Oct 29, 2026 earnings call — Record revenue and strong fee growth
Record total revenue of $81 million, highest in nearly 150 years, drove earnings per share up nearly 17%.
Revenue $0.1B (est $0.1B) · EPS $0.71 (est $0.66)
Key quotes
"Noninterest income grew nearly 17%, representing 42% of total revenues, a level that continues to set us apart and fuels our continued and future success."
"Commercial and business loans are up nearly 37% from a year ago and now represent well over 1/3 of the loan portfolio."
"Reserve levels remained solid at 1.23% of loans and CET1 is 10.5%, well above our regulatory requirements."
Analyst Q&A 5
fee and expense outlook; accretion
Q (Jeff Rulis · D.A. Davidson): The analyst asked if fee income and expenses would step down in Q4 and how the remaining purchase-accounting accretion would split between 2026 and 2027.
A: Management said fee income will step back because the net gains from premises won't repeat and future results depend on market action; expenses should be relatively stable quarter-over-quarter but have some seasonal pickup in the fourth quarter. They expect approximately $13 million of accretion for 2026 and about $9 million for 2027.
"So on the fee income side, there's going to be a little bit of a step back there on a reported basis because we won't have the net gains from the premises again." — Alan Villalon (CFO)
loan pipelines and September spot margin
Q (Brendan Nosal · Hovde Group): The analyst asked how credit demand and loan pipelines looked after strong late-quarter growth and what that implied for Q4 loan growth. He also asked for the spot margin at the end of September (full month vs 9/30).
A: Management said pipelines were very robust entering Q3 and look very strong entering Q4, and they reiterated mid- to single-digit loan growth guidance. They gave examples of large new loans ($28 million, $18 million, $33 million) and said deposit inflows from mid-market clients helped growth. On margin, they said both reported and core are down a couple of basis points for September (for the full month).
"Both on a reported basis and core basis, we're just looking down a couple of basis points for that in September." — Alan Villalon (CFO)
rate sensitivity, deposit beta, repricing
Q (Nathan Race · Piper Sandler): He asked about short-term rate sensitivity on loans and deposits, the expected deposit beta, the split of variable versus fixed loans, the amount of commercial real estate repricing over 12 months, roll-off versus reprice yields, and the split between Prime and SOFR.
A: Management said new loan yields are above legacy yields and are accretive to earning asset yields; deposit costs are ticking up, especially on money market funds, and they expect deposit beta around 50%. They said loans are 50-50 variable versus fixed, about just a little under $2 billion will reprice over the next 12 months, roll-off yields will be around 6%, and roughly 28% of loans are in Prime while 44% are in SOFR.
"And as of what's repricing over the next 12 months, we're looking at roughly about just a little under $2 billion." — Alan Villalon (CFO)
deposit pricing, mortgage slowdown, provision
Q (Damon Del Monte · KBW): He asked how the bank would defend deposit pricing if rates rose further and how to forecast core margin into 2027. He also asked whether mortgage pipelines could weaken with high 30-year rates, and whether the provision should be about $2 million in Q4 to cover new loan growth.
A: Management said ALM scenarios of plus or minus 100 show little change to NII (maybe change 10 basis points), and they feel neutrally positioned. They said they go up slow on deposit pricing, defend largest depositors, and be reactive to competition. On mortgage, they said pipelines are lighter and there's a slowdown but experienced staff can pull some volume and they expect a pickup in March–April. For provision, they said new growth will likely be in the 1.15% range and there could be specific reserves on one or both of the long-term workout deals.
"And so new growth coming in will likely be in the 1.15% range." — Karin Taylor (COO)
charge-offs and share repurchases
Q (Kenneth Kohut · Raymond James): He asked how to think about near-term charge-off expectations versus the long-term average and whether the ~250,000 shares per quarter repurchase run rate should be assumed going forward.
A: Management said they expect lower charge-offs this quarter and a fairly clean portfolio going into next year, though a couple of deals could carry charge-offs and it is early to define a range; long term they expect asset quality to creep back toward historical levels in the second half. On buybacks, management said capital priorities remain the same and any share repurchases will be opportunistic when capital is beyond other needs, with no defined buyback plan.
"For this quarter, we would continue to expect lower charge-offs than we've had in the previous quarters this year." — Karin Taylor (COO)