Oct 29, 2026 earnings call — Optimize Origin transformation and record quarterly results
Reported record net income of $37.8 million and record diluted EPS of $1.22.
Key quotes
"This quarter's results are a direct reflection of our team's deep commitment to Optimize Origin and how we are transforming our company."
"Year-to-date, we have grown loans by $512 million, excluding Mortgage Warehouse."
"Moving forward, we have included an expectation of one additional 25 basis-point Fed rate hike in December in our forecast. Combined with the impact of September's hike, we expect margin expansion to 4% in Q4, ±5 basis points."
Analyst Q&A 5
sustaining loan growth into 2027
Q (Matt Olney · Stephens): He asked if the high single-digit loan growth seen in 2026 can be sustained into 2027 and how much of the growth came from new hires versus other factors.
A: Management said they are building momentum and the pipelines look consistent. They noted $512 million year-to-date loan production, of which only $82.5 million came from new hires, and they expect continued benefit as non-solicitations ramp and similar growth in 2027. They also said about 54% of loans float and deposit betas have historically been 70% and 55%, so deposit competition is the main uncertainty.
"To your point, if we've done, I think, $512 million year-to-date, of that, only $82.5 million is from new hires." — Lance Hall (CEO)
margin outlook and tech investments
Q (Woody Lay · KBW): He asked when margin might be traded for loan growth and how the planned tech investments affect operating leverage in 2027.
A: They said there are tailwinds from loan and asset repricing but clear competitive pressure on loan and deposit pricing, so uncertainty remains. They also said earlier expense savings from Optimize Origin are being reinvested into technology and efficiency, that some tech spending will shift into early 2027, and year-over-year non-interest expense growth slowed from about 5% to 3.8% in the third quarter.
"Our intention coming into the year was to reinvest those savings into technology and other ways to make us more efficient." — Wally Wallace (CFO)
deposit trends and ROA target
Q (Michael Rose · Raymond James): He asked about deposit trends for Q4 and next year and whether loan growth will be matched by deposit growth. He also asked Drake how to think about the intermediate-term pre-tax, pre-provision ROA target.
A: They said the period-end deposit change was distorted by a large Argent deposit that flowed out, and on averages they saw about $220 million deposit growth and about $80 million in NIB growth, and year-to-date about $160 million NIB growth (about 8%). They expect Q4 public funds to add a couple of $100 million with roughly 30% stick rate. Drake said the ROA target is their "North Star," decisions are disciplined, they will not compromise ROA for growth, and they expect to sustain disciplined upper single-digit growth while improving returns.
"Well, obviously that's, I hate to use this analogy, but that's our North Star at this point." — Drake Mills (CEO·CHAIR)
NIM sustainability, hiring, Argent update
Q (Stephen Scouten · Piper Sandler): He asked if current spreads on new production and deposit costs support a sustainable 4% NIM, about hiring plans for 2027, and what to expect from the Argent investment's equity income.
A: They said there is clear pressure on loan and deposit spreads, but 55% of the loan book floats so Fed hikes help loan yields; their modeling is conservative and currently holds NIM around 4% though it could fall if pressures increase. On hiring, they said the pipeline is strong, hires will be targeted for impact and the pace will slow from the first half but remain active. On Argent, they said Argent's acquisition activity has more than offset the Durbin impact for 2027, though they budget Argent as a slow grower; initial Durbin analysis was $6 million and now looks closer to $4 million.
"Now they are more than offsetting the Durbin impact pressure for 2027." — Wally Wallace (CFO)
expense timing and deposit pricing
Q (Gary Tenner · D.A. Davidson): He asked whether elevated expenses from pushed tech investments would stabilize later in 2027 and what fourth-quarter time deposit renewal rates might be.
A: They said some planned tech investments were delayed into early 2027, so expect some acceleration in expenses in the first half of 2027 versus the back half of 2026, but they are not giving specific guidance. On deposit pricing, they keep CDs short; interest-bearing deposits in Q3 were in the low-3s like $3.10-$3.20, they expect those rates to increase in Q4 after the Fed move, and they are posting time deposits at $3.75 though not all renewals price at that level.
"Our interest-bearing deposits overall in the third quarter came in in the low-3s, like $3.10-$3.20." — Wally Wallace (CFO)