COLB - Earnings call transcript Q1 2020 | Columbia Banking System, Inc.

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Operator

Thank you for standing by. Welcome to the Columbia Banking System First Quarter 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session through the web and telephone. Instructions will be given at that time. reminder, is a recorded. As Instructions] this being conference [Operator

Banking call to your Chief I Columbia like the Executive over of and would now President turn to Stein, host, Officer System. Clint

Clint Stein

columbiabank.com. everyone The and you, on call also earnings the which release we as market Good results, at Thank our quarter released thank is today's first Tamara. review we for joining you opened us morning before this available morning.

death tremendous our additional disruption individual to in points. of I support COVID-XX detailed exercise begin January. despite X,XXX earlier call Since most bankers pandemic parts lives recently with execute years of by plan personal bankers proactively early trigger today planning each first direct in serve for Sound our at region evolved. to their our understand the tested want continued relief December challenges provide coronavirus to Early XXth. our communication began customers, families. Pugent phase we on, shareholders thanking US to plan against have escalation it is bank-wide for many the than to communities then, and through on to developed We in the phased and a entered reported follow XXXX. pre-determined plan our to a worked we've into and pandemic ago options February with a It clients their were together and through and businesses professional other The the and and who joined the the as other pandemic first has the

that be and has bank valuable our community and at will believe our empathy, banker's compassion, to a support are most currency. continue heart and We I

not of different the expense and the COVID-XX. it's is impact us Bank XXXX strength as of financial and with is will profile, public health serious recession evolving. ensuing our it's COVID-XX strategies liquidity economic balance crisis to with market along crisis sheet, and a still great of of proactive capital disruptions. we economic then This are a sensible and The serve position management that consequences risk handle and that XXXX from ramifications positioned Columbia our rate well the credit weather well interest

history, the We quarter and typically throughout the the items. our the off our to year a fifth provision with is started seasonally can basis on EPS our On in see due this linked momentum expense statement what you by tremendous a was financial $X.XX best in related basis, impact weakest pre-provision $XX.X quarter. declined million. of credit-loss line quarter

income net growth impacted loan by of While it and reducing outwardly non-interest focused the and strong quarter deposit EPS quarter. an have been expense, would were the outstanding the remained bankers during COVID-XX while produced significantly expenses. Absent provision CECL impact our and

today call Credit Interim Financial with Eid Operating Eric Chris Merrywell, Chief until Officer; Monday our On Officer me this Chief Chief Andy the McDonald, who past and are was Officer. our our

your remarks, to our Following questions. answer be prepared we'll happy

Let forward-looking may call. the make remind during me we that statements you

our earnings either or filings. on For release to further or comments, forward-looking information website refer please SEC

to turn this over the I'll point, Eric. At call

Eric Eid

Thank you, Clint.

partially higher million, significant XXXX. million income due First The $XXX.X rate day-X was the net reduction After linked-quarter loan provision on was the was increase in an first Net from of advances. payoff environment, and in This income less pre-provision Pre-tax million securities. interest record. discount three CECL for on million and accretion interest of of day quarterly of early a $XX.X to decrease than $X.X of XXXX. and interest provision of quarter linked million one increase quarter was best earnings of the quarter related paid interest per in first FHLB factoring $XX.X losses the million $X.X income the first credit income quarter earnings basis was offset earnings a earnings of by $XX.X $X.X $X.X share $X.XX and million pre-tax included quarter out lower quarter for of the were interest to an and from income decline a million. the on first expense,

due the loan costs The points of increased although operating due increase X yields. basis end was basis, was in in period short-term NIM on to linked funding a quarter deposits X.XX% decline mostly average down deposits to The primarily lower during a quarter.

at $XXX to Total an of quarter public funds. X to deposits points, year-end, points $XXX increase industry-leading be ended billion, linked XX continue cost down deposits from basis. up of million million at basis Our a quarter $XX.X the basis due on primarily of

of a to X% from little further with is our quarter. our typical was the collar. is rate rate for or March of XXst, deposit was XX% pattern The by interest protected fixed, is portfolio portfolio At protected growth first XX% floors, loan another million result declines. loan in no Our seasonal $XXX our at XX%

of of Our provide liquidity us are grade readily investment pledged to funding through sheet billion have on which to needs. base. balance $X $X.X position capacity primarily access borrowing our meet liquidity not billion we billion $X.X the Overall, to continues marketable any investment and portfolio

with to of principally capacity Additionally, $XXX,XXX account from in income due deposit we other in in an partially billion Banks. million decrease have Home $X.X down fees. Correspondent $XX.X unused loan fees, offset increase Loan Federal Non-interest and was by quarter, prior borrowing Bank

quarter, non-interest the net a in was COVID our to XXXX, and associated quarter mid-XXs lower expense was down our $XXX,XXX, million quarter On expense rate account by down $X.X in the which run to basis, fees. we net decrease a year-over-year deposit was million $XXX,XXX. first interest higher primarily fees income was a handle continue expense actually gains We and linked due offset loan Non-interest of invest securities in expenses to future. first as to Compared basis. anticipate continue on with $XX.X

down X.XX% quarter, for was core in the the X.XX% quarter. from Our non-interest fourth ratio expense

first XXXX. compares in quarter X.XX% ratio of Our expense favorably to reported the the

quarter for rate compares which a the quarter XX% XX.X% tax was quarter XX.X%, linked and on basis to XXXX. effective for first Our

Chris. over to to At the this point, I'd like call turn

Chris Merrywell

To and echo Thank shifted of or time Clint's that serve Erica we employees same to everyone. way work good comments, safe. we at our to needs the critical the clients our keeping you. and clients have communities the immediate opening communities morning and

The have the the Our clients process. including as they and production office successful have our other paycheck to and had teams payment been back relief protection worked been in clients have assist pivot quickly teams forbearance the guiding evolved regulations to very outstanding around programs, have and clock the because SBA program. through with

Columbia positioned to in far are market paycheck believe excess relative the As at levels protection participate share. in program we is a result, our that of

side. them shutdown. saw increase on in solid and Deposit and in by and experienced towards deposits during funds consumer. quarter seasonality was spite as the quarter back the the rose come the down funds business retail of the and withdrew growth, other deposit public end We then typical mix First economic expenses clients $XXX predominantly retail of pay quarter. up the XX% built remained The our at million credit to the loan and and XX%

the to strength of base. deposits than peers, XX bearing of lower non-interest continues points basis be reflecting cost Our our of deposit our

in and reduce moved in levels after side, deposit bearing last the back seen points we interest XXXX. at rate basis XXX rates rates Fed to immediately interest the March On drop

continue a too increase differentiator rely interest any annualized in on our million, believe grew much our an Loan balances on the approach We key rate X%. is of as relationship-based and deposit to available clients that $XXX market. this by

first year-end the and XX.X% million end line $XXX the increased lines industry's at the from million was first increasing production in In utilization, to C&I loan was quarter. predominantly New of line was utilization at increase it XX% during the quarter's in the XXXX quarter. line with revolving $XXX

was It's our same with real Previously, million. C&I presented a financial public or in $XXX was mostly by noting the C&I CRE, as that of quarter to quarter XX% for production rental was estate production loan sectors. production statements. well the the and was agriculture it where followed Agriculture centered was XXXX sector, sectors now million new as the or in the agricultural approximately in loans. construction, New separately is administration. leasing component worth of $XX hospitality million one-third similar first centered $XXX healthcare, XX% This and in

were floating floating and XX% comprised loans production the of mix of overall fixed, X% mix fixed, and XX% the lines total. XX% is whereas XX% variable. portfolio variable. XX% The Term XX% The quarterly was production now XX%

points X.X% down during New the The booked X.XX% throughout down the the XX tax coupon an rate is overall rate loan of quarter quarter which end. was lower than points. rate basis of declined XX XX basis CRE basis of overall average as production C&I portfolio and adjusted at points with portfolio quarter

the in invest business. to are We continuing

As money our in lending deposit and later to or go based transfer in capabilities, capabilities calls, this we business online peer have small peer expect said we XXXX. opening year account in prior to online banking early and back-office improvements

will I to over Andy turn call Now, our credit review to the performance.

Andy McDonald

migration portfolio. to million quarter the and IHS The to when the changed flat second at COVID-XX performance that to forecast Chris. reduction the a economic from XX% anticipates In the can our product estimate annualized has beginning imagine Thanks, about primarily a the in of following million $XX.X forecast as compared in in the relatively is CECL after of domestic for use was our to economic and you beginning under accounted $XX forecast general, the to the resulting the the We bit. rest see an due the increase due a in quite deteriorating with negative Therefore, in rebound. our change occurred forecast provision Markit gross pandemic. of year for it quarter, XX%, approaching that provision

XX the points, metrics represented before acceptable. XX points a impacts for been issue up increase annualized and impact. credit under bit Therefore stress borrowers however to loans the also your quarter COVID-XX non-accrual was basis by basis very for charge-offs not points well was COVID-XX clicked and were Past in due came net to standard The loans related were quarter quarter. NPAs to this for who were basis XX related the had fruition.

$XXX to substandard of now changes an are portfolios loans On to loans quarter. million increase during or in loss believe $XXX increased these in saw rated $XXX XX.X% of $XXX mentioned and and measures. low We our will watch Special total increased million million loans. by million downgrades increased from impacted ratings X.X% million of risk risk approximately going to weighting million. total. $XXX the million that watch million the saw below increased quickly loans the we $XXX front, and $XX from $XXX occurred COVID-XX loans be These Many

rapidly of changed the dramatically The has in times. unprecedented assessment environment are these changing Bank's today risk. are operating Clearly, we credit

our stakeholders out of believe us by the the will great we on of we this focusing first it to best to front the with get interest exhibit for industries of all recession, in As stress. some is of believe be in

is these undertaken it in and of taken demonstrated acknowledge only in believe risk so. we to quarter-end such, provision risks and the the As to doing resolve ratings the assessment our prudent quarter prior

for through for pandemic. X,XXX in XXX also were which portfolio. try roughly about the loan amounting for in We total requests April deferrals deferrals. are believe deferrals accounted granted X,XXX million of million best XX. way clients $XXX as another the this have we in small our interest through of to our We were $X.X in granted about payment to Most loans work deferrals these to stakeholders dental $XXX or billion Roughly businesses, our

would the of the now be believe some to be pandemic. by I impacted some will that, the to give With we first on like color portfolios you

practices for healthcare billion in key For loans In and dental course of The our aware, I'm with impacted Columbia most procedures. about operation aviation the of retail, these our of that you by dental have restaurants account portfolios. to dental industries directed aggregate, of portfolio or $X.X X% emergency is roughly COVID-XX type sure includes most exception portfolio. states and cease our largest hotels, portfolio. are

reopen expected So effectively, May. closed to are not sometime and in until are offices dental

Therefore, note average we hundred portfolio. million in dental had of X,XXX XXst, $XXX,XXX. a loans, March approximately very granular it's notes of for As related size an $XXX representing

processed we for of today referrals have portfolio. payments two-thirds said, this I As approximately

participate assist they well as will these businesses, anticipate the such, able will required and be program, sheet. balance minimize As will portfolio to believe large is them a these truly working their as until be businesses. also on of transitory August clients, impact we most number working this as not with making resume on paycheck We by with the protection payments to the of reopen of COVID-XX the will their bank's capital we impact year, clients in needs which this

on, move would like you credit I concerning to I portfolio. few metrics Before with this share a

of also that in dues affect granted past. points. payment. were portfolio was deferrals minimal As number rated March deferrals would to this of made XX Past the their another only I they standing. XX% basis not at were March as Said approximately XXst, way, did customers good highlight

however, We also to outbreak. prior non-accrual dental have these on in approximately loans non-accrual were loans, $X million the already COVID-XX

So the which portfolio have we discuss. have COVID-XX portfolio, high XX% to we a segment, billion to identified is excluding dental of largest $X.X retail our next our another caused is the economic disruption or portfolio. by The risk, relative having

million X.X% related commercial real of loan our commercial between retail business in split We represents have about estate exposure approximately This and portfolio. $XXX loan.

and would Washington evenly between split is and you of and building loans is largest of The commercial I'm real largest loan approximately average about is million estate MSAs. types struggling size centered It's in Seattle Oregon really $XXX The part exposure Portland garden here, total. -- as our with materials businesses of comprised XX%. The the component in $XXX,XXX. representing center expect retail

is around portfolio at Using originations. well. was XX%, loan having origination by XX% XX% average values, than vehicle parts value on XX% to based and to at for dealers beverage of at Next with value stores food portfolio XX% as loan the a followed the auto the less and

XX%. to tested average stress value having value stress XX% On rises to than the in portfolio properties recession. to XX% We less about an this with less have a XX%. great in equivalent the properties the value loan value a than of have as loan for basis, of decline to XX% a seen loan The

retail and portfolio, is the entire special X% X% For XX% past, is mentioned substandard.

referrals We to-date payment have this also in seen portfolio. minimal for requests

I area next the like to is address. Hotels would

which We hotels also portfolio. XX% hotel the markets, of you we and we of loan at. comprise one finance, million Oregon of About include the Portland have exposure of granted for we we and XX most of Seattle portfolio. good major on Inn, would flags portfolio $XXX out of however average representing XX% have $XXX of give of deferral billion examples properties be size loan X.X% Marriott million. To million. coast. is the in financed in our $XX have of loans, In the the idea that MSAs, about is the the or about an type Best the The These flags; requests about have total, following properties Holiday XX% Western types $X.X Radisson. To-date, would flagged

Similar testing commercial basis, XX% a portfolio has to loans, the estate of portfolio retail less to to real XX% loan with than the having loan XX% value On is a based to to of about loan than a portfolio average this loan less well. on we stress with for on stress XX% value The did XX%. as XX% the the value portfolio appraised having value some XX%. less a than value originated

veterinary and providers, million $XX $XXX,XXX. million of and times about is other is chiropractors, The $XX such X% and we past million varying services. is therapists healthcare also another and physical counseling of are Approximately physician practices loan watch XX% X% with portfolio substandard. Non-dental Today, on $XXX healthcare average size of rated have $XXX total. the is as rated in million

sector are this granted on. opens in to orthopedists, we have so their $XX once Similar total as the about million segment. up to deferral rebounding see dermatologists, dental space, We able economy in optometrists the this XXX see for requests and folks when again

food Restaurants and Okay. services.

loan size and XX% watch substandard. balance Today, with have pass-rated, is $XXX this approximately portfolio in is of the an We million average XXX,XXX. XX%

XX% debt X.XX XXX Today, loan XX% million is a portfolio. stress The for On substandard. watch a XX%. XX%. is of granted in on to of had this X% coverage rises scenario, deferrals about We credit average pass-rated service and a value to $XX is have loan-to-value case with

well lessors lease million In discuss being special portfolio exposure one remaining the carriers airline exception of $XXX comprised is airplanes. airlines that to about with credit aviation last to the is direct the airplanes going about US entities entire portfolio to the Today, mentioned carriers. The and to domestic domestic $XXX direct total, This $XX our substandard. with of exposure I'm as both portfolio million rated to airline is exposure rated essentially million portfolio. of as

airline you past funding industry participants. recover them few As will entering receipt with XX, impacts in capital the domestic along began raised formal via the weeks during the government April Act. dollars know, by COVID-XX the from with of agreements many regarding this CARES Treasury We carriers week believe of into of billions of funds the help US the

XX% of majority and The of North an aircraft the X.X younger, XX% to of origination Asia, America. pandemic. As The years. America portfolio more South in lessor portfolio portfolio, age for the East. for our aircraft is exposure more the these fuel-efficient average Middle in in consists narrow-body We rest Europe the the X% is loan the XX%. in is with view in of post values, be lessor to value average Based on and demand

based However, what believe values value today's to closer loan XX%. is are, to we the on

Okay. I'll Clint. back now turn it to

Clint Stein

this family. Monday him to on experience Thanks, to now our welcome table. know Aaron Deer, take a nearly institutions Aaron want and XX to for board. moment Andy. calls he I financial of has Columbia we side as gets new of these officially delighted to covered CFO Many the from are Aaron started you on to Bank years. Aaron the have

dividend regular our quarterly announced of $X.XX. also We

of as be the shareholders will record close on XX. quarter's to This paid of May dividend XX of on business May

our prepared comments. concludes This

questions. Tamara will now Andy, answer a open questions. with it Eric and reminder, are Chris to for up And your As me

Operator

[ph]. Thank the from go Please response we you. ahead. Instructions] have phone, Rulis On Jeff [Operator

Unidentified Analyst

Thanks, good morning.

on the margin. First question

went But but said to and quick. through floors portfolio pretty floors of moves, the Before think XX% you protected walk is I floors. those was with that get that, I the -- of the rate percent to at loans, through which XX% of wanted I that percent could are fixed you from loans

Eric Eid

up pull Yes, let me it here.

and the -- one offset of we are have collar XX% at XX% the collar. floors then LIBOR. fixed, month notional X% we are our notional So million have have $XXX we

that's add up come how So XX%. that up, all have you with when you the

Unidentified Analyst

you. got Okay,

So the collar. notional the is X%

Eric Eid

Roughly.

Unidentified Analyst

Yes.

lack or risk a security given taking back the that margin, looking I deposits, of low pretty already guess, sort biggest the they're will level. So deposit see yields to loan ability you step lower is that on yields that of

Eric Eid

maybe some Probably, of those to all extent.

the and I for the going and think an PPP to we're the fee that of our our see are impact over quarters income next to going to in and to short with couple run increase we the spreads have to That's spread going continue deferred take carry loans program, under run yields sheet. probably are margins be as loans that actually on longer obviously we balance on pressure. forgiven

now between Forecasting is bit right and a fed dislocation We're challenge. of seeing a LIBOR little funds.

our getting the sure. on to we're around continued pressure going that. we're so NIM arms see But think And I for

Clint, to add And want you anything?

Clint Stein

it I at slightly looking way might help. is just different Well, think

that the is between that and fixed of then part within of already about the that going think portfolio, of to we the loans So won't $X.X billion reprice their re-pricing $X.X pressure. the the floating-rate next $X.X floor year, portfolio, loans not in face billion there roughly about at that's are when billion

of of you know loans environment. modeling through interest perform at advance put the we significant to and that NIM book, a that is purchasing rate of a our with not core a a loan strategy in coupon. as for just business year place, that mentioned the last of much it risk going with X% have But we part in Eric bunch looking originated well rate think in down dynamics, our reprice, part it's difficulty I purposes, securities

going time. I see don't aggressively the us into reinvesting So to think book that at this necessarily you're securities

We will be opportunistic about it.

that think I some defense. us gives So

the we when big loan little momentum through to our normal. growth some saw to things the balance ticked economy of February mix, and in how up. reopens, on shift the deposit as Asset tremendous quickly amount return organic terms sheet mix shifting asset don't January a more the We know ratio We that's loan a had and towards deposits unknown. of to

historic of in fine into but we -- mentioned, that we all are deposits factors So looking can well. account that those about still are taking our And some think lows, that we're the have Chris cost deposit near forward. we do space kind tuning as as funding as their

Unidentified Analyst

And just the Okay. another on Clint, question capital side.

had on included you thoughts focus maintaining in a you'd ratio In buybacks, the safe that on and maybe special the terms Any the of say table maybe regular. going to special but payout -- high capital there. that

Clint Stein

the million allocated repurchased wound when around $XX We right right quarter for XXX,XXX shares Yes. I late we our the future. intentions doing XXbX-X the We plan foreseeable during under and for now down was any have March that it in that. don't of we think that get had buybacks

there In there content still think terms that capital dividend then is tool pretty is uncertainty We I of but think the down. would capital drift regular special dividend, we've be that's those always be TCE let ratios focus I our manage ratio upward. primary maintaining XX.X%, it that been so much of our to to and healthy have used a ratios a out the

Unidentified Analyst

be up. reserve if of loan one level credit one. The stated, that relative quick And marks include you what $XXX to to were would it. last million Got that trued

Clint Stein

we if is back the add question. the discounts the acquired portfolios, that on So,

Unidentified Analyst

Yes.

Clint Stein

He I haven't I math. has that done Andy on… been either. has don't focused think

Unidentified Analyst

discount the amount? have you do amount, the Just

Clint Stein

after you with follow-up call. can We after the the

Unidentified Analyst

all you. thank Okay, right,

Clint Stein

Jeff. Thanks,

Operator

Thank you.

Your go next ahead. McGuire. Gordon response is from Please

Gordon McGuire

morning. Good

Clint Stein

Gordon. Hi,

Gordon McGuire

what the So being quarter of how you next heading does the into Clint, your year? look I I and for pretty the could trended levels. this like those March guess by outlook the was pipeline overall drop-off guess I was rest month. if month in how production you you had big wondering mentioned provide and January, just record February

Chris Merrywell

tabled. dental and of the drop-off be Gordon, moved portfolio. businesses phase starting pretty Andy had we review can you the was of this I closed, is tell Chris. pretty, the into we down pretty extensive shut a to being And as significant

that put closed I that example of use requests we is This being standpoint as of things that will So hold. have on and business an we nature.

but So on record. quarter actual it I pretty We set on were a pipeline, pace figure first month. was didn't the for the to significant get new last the

Gordon McGuire

will pipeline The here. assume the outlook more pretty is is Okay. from muted. probably I flattish

Chris Merrywell

decline. uncertainty still going to is a to demand around going people is some good but when depend pent-up move see have what's revenue. happen earnings, those quick we the that back pipeline, if There quickly in reopening some on There businesses things. economy The how for materialize, that's We'll reopen. happens and how to

You going directionally certainly those, correct to be probably difficult. more

Gordon McGuire

you discussed your funding are And how little I'm and Okay. Do balances. have caught not I prepared a sure reinvested, in Chris, bit thinking fund just of that or you being going you PPP balances remarks, but guess a guys total really if to you those like you can the would deposits to with about is security sources. lot look are I not that outside

Chris Merrywell

include we're to our look that as totals. to you up based our our you provide at those debt that available will that we ability on ability quarter, nights, that share But to feel discuss as far we the do second as discussing the time all nature. the Coast demand total tell we of things options at team lots funds, than long the PM expectations. has on options since will days to hours aggregate and totals And hit size are East outstripped XX:XX and guidance prepared We of said, been that work more to of PM showing the that in have to the X:XX reopening align as to put I tell would hard we'll and I we the don't one these

Gordon McGuire

the the result to that about on guess have net migration correlated the or talking Okay. credit probably as dive were deep in warranted the that that deep into of wondering you maybe was you migration is took there any might issues of the I dive but COVID identified how guess are a seen, of but negative going Andy by just you underlying I beyond a you of industries. your deep impact reference I'm much or dive specific COVID, general COVID release saw? issues quote the issues

Andy McDonald

The specific downgrade of vast majority a was guess portfolios. of I result dive into as part our the

at look all $XXX there, in that and Were So all related. with focus in quite there COVID-related. retail airlines areas you it's underlying hotel mention, at COVID-related. downgrades move that's the drove say and to predominantly million that. pretty of our all argue They're a rated can't I was But special believe much have so that's past would our portfolios I credits is they Sure. the probably I do those because weaknesses? downgrade, I on against mean that COVID-XX bit

Gordon McGuire

I'll you. thank step Okay, back. Thank you.

Operator

Jon next response Please you, go Thank your ahead. Arfstrom. is from

Jon Arfstrom

Thanks, guys. morning good

Clint Stein

Jon. morning, Good

Jon Arfstrom

notable the or new anything Andy, portfolio? Ag on

Andy McDonald

Anything more notable?

Jon Arfstrom

are performing point? ag you notable? assessment of your things Yes, new at or focused give I we're this at mean I areas. can But how know on these us other

Andy McDonald

Yes.

farmers Ag the the commodity sure pouring the I so buying a for to portfolio. coming book of on and news to all ground going came now milk under concerned great Most of portfolio see through the out struggle how think certainly the agricultural We're and and about I'm ground the of dairies couple been that to are XXXX more that the and that is you the okay. to been the course, Midwest of have cycle reports a There prices. has plays of that us has area years things out. aware we

of be going Absent any not of ability commodity about function most to which market. we we part, kind still a in XXXX prices that very product the enjoy is do production the to some rebound but exposure what for by say, or in is to to get and also we really Some time-frame time closely. it million crop offload, watching and is a see in that in our the XXXX we have going bring then to the one that's cattle book have I'd calendar the $XXX are do portfolio

Jon Arfstrom

Good, deferrals. dental then the Okay. And helps. that

loans these caught but what saying, you come catch like of you're I right comments? did I your sounds most prepared that deferrals that in would think Is August. in it I were off their -- --

Andy McDonald

Correct.

four will take offices adjust So at latter under of their standard purpose months if to reopening economy, belt part were the or so on programs to have payments. would those our deferral time to you making give summer, least before us that start into part was middle some to the revenue the of get they the and the

we the to ourselves. do prudent for that's for both and think practice again, So the thing dental

Jon Arfstrom

you the question on subtle Okay. in here like And and are maybe saw it you certainly there I'm trends? you drop but bit seeing, then, little seeing a a card activity what down just on changes revenue but or assuming stabilization trends? seeing year-over-year more and sequentially, looks are you Are it's the a P&L,

Clint Stein

Yes.

think a that saw certainly been -- there drop. we I a has

their think and certain it more get are is want money to places well fairly simple. to reopens to on, that some as but see start the some parts things people do shift very industry said, I through spend we it become for been online back to who stabilization people expecting are purchases purchases, that this as of there nature. of so working will so We're demand using to start in-person continue you'll based also cards, will and process those from out and things pent-up

Jon Arfstrom

Thanks lot. a Okay.

Operator

Thank you.

Your Please next response Jackie [ph]. from ahead. is go

Unidentified Analyst

Hi, good everyone. morning

Clint Stein

Hi, Jackie.

Unidentified Analyst

Ag just from. to quarter, migration prepared the is that I remarks, portfolio what sector you this if went the apologize Andy, already from But I that it. the in non-accrual mentioned missed Hi. the in your on

Andy McDonald

Alaska. fishing It's in from the industry state primarily of the

they of fishing they is last the of slam primarily salmon it as in say the pink season that. opening They delayed is So which a it the can. lower quality, lot call what goes

quality the of fish So less. the was

so as attracts which result, fish, that fish of we have a lower they a price on quality put had lower and processes stress couple business. And that a quality their

Unidentified Analyst

Okay. And is what quarter related charge-off in to? that the the

Andy McDonald

No. to Eastern Washington. a The operation row related charge-off in was crop

Unidentified Analyst

of guess Okay. of course a elevated metrics And though it quarter, was little normal the in it's in I these kind both bit even business. would that just

Andy McDonald

them not row characterize say had for it and of farmer $X was quarter. as and charge-offs drove situation which I'll just we would grewsome business an normal stuff one Yes, then charge-off strain. with the this really expect extraordinary to. I he crop million, It

Unidentified Analyst

Okay.

issue than more much So of a macro issue? micro

Andy McDonald

Yes.

Unidentified Analyst

just some talk in at where to you bit gave And to now of and bit also press in expenses right maybe know standpoint. range you're color but and noted wanted you about just I initiatives light costs, and initiatives an that the anticipate efficiency looking a were of I COVID-related Okay. investments then be on what release of of a little efficiency that a ongoing kind from little

Eric Eid

at rate our small of coming got of with I Zelle, coming spend clients, and being done right going to tracking the Jackie, solutions, competitive, and, we've we and regards the business but but some us run new this and are our with relevant and oversized things lending remain digital there. offsetting, just now. keep rate. this that our we're it's become Well, That part account of open to invest platform run the our juncture, just innovative digital, has we're said, the fund to essentially mean in part They're with continue are

Unidentified Analyst

Okay.

Clint Stein

through of things things some accelerated rates. that functionally we for the it's is better. to run some we've add of the things Eric to conduct ongoing but of and last six was improvement been expense the done, aligned some eliminate combination been business we of higher what that has I'd some or can always and There our look is -- able looking something we're do learned the through we've program starting it non-interest we've of been the terms that's some efficiency with is to that years as and will also some reduce it's learning past the rate. of get I still people at the our that adoption digital some months, channels, things differently of project. how Obviously how redundancy have DNA the and we've in getting, part doing we've and some a that protection has paycheck few other over went in how taken actually and say

some talk we are now they people as to can new the as cloud come And with leverage had under we've when we some other think that going side, the finding this areas other bankers, we're efficiently. spend say different is that learned as with that opportunities that we they more of some ways. COVID-XX silver that uncovered are well we've focus I out through lining are they've do the There our we've in That's had, how this. things

work that's we've kind on So types of of and on. things we'll a been foot high-level continue working the XX,XXX of to that overview

Andy McDonald

to way that all too loan on we it and used and digitize program. deck finish no requirement some rapidly just digital way process us application and provide We funding have all whole demand without there existing PPP the and have hands from is the will regards fulfillment Jackie, XX-day background up gives us on through line. keep I the capabilities able the and that helped with the did we would color the really we we with the to having over been that

Unidentified Analyst

the guidance understanding was of program, And you're did some number was the relationships? new or and as value, potential existing customers that PPP that open Okay. the when going provide dollar not to it or to to you loans existing

Clint Stein

we we to opportunity throughout the can most the with the an important it Jackie, not clients thing and our follow take chose this as demand. process use care process. And do prospect to existing work is of to clients

Unidentified Analyst

all Okay. you much. very Great, thank

Operator

Thank the questions time. you. are There further in no at queue this

Clint Stein

Well, safe. thanks luck. good well everyone, stay Stay All right. and and

Operator

you this webcast Thank found this webcast. joining informative, hope We you today. concludes us our for presentation

good a now have disconnect may You day. and

Columbia Banking System (COLB) 3 May 202020 Q1 Earnings call transcript