CAC - Earnings call transcript Q3 2017 | Camden National Corporation

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Operator

Good day and welcome to the Camden National Corporation Third Quarter 2017 Earnings Conference Call. All participants will be in listen-only mode. Later, we will conduct a question-and-answer session. [Operator Instructions] Please note that this presentation contains forward-looking statements, which involve significant risks and are described in the company’s annual report on Form 10-K, and in other filings with the SEC. Today’s call presenters are Greg Dufour, President, Chief Executive Officer and Director; as well as Deborah Jordan, Executive Vice President, Chief Operating Officer and Chief Financial Officer. today's being that note also event recorded. is Please to conference call this time, to the like I’d At over turn Greg Dufour. Sir. Please ahead go

Greg Dufour

Thank our more third few everyone call net welcome or We're in COO operating you, a National will highlighted results Jordan for of share pleased you for XXXX $X.XX million with Rachel conference quarter income to give or quarterly This by third quarter, CFO Corporation's $X.XX $XX.X results a results. $XX.X to share. Debbie to review million brought XXXX moments. quarter income Camden share. net our the the of and diluted or financial to per diluted detailed and per discuss and financial year-to-date

a we're our moments, will As efficiency very on return in Debbie measured performance asset on explain with and assets, equity, return by pleased quality. few

Before that few like a would items. provide on update to an though, I strategic

infrastructure we're to invest needs consumers, continue We to customers meet and as of our in grow, the our clients. to ensure as well evolving strengthening as technology we

we of quarter, already several call depositors services new well technology, relationships. commercial which strong our the which We've provides During our more treasury TreasuryLink, for a as as online large introduced tools. package management we deposit onboarded

services services ago. center We online call and secure our introducing also and capabilities. online our our are call XXXX provided through by almost These banking expanded introduced center and services a mobile chat complement we suite year

age the new platform with Jack highlight by in improve data. a demonstrate market experiences in streamline pleased on these at Deposits and operating the processor, the the to XX, in XXXX provide Camden National returns technology Annual customer opening released Henry. efficiency Few the for our to maintenance future. has we're while front, of the working our a branches another implementing announced Karen projects We're of the like the weeks strong on been June changes. shareholders ratio, of share forward we previous as headquartered looking able to of in as Report deposit XX.X% core investing Executive Mirabile time to based XX% to largest largest organization quarter, welcomed We're Bank FDIC new retirement I director that Directors John XX. invest leadership now to Finally, same John's continue the to the our President mandatory ago, turn role. its and I'd our over to age and Summary share of Larry's retirement by distribution account any to Wealth second mandatory our we Karen also Trish Sterrs during We Holmes, Stanley, as has several Mortgage reached Director Debbie/ grateful are Also Board's of Jennifer State. the discussion and September. Chair and Larry Management. the Vice Managing reached leadership of Retail Board Camden and the National Banking bank Chair Rose for now in

Deborah Jordan

and Thank you, afternoon, good Greg everyone.

results and the financial previous the XX% of net $XX.X and third of last of solid income diluted X% quarter for XXXX to We compared up million up quarter over are share. the per report pleased is income $X.XX to year. of quarter Net EPS with third

tangible growth average ratio income net on key drivers was For equity operating a loan improved interest our interest efficiency stable balances quarter our cost. provision The XX.XX% income due margin, to a net and loan reached the return included previous XX.XX%. assets credit increase loss average translating average an our quarter, lower to the X.XX%, and was return quality in over lower net on and for

quarter X%. interest up driving was loan The in third this of year-to-date net was to X% our year the between June a balances average for the rate quarter, growth second loan bringing portfolio XX, income an increase quarters. reflected in slightly since loan loans Our surged

a average experienced also X% We increase in linked quarters. deposits the between

assets of Our quarter; when acquired accretion from interest accounting two The portfolio loan a increase the during second third second deposits loan loss sheet quarter. for points loans, enter income purchase metrics third the combined at or provision resolution for net the basis third our our X% adjusted however, $XXX,XXX was $XX.X the for commercial and was growth due $XX basis in interest investment quarter, to slight security to income with asset quarter September X.XX% adjusted the asset improved in The low net shift cycle third of average Current quarter loan mortgages. reinvested points X.XX% primarily at of and basis bank's with one the margin of on being excluding improved both assets cost million, interest deposit large flows XX the nonperforming net with quarter. points in an the the via for margin the we jumbo XX increase by to over seasonal the total million is residential charged-off loans. estate as Fee cash side or XX. real quality reached margin balance

as securities balances. quarter remaining we third includes on securities The with gains liquidated investment $XXX,XXX of small

$X.X fees, previous swap in in efficiency just $XX.X quarter quarters, to Operating occupancy income including fees declined a compared for million of X% in the Between the addition, on and experienced compared decreases quarter. of In an cost and categories Oreo second costs. we resulting XX.XX%. banking expense the for number collection ratio $XXX,XXX of cost consulting recorded for our professional program quarter. $XX,XXX quarter loan totaled million to Mortgage back-to-back up the to we

higher both XX%, with Rachel? now open as remains for financial revenue. we anticipate it growing quarter to investments year-to-date we technology trend on our under will Our however on focus ratio a call That the and efficiency comments results. in concludes continue make third the questions, people We'll

Operator

[Operator comes session. with Please question-and-answer first the instructions] The go DelMonte Damon begin from now We'll question ahead. KBW.

Damon DelMonte

it is How guys. afternoon, today? going good Hey,

Greg Dufour

Thanks. Great.

Damon DelMonte

dealing know the led question if wondering the loan pulled looks what a way So, this there on side around you there C&I talk you CRE with and up bit mortgages, on just little going what just what's have about the Any back. residential commercial growth, quarter? XX%, it like outlook color like? first but guys saw on could and I looks

Greg Dufour

to Damon, competitive can probably that the a it the that we've if will. pricing best seen we're it little during you is market especially really seeing gets and way that then summer to competition so only bit summarize months from temporal change far down you some perspective the

Damon DelMonte

Okay.

as guys were looking how the think around I you head that And at of you X% balance hold? previously XXXX? looking year so into growth. at Does are annualized the and still

Greg Dufour

to we've a to still a little up activity that do now. Yes, of We we're to get that's see close things anticipate bit what There flurry tends holds. and the starting of years. of couple prior yearend past be to seen

Damon DelMonte

Great. Okay. regards to was Debbie the this With yield what the actual accretable margin, quarter?

Deborah Jordan

Hi quarter in Damon. third accretable earnings yields The the for the release.

Damon DelMonte

that, missed it. about must have Sorry I

Deborah Jordan

That's is the average at two-line There look when you items okay. quarterly balances.

net I interest margin. So, I net then have adjusted reported have interest the core the margin and

was third eight the So, the for basis points. quarter, accretable

margin core So, was our X.XX%.

Damon DelMonte

Okay. Perfect.

Deborah Jordan

and up were up compared I XXXX, good look happy year you to third the basis so, was ago a a pick second one points. is me two-basis And we news makes thing think if that quarter point the one quarter of

few we've exposure first on good strides our reduce have the margin the front and years, and is think the interest I over it's made So, sensitive latest income to we're time. slightly the very net asset last we liability for

this quarter seeing And of in year. benefit that third so, the we're

Damon DelMonte

Okay.

a we lot as core pricing. So, going look doesn’t to pressure you're of on deposit it ahead forward like the seeing margin look

that would be So, this could core comfortable you little the from expand in bit margin level? saying a

Deborah Jordan

slightly up. I flat would say to

thing am articles pressure above doing sure to our At have deposit some deposit the you're Street on, up modeling I think themselves. for point we point to was all don't all the we held long increase rates talking by think XXX bankers period Wall simulation One the some Journal beta rates so… overall our XX% is of do will have I for modelling I one that, a time. and

Damon DelMonte

expenses can least, then alluded the this good we fact on question what more the that out, One some control, expense hop investments frame just I Can you good would given Okay. rate in you run be could in the think were coming ongoing to I quarters? at you in for what for increase lower towards than look quarter, the franchise. a you expenses see looking to us

Deborah Jordan

quarter the third third is dipped up best the usually revenue quarter. First, and on the usually expenses where our was down our typically quarter,

the of when live XXXX, the in also quarter, the to hit I would we'll these but kind of I and technology at investments, go fourth do think going we're be around some XX.X%. quarter saw that they're investments third so look in We

that under manage to is commitment our forward Going XX%.

going in next thereafter. and So, quarter expenses then you're see a bump to operating

Damon DelMonte

now. you. for Okay. can That's had let Thank somebody I and hop else all out get I in.

Greg Dufour

Thank you. You're welcome.

Operator

with comes question ahead. from Jaffray. go next The Breese Matthew Please Piper

Matthew Breese

afternoon, Good everybody.

Greg Dufour

Matt. Hi

Matthew Breese

Debbie just few more it margin the bit little on last sounds optimistic quarters. your than a commentaries,

we pipeline that side side with deposit quarter? that with we maybe you your better just cost saw loan outlook rate parts by the rate a about the As and or think you yield average moving hoping there, just loan could share the us driven versus is yield on this I the was

Deborah Jordan

side. booked back more I few a in is LIBOR have back to on done variable combination. down loan prime lot we've last of core loan helped the rates us, swaps. the holding our deposit a rate Yeah, Currently over think it's we but and years, a lot

that sensitive. turning from has helped us So certainly asset slightly

average quarter, roughly residential On third yield the the for is of loan portfolio booked. I the yield the little X% over think

don't been I rate. and the it's fixed side, that commercial mix the variable On the of have because a

to have would back I So, on that. go to

Matthew Breese

you XX% securities of is you assets roughly roughly some quarterly back look I about change your the And think have been that that do that securities the total and earning all did at and from time. will some the of do levels? for in hold a continue? commentary up As by assets around Okay. Is loans, margin note then driven XX% or you historical that'll to mix shift think expansion

Deborah Jordan

the to side. I think XX% Yeah, investment XX% well on

estate on and side last more the residential half. real portfoling in than side we are year the the We have mortgage

swapping out the bit certainly, that. beneficial So a X% to little is do and of we'll two thirds continue

Matthew Breese

frame just this product residential you going seasonally unusual forward, staying is Okay. really investments on strong the just and off saw that for front of that this understanding quarter? should and we like was the side, volume terms I rate people us, a quarter. that sales the working you hoping anything technology could step of of level be revenue, in to of quarter it a a one was is is step this further drive taken seems is XQ up gain there And say a would some more on on then or good just

Deborah Jordan

Yes, and no. yes

bring so The first did we're the to in see starting that yes is year we and new on lender benefit.

which easier We also quicker the to application to MortgageTouch, for blend, launched apply and it mortgage. is the make

that believe So, -- am those we not rate. we're conservative the volume think helped third two to things we had are to so actually don't positives have forecasting not was and sustain us. -- I the that be going and that highest quarter I going We're

we'll million we'll I the to in $XXX around I million in closed to see it's get quarter. be going think fourth -- third $XXX that's $XX think would about million quarter. production the of

Matthew Breese

in that's is side really departure on Can my just I front, year and a the know then we And been you wealth had early filled. last the question on some and hiring we on Okay. expense operating and of business a or from and an the change of that perspective? perspective see going sort should revenue trends about whether any and talk the not

Greg Dufour

market XX, to The in who due was the into it, We step that in had XX reason had Matt. years. were change on was personal the Yes probably has who main a Jennifer the wealth Mirabile for personnel fortunate been personal that job. staff we could we for

very connected. well So

many in We're not ways have So, bench. a we that beat. missing

we a as the look to business. We out in to far continue and that at management in looking to new us. think We're I things we'll it of wealth continue all. invest is as some But important future for as very be when business come seeing revenue stream

development We portfolio investment have business that relationship we the managers the of as well managers. some as front to support people well probably as bring the have broaden from offerings in a as areas and more from

into say on would probably up but that incrementally next couple the we back quarters, be bit. see build that I quite we'll what a the of over should reinvesting topline, So, business is

a Banking we change very brought a formally strong had The for other of and Trish Bank. major mentioned running sales Has in culture us. Rose who sales and excitingly perspective, -- I management Mortgage joined with perspective. but mentioned that Retail was us she's retail Citizens more EVP She's us is for administration

expertise sale Southern New that side, to get and we're we especially in that So, forward as Maine competitive those area deepening markets. Southern looking more into the Hampshire

Matthew Breese

it. Got

Okay. what ended management quarter And you remind a us under year the assets lest or ago at just versus quarter?

Deborah Jordan

under under management, ago, under at over little $XXX is $XX to total funds our a Bank management are wealth in Sure, and flat National Camden September assets the was year-over-year. included but million million, down XX year compared that's which a actually management

we've So, just million clients at you had increase. under increase X% $XX a look if management or

Matthew Breese

Got it.

you That's Okay. had. very much. Thank all I

Greg Dufour

Welcome. Thank you.

Operator

instructions] back closing to further question-and-answer our questions, no As have like Dufour turn we any remarks. session. the for conference concludes [Operator to would this I over Greg

Greg Dufour

all story about this support I to of soon, quarterly of at thank want you to you as well the talking as Well, afternoon I you look We Bank, forward all National all behalf for taken time your thank your us the take Great. that Camden hear attention for on our earnings. care. to you've and to for

Operator

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

You now disconnect. may

Camden National (CAC) 31 Oct 172017 Q3 Earnings call transcript