissatisfaction to surge our we're recent So but there. that's customer there's And in a of new maybe growth. lot

again, an So of And started over We good balance should the we think about important. we year. feel is it which period advertising pretty interesting the be that.

David Feaster

more I color. the a seeing guys the kind opportunities up following What new you performance in in careful? the a and maybe getting Are more on being maybe you new higher, helpful but frustrated great when that's a be expansion potential just trying as hiring for or to That's bit mean you sitting, a trend, even Yes. aggressive terms more on by calls? are interested growth, some there? inbound seeing banks of bit of others are you are And of that. big Are hires

Chuck Shaffer

the bankers our being solid describe we absolutely opportunities expense hires acquire that would to with additions all around need where something We'll opportunistic to into on weaved new at is look that's prudent customers, them. think a I'd continue portfolios have seasoned In our thoughtful and environment, the we'll to while of organization we records Yes. see good be we take where cost. to the franchise. in fabric strong marketplace we those make our bankers but this strategy track well discipline, hires to about be

David Feaster

last That's Okay. then me. And helpful. one for

the how digital an new But strategy do model. on think just or affirmation maybe has curious, comments strategic other planning offering Just, either business opportunities normal is to I of you or this forward to product any initiatives further and it your of that planning overall. is in just environment more you're just really look this adapt or enhance identified as your supported your obviously, there maybe whole

JeffLee

take that. Hey, David, I'll Lee. Jeff

mind franchise I distribution and vitally an at notion of you'll introduced which being now model, it's Day the in if February our business remember our of set want a that. I attract house. really there that the momentum we we multi-channel that XXXX, and start, the we look think well. the The more to that in the more to side the part to in set. of of really Investor important this positioned to affirmation think to the consumer area. digital it's for certainly suite us But that's made continue serve well. businesses look we in set do at we the those business push about think if that can harder, progress done you as have we is product that capability opportunity, to where We servicing There a lot I customers. a consideration with be seen probably is to of We've good we've the at aspect and from with about think it's think want business

to of even digital the the So on pushing business you us side see front. expect more

Operator

you. Thank

comes from Please Marinac. Our next go Christopher question ahead. line on

Christopher Marinac

and out mentioned are of what focus question well sort today But all ago? I Jeff you, that or on the banks customer. they what figured the it you of industry? last information next is I a it night too Seacoast and similar introduced three up business you to that catching simply for think kind years for in the had is other Thanks

JeffLee

tell even customers was I how about now when face-to-face be think 'XX them interact don't Investor you, in a see major to country Day. the thesis got would that part bank in back we you before 'XX anymore. unveiled I that every That you've you with understands in our the thoughtful 'XX, of

to We a locked interact don't just that's how the expected channels. to to you center, And we conversations call with convenient the thoughtful naturally on, expect it's why in migrate whether thing It's digital see do really have it's customers them customers you more face-to-face. whether logical when and channels.

at new non-mega of so on non-branch I activities a a look the look what of there And activities ideas well. a heightened when it urgency positions do This of about the routine or this is multi-channel to I happening non-routine you know driving kind the about channels. the really like. normal, the sense distribution think for is and going notion banks fact, what's across focused to us

But see to what a cultural lot you're to of hold pace We've going think banks industry. my across a these go do. in on too the have view. to think That I trying we're I a of going through. Chuck? take that a the are aspects lot to greater focused at that think cultural change it's I can't be underestimated,

Chuck Shaffer

look were gotten when Yes. perspective you cultural That's what back to when done performance that that. from you is I I'll here there we've a year, earlier appointments thinking center the you exactly while approach with those our add the serve And centers' customers mobile sales and with along And what call the availability were taken appointments to to using and was talking tool call outcompete at customers integrated accessing in needs environment. this the toward branches, our the moving and all over phone, pandemic via suite. look just out accelerated needs of has think in of already availability integrated via at this support and bankers I in analytics-driven rolled X,XXX we we the and of providing with via online that. us process since outreach, to probably our appointment digital, if we've other customers approach about for a largely that of It's an channels allows

Christopher Marinac

Great.

kind I track. way guess of as that or simple you scorecard keep going on Is anything wins business of look loans So the watching a a is best there's deposits would well forward? the else it's kind new to forward, there simply as

Chuck Shaffer

our us. part piece And the a cost of lower organization big would for move emphasis That's servicing to to be Yes. continuing channels. the other

for franchise up to seek into we think cost more take over pandemic activities availability growth-oriented the and support And customers accelerate to get relationships. it cost can their to I and in allow more the down, the other that as the capital. ways the servicing them service move us frees

that's this the approaching forward. way And be moving we'll so

Operator

you. Cantwell. go Thank Jeff ahead. comes question our final Please from And

Jeff Cantwell

should sheet? sheet you on now? The this right Chuck, there? asked you months environment is most Seacoast piggyback all you in us just balance about earlier. about the we I'm environment? managing and out next want the are going just do approach Just how Thanks be in to in fast little should few the strategic of you to expect prudent question And Can you I what a quarters? thinking or how focused be ask what couple a how you're on uncertainty could a this tell lot. question bit actually, were a one, balance growing think over And is the

Chuck Shaffer

Yeah.

in management interest balance think we're the obviously, changed the have just I about outlook has just think sheet environment environment, meaningfully given if this changed you rates dynamic in. and

our as And about, it around I'd to that's though, probably We'll and I a given to loan fees. other expect maintaining outstandings robust best talked a and liquidity I expectation, in from in more are sheet on generate prudent to think other to, as the in. growth posturing to It's in given position. the as manage credit. put modestly we the franchise balance and We've there's move general, coming our describe is, decline there's conservative earlier, continue ways very the loans also prudent growing forward. and be customers focusing value, deposit Overall to approach mentioned we'll conservative quarter we way a on customers environment ways we capital base. expense to focusing

move through And as conservative lane. a time we'll the to continue we of manage both balance that sheet so and but income sort appropriately we'll from do

Jeff Cantwell

it base should maybe us on quarter be Is here there second there and improvement bottom is that Is from the for second will Thanks. activity assume you bottoms for income. we fair saw economic the little I over interchange few Okay, next months just the to is, question can be talk My great. the fair? case about Thanks. off in on that should out? probably up revenue maybe bit? us And here to a the that quarter. that improve that second

Dennis Hudson

took I really big everyone you apart things operational. the And the of have At a then, the lot continue of A people April they I that standpoint, anything this took from in levels. to pause to on number you point, a recover. to it up When pop doing what would prior to kind household expect peel do aspect, May back the your unexpected to and wildly where hit, one staples think quarterly doing. right that's a and were honestly barring pandemic buying keep number was mean,

it trend So again, Jeff, previously. been would the to I to wildly number anything way barring unforeseen, the continue see expect had to

Chuck Shaffer

more is vacation debit, cards every vast which interchange of of from our rewards mention too. And type and comes day credit interchange interchange majority other The programs. versus I'll

return. So returns, we to expect day as every spend debit

Jeff Cantwell

And about over what now in. consumers world migration. digital in response chatter strong has of final a one digital to lastly tech sector. to in -- one a it. I I then, Got moving squeeze always COVID. that's Seacoast very And could that right if is in There's basically banking the by fintech mean lot had

And online wealth, so, you the migration are seeing migrate what digital, appreciate curious a sell or think sending banking, question banking seeing I operational customers, seeing. you you is to are to the can if are And just this. helps feel I'm it give much. mobile from by payments, that. digital very standpoint? them it is you remind is is and by tell be if your asking people you it I right could for it just us in Seacoast money? people consumers you're bill is, what us an digital us Thanks ways how maybe

Dennis Hudson

usage are your when of I the dig got Jeff, seen was now dependent a moderately those problem. no seeing Yes, up. certainly always users that with you're We've you active And portion you've becoming who think, channel stay the and their are go much number more is numbers, what connected were people their on into banking to now those always active. relationship. bank What we've seen

pop. the so thing importantly just first you that us, business, that's those the usage consumer you've And of for numbers numbers seen and look at when pops kind across, across

are think the outside network. I now of of that just numbers being all also network. we've nearly a a you've done deposits the number pop number XX% the of now for outside making is their are focused that on branch of where deposits years seen now That's amount consumers branch

we gives That XX%. as convenient So more in big now this environment, non-branch flexibility of move operating channels deal. of number digital even channels a Those are a us increasingly kind businesses the forward. that's small finding lot and

the as we mentioned we're our not inflection for not. is then, course, all gives that. our it think focus who But that for it's and mean well, routine by are customers. it's we're that we're or relationships experiences really mean But high we think the can an there evolve, more some to organization do customers point growing more digitize. Does our of to Zoom of we things be to Chuck our clients, free the when importantly, just time it and of So And does industry. for that happens, on digital-only technology expect. truth flexibility. as to have truly helps it we it continues the that's digital not what up moment whether value do facilitate That's us and it face-to-face good banks, able providing I face-to-face,

Dennis Hudson

Jeff. you, Thank Thank Great. you, operator.

again I think And as speaking that Thank third to forward you. look all concludes we the question-and-answer complete quarter. we session. the

Operator

concludes And this thank you, gentlemen, and you today's ladies conference. Thank for participating.

may You now disconnect

Seacoast Banking Corporation of Florida (SBCF) 24 Jul 202020 Q2 Earnings call transcript