GBCI - Earnings call transcript Q2 2022

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Operator

Good day. And thank you for standing by. Welcome to the Glacier Bancorp Second Quarter Earnings Conference Call. At this time, all participants are in listen-only mode. [Operator Instructions]. today's being that advised be conference recorded. is Please hand over to would now speaker conference to like I your the today, Mr. and Randy President CEO. Chesler, Please go ahead.

Randall Chesler

Administrator. you our our morning Officer, treasury is thank morning Copher, Chief our With All Accounting and Officer; Ron Chief Officer; here for Don and Angela Financial thank our Cherry, me this Well, our today. Administrative joining Tom Byron Kalispell right. in Credit Pollen, Chief Dolan, us Chief you and good Dose,

ended the health good our quarter, we about the core very So quarter feeling the second strength of and business.

prior for quarter. of the prior $XXX,XXX more in was million points XX the nine quarter the basis separates of of prior loan X%. This the of a X.XX% an decreased or Utah, of X.XX% we from the flow the million in in the quarter from as Washington, Economic tax prior from Pretax for build a the into of an of United $XX.X loans the thoughts net detail later. Nevada portfolio some percentage Idaho, The and growth current country quarter million we provide Once the $XX.X since tailwind $XXX of data the XX. of quarter. which the X% again, on of to is revenue million versus very X% few points a states Our million and the or an best most core quarter states strong continued increased the tax-equivalent seven the our income additional in income interest cost some quarter $X.X Analysis net This annualized. I'll gross continue the business the XXXX of leadership was of $XX.X and prior Core our increase rest Wyoming, six had quarter. or growing Arizona. Noninterest million from shortly. for States. Montana, in of or a on touch the or domestic US discuss margin income core points quarter. index Net top in $XX.X and were record million, markets for quarter. the excluding during first, the that high one the X.XX% work. Net from measured markets favorable net of position $XX.X was published product divisions, distinguish was in is will by million, Banking A interest $X.X climate I Colorado, to strong include highlights $XXX deposits assets Western XX% Net X.XX% be the recently markets. in Tax places XX% decrease company were which tax-equivalent then of growth in Markets, quarter, about each US of of as themselves The the million, organically organic PPP on which in deposits of XXXX Top states, to points Bureau $X.X best quarter. increase basis compared interest on we the pre-provision quarter as annualized. live will million. in that to the growth from was The a increase in to one our which The prior of operate our basis and points, or some $XXX discuss million basis operate the area Community quarter some margin another a XX expense we premier of basis detail in company, earning $XXX.X Foundation eight continues banks the Eastern prior basis and community the all

while pleased of types, underwriting loan end quarter based the near on for our $X.X credit for continues prior quarter $X.XX expenses, Earnings to million to discipline. quality the loans appetite per strong discipline. the which our grow this guidelines We to levels. the we consecutive With of regular record the growth was ratio XX% quarter. the maintain bend with maintaining declared risk dividend dividends quarter we Excluding acquisition for million, share, risk $X.XX related loan again deposit and loan XX% stuck $XXX our versus PPP didn't The company into pricing increasing consistently in annualized XXX a The portfolio record the driven Overall to portfolio a $XXX.X the per million. regular has We was portfolio plans a was quarter. growth loans. the noninterest was by deposits, before $X.XX anticipated our consistent not the financing prior XXx. in happy to was share very loans we're regular to rotate of for in of in in increased increases. has markets opportunity and growth lock improve and to out quarter number cash dividend. to rate quarter investments dividend including accelerating of loan expense the continuing declared customers quarterly and have P We're Credit and a

$X.X gross payoffs XX% the new for a gross of quarter production billion, -- before increase was record $X.X billion. loan production new a Our

with in the to and by XX borrower basis XX percentage the the customers, basis points broad contributions divisions basis made good understanding our delinquencies nonperforming points the quality have improved our from the XX% existing growth quarter in commercial prior points Given loan we a compared was quality ended at quarter. the credit. commercial we the markets, loan of XX growth points our assets the of the based of loans this basis to eight assets a as where XX the states. About bank to prior Credit of stage quarter. Early saw to across each improving of strength during quarter from of very

about customer We with with future mid the growth continue the growth of building loan in strong strong and reserves high through digit low economic while a responsible and an to being our the quality appeal new to very to a footprint double on markets outlook. our well healthy underwriting as strong are our prepared remain of team said, continue ones. credit event maintain with generate downturn focus capital, to deposit cycle across also will a which of earnings. That optimistic very lens. growth model Core the we continued existing relationships franchise the We was

quarter earning million of X% annualized. by are deposits $XX.X $XX.X annualized This deposits Year-to-date now core of million was deposits. to as increased margin was The quarter compared net prior X.XX% annualized. The basis the in margin X.XX% nine to our by X% Noninterest prior up the of interest yields. quarter a in the result to a loan deposits X% quarter. account quarter in compared prior the quarter, increased The in points or core quarter percentage ended XX% X.XX% the points. quarter. interest cost to X.XX% basis increase core was of during on the debt core a at for investment X.XX% in securities And basis a dropped net current for basis one core six tax-equivalent current tax-equivalent and margin bearing deposits or and X.XX% core the total The quarter. yield of on compared the assets net interest points increased of

prior loan rate the X.XX%. ended portfolio New a at at The quarter. quarter yield investments on seven from tax-equivalent in the debt of securities X.XX%, down were points added the basis

the with quarter. core of yields We loan of However, $X increase increased around XX an X.XX% yield loan the seven in over new billion points core of X.X%, X.XX%. which production about the basis prior basis points versus loan from prior quarter, core yield was added

both quarter, new and year. the through $X.X the We to our inflection million increasing new and income higher the expansion due loans This million reached margin yields. $XX.X investment or have prior an rest will portfolios, loan now drive declined Noninterest are from primarily the XX% where investments of with the of yields of XX% with portfolio mortgage $X gain on income residential sale in taking substantially market. on quarter. a rise refinance The a residential real current mortgages. reduced rates million activity. Rising quarter toll on or prior the has and mortgages $X of residential estate reduced the sale the rates decreased million are from interest from residential point Gain for interest

forecast NBA As XX%. in now the down the be that will by market XXXX

We to reflect trend. the same our expect business

noninterest expenses, was expense million. $XXX.X a Excluding quarter the acquisition second

in volatile successfully through interest very a to business managed hires. was capability team very see best-in-class high a while level health effective corporate quality our quarter. a in were at strong, to to technology Glacier that firms record and is a robust while expenses we we very driven franchise stable rate with franchise. bridging primarily great The continue brought new expense environment. sticky increase did the another staffing job gap source The divisions. new The of service work We We by needed with on second funded of loans, control Glacier Bancorp deposit a

a very are XXXX We stage strong in grow positioned well and XXXX. to set the continue for to

now may my Instructions] ends the I'd any that analysts to questions line remarks. please for that And like [Operator formal So Latonia have. open our

Operator

from our Matthew Piper question Sandler. Clark comes And of first

Matthew Clark

does growth growth X% here, kind I year-to-date. morning, like guys. from the guess actually good how you can your the you Hey, think annualized do -- what side? think And this is year? on deposit deposit I Maybe look pipeline on starting of X% outlook maintain

Randall Chesler

we Pollan, the we've a treasurer, did. looking at Byron we're Sure. I obviously lot happy our year-to-date that Yes, very that. see time and of growth think, to Experience, spent

comment you So on to maybe want outlook? the Byron

Byron Pollan

see expectation, some flat. looking willing balances some some let run and balances But we are balance I we're We rate could deposit go. sensitive to balances off. be that From for roughly to sensitive attrition think rate Sure.

this to And in be going chase not able keep are rate being to we deposit our very flat. we'll We think successful cycle. costs rate

we down. what deposit very to back to achieve were keeping look last costs you at rate If the we our were in successful cycle, able

achieve similar reason to around. deviate see to strategy. able from be expect to don't We this time the success any that We

for think out. be balances to flat on I from we're roughly So looking here

Matthew Clark

know Okay, to portfolio the you happen monthly margin the and the being June. loans month the securities great. have then And or accretive here. from to happen to in of average Do

Byron Pollan

with to you have back to will We that. get

Randall Chesler

to in Matthew, front right get of have I that we that can you. don't

Matthew Clark

Okay. And expenses. just then shipping

run of kind I think just on want the $XXX path $XXX too. last fourth a your thoughts updated to get glide million about to million talked to there we of quarter, quarter rate outlook

Ron Copher

Yes, Matthew, is this Ron.

we As remarks, merger the said expenses. his if related remove in Randy

for were first bulk The that. looking million quarter. us that had to million, hiring, the were of the which So with firms that we we have at data technology help is our us. it hire $XXX.X people of compared to to $X.X We our And million corporate all up address in to firms call across want help technology service as $X.X we $X million the where to was platform. warehouse cuts I

So is what example, a compensation rotation will of come say a other those that see That down expenses to see going grow. we you're well, just come a temporary by would way it, to, $X firms going to will of going down, million, expect but expense use what's is folks. you're outside

So I'm put quarter $XXX what million. that we $XXX would $XXX had consistent and $XXX the in that is all QX, when repeated to range you the would say, million in with saying And million. be first million be that guided comfortable I to from, together,

quicker, but a got to engine So little wanted going. we keep there

Matthew Clark

clarify then any comments, additional occur? additional just color it but to just to the And digit thoughts too. sounded slowdown the real digit. mid-single in want on I but the resi, estate to Is assume any growth your loan where Great. outlook, outlook there just it's commercial like somewhat Randy, on expect and you double related,

Tom Dolan

the at of this is with digit. double low year we The gave Tom. Matthew, outlook the beginning

we've think to mid moved up I low digits. that to double

XX% looking I XX% somewhere the for think we're probably year. between at and

comments, right rates, the the folks deals at we is year, to So trying our seeing at a which a get with what rate. obviously they is bit which while in pent-up in mentioned and lot beginning little half we're had as it of the overall, the more Randy of pipelines in the consistent get movement his their a in second demand, reasonable of slowdown in

double the kind second load off I digit. still should we'll between see So it quarterly for of the growth, the half think somewhere but of year that finish slower of year,

Matthew Clark

Okay, excluding to I and check. PPP? that double the -- is want just

Tom Dolan

million Yes, PPP. that a only be have would so think less, almost excluding We factor I anymore. of $XX not PPP

Matthew Clark

Yes.

Thanks. thinking year. last Just the to about comparison

Operator

from comes question David Raymond next Our James. Feaster,

David Feaster

morning, Hey, everybody. good

on clients staying the maybe we forward curious of half pull how stands did I'm back the pipeline up how to into Are just helpful? composition more head just the the growth has want just on at demand. sounds pulse see some commentary Just follow thoughts this point? any the the would trepidation to some the as have be front, like just economic we your that changed. any of of And given outlook, year, starting you on

Tom Dolan

Hi, I, towards down I'd on put by of it, if right coming third to the David. down, that were And bit. over little borrowers the This year. a rate trying where again. point, are cycle quarters get had percentage a they're Tom hit Pipelines to were first about of where ahead they to couple of say a the head, you your of I

what concern and impact there going of in regardless. have. to there's with forward, the standpoint, certainly impact, make So are our with for the inflation their looking sense, projects, moving long-term metrics terms a trepidation forward But they're rates return, they're moving borrowers some still interest from out when

So our forecasting very call probably healthy the I would we're latter pipeline. that of the the say frankly is But bit a for pipeline quarters half would was frothy. maintaining the prior year And quite today still more pretty healthy. we're several I growth normalized. little a quite still

David Feaster

Yes.

bit. And driver makes CRE Obviously, just into a this sense. was That huge then a Okay. of digging maybe growth quarter. that

as some be conversely, that there any focused And some there as certain or might forward, more headwinds better you're at, we Or any more on at feel cap curious or that there's segments sectors higher are we that that is demand curious are avoiding? in you look maybe are I'm maybe look just where Just right, segments look markets? better seeing And rates. obviously, CRE, as rates and are we you're frothy it on then we weighing opportunities? there opportunities? see

Randall Chesler

really I a into industry et cetera. avoiding by at the case look equity is we're are, how deal much look wouldn't and strong particular mentors coming We say every including requests any nature our of on of deal, by at just basis totality the industry. case how the

we good become significant shape. demand warehouse And lot We've to a the with ultimately, more across but cap with and for as the stronger coming yield deals. components calls, result of come one different as pandemic, of multifamily our that mentioned underwrite our into migration, pretty demand our various footprint even I've this debt in we've prior is of cash last lot for cash of a of where have characteristics equity of through our the which have segments, seen years a seen way multitude they we industrial. in some. So in debt ultimately requirements example, rates segments, yield series And down borrowers the couple the are all the steady from on into including throughout see a pretty borrowers at the -- come required equity segments

David Feaster

taken together, books just on deposit book just growth growth the here that quickly the expect would probably the cash new commentary probably towards would are be loans, that the to then any and restarting putting buying just securities just duration, flows helpful. or are curious on shorten and what reallocated up you maybe of outlook commentary then outlook just And the and kind peaked the securities on, organic securities that guys Okay. you touching given you

Tom Dolan

perspective peaked the balanced and and portfolio. see do portfolio, so will allocated that securities securities cash it’s loan remix in the be coming I a to From where likely flow some think to

targeted the now, pool But we're buying, related kind that CRE we're don't right very for buying I In what terms is this. most part, of shortening really of we're to so what it's duration. limited know

Operator

Brandon will of Our Truist next Securities. come from King question

Brandon King

am growth I loan half Hi, good year you is the some of the further where a to in on wanted flat. sheet. on outlook kind balance where loan with noticed in limit deposit is the borrowings to loan to lagging. quarter morning. sheet borrowings far from of I play where Yes, certain the that the of bit And can these, increased borrowings slower to to remain wondering of growth the second fund touch as slow that to with constrain strong a loan kind the I with appetite so balance there and going growth to growth as growth, deposits growth use amount and

Byron Pollan

this Brandon, I Byron. And is can the address borrowings.

what the I think is we're of temporary So seeing a just here cash flow. and mismatch timing

quarter runoff are the growth loan flow kind the We we deposit we're see, portfolio to things. strong And very growth. growth, have we is second gaps. One so mismatch. think a lighter the did backfilling of couple of also, with any FHLB But in do securities as funding of that temporary we that a some advances the with somewhat of plug using of that's cash some

progress And that flow be pay cash to so of those likely the as year, security through able we down see some borrowings. short-term to security, certain

Brandon King

Okay. could is us ways [Inaudible]. the outlook next over portfolio, with of what you the And the flow securities cash again remind year

Byron Pollan

about a We're $X.X billion getting year.

And so closed $XXX little. it about a million down has that quarter, breaks to a

think we billion were to looking previously $X.X at moderated billion a about year. about I $X.X That's year. a

cash be I that do rest amount a the year. the that, So consistent of flow will of through expect

Brandon King

I growth lower a products, to there's the top if is that I'm the of the XX% on the to manage XX% curious efficiency then of know cost that company line the next year, to you with potential? efficiency I'm potential wondering be over but And kind in expected Great. Okay. the a ratio, and and NII, chop for growth XX%

Randall Chesler

We've towards maybe address the XX%, that with. think that of place will initiatives end revisit one intend of we range No, lot a Brandon, I is XX% year. efficiency. the it got in We'll that stick to

for solid continue very right a feel revisit, we like that That's So some that. range in. but this of to be now will, we'll we'll

Operator

question next comes Our Terrell Andrew from Incorporated. Stephens with

Andrew Terrell

apologize morning. you expectation an I remarks. good mortgage Hey, did I missed for banking prepared provide Hey, the in But the year? if this for

Randall Chesler

part That's did NBA think give more expecting but is I that's the Ron we're Andrew, a little what's I similar for business, say give try that it that our a a tune but trends I driving We've you color. the If about drop more bit. a gains. of Ron And big in No, calling question, your fine income. color. to talked you noninterest the can little market. think A with XX% in that obviously to it, can

Andrew Terrell

helpful. be would very that Yes,

Ron Copher

Ron Okay, Yes, Andrew. here.

So portfolio in second XX% the growth to first X%. was you annualized. saw was the the XX%, the that residential in And quarter quarter compare

So to the whether due [Inaudible]. loans, of rates, of gains a the that a at were fixed higher down you're because the, portfolios, call product rate and spike the the what in I'll looking more was interest amount disruption sudden

elected our to And chose so customers get we closed mortgages help the quicker.

have, that can't into we loan those resulted putting portfolio, construction So in also sell we the loans.

some portfolio the well. then see of see there the close first you'll But be gain would run that as to on that But outlook, in So X%. more growth getting coming rate growth would to our to in that quarter being the we sale.

get So of that and million mentioned, quarter, the perspective. And QX. had $X up that's we we'll to in second then from QX each see $X could million million stepping in the $X what NBA Randy how we to

Andrew Terrell

really kind market, mortgage you're That's, then when normalized curious Any XXXX. going quick really great. volumes kind just I the very to looking business? in kind staffing of division, or it’s the in of back of and high Did you seen of anything in it. within a helpful, we've I'm given more Okay, your in changes XXXX- alter forward shifts market. the kind make are mortgage appreciate And mortgage then one,

Randall Chesler

This being a happy no, serve business. high is markets with us very for the Yes, mortgage community core to bank service. with a of level our offering we're

we We And have the are getting more as have volumes efficient there. allocated changed.

Part the within that in the the other we're our Our you to quarter-to-quarter working so them and reason of those have for of to able business. approach is people can is people mortgage parts is take reallocate more we reallocate FTE the flat. business company reallocate see

managing So and getting expense improving we really in that efficiency management are way. through

Operator

come of Our Jeff Rulis next from Davidson. question will D.A.

Jeff Rulis

a that quarter of expectations then Thanks. housekeeping the maybe Good I just tax production this maybe on a Really morning. just on last. versus couple and loan on yields rate new question just missed the the items

Ron Copher

Yes. Jeff, Ron, here.

the be XX%. range ramp could it bit speak would let to XX% up a rate. last reaching, So year. and XX.X% somewhere that to me it'll hitting tax say see little said to between the get it I the XX% I ramp we up just closer that quarter

So that's the outlook.

Randall Chesler

quarter. So our production new this

that's production the on right the, XX have We points quarter. basis And over XXX. about prior on we're new around loans

Jeff Rulis

update a your Got just And conversations Randy, But it. some market economic on Thanks, I I think Randy. partnerships. any concerns pause I on leads think by correction, guess to seek to gears, kind And and appetite switching M&A that nature. front? of

Randall Chesler

our Well, Sure. the same. remains outlook our time,

have been to wanted think I well. we saying get we went did make sure we -- conversion, Alta that that through the

making of projects As well really technology sure number that's gone we precede as have well. all

of talked the make an that earliest end about would obviously one the and certainly we at year, changed, think thing The view I announcement. next credit. on year our is that we and/or So

take changed. a of strategy in terms we're pursuing in as interest that a that be think going I there. deeper hasn't of the uncertainty look, our given to some But

Operator

would closing over Mr. to now I remarks. to conference you. like Thank back Chesler the turn for

Randall Chesler

I questions. I good. very Well, for season know our the a it's analysts. Right. busy appreciate

want asking have appreciate to Friday and you hope today for thank we taking a as time in you with a the everyone great So Thank I great dialing us. some questions. always, weekend. else you. And and great

Operator

you for participating. conference. This concludes today's Thank

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Glacier Bancorp (GBCI) 22 Jul 222022 Q2 Earnings call transcript