PFC - Earnings call 3 2023 | Premier Financial Corp.

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Operator

Good morning, and welcome to the Premier Financial Corp.

Third Quarter 2023 Earnings Conference Call. My name is Ellen, and I'll be your operator for today's call. [Operator Instructions] Please note that this event is being recorded. I would now like to turn the call over to Paul Nungester with Premier Financial Corp. whenever ahead go please you're ready. Paul,

Paul Nungester

audio Good us for you. This Financial is and Corp. morning, the premierfincorp.com. available earnings everyone, joining for call the webcast, being you website thank also will today's Premier call. be at and conference Thank replay third at XXXX quarter

take the Following on and we questions. company's our prepared will your performance, strategy comments be available to

hear like conference question-and-answer Financial I'd begin, operations to statements may call period, including we that business the remind future Before during Corp. to the today, during you and financial forward-looking related you results Premier for

Actual information factors results file materially over on Exchange included in forward-looking management risk release control. current of company projections and Commission. the these forecasts no statements in on has are and may reports differ news the company's which Information with the result additional as and Securities and a the on from factors

call now over to the his for Gary I'll turn opening comments.

Gary Small

up good all million with or pleased for share. on you, quarter expectations an $XX.X expectations. to of morning. I'm performance at for million favorable Thank and were tangible came and average in earnings income equity of quarter Results a Thank the X% in our announce team, the us. and XX.X% for On $X.XX of represents Core Premier you our Paul, third the behalf X.XX%, line joining net per or linked-quarter was ROA basis. versus quarter. posted consensus $X.X We return on

was the basis, better versus up X% average an quarter. quarter loan topped X% annualized improving and income a our of commercial we XX% interest C&I on prior originations up the X.X% quarter X -- an Year-to-date net slightly basis third was with at net and interest and stands loan anticipated. EPS annualized margin growth had bit growth our commitments. quarter for results were than the on that

using for quarter an in their to finished leading recovery loan climbing $XXX-plus clients excess X-year positions. category declined is business closed the net quarter growth report. down with Commercial delinquency XX% position their loan basis low credit deposits cash at quarter Customer on rate point, pay C&I thousand. annualized we due systemic the basis, a commercial way annualized for line to linked are was the our From quarter. and deposit utilization a The to the X.X% of on slightly a credit, up a single perspective, nothing nonaccrual a at

a a increase and to We achievable. adjustments the be special one multifamily. category, loan, the did to loans, loan mention an other is Each by expected -- are see expected C&I in performing be are X driven required the

down million. We from this have coming in re-lease repricing situation. strong benefits risk. on and a office and category just basis, exposure Premier X.X% each at Nonowner concentration occupied guarantors under in $XXX was portfolio low relatively the in linked-quarter low has

QX the XX% fee to place and was mortgage the Residential hedges margin sale on commitments that of had fee a fee income. revenue. X.X%, up respectively were and the income insurance We support year. $X.X construction income on improved basis on in prior quarter and million, adjusting benefited was XX.X% X.X% gain versus Management Wealth for or linked-quarter linked We a The up rate $XXX,XXX strong up basis. deposit-related totaled when from environment. a and for QX rising

efforts continue pay reduction cost to Our off.

current to it's XX about XX% the for really factor. earning very should margin -- on improved to our offset a XX.X% quarter. per challenges. as has I than a result, cost points, maintained we ratio always say, Premier that peers are basis ratio. efficiency basis lower And Our asset low And helping our

future. will combined a curve with when structure more in performance typical for yield serve as low-cost the Our a springboard

banking banking online new place a launched a in The and new features is has digital enhancements, better ease middleware, platform on capabilities, omnichannel early to small coming our platform, flexibility mobile Each new future a platform board clients. and for services, and cetera. is recently additional adds consumer experience We've our business relative et great a digital great in 'XX. deal digital of and provides banking improving

levels, in Our really management no clamoring The and have our with the Consumer first XXXX payment enhancements as deposit of consumer been to clients to drive improvements growth active this are new front. going we although still for positioned a clients product users balances week. well been XX% In we're our delivers. at combination are well see deposits really credit our issues additional down, system integrated treasury product forward. consumer whole digital has on and the received. above the recent converted set, working time just

Commercial a conditions conservative slowing maintaining clients expansion economic position, as some are and thoughts on vacillate. rate

that facing to industry-wise, have big significant within markets be challenges the We no little to to we have an look suppliers. tends market but affected, contract group well forward plans been amicable the exposure each our all X There are diversified resolution. and auto or to

opportunities are a have the and number on throughout our regional markets sidelines. good and commercial of We community banks

to these opportunities selectively. for capitalize on And Paul to expecting now details. more it over are I'll We turn

Paul Nungester

to and decreases in than where experience due the Thank continue annualized, deposits as seeking annualized. X.X% more including point-to-point mix the by keep yields. deposits by higher deposits begin primarily time to savings, increased you, in increased total Gary. customers sheet impactful offset I'll during customer demand migration with did that an We balance deposits, and public noninterest-bearing were fund increases quarter, which X.X%

other allowed declined off. assets side, On primarily the roll we other and total to as earning assets securities earning

to points, contraction. higher customer earning improved by strong combination we million reduce basis wholesale fundings growth $XXX of able ratio due to XXX and the by were modest cost deposit and loan-to-deposit Our asset

having June, eked of swaps the in stabilized interest basis full As changes, executed X a point increase XQ. for result balance out margin benefit a and quarter these plus we sheet net from actually a

basis from Total average in increased earlier. and mentioned costs migration X.XX% deposit XX%, in funds to was monthly the XXXX which from a up points accretion December XX change costs beta to deposit were points rate, which federal compared X.XX%. mix basis due XQ, September, excluding the XX% This including effective interest-bearing I deposits X.XX%. broker increased for to marks in customer average XXX noninterest, but to represents of Total June primarily cumulative the

by prior Net which the of previous XX interest positively basis loan margin X.XX%, was points loan the yields, impacted up and combination growth from higher quarter. were

yields monthly the for since of change the XX% December same rate PPP period. beta in the funds cumulative loan were XXXX compared September represents basis effective This to federal increase for and of points impact XXX a Excluding X.XX% an of marks, average in the XXXX.

was due commissions noninterest agency gains insurance to margins. where income excluding the to banking $XXX,XXX income X.X% million XQ. last sale mortgage primarily Next, better to on and gain from quarter, due insurance last in increased increased This increase primarily quarter, $XX.X

of insurance year XX% to costs run cost-saving reduced agency of beginning insurance or quarter, of expenses $XX.X date and $XXX a estimate agency Through last our on the the X% sale million $XXX annualized transaction to sale, $X.X initiatives combination for down Excluding million. of expense rate by our the we million already implemented the from successful million were linked-quarter basis. have

$XXX,XXX a comprised expense benefit $X was linked in quarter for of net decrease $XX million million a which and expense on benefit a third loans. unfunded quarter the for Provision of result net in a of Provision $XXX,XXX, increase ratio net the was a loans was X and marks. basis decrease $XXX,XXX or recoveries allowance to of in including unaccreted a the $XX coverage acquisition X.XX% balances, for point million commitments X.XX%,

including core third pleased quarter, with the performance margin. interest stabilized deposit in our are We a and growth

$X.XX income $X.X turn for $X.XX. in financial That the impact closing Excluding completes increased million return and a increased assets remarks. call linked-quarter of core net my on and review, FIG the a on EPS X% some for or to XQ, back Gary sale average over I'll the X.XX% to basis

Gary Small

new that. strong certainty QX quarter around and and guidance for deposit X.X% some Thank the X% QX with continuation fees keeping growth on assets was perspective, small year. tailwind, down securities in moderate no bandwidth you, Expect Paul, earning There months of offsetting a We've deposit a growth but roll-downs, mix X absolute repricing Margin would see that. continued very X small throughout remainder stability. X% see movement. could Expect on results. I the row a year-end the with to will a we improved at trajectory, expect consistent Earning third and originations business the points about income to deposit Loan good thoughts been average the fee category. with an wealth in basis X by of for yield I'll and expect assets. offset loan and share

range. million provided similar at we in Fourth The with last will income From call, perspective, rate somewhere likely be run projected million. forecast quarter no the mortgage to more a in $X.X change. keeping is on our credit expense QX $XX be to the

potential favorable of construction moderate, Although movement lower for quarter NPLs. benefit we commitments. a level the in continue will -- the provision benefit unfunded from to see Fourth

the We consider X over add year and are point First comment like X sale favorable quarterly average of organization over the on the full that's quarters. would of net share EPS X the charge-offs the the of position. a see nearing normalized performance basis quarter. contained more $X.XX excluding conservative. second we X Group past rate it the the Still an and I to for a a unfunded run has to past delivered to this range, in the quarters impact Premier Insurance keeping

That tumultuous over determination long-term and of value performance is it. of being earnings for you balancing to delivery and positioning through part we're banking and capital as organization, difficult consistent and the to runs a top commitment making for reflection decisions DNA, and a performing shareholders. needed, This quartile Premier's Premier to count adjustments period organization to of direct making return this driven commitment team performance creation performance can industry near-term and a on objectives our as our

take that with questions. be all to happy I'll said, And

Operator

KBW. Instructions] from Our first today question comes Michael from Perito [Operator

Michael Perito

Yes.

tailwind about for this term as balance there's think year. fixed curious been costs second if kind the of over funding of looks here? like lagging stuff reprice change we that blended of the some X.XX% about higher kind of the you're the But was yet. couple maybe see then providing question, one, not And schedule asset I a yields, minute realize it a for rate year? guide spread to maturation incremental margin investments X near loan stuff the wanted here, the it. that I Number kind [ I cost, of down ] to Just guess on questions. Obviously, putting on to And again. you're new it like or up incremental blended Is above incremental deposit stabilization what to questions and And next just kind you do of of CRE-type today? XXXX, maybe expect some good kind that some have pure level? just spend what's

Gary Small

Mike, the part I'll and the of question, second. take first have the will Paul

You rate the [ or sort north it would X.XX% repricing as mentioned that's expensive do around of base, on is of on ] X.XX% as the ] funding at figure. we stuff business the [ or incremental most new number, X.XX% our comes business which adjustable ] going [

to with our If an look X. generally, you starting at is book, everything were commercial

you If at Xs some on have them the that our look and things of retail relative to have consumer book. book, XXs we

floater going the repricing would gets it get of is on floating That north be you and rate -- of XXX business is story. which higher going kind on, there's going and So new X. more higher, plus

Paul Nungester

between we're in one the that terms We've Yes, buckets. adjustable cycle lot up, then modest your level. I Between comes book, up on to take question and that have of of stuff be of kind get bullets with looking in maybe total We and XX% coming which the would a X in don't fixed Mike, next probably true and there rolling year scheduled there. a got repricing X-year I'll got up. up coming the was maturities a XXXX kind to second normal believe we've the those

what we're accelerate So whatever for get not have obviously, lift are could or you, lift some major we're a some, out for that. not expecting a from if of of looking but and We'll customers that reason that. lot anticipating refis

to on seeing piece that been of trends similar should So what here recently, it. you've Mike, continue

Michael Perito

Okay.

be you guys where quarter quarter mean are So little most pays more like always I they year equal, you conservative bit. on think think is stay a some based spreads mean, do modest all of kind the compression. the still to to But behind it think you that's on it a maturities much doesn't and more maybe sounds are, that should sound like incremental reprice compression additional I outlook? else Or higher. although multi-quarter than you should Do there fair? if it next where that bounce things period, obviously, of on over be like rates

Gary Small

to I We'd for a combination about -- cautioned we amortizes off. have can characterization Well, see It's of it say couple ourselves think and from we'll we to also that we're yet. the it that a we're is your if certainly see -- trough not we like what at right. reprice not of quarters. But what here. But there, book

of commercial this We'll pull on, side, XX% so a a What it's stuff year the back it with the a be sales more but about bit. were million the there's new a staying we did had less replaced there, what's the we've market comment, between that's and will from $XXX market to year coming the letting where and on back at in the it with next in grower business, so purposefully last a our year. on because year, normal impact little the is going the rate coming we And be be repricing a out to -- versus we'll in way. bit book newer favorable again, new the have a

[indiscernible] new think to that's -- it if it be favorable I going direction . will it's fine, So favorable.

Michael Perito

Great. back. step next dovetails into I'll and question, And that then my

kind north knows on in part because yields, incremental, the I commercial just early latter on of I we appetite next Just growth maybe the your for guess, here loan and But you guess of X with mentioned like. bit banks the of pipeline -- pull a who kind year what as look blended we've mean the being I what's question. it what look seen here. of I guess, back X-part environment of would liquidity a lot part is.

the And asset it in a earning remix quarter. so guide like based curious, I expect on mean, your little sounds you fourth

I go Gary, I you customer north have prepared there there. is your base, customer release, like credit loan could much if utilization down. of remarks on growth, current might you it today from appetite the perspective? secondly, some market some think layer positive the a mentioned I So then sounds but deeper And going curious C&I how mean X% commercial in mean, your within for like in

Gary Small

get pricing terms I hesitate word use reasonable, that power, the you is folks on if looking the the and you're to enough there's pricing sidelines but works can the deal the for.

point, at think So this I that's very achievable.

Operator

There Okay. from the are [Operator further Instructions] line. questions no

you for any So remarks. closing Gary, to I'll hand back

Gary Small

to Okay. reach conversation questions all free I you interest thank for your develop you Thank feel might next look and that to additional great a forward out with quarter. and having all. any

Operator

concludes today's joining. for all very call. Thank much conference That you

Have You day. rest disconnect now may lines. a your great of your

Premier Financial (PFC) 25 Oct 232023 Q3 Earnings call transcript