Oct 23, 2026 earnings call — TriCo deal progress and margin outlook
Q3 results showed NII $174.1 million and NIM 3.30%, and management expects Q4 NIM 3.34% to 3.35%.
Revenue $0.2B (est $0.2B) · EPS $0.52 (est $0.59)
Key quotes
"Integration planning is going well, and we continue to expect to close this quarter."
"Third quarter net charge-offs were $21.9 million or 60 basis points of total loans and leases."
"I think we're kind of at a trough in this quarter. I think this is probably as low as it's going to be, especially given the rate outlook that we've seen."
Analyst Q&A 8
loan growth and margin expectations
Q (Andrew Terrell · Stephens): He asked about the loan pipeline and whether loans will be flat or grow a little in Q4. He also asked how to think about pro forma margins after adding TriCo.
A: Management said the loan pipeline is still there but payoffs are reducing balances, so loans may be flat. On margin, they said fixed-rate cash flow repricing is about $400 million a quarter and they see spread around 160 to 170, with small margin moves if the Fed changes rates.
"We continue to see the effects of fixed-rate cash flow repricing on our balance sheet." — James Moses (CFO)
funding costs and deal integration
Q (David Feaster · Raymond James): He asked if funding cost leverage has more room or is at a trough. He also asked for an update on integration and conversion work for the TriCo deal.
A: They said funding cost is probably at a trough this quarter and local competition remains muted; they gave a rough view of deposit betas. On integration, they said teams are working closely, Jamie is leading the IMO, TriCo's CFO is leading their side, and the vast majority of TriCo employees are staying on as they prepare for post-close work and conversions.
"The vast majority are staying on with us." — Robert Harrison (CEO·CHAIR)
deposit drivers and office credit
Q (Anthony Elian · JPMorgan): He asked what drove commercial deposit growth and how management sees deposit growth going forward. He also asked about CRE/office credit and whether Q3 migration is a one-off.
A: They said the commercial increase was normal flows and they typically see inflows in the fourth quarter, so they expect some deposit growth in Q4. On credit, they pointed to a Seattle office deal as a one-off: it's still 75% occupied by a federal agency that is paying rent, they have done deep dives across the portfolio, and they remain comfortable overall while not expanding mainland office exposure.
"It's still 75% occupied by a federal agency that's paying its rent." — Robert Harrison (CEO·CHAIR)
deposit spot rate; repricing split; CRE downgrades
Q (Matthew Clark · Piper Sandler): He asked the spot deposit cost at end of September, how the cited $400 million of cash flow breaks between loans and securities and their spreads, and for more color on the CRE downgrades and SNC portfolio size.
A: They said the spot rate was 117 basis points at quarter end. They said roughly $250 million of the cash flow is on the loan side and $150 million on the securities side, with about 110 basis points on loans and about 200 basis points on securities. On the downgrades, 3 came from the national SNC exam, 2 are portfolio multifamily loans entered in 2020, and C&I SNC is $275 million outstanding with everything pass rated except an $11.6 million unfunded commitment special mention; they did not have the CRE SNC number on hand.
"Yes, it was 117 basis points, same as it was for the quarter." — James Moses (CFO)
C&I vs CRE outlook and deposit betas
Q (Sun Young Lee · TD Cowen): She asked whether C&I can still grow given lower dealer floorplan and whether CRE payoffs will moderate, and whether the 40%/30% beta comments include TriCo.
A: They said C&I volatility is largely driven by dealer floorplan balances, which can go up or down with the market, and fourth-quarter balances typically increase while they keep onboarding new clients. Jamie said the 40%-ish interest-bearing and ~30% total deposit betas were just for legacy First Hawaiian and it is hard to say now how TriCo will change that until after close, though they think highly of TriCo's deposit management.
"I think that part of that is much of our C&I historically, the volatility is driven by dealer floor plan, and that comes and goes depend on what's happening in the market." — Robert Harrison (CEO·CHAIR)
share buybacks and Basel III impact
Q (Andrew Liesch · StoneX): He asked about the outlook for share buybacks after the deal closes and whether buybacks would resume. He also asked the expected CET1 impact from new Basel III rules.
A: They said buybacks have been done consistently in the past, were paused for the transaction, and that they still have authorization and will consider buybacks after seeing the combined balance sheet and accretion, but it is early to decide timing or amount. On Basel III, they said they expect about a 100 basis point impact to CET1.
"It's certainly something that we've done consistently for a long time ever since we went public, and we did pause it for the transaction." — Robert Harrison (CEO·CHAIR)
loan mix, systems conversion, spot NIM
Q (Meghan Lynch · KBW): She asked if they plan to reduce Mainland participation lending after the deal and whether they chose the platform for systems conversion. She also asked for a spot NIM.
A: They said they are discussing moving away from credit-only lending over time and will try to build fuller relationships across the combined client base. On systems, they are still in discussions and are thinking the conversion will occur in the second half of next year; they were not ready to announce the platform. They reported spot NIM was 3.33% in September.
"We're continuing to think that second half of next year is when we'll have our conversion." — James Moses (CFO)
post-deal lending focus and deposit retention
Q (Barclays): He asked what lending areas the combined bank might invest in, especially in California, and whether they will run deposit promotions to retain balances ahead of close.
A: They said they are discussing where to grow and will support TriCo strengths in areas they have not done historically, naming oil and gas and agriculture-related lending as examples, and will cross-fertilize areas like hospitality. On deposits, they said there is no branch overlap so customers will keep the same branches and people, disruption will be minimized, and they will focus on customer retention especially around conversion timing.
"One is oil and gas and the other is more agriculture and agriculture-related lending." — Robert Harrison (CEO·CHAIR)