UCBI - Earnings call transcript Q2 2022 | United Community Banks, Inc.

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Operator

Good morning, everyone. And welcome to United Community Bank's Second Quarter 2022 Earnings Call. Hosting our call today our Chairman and Chief Executive Officer, Lynn Harton; Chief Financial Officer, Jefferson Harralson; President and Chief Banking Officer, Rich Bradshaw; and Chief Risk Officer, Rob Edwards. United's presentation today includes references to operating earnings, pretax, pre-credit earnings and other non-GAAP financial information.

For these non-GAAP financial measures, United has provided a reconciliation to the corresponding GAAP financial measure in the Financial Highlights section of the earnings release as well as at the end of the investor presentation. the ucbi.com. on included are website at Both will Copies presentation Form were second of quarter's the this X-K Relations at the and investor earnings release call of filed replay the company's and of available section SEC, in Investor the with a be ucbi.com. last website night on representatives aware that forward-looking Please United. this be statements may of call, during be made by XXXX be uncertainties X its should and statements the considered XX-K, company's described of website. pages forward-looking of by and on in included as Any risks filings well and on X the provided SEC other Form as light its with information the in company time, to this At the will Lynn call Harton. over I turn

Lynn Harton

inflation, Fed and of thank had solid strategy. economy, the direction and a tightening we for the our and morning of that the call strengths you of over demonstrates today. company some quarter our the Good concerns joining Despite the

net advantage. operating historical by service largely strength of interest deposit at interest to highlights the created in an of First, point grew margin. expansion deposit We've rate our our beta by core this basis our in deck to to XX base X.XX%. annualized revenue you return our on some additional assets into revenue this our growth, give net This insight our primarily included performance. quarter our driven XX%, information Due expansion improved

increased pre-provision Our $X to return pretax And a income by on XX% tangible increased growth common million, our annualized rate. XX.X%.

to and mention and in assets improvements performance special credit recoveries continues both our outstanding. be net With Secondly, credits. nonperforming

the the we're focus performance into to been believe credit economy has if does we And slip through Our goal recession. prepared cycle. balanced always on

we the weakness seeing system. or for interest outside We any of we banking signs in is the signs markets economy. significant that from believe But out flush business While watching serve. we increasing stress, excessive majority the that the consumer leverage not of we're rates always know of are

loan bit target range, but Our a our growth distributed normally. than differently in was

real this loans increasing choose estate we're cause economic market, of I'm cycle a held C&I balance more Our of glad the adjustable where commercial we pleased we finance Equipment which slightly. rates, was slightly our mortgage, loans, late on focused growth nicely, rates our past. our at than customers A of These moving be have down grew was which residential by pace fixed driven seem in slower given sheet. hold, more to And were all essentially environment. large originated, part mix always growth with flat. quarter. to are relationship United end to that into a our but

a to looking share about market. details officially part David, is I and having how newest and very We're to great United. And the and clear the well of of of to partner cultural approach about I'm very integration the a become Jefferson, over the fit Finally, similar more our you rest excited going together forward your into that continue planning, quarter? for team are Bank. we Progress be now

Jefferson Harralson

home. page the morning as one Huntsville, Birmingham, fastest in well of good we million the and in some proud best natural their X, fund higher believe that X.X% we form footprint to core deposits at the are And banking. southeast, Progress the everyone. that well quarter, natural to shrunk Deposits markets as in Panhandle, excited of of average. of pending We're as and merger And the are on it bit look think I'm Lynn. XXX% the Tuscaloosa. the serve national little population And On of growing markets us our in Thank we have and growing deposit Florida to our page a we franchise, going my by rates a markets you, our evolution will moving and higher. comments rates is X. $XXX the start at which more move or of as

Our combination loan loan slight drove to our last $X.X to and The the deposit ratio of still year-over-year, deposit quarter. shrinkage deposits deals. growth from excluding up were up XX% XX% our billion

the Our the towards page cost that growth going billion. into quarter a just this our highlight had up $X.X loans in XX, At to C&I driven diversified portfolio change lending we page, excluding XX we a is have intentionally and page capital. that quarter optimistic two base. about low and will kept at our diversified PPP downs at talk heavy, rest annualized business high ahead talk we to granular, very originations was of as less growth the bottom The we time. rate a And the quarter, over of as about grew margin page. skip about on very I by risk record translates was a loan there and we this ended and a X% up basis the mortgage drivers are of mortgage, our loans We we for our limits our deposit CRE, loan And portfolio drive year. Lynn all the mentioned, having On which with loan on growth well. pay believe loan at shrinkage, talk was I of light help in quarter. about points quarter am expansion for floating residential mix we as this later

offset a strong with quarter higher of rates course. of securities as and growth. in rose a profitability Our TCE to ratio as We loan was flat relatively did strong related our decline million AFS slight AOCI strong see $XX a ratio stayed our by profitability the in

on higher discuss deposit cash the higher lower mentioned our interest of five from that the earlier. to net the of exchange points impact points Moving which and had sheet, we ratio from I expansion XX, balance positive And basis the form of page we basis XX quarter, to XX margin, the rates. in came margin in of came loan

to quarter last experience rising this beta XX, quarter quarter peers. cycle cycle. different a up well had the we from the And rate XXXX against we the while deposit our one, is stands certainly believe second on XXXX, of from last Moving a page of which fourth XX% did include we page to this

While to and our take we cycle. will want care of customers this

It metric. are again we quarter. peers well this fare We that will down last optimistic talked on about XX, once from fee was compared we to Page income.

smaller a driver to drove that quarter had the We million compared Our falling gain QX. QX in QX with rates that the rising in gain $X.X refi gain a a mortgage we One, million had MSR to We decrease, was the business main last decrease. drivers off. million a business and of sheet $X.X compared three in were MSR had difference. QX. floating This being decline in a going is volume despite have Also, this more stronger were less in loans we rate mix which with And into seasonally combined change did also being and quarter, a towards XX% lock loans, quarter. the locks in balance $X.X sold. a rate loans decline means a

realize economics QX, time. the we or will over of more lock volume the in Some

the categories. of some to on income fee other Moving

good Navitas SBA also $XXX,XXX and rising We loan With to at And loan from be loans under NIM sales, the item demand bit $X.X closer this little more gains quarter. and loan million sale we rates picky a the $X in would expanding had gains on a in I in to selling more uncertain quarter. third this the pricing in market, to line be quarter. expect plan million just

PPP and million lion's quarter. expenses, take over nearly XX% from for up The acquisitions we deals quarter, our a by which and that and another Reliant on would and $X.X to know lot operating Moving gotten, ratio the can way, share see of marks, year. the quarter last of if on savings the expense in we year, as If some our million expenses to moved you $X do, of. over some we if the and efficiency to quarter and the another operating just merit this million our core we Aquesta adjust proud expenses are take the the and ago On increase from estimate included was page get, our efficiency a profitability last This of basis, increase the cost year driven that the acquisitions. exclude core adjusted if look by which it and cost I benefit you million in up ratio, achieve mostly will, were was savings. also XX Reliant. that efficiency is at cost were year-over-year improvement have also the a you driven you increase really fees, at then the savings already to growth analysts level, $X.X and $X.X we XX% both Also, under an MSR ratio, it

also points our our to had million page still two that, growth. on net feel it's On provision. that second recoveries bottom results quarter, credit special it We page three in now But Reliant substandard build fact we generally slightly reserve quarters. row chart we deal. slightly XX. $X time categories dollars With in in worse inception recoveries, did and we credit. which that give strong the another to the up double three to improving I'll economic that we last the credit at CECL increase on dip of related And XX, release. CECL loans solid The we've improved XX, quarters necessitated improve the were net had two a assets. in had percentage COVID and had with reserve on flat Part where build for our And quarter in mention, $X and basis shows details credit of our to pass a page problem On some All model since Moving quarter. and nonperforming due accruing back loans. you of and with related about this good despite and outlook, a reserve loan second build we trend Lynn. quarter reserve million is are the in and shows

Lynn Harton

future the now excites us growth. organization it all reflect great that continue what built that performance. for I for preparing deliver my also the to afforded a Thank outstanding thank you you and you retreat. do I'm you, on that have Jefferson. always working And as annual to opportunities And to teammates have planning United me

to And passed and finally, year I like he always founder a month. the the know DeVan. away half In great DeVan said So of a and others DeVan leader a and I'd I'd good Reliant did Bank Ard, direct, earlier strives to He you. congratulations, great He floor short, you. questions. was CEO man thank be. Rest what tribute in DeVan to came make miss truthful. to was would. peace, a and for a quality company. and a built to forthright the he ago. now many He team about And everything a this I like the who open and and

Operator

Brad [Operator first Our of question today comes from Milsaps Piper Instructions] Sandler.

Brad Milsaps

morning. are banks this Seems wanted good loan loan Lynn, hate growth. like lot your a Hey, of blowing guys you Maybe, to start maybe with just Certainly growth. guidance. quarter really away

to into a I jump So more. kind that bit wanted of little

You are. mentioned typically they those secondly, curious kind large of needed. what part maybe just how of you of downs, were got loans you the as And sort pay amount of then it, relative to

How to of that on just kind crosscurrents a maybe was of growth might with Reliant that at I of put you bit, speak And but a down of during there of have of kind cycle. play book saw conservative ultimately other impacted of little You're into loan color much curious, kind kind quarter? finally, part some the of this any you did then was that quarter. have this that. the more run-offs up Tennessee numbers the this

Lynn Harton

Brad. Perfect. Great question,

Rich Rob, And join start I'll Let as and well. that. with then in

Rich Bradshaw

$XX was morning, management in of the about off in jumps out million and very million. senior commercial We and talked payoffs, was there we at that of about that large kind care that jumped Good was, quarter. there payoff out We deals client wealth the pay $XX market, the a had Brad. late four on and another anything had

little see, that our normally larger in we from quarter production a was our than largest largest quarter there's ever payoff ever. standpoint, So it

most state there recession, about the it. where the one, their Going are of cycle? forward, really the geographies with if -- not we they well importantly, and as in understanding in I time thinking each Where cycle, spent a lot are is are the and of we in markets, the presidents seeing

about good the felt I growth. So

quarter. I think will a little mix this our be different next

commercial, less I mortgage. will think mark we'll around little still that be X% be that more a

acquisition. a Also, know, leadership beginning transition. see of at typically And we went just Reliant, an going you conversion. we run as of the terms In off we're through through

great all, about good concerns Mark they're people there. no commercial team, And the about the who importantly, have the feeling most the Ryman that leadership executive, and there market. the feel team, Wilson, that that they at John is pipelines great feel really about So

we're So that's country, the about it. how still markets thinking I'm in in the And kind of I best believe.

Lynn Harton

do you add? anything Rob, have Yes, to

Rob Edwards

about Brad, I regarding just terms, our are. I I was second we're And does question how play cycle would conservatism say the think in into who your to be continuing we much would say, it?

believe before our So in have would if are say cautious we very there's cycle. we But been the appetite been around But I because than we moderate. more changed. anything changed, hasn't it's speculation where we're that's of just

Lynn Harton

we we little much have seen in been, general, me, been be has And Well, little the in more a the I’ll not we've we seen market tightened we have more the say aggressive not just market on to the margin. than have so as aggressive past. as seen have a

Brad Milsaps

you. my the as little thank June. point that all. to end. changed Great, the in each And little mentioned of four basis more those around follow maybe I a interest month if worth past, And just might XX was have increase in had at But net the if then curious the basis the thinking kind numbers maybe curious for of Jefferson, a beginning, margin kind you maybe being of you've probably points, are you less up, in

Jefferson Harralson

that that, points numbers things per annualizing There's that is June you our if in will lot there's month, think margin I'll think XXX. the forward, going XX. margin, a a about risk single give say. five you the I so about But of basis Yes, and

be And I that we And from rates have just XX well. some points. of already quarter, margin basis next the will to expect that our happened increase, XX up as the to think see margin

you of July, the thank. in in a If rate couple got hike XX we basis like next point weeks

Operator

next Jennifer question today Demba of comes Our from Truist.

Jennifer Demba

beta Thanks. you deposit Good morning. rate guys just you during said assuming curious, do one? this the XX% for What cycle. last I'm a you had hike

Jefferson Harralson

in It's We're one deposit versus the currently this last a assuming our similar cycle beta question. great forecast. a

is As that on page, off you or see in our one on page the starts really the deck. our forecast, It new low.

points The was last first XXX basis time. points basis eight

that would total quickly, and moving for beyond, it rate go up hikes. quarter, were we three This just starts relatively and then beyond went XX%

depends modeling. So we how using on a of it this long But cycle rate goes. lot for are now, XX% our in

Jennifer Demba

-- Okay, more you you guys I what kind detail any, are be seeing guess more behavior can said great. a of that? in bit you little months. a give lending little you aggressive And more, recent Can seeing may talk about on you us

Rob Edwards

would we then currently people just comfortable think Hey, other mean. and with scenarios I we it's Jennifer, are. I than say speculative Rob. been are traditionally I more have

a the spec warehouses. lot So the those warehouses. There's of worked there's out for example likely One announcement in reason people businesses have Amazon to the of bit And The products be is a be of But cautious. would of good warehouse you kind environment really number lending. of they're different doing that of months. XX to out a was change. last little

Operator

Our next from Rose question Raymond is James. of Michael

Michael Rose

Can I If -- looks Hey, like on in your happened walk still have trying am quarters? this what if little in I'm good have some of my both mean, for you this next pretty flip in then I was everything you the a what the I positive and for just the call. there's But better might into dynamics. just of some the there's getting side I timing I MSR mortgage markets. obviously and I get know, another expectations in a just through beginning. was that, healthy. to loss then in of just dig and it I dynamics rates the Thanks. come migration. But the down on inventory be like us quarter, constraints sense bit, questions. Thanks quarters exclude missed you that. taking the can know morning, don't everyone. on of the couple

Jefferson Harralson

start might on we're it It's Mike. and with quarter I'll next quarter, thinking happened or this anything question, to add. want how a great pass Rich he to, what and about I'll

in So this lot revenue a yes, were quarter. we mortgage down

lock it mix at loans, look if the with the you And down XX%. was If lock our change over the floating volume, was of rate volume XX%. rate loans, look down at that just held-to-maturity towards you

again, XX%, generating we're that down piece quarter-to-quarter. on was the So sale on

more But significantly pure rate is loans that this a rate maturity income number driver. lock onto going we'll time. quarter get over have the we'll a held-to- main economics Now mortgage that balance from floating volume fee sheet,

it the to Rich talk forecast. pass to and I'll business over about Now the

Rich Bradshaw

Sure.

terms side In down expecting we're volume the lower another XX% probably quarter, to of QX, fee expectations this on around XX% the somewhere and be for mark from well. as

Michael Rose

least pin half risen, is exact to not of that down move of then the And loan maybe like kind payoffs, and X%, very kind this back the the in we what lot make the growth a looks back sure given rates half of production that of an takes. loan particularly the and the what with year, of beta just Reliant to the quarter, there. But growth have helpful. not this X% as run slow that's trying and for would moving Aquesta Okay, as commentary, to just we puts for some core quarter’s outlook pieces year. crease good it the should of into back should obviously, the you phase, of circling sense But contemplate off at

Rich Bradshaw

Rich. Yes, this is

about it. think As I good mentioned numbers earlier, a that I to way think

little little mortgage little up a I bit and think more change said I bit down will that on a commercial. more with a bit mix

Jefferson Harralson

the quarter in lot late we got of growth this a they What was quarter. loan inherit,

lower average period our our loan of So long growth growth. was end than

And strong volume spot, of we're we so the next quarter standpoint off average nice an from end for starting that a loan quarter, growth given at had.

Michael Rose

for Q-on-Q, especially Perfect. the final little bit on not from also And the some Thanks. the just And were recent just that some one an some maybe side. a but for that presented of drivers maybe me, about as client us one there, can best salaries the expenses down we opportunities update higher, of understand plans? on just the acquisitions obviously dislocation what's you give hiring think only on revenue but going more with

Rich Bradshaw

Rich. throughout the obviously Nashville Sure, this opportunity footprint. are that talking market a going you CRE found Including currently there. looking we Florida that Also fairly position, because And looks We're middle is discussions opportunity. that on this a tell be And well. right such great for at in an now out person middle there might that about is we're market have I see for may lift also will market looking in promising. person. we as we're

Truist what the brought we of owners. just we're brings for for Additionally, we as on on those BB&T. just he space, with start can strategic multistore and And the we size on And will Banking and Corey particularly out we Syndications And And franchise team SBA. taking do of in XX experience and Head relationships. in well Corporate us. of a And years of then this some the leader Boyd, Navitas lastly, that larger we now. of think brought larger

excited about that. And very so we're

Michael Rose

great. Okay,

little out bringing continue as much. to more bunch to a more at guys. Appreciate like relatively your bit around Thank a just people with cycle. it, opposed of higher sounds cost to surgical so So get you on be hiring

Operator

from Kevin comes of D. Davidson. next A. Fitzsimmons Our question

Kevin Fitzsimmons

everyone. morning, good Hey,

banks declining that improving this a give liquidity deposit Just if it, what balances curious the turn know going means. referred deposit forward. just lot in could us balance so excess And of and from sheet. shrinking I then you change on we've far seen of mix you've the shift to

growth day, for prior bank have might of some system. And you're future And that compressed. still the was just the driven been lower growth, earning that securities. make then while we confident more the it's where and is few Does -- still we've by of it's and percentage leaving reversing a the able at But it deposit means the But this the been? NII you growth margin. be its via are little are purchasing asset outlook quarter? is driving margin the than confident you the balance NII end shifting being really to said than beta average that sheet being And years, we'll even drive accelerate the are if what Thanks. for last versus leaving now

Jefferson Harralson

So for intricacies I'm and about But and It's great I a growth right. lot, I'll is you of very question. strong. some our the things NII about, a are something it's outlook some thinking the think that tell

other but I you least So think if one billion the banks, billion when was something last inflow over worry $X.X about year. that have outflows seen the had you our you dollars, deposit of it's of I've of over

realized we you for that So of year. might deposit the get the outflow sound rest

going been And there securities I to $X -- reason cash at stay hold is if outflow. you're to billion. book growing very now. for our that One have rapidly. right deposit if billion we see is at We think are a And $X

I -- go basis like our reason The and it’s XXX is, and it, the environment points, you securities rates other volatile of up portfolio. may size in such a another we're rate if got

Now led here. relatively securities has keeping probably so the into for deposit outflow, it portfolio the the flat potential

and competition, may seen deposit The on higher really them. in and the rates from we about get thing thing I deposit and have one to outflow well if we deposit XXX we looked that really betas, may Rich basis one kind or you've talking a of at been our competition, seeing big is just we late had some meeting July, yesterday, of change competitor changed and hasn't lot it you're just I when a growth and this Now points loan up. from from some committee, our see and mentioned XX pricing,

thinking our that But about it seen that yet. the committee. still deposit something beta. deposit We're doing when we're for is haven't planning XX% we're We

the core going I and that country, But having us deposit an we'll to picture, next have expansion. us I of think rate to one mentioned think, the having I'd XX having XX:XX around big that's unfolding that Yes. change we it this points -- right most could margin is rates in as be very quarter. to get translate XX impact? believe So basis significant base the

Kevin Fitzsimmons

Great, thanks, Jefferson.

one follow mention to One the on and wanted get Just I on and enough covered know to on, I comments you was Lynn, Lynn, way, by I him stock for so those thank just question fortunate to regarding DeVan. that. really appreciated M&A.

Just seems feel longer closing guys schedule, still in about I if if quarter, Progress you still that good to get guys term fourth closed you and M&A, and on would integrated. that want on assume

the of top not longer but term. term, probably So mind in near

the environment deposits more but does for on to, traditionally, you. the M&A that. not focused has industry? thoughts so like much on Given in it a Thank become curious prior gathering years of shifting maybe little your Just

Lynn Harton

Yes. Sure.

do, of DeVan. we kind regulatory on on mean, you leadership of comments uncertainty timing closures. I now in Progress, Right the about cognizant So we're more change and for thank very deal of and

So certainly of we're that. cognizant currently

with normally we fourth any said, we've operating quarter we different to still have close as to don't progressing are that that environment schedule. a be wouldn't on We our we believe it's able would, reason in. been But

extend in plans out. it also we've so does got And case contingency

So and we'll that. see wait on

I industry, expect just M&A a been lot there's of for surprised. in going the not building think, conversations always that and general, on. long-term with much activity down we're having terms conversations, to of get we've kind The near in kind can term, you are yes, wouldn't same focused that of relationship on. the of the I In banks with prices announced, see just

the is a months billion relationships point so, $X on southeast. at another of those of kind markets And left. to you if the back out market to million banks lot think, we see. opens in or We're but those. work look think not when up, we'll $XXX in building nine So maybe There's growth continuing with we that

to quiet and an for I while, in helpful we'll as fully and think period integrated. that for Reliant be industry us a a Progress certainly actually for and I So think is us, get

Operator

of Our David Bishop Group. next caller is Hovde

David Bishop

you. morning, question. taking for gentlemen. for my Thanks Yes, a question good maybe Jefferson,

of into the think to preamble, about basis Progress and growth? X% the You mentioned the I deal? year-over-year containment rate on on core core near X% maybe thinking should a sort expectations that in that that of -- inflation be is, expenses, the operating of basis, of maybe rate Excluding are Just impacting expense you the some XXXX? the term how of and impacts is

Jefferson Harralson

a this Expenses for great little was than a higher It’s question. I came in expecting. quarter

go it's, of you in there, there. back and types invoice timing some things there. there's some If some seasonal through, look in in There's things things timing there's project

than will grow continue to them grew will slower expenses be think I a we quarter. lot this what

less of be than I think this it'll growth the half of quarter.

July. it in what more but forecast. as at, confident I'm expense efficiency half in ratio that So I well. I'm in at some we looking significant been year. seeing the with back early, looking July think of I've improvements looking grew feel $X.X of QX. less in We're expecting looks million last like quarter, pretty at, I Early this it'll be And or forecast it's the reports this I'm half

target in reasonable So I over for and of laid that a time, I X% the think where is kind And I out target. near think term.

David Bishop

at I like question population talk of does you gives you're in rate the strong X% like seeing sound seeing just that And presidents that that maybe of obviously as of I comfort appreciate rate growth, mean, you you backdrop some a level macroeconomic obviously, there. that. that you're appropriate and then what doesn't good good think Do maybe the Lynn, feel maybe for growth there, credit rate market stress infra high growth to that or are markets. for curious overall out level? backdrop much And Thanks. the a like you

Lynn Harton

Yes.

and I focused feel be in. to range focused, of to those we been X% I'll Rich additions et the But particularly on very we've things. very concentration staff, comfortable So that you cetera, when management, start we've look at jump can continue certainly and that made the sales sorts

I don’t with very markets, think growth X% rate be that's range. right our if kind at look you in now. have add? very of I to Rich, I'd X% to somewhere that anything comfortable If you'd comfortable a know,

Rich Bradshaw

agree. the guy. And I'm would sales I

like It the especially near I approach, in blocking the back I as here right talking the and that right it's and think tackling I don't we we're right things in certainly like the discipline the doing know about we're approach. future. still think in feels uncertainties

Operator

is KBW. Mealor from question next Our Catherine of

Catherine Mealor

guess, of XX sheet kind for cash? you, that morning. of Follow portfolio Good XX that? will of a think growth kind securities I And NIM more next are deployment your outlook assuming to in of mentioned up Thanks. bps flat. assuming for quarter. excess balance you the of, on you you kind I Jefferson, Are What remain

guess that assuming but just versus NIM just thinking I'm you the yield? liquidity of about it's that excess and How guide point are how excess contributing the really much the So liquidity. I to higher

Jefferson Harralson

Yes, great question.

So that's we flat slightly a have going balance down into that sheet QX in to margin.

be So for cash securities to QX. would that down [Inaudible] then flat or relatively flat flat and securities is very

Catherine Mealor

Navitas? that commentary number. about down, then coming million relative Is that Navitas, to million $X.X a these SBA, you USDA, Great, mentioned includes and And okay. line your $X the

Jefferson Harralson

sense. volatility coming, have pricing spread growth what moving is -- words selling our don't I’m for And way. as is I because that the number no them, complete it just income high could what $X we loan to and And fine. quarter, in committed we $X be be I pricing we're that is coming, But think of is the kind And range, second matter I committed the expansion the about that's of be don't is up a be, most And the good expansion know price million the the about year. that most significant it growth We feel of was most want about line no margin to where Right. QX. of outlook. sorry, item little quarter. And are. makes was the us. price that thinking in as the we're of let’s these in if the significant don't seeing But be may is talk and even bit to right I well matter that last net want the markets, to I seeing what for But on have is half how to want million And interest you're down. loans we

Catherine Mealor

origination less. just Or hold then, to so you on sheet is change that for any balance volume it and might sell there Navitas? And more your is

And so higher sheet. then see in just that respect, actually on growth we balance more keeping might Navitas because loan you're

Jefferson Harralson

That's correct.

at we so And grown out and now hold on really Navitas. Navitas is pace. if And were right of total nice we're a loans X% to

for we self-imposed know, little more keep Navitas growth the sets up term. in it and you us a sheet, XX%. limit As if balance near XXXX we And have on of well limit, the loan the

strategy more So a to better the it's think a loans hold long- SBA loans. it's and the bit term little a, I of Navitas

Catherine Mealor

about commentary [Multiple said you've in Navitas, of the Great. anything you're any into and in you And a insight past, have six Speakers] kind business? and there churning that in month seeing credit

Rich Bradshaw

our seeing not yesterday, to talked them really Yes, Okay. and actually expectations. so

the a in So we points in QX XX in sort nine XX they to losses. running to basis went points times, basis XX in losses of pre-pandemic point QX, from normalized were losses basis

in were So would we very, to would they normalize. north continue forward points I pre-pandemic. expect going of low stage still basis something where to compared They're are the still delinquencies. early very of XX sort losses, that but expect to

seeing but it would moment, the return unusual at not we're normalized anything expect just So more a level. to to

Operator

Marinac LLC. Our next Montgomery question Christopher of comes Janney from Scott

Christopher Marinac

further drill Jefferson securities bunch gave there's capacity Thanks. a of I on answer. Or and further an angles. you book as know I you it to the know both about using liquidity. to collateral? harvest? think I existing on do earlier use even on down some team. Good morning, How information great wanted

Would So how you would something Or think environment you this about have? just that? different keep you do than curious lead current size? you to just Or change? the

Jefferson Harralson

Yes, that's great a great, question, it’s a Chris.

about, drive three for think our the think even Something I growth growth deposit deposit because, will say, I years. is that flat

time on our cash balance change as just have we a funding I fund and also fund that, well, think over and sheet have can to securities then but we'll we it with the mix here. --

I sheet a time. going over a change So balance mix lot is towards just see growth, to think not loans you're of but what

over you of growth, normal ratio to deposit loan is this level to too about using growth, of billion securities to I think will to over take that a be $X mean, to fund loan up book. fine I'm my the for that. $X we completely capital time, and But the I billion more now. have fund our So back XX%. And fine way it I completely time, the cash with

a see going decline, then lot well. months, the of out, handful then I maybe XX or to going ratio and I being again, to you're balance growth loans don't by XX think you'll of funded, see, to as securities for and being securities So a funded or see next years sheet you're ultimately, just, securities cash

Christopher Marinac

additional think the of it. the too those be guess, of, perform a the yield color. about different nature should originated. up Right, And the I whole UCBI betas side, how portfolio, kind on of just follow If loans asset or just to Appreciate are similar rest the then we that of Navitas it beta thanks on for because conversation. will

Jefferson Harralson

So a beta period and loans. lower than even lower rate fixed a will when it rate you're time. the maybe rest takes on And Navitas book. increases, passing longer of much a beta, They're of making the have

rate in had loans to of the low. environment look So to in rate stay this if one just But too, Navitas environment. going us the up higher. folding would very more to you to the an and downright not And our higher but going very quarter, at move low. or adjustable at very rates to last XX% I environment. floating quarter, being it be XX% it's very That under very whole in helpful with remained closer becoming beta in we was that variable us rate to at hike helpful book you if expect helpful as be more said, look are was

it's going from to going I Navitas. to see still come beta alone not us, good just a from but you're So think

Christopher Marinac

given and in rates it change something the end And interest change it. is is, months, the September? in all? there of any the Got by passed betas here Will in be along the at pricing last several

Jefferson Harralson

Yes.

hikes. competitive environment. a it's along So longer little it a But they're they definitely rate because are and uncertain takes more passing

Operator

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

Lynn Harton

for call to any see and questions. otherwise will Well, the look thanks follow like soon. much. to forward again up Great. you talk you for information And Thank so your and joining we that might to we you

Operator

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

may now You disconnect.

United Community Banks (UCB) 20 Jul 222022 Q2 Earnings call transcript