SFNC - Earnings call transcript Q4 2017 | Simmons First National Corporation

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Operator

Good day, ladies and gentlemen. And welcome to the Simmons First National Corporation’s Fourth Quarter Earnings Conference Call and Webcast. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. [Operator Instructions].

conference recorded. today’s reminder, a may be As I to Mr. like to call over turn the would now David Garner. Sir, may you begin.

David Garner

Simmons We Good morning, quarter as at serve Garner earnings and National everyone. My name Investor is teleconference and Relations our you to welcome David webcast. I First fourth Corporation. Officer

Chief Executive and The of this by the Casteel, me Company release of CEO Officer. Chairman the information and Joining Chief discuss in of are Barry our earnings Chief future. Fehlman, Simmons Makris, discuss Banking George Bob today one wholly-owned and subsidiaries; bank is Financial to Ledbetter, and for to purpose call quarterly Company’s and Bank, data our Chairman Officer; issued outlook our Officer; provided yesterday Marty our

our followed We discussion question-and-answer session. comments, with a prepared by will begin

are analysts other session invited on research Q&A Company Relations that have investors will We in under call, the A institutional on website the including guests be the prepared this simmonsbank.com a session. equity tab. firms remarks in Investor Q&A our our provide from call and transcript of to in the All listen-only today’s participate posted mode. our and conference

and Company, expectations, or forward-looking involve and be estimates. in forward-looking factors, performance certain known call which that and statements, and During to today's special notice our I the make actual cautionary constitute unknown may cause results from and by materially statements the current regarding remind statements certain this risks, matters discussed and disclosures call may outlook. during and forward-looking different made uncertainties, we expectations, other may about presentations estimates our other goals, certain may plans, you of

of Commission. please the filed Form certain Annual risk and all of Exchange with certain US Report recent with our Information refer description on factors release press a list section risk and in contained the most associated the Securities For our to of our earnings XX-K, Forward-Looking business, as

the such of and management based The otherwise. on forward-looking information occurrence or receipt by on events, of projections, assumptions guarantees Company made beliefs and obligation undertakes Company its of update of performance. are to statements, not estimates, Forward-looking the based statements statements time of future revise any and the are the new no management at future or

with insights. a determined should for be may this Any will in and as These measures report by we non-GAAP contained measures in they that presented now metrics. these performance call results Makris. are SEC non-GAAP GAAP are disclosures the to Lastly, note the in references provide financial turn reconciliations core presentation, operating non-GAAP Mr. that filed certain discuss to financial the meaningful Form are will intended yesterday substitute necessarily metrics George viewed X-K. over that current on With to our said, be with I Please companies. of not accordance GAAP comparable other nor non-GAAP to

George Makris

and the and the of tax one-time $XX.X to a Thank approach XXXX, was producing non-cash reform results. into tax net decrease and release in recently share revaluation fourth per same rightsizing $X.X million costs. from $X.XX. the result assets $XX.X a fourth yesterday the earnings you, reported assets as all issued merger-related earnings welcomed of Diluted David. billion, the new exceptional were we for of with maintaining XXXX compared We earnings $XX.X first of million a stronger of quarter. quarter while last territories, new call. liabilities $XX our customers, signed million community into fourth In deferred charge million branch were and exceeding quarter included organization to And year. welcome momentous our our Also was income quarter law. of quarter expanded created associates conference to our press in Included income

to donation million $X a made Foundation. the we Simmons addition, In

compared Excluding $X.XX. items, after-tax share increase impact period year. quarter these $XX.X for of XXXX, the million million were an same the of per fourth core company’s net were earnings earnings core to the $XX of last Diluted

at an last quarter. end $XX.X increase of balance was billion the from $X.X billion Our quarter of the loan

to million During net the quarter following in merger $X.X XX. the loans Southwest since the October Bank acquired at in the loans from our merger increase since loans items. increase $XXX portfolio date. increased due on million SNB at billion We includes $XXX increase payoffs. in our Bank $XX finance our seasonal loan a consumer million lending from Simmons about portfolios liquidating optimistic future of million loan in growth. And $XX date. decrease increase at loans decrease agricultural million and and which net remain Bank indirect $XX a net

accelerated accretion subsidiary than $X.X income last combined The our close larger loan quarter to development of acquired as basis, a on income define the the accretion fourth income the quarter -- original of Based at quarter ready than $XX loans for concentration cash our approved fourth quarter. pipeline the and loan from portfolio was $XX.X for was acquired XXXX XXXX and growth. and flow projected million concentration of loan On net banks consolidated to and of Our XX% loans. which loans discount million our the CRE expect higher be loan end construction was $XXX these ratios we year. our quarter estimates Including would buying from due cash do loans. of in on loans is we of in and the total XX.X% to same the the flows same to last originally include XXX.X%. million. important experiencing million, projections, concentration was the loans was a It’s interest The approximately million XXX.X% be this compared CRE period All excellent at year. was not that loans the increase to with the end be $XXX.X company’s concentration Accretion during CND note would discount XX.X% quarter. discount, our of

for excludes The fourth interest of quarter company’s to core X.XX% net the year. of which net was last in the Deposit to earning quarter in growth XXXX. increase X.XX% rates the assets. deposits up X.XX% period for cost from increases which margin Our experienced compared interest banks. acquired XXXX the acquisitions X.XX% We’ve same quarter last billion of was accretion margin continued basis on in gradual offset the was was funds related internal from same increased the year bearing prior year. to interest by driven deposit This XX on-time the of at and $X.X cost points over Cost growth. increases higher of the

We increased increase continue deposits project recent and a that result rate of cost will fed competition of to funding as hikes. for the our

from had and to loan Those another $X.X $XX.X income, and income trust sales million decrease same insurance increases during our in in the on the prior charges and fees the SBA were to due quarter. XXX,XXX offset Our sale gain securities of quarter. million, increase non-interest the quarter lands service acquisitions in the income by due income of quarter from of an was XXXX. for in decreases We of business of increases sales

the acquisitions in over quarter expense During while was proceeds expense will during the non-interest over all for are non-interest quarter, that last period we income for higher quarter the categories increases at lower reinvest from $XX.X core the sales sold result tax securities year. Incremental loss. approximately XXXX a similar million, $XXX.X was in use in our the $XXX Non-interest same of the rate. XXXX yielding our in yielding to expense a We which maturities lower increased at the in with million. million investments result

made In entire grants addition, Siemens our the the primarily CRA during throughout quarter qualified $X we development a geography. to contribution fourth to million provide foundation community

was quarter for the XX.X%. ratio Our core efficiency

the loan going XX% result lower these XX% million company a and estimate acquired tax forward income $XX.X for of its charge At $XXX.X year non-cash As be The of This the estate owned. do allowance in problem Act XX. balance in was $XX.X to non-performing We $XX losses $XXX,XXX a was legacy XXXX, of of law resulted loan million loan primarily effective XX, for September provision reserved do a related analysis an basis one-time decrease Tax gross at additional Company's loan assets quarter on for range. during deferred was mark million required X, full were total was for to to $XX.X total million. the The million revalue allowance relationships. three the loans of real $XX.X not to to into expense. was charge-offs The up loans. the loans. account the tax end, The and of tax additional $XX.X allowance with rates tax amounts. of loans our equates million charge-offs This signed and points on and were assets in December to a require of XX corporate coverage. December impact legacy loans. and $XX.X other Cuts is losses million deferred credit future made to XXXX At in loans for discount statement deferred X.XX% from coverage total non-performing for Jobs the on rate down of ratio The liabilities million,

were charge card annualized points. fourth net basis quarter, offs, our credit total to the including XX During charge-offs loans

Excluding the loan net million during was was for basis loan last the the due The same points. during quarter provision provision to needed the growth. annualized loan credit loss The the loans charge-offs card compared strong and to period $X.X $X.X charge-offs, to migration our increased year. total during million XX larger were quarter

the end, stockholders’ position equity capital common Our quarter was At $X.X very remains billion. strong.

May investors. announced very which excited $XX.XX, integration our Our last stock SNB are same opportunities X book for market. believe the increase scheduled was are Southwest value last while of share will we The investment per from $XX.XX, well. an the create of of share same Bank opportunities The increase Late February an week X% combined tangible value new XX.X% last split going and and year. conversions X for the we wide book Bank year, of variety we for a period period is was about from of per systems a and

owners and is retail a have Our ownership vice-versa. customers believe as dynamic XX% it’s valuable to and approximately we

include, and for foundation $XXX the up as while will the institutional our investors. The variety a capital our operator our I’ll associates. among which high-performance questions open reported the in investments date a dividend. on development support of five stock for of of to grow in believe communities The in we the law optimism prepared years contribution of and split increase we deployment for line in our This services strategy help an now our The as footprint and back after provide to financial Note our increased consider CRA the to changes impact qualified instructions technology please company. allowed throughout We’ll an and our We stock record customers. to statements, effect from us including us our dividend a for the opportunity ask shareholders that share-related on and community our also tax reflect XX% research the review investment due we the will concludes at to is initiatives, our January left our our additional periods disclosures, to presented. in take improve to will include our products sharing new our business of of our of come questions. Siemens our finally plan, achieve call potential announced share delivery and the over envision and comments. XX, same growth evidenced by of per These increasing an on increase the the time earnings XXXX, investment the XXX(k) to profit all shareholders. $X investment million million grants well to split retention return has other component the associates our increased consideration to distributed investment analyst

Operator

question the [Operator KBW. you. Thank our Brady first you Instructions]. Gailey comes and line of Thank with from

Your is open. line

Brady Gailey

Thank you morning good and guys.

lot prepared a its the five a if your out some in doing about big tax of caught comments George over technology even $XXX a me was you’re lower things in with So, number that’s thing you years. the that rate. One spread investment talked million

think getting back, form. step how are drop from just guys of I do to bottom-line? you the that will you actually tax you much wondering was much of when a the So, How benefit take

George Makris

me with about Well, that’s a XX help number, good that, -- question. We’ve Bob the estimated

Bob Fehlman

and Of about relates for Well we it whether budget the a we’re our in there, When you on cost $XXX say what be In million have five already new I communities upgrades to our be whether look tax systems, it in the so we’ve $X that for replacement could includes the would of basis for to its it that investment headcount, years. it in could forward the that next budgeting go major the half in could year have, mentioned line in forth. next employees, be its of in the we some at systems of is bottom million in technology. X increase. first over mind this it

all won't the hit cost but year for bottom the to is line have $X we incremental that budgeted it to our the when So, range. we IT go in million next X

George Makris

me the I invest to Bob those bottom XX% talked about. mentioned. rest we in current close a touch it The some our tax to like the areas lower of already of items, Brady going let we’ve will So, benefit XX more that little estimates. of on the feel the of rate line based certain on are

talk me technology the specifically Let about investment.

in in system [indiscernible] bank bank our back a you billion If standalone bank, think $X current Arkansas. was the largest

to we’re billion this the we're best-in-class is will today. out are to The the that grow. size we choose going not whatever picking on of our applications appropriate luxury to us afforded that system the to size then, market and and All $XX a case of operating take

Everything table. So, one-time really all this is on is redo the our of applications. a

addition is mortar and the know bricks In moving from you and digital. more away as to to trend that,

in is important of So, big customers’ we to consultants in and care what the take We that have them on that have with going more digitally to to we have all that need they so digital forward. needs the of] that branch wherever million even of that do outside good digital pretty is we our going be. bank and some today But a that working our are us like what’s be look branch. applications deploy our choose of two we together already can branch to future but teams put One We technology future. number. is actually going part [towards initiatives $XXX

allow big accelerate will cut have we program been XX-year it tax to of is we’ve initiatives the going this, $XX to So, and us the I five-year table got program. for the have what million, a budgeted million may some $XXX you seven to on XXXX. the of benefit probably into of a tell

Bob Fehlman

other cost. is and Which expenditures capital

Brady Gailey

helpful. That’s Alright. then on And M&A.

head anymore about You don’t are that into with an M&A quarter. as have fourth deals the in XXXX? be two May any on pending just thinking closed you update the how we

George Makris

Well.

Southwest we’re very and totally having still are two the We is and in February interested May. still SNB very Bank we are focused on productive discussions. one one in integrations, Brady, Bank

reverse entire And sort our of that’s dissimilarly to other affects integrations, we’ve that going organization. got integrations Simmons some on

had So Bank, entire particularly that things the company. we’re the deploying that they Southwest across there at they some were doing

it’s So, converting it’s in not converting systems Simmons Bank necessarily certain cases systems. but Southwest just legacy

a relationships see current different still approach little we’ve and big in the we establish active That are totally is taken to on that merger will with excellent market past. M&A the which believe So, in deals focused we XXXX. said, be throughout We these our that. geography the particularly real are partners opportunities some than

the would and little M&A to probably our end us in the expect direction. a ball of the year toward game So, be for precise more I back in

Operator

our comes And from the James. of you. with question line David Thank Feaster Raymond next

Your line is open.

David Feaster

morning, Good guys. Hi.

Southwest your have So, loan pay you across I lot just that next us markets. for seeing strong. It could had in impressive pretty high especially be growth was you and and pay downs Bank at peers loan looks outlook your when wondered give a may quarter are growth level your if net year loan was growth. impacted like the a really especially of ups what

George Makris

before. team mentioned Mark Vernon and was Bryant the The and team Sure. Well his year. Funke think during done that was exceptional job his this I let I and me and this by just have say

when to very quality benefits grew organization. a announce on associates of know larger you think Vernon announce leadership banks XXXX, an of You you when that's during hope had early their to everything it. real a understood and the the you acquisition Both Mark keep testament of that those who you the and tremendously of

quarter. grew the portfolio Southwest the see by results fourth XXXX XX% during their in you Bank over particularly and

$XXX loans I've loan you our two even given at for of $X.XX one continue that loans growth expect numbers on in results approved that, and already expect but we XX XXXX digit probably pipeline our think to a to I is safe same XXXX and is I We pace million would close today. but is significant to those double over range that base overall, XX% not ready construction is unfunded billion that more at

me and let So, we to those loans. a backing into that, go funding expand see strategy have off really our that now and don't up a and for little just lot teed bit ready right of we

have tremendous We not to funding funding of to problem. is term a the available short loans a so amount be us going

the that we our real us believe that position if in focus is be aggressive time to years of we're will will for to kind XXXX. a several core that a we strategy of be pursuit for fund a However, in loan successful in believe to and growth We now deposits, in come. for us this be

expect know partially loans. that's one deposits off We rising we of marginal our feeds the that any our throughout other may and the see to expect strategy think a increases for the in you we before cost and XXXX So, to good as we offset in strategy continue we said would year.

David Feaster

guidance, and kind your next about NIM, great floor the sensitivity, core asset the remind color, maybe rising for the kind core deposit us now. had NIM you the thoughts I'd get that appreciate to was correctly kind you what ability we're which to on, be. like NIM like thought on I I about of XXX get your for of cost of sitting and your thoughts deals pro Okay, to the just core forma here to talked the remember two accretion and if just year on I that's your of wanted control going just was the

George Makris

I'm first. that going to let question tackle Bob

Bob Fehlman

I’d of together of XXX-XXX could know to be that right we range. into say of at intend is core about off, NIM have. were core When be that, you XXXX put Well Keep that so legacy still first we for at range in QX guidance we going our XXX, all so Simmons probably middle the was to -- we're some about will to in the we our deals that you seasonality for low our NIM. with expect be QX mind XXX XXX for end in and XXX drop below the the

So, I sheet and are asset are positioned continued more would side, the we that the we so sensitive the for expect balance very more are increases. sensitivity on on well side, moving sheet rate on we balance

So, that front well. but we're have I of right number don't in me positioned

you me that guidance you Let We year. accretion on XX give number course little year. more of for David front gave will a end loaded during million, the granularity be the the next but of

I’ll mind come will works. So, the these accretion in you pay-offs on based keep that change quarterly and how in numbers, actual give schedule

got in year. right QX. scheduling X.X for and in X.X next QX, million XX million QX, X.X now million our what the we’ve numbers scheduled is So, and in million we’re for the and budgeting year X.X in is million That QX

of everybody also. helps that So quarterly the on kind numbers

David Feaster

already are seasonal expecting closed Could guess some suspect That’s expenses, the quarter? have big already and of remaining timing is maybe the cost inclusion in maybe expenses last the I been one much part appreciate a how of I that talk of the deals I synergies me, you but just know banks the in to and color. conversion. from got of given you’re the FICA terrific. the and that you’ve first I back saved you two of systems about that the And guess rate maybe just run the saves the reminder synergies

George Makris

interest It we that touch QX in million achieve believe be Generally, this, will have quarter and first in take changes rate. more [ph] first loans that little year subs the mentioned tax will at a first lowest with flexible range. Agro quarter, specially that be the payroll the remind that as that of on I’ll portfolio that. level we will today. you charge XX and cost you’ve I’ll our to We quarter is Bob’s already rate expense this rights beginning total rate be in is usually our in also then. that we’re that the $XX QX all believe in we the our than regards mentioned on some books we Agro are where fixed run will higher we the that loans its to

will quarter. on run first impact net our million interest XX third we is margin $XX we that So on during cylinders But good once in hit negative a a believe have rate that the to the quarter. all

Bob Fehlman

keep the in first mind income in David, year. other Also, down every quarter significantly it I out, but to bank of NSF just pointed the be tends like the

had that’s seasonality. impact on an So

Operator

our you of Thank and the next Matt line question comes Stevens. with Olney from

open. Your line is

Matt Olney

with our a growth stronger loan and confirm, that to talked us sounds improved than time talk that’s make last relative we would if to discussion? like wanted you commentary can the previous loan I so tell about just if it because it what's and changed the the to number growth Wanted one, XX this net outlook to XX%,

George Makris

run last here I but SNB expect Bank than XX%. this Officer, year’s our Bank to at as call am Simmons be X be very Matt down. territories active you and to outlook, we based I I the performance legacy that sitting Southwest to tell I and footprint looking divisions, has X% and Bank our significantly Bank would we Southwest SNB, growth up legacy really this our that not consider take both Chief in would Simmons on then look at a year’s a Lending think three Well we Reddin, and what more would

to just what about those. feel I for So, said. I Matt up That’s good

the the per very we we both have biggest we the optimistic capita put So, all the serviced this that our the that showed together, mid are you on we recall in Bank the markets by of left in potential the when serve, are And we’re new side Matt, and Bank if population all all Southwest income and markets SNB. about growth markets. graph ones

it’s in bigger a it, size projected process. is the XXXX taking us. surprise of advantage when bit a So, but really is not excellent in their from little we surprise our originally to a But of success

don’t recall, Southwest establish Simmons short bought, Bank you relationships a from to allow SNB in I XXXX know the bigger and to Bank of was, of what If number little million go Bank and both ahead those participations during $XXX them their markets.

So, their we they done are very what optimistic about have in potential.

Matt Olney

And at more thinking with years some be still But seasonality volatility I versus years? about new previous loan George think think growth the talked be in seasonality of to even will we some in loan you XXXX -- growth do you or now these to previous it Simmons. markets, the create about expect of do

George Makris

Just math alone, less significant. Matt make the will it

portfolio million Agro piece Our is I this think $XXX year.

it affect both as those much would you a are total big won’t Our at They high net chip relation growth in our yielding now. Those loan away what used portfolio tell smaller because margin as portfolios. much of be I on credit $XXX that portfolio. is interest are is I it the to will relative card our numbers basis net million. guess loan

So, at little they will a their chip that when they lowest, are bit. at NIM away

Matt Olney

loans? three loans. three commercial else on mentioned can Then those there elevated credit I anything George. Is with helpful, were That’s you. some specific us on think Thank there the charge-offs I heard were share you said you it. quality, you they Got

George Makris

or loans market. Well the the ones we’ve for are in those [indiscernible] quarters now that three two mentioned three

We exposure. have fully was thought our what reserved we

is have good look We expectation. decided loss that and hard it taken at realistic probably that

weighted and just of full If based additional charge charge-offs. were an those none off. allowance on they was So, we provision reserved those our to

Bob Fehlman

In million fact, X.X X.X million increases, linked $X with million. on the quarter the was Matt, all provision a of increased to

acquired that our that we in or to loans new was of All banks related new acquired. loans

Matt Olney

then helpful. should in the guess that? I looking the be provision as how at next be we as that’s XXXX And question Okay, would far expense

George Makris

divided our quarter-to-quarter you projections, to based to on from budget million may Well think our I we be quarters pretty tell year, we XX XX for between four expect $XX [ph]. can tad to expense $XX a that the exceptional all evenly provision be million million is million but

Bob Fehlman

we and migrated rolling that And provision the loans, allowance of accretion Matt fund as the accretion those so as first a have an those on migrate off, to before, is the is so it's over. lot to we the offset in about over the we're talked on from year loans income up migrating

Operator

Thank [Operator your line question of from with Sandler you, open. our and comes Instructions] next is the Stephen line O'Neill, Scouten

Stephen Scouten

wanted see make just and say thought then I first George some get I and XXXX million I sure expecting try thought number million that XXXX. to had go I and to so to you expense heard I in XX the just back the right guidance of XXX you're million to heard million first budgeted there, Hey, just I clarification for say I X Bob maybe X

George Makris

Well replacing is other trying the XX some an I we to what million increase explain already. we IT related $X million XXX Stephen the part be in of already year expense the the we million so books the but ongoing of was XX X be in million, the for to that first of million expenses capital expenditures, earlier get $X will of would expense and million next total additional, spend is XX the to the first XX the that is have years, - when this basis couple about expenses is that part in year on of of million on the

technology. part in million, it in with expense so may $XX and we of will million that to IT example one million be new for or expense So, have area $XX total number replacing the $XX may grow

Stephen Scouten

million million the in that annualized will run kind saves back rate, up spend with And million done the the does year million of half $XX like X of for kind million, $XX get ramp X to from 'XX already once that cost acquisitions? $XX or guidance XQ of that - encapsulate you in technology the

George Makris

and half spent going year. million XX there in to in of most be first of that is It's fact the

Stephen Scouten

which that thinking is a year blew basis through the a loan I just low already you've full in years XXX seems you on number, to then or of got million I said point XX million too growth of to pipeline great. for well With pretty the $XXX and mean kind mean million think targeting achievable XX Okay, billion last XXX north ready almost you pipeline the about what one and million, million were close. for great, you dollar year I the in know $X it I have is at

George Makris

a dollars that at. of is think a look Well already somewhat billion we we take baseline certainly $X

You all of of the the is in know some not going sponsors of on is money it be million it's until so some the funded XXX won't project, to construction, it in to into that or XXXX, of year deferred all depending year, even into how in going project early new the on maybe come just the end some it's be is. the

out hard billion think dollars, how for on actually time of of dollars this our but will north net billion the books So, that $X really $X to year. be hit some we the Stephen it's books growth would the

Stephen Scouten

does lower that to CRE I of ex being capital increase as that largely do limitations concerns as any Bank even here Southwest it that about about you create Okay seeing is and talk in level, the that's are credit is mark. mean CRE guys from expect terms the Bank risk-based and you SNB helpful, a any that result of and you you and have the kind still I and growth weighted guess? number composition especially with

George Makris

converting and Well, think some creates non-qualified it are well. several have including we we limitations think any which doing Tier-X debt don’t we options

in seeing up up. takes will CRE loans So, but lines opportunities lot to all of We do help investigating one increases our it during that us we’re unfortunately hotel big and lot several we’re that business a options loan. of XXXX a SBA see sure of a make

got enhance we’ve So, we’ve to up We’ve market. the that we monitoring expected which in CRE make is our really monitoring levels going gas on the to further with forward. and we’re going the enhanced our the to for have other that seen CRE areas the have in all at foot opportunities

necessary to keep the we’re going prepared of So, this that. well don’t planning we and is growth have we’re now, any really to aware do that concerns

Stephen Scouten

that I little you’ve talked XXX before one end then being more is and guess holistically securities based Are Thanks. there that more to of been rate kind more redeployed there specific just because curious you’ve numbers. variable moving around of changes a to or bit composition already of in expected rate as happen previously terms that dynamic? first what’s NIM. you’re Okay. what changes XQ I’m or on was changes, one best then the at to and of forward. in really pretty last a kind composition sensitive about targeting kind neutral driving Great million that doing the quarter in loans

Bob Fehlman

over On period our shortening, the that time. of composites, one security we’ve shortened is a portfolio is rate

helped on some rates us So and as I that’s to shorter believe more the bit we a duration the little sensitivity loans the have those some on asset move variable rate moved forward. on loans to and we more

on that sensitivity that size tweaking So earnings increased the up we just asset side. as our a asset

George Makris

loans fixed rate right loans a rate know we convert, loan in fixed started was You rate that little are. index to over Steven typically some the a as

increased on strategy future. that a just an our pressure the NIM today great think So where has it’s we for

So we able increases that which advantage XX happen likely will take the rate to to we over to next XX believe of very were be months.

Stephen Scouten

a makes sense. of that and Yeah, lot

George Makris

security looked was of an sell as loss a able the in obviously end do And Steven then sales. $X.X the that tax We’ve opportunity million was in had to we of were that low year, yield benefit. year at other the on took advantage so recognize about We $XXX XXXX and we a if loss question the really you security. million had

that So, year at of reinvesting back end that the the in and little reinvest of a first quarter bit into the are data will process the we portfolio. in the

probably an about Our X.X-year that and seven million $X duration, almost basically we’re look more earned on will year in that made. back is the makes investment rest haven’t but that than it's would a not months we extending back over not we earned half we much as have on have of and

what was So, million. some know that year could securities and the a so to at break of looked it on end we analytical best was an we just $XXX you harbor the do clear at of piece the yielding out

Stephen Scouten

Thanks so for really much helpful great. Okay, That’s the color. guys.

Bob Fehlman

Thanks Steve.

million, is related estimates. was our one item, was loan higher all that side. million $XX was rate it $XX credit our you the Before booked about to would discuss this like quarter, interest I we’ve get None off, original It than discount it of for to related to of component it.

for be to fourth rate initial what the where is really has and we it come where experts the the last move of interest comes our valuation the will one, quarter down in in been what movement period that as time accretion and and in that we is from over gave the obviously valuation year guidance as was have when get the So, that. higher

at you our see So, it came to really the expectations. higher And It almost works. as GAAP look on discount of all the will That than rate to loan expected. how None mark. sheet came related we side, component. the when balance in was with right the you know interest credit you

on and We become as over life component loan a accreted day one they effectively one have for rate of credit your is mark and an those two, loan. day discount the interest

Stephen Scouten

Right, yes.

that’s million ‘XX? for XX encapsulated in all the So

Bob Fehlman

right. That’s exactly

Operator

like Thank you. I time. closing And I any Mr. this further would to remarks. for Makris turn call showing not to back now question the at George am

George Makris

excited I we’re the shareholder to Well, was to helped like awfully was forward forward great look this those. all it and have day. identify with a starting us. We a investment off thank XXXX we of us several you joining bang. And taking changes which fourth I joining eventful. advantage say we’ve us will we today successful going very again have friendly for and The is Thanks quarter for would certainly morning. think that believe of law tax opportunities certainly outlined that about

Operator

Ladies and thank conclude conference. have all you a Everyone, participating day. This the program in great and gentlemen, disconnect. may you today's for does

Simmons First National (SFNC) 23 Jan 182017 Q4 Earnings call transcript