Latest news with #FrankSorrentino
Globe and Mail
11 hours ago
- Business
- Globe and Mail
ConnectOne Bancorp Strengthens Executive Leadership By Appointing Legal Advisor Robert Schwartz to General Counsel
ENGLEWOOD CLIFFS, N.J., June 25, 2025 (GLOBE NEWSWIRE) -- ConnectOne Bancorp, Inc. (Nasdaq: CNOB) (the "Company" or "ConnectOne"), parent company of ConnectOne Bank (the "Bank"), announced the appointment of Robert A. Schwartz as General Counsel, effective June 1, 2025. This strategic appointment reinforces ConnectOne's commitment to strengthening executive leadership capabilities as it accelerates growth following the successful completion of its merger with First of Long Island Corporation (formerly Nasdaq: FLIC). A recognized leader in the banking industry with deep expertise in mergers and acquisitions, securities law, and bank regulatory frameworks, Schwartz brings decades of legal and strategic experience to ConnectOne. In this role, he will advise the Board of Directors and executive leadership on legal, regulatory and business risks in an evolving operating environment. The appointment comes at a pivotal time for ConnectOne, as the Company recently reached nearly $14 billion in assets. Schwartz has served as a trusted legal advisor to ConnectOne since its inception, playing a foundational role in the Bank's formation, IPO and multiple transactions throughout its 20-year history. "Mr. Schwartz has been an integral player to the bank since day one, and we look forward to working with him in this new capacity," said Frank Sorrentino III, ConnectOne's Chairman & CEO. "His ability to balance legal acumen with business strategy will be instrumental in driving the success of the newly expanded institution as we prepare for our next chapter of growth. Bringing someone of his caliber in-house reflects the strength of our platform and our focus on building an industry-leading leadership team." "After two decades of helping ConnectOne navigate many major milestones—from our formation to our IPO to strategic acquisitions—I'm energized to now lead our legal strategy from within," said Schwartz. "This transition from trusted advisor to executive team member is a testament to ConnectOne's ambitious vision. Together, we're positioned to capitalize on the growing opportunities in today's dynamic banking landscape." Prior to joining the bank, Schwartz served as a Partner at Windels Marx, where he specialized in advising financial institutions on mergers and acquisitions, and bank regulatory and securities law. Schwartz holds a J.D. from Fordham Law School and a B.A. from Fordham University. He is a member of both the New Jersey and New York Bar. About ConnectOne Bancorp, Inc. ConnectOne Bancorp, Inc., is a modern financial services company that operates, through its subsidiary, ConnectOne Bank, and the Bank's fintech subsidiary, BoeFly, Inc. ConnectOne Bank is a high-performing commercial bank offering a full suite of banking & lending products and services that focus on small to middle-market businesses. BoeFly, Inc. is a fintech marketplace that connects borrowers in the franchise space with funding solutions through a network of partner banks. ConnectOne Bancorp, Inc. is traded on the Nasdaq Global Market under the trading symbol "CNOB," and information about ConnectOne may be found at Investor Contact: Media Contact: Shannan Weeks, MWW 732.299.7890: sweeks@
Yahoo
11-06-2025
- Business
- Yahoo
ConnectOne Bank CEO talks completed merger, macro uncertainty
ConnectOne Bancorp (CNOB) has completed its merger with the First of Long Island Corp., expanding its total assets under management to $14 billion. ConnectOne Bank Founder and CEO Frank Sorrentino speaks with Josh Lipton about his company's expansion, new product offerings in the New York Metro market, banking and M&A regulations under the Trump administration, and how the regional bank is viewing the commercial real estate market and the odds of an economic soft landing. To watch more expert insights and analysis on the latest market action, check out more Asking for a Trend here. ConnectOne Bancorp is merging with the First of Long Island Corporation. The move coming against the backdrop of an M&A landscape that's starting to show some signs of life. Joining me now is Frank Sorrentino, founder and CEO of ConnectOne Bank. Frank, it is good to see you. Uh, let's talk about this deal, uh, Frank, because you did complete the merger. Walk us through what it's going to mean for ConnectOne and your clients, Frank. Well, for, you know, for all of us, uh, it means we're now a $14 billion asset bank in the greater New York metro market with a phenomenal footprint across all of Northern New Jersey, the five boroughs, out on the Long Island, and into the Hudson Valley. Uh, and having a larger balance sheet allows us to do more for our clients. It allows us to invest more in technology for products and services for them. It allows us to do bigger loan products and more diversified types of, uh, product offerings for all of our clients within that market. As you know, the New York metro market is probably the largest in the United States. It represents some, somewhere around 10 or 11% of our GDP. So, uh, being bigger and, uh, being able to stand up against all the other institutions that are here is, I think, uh, a, a good thing for us to be doing. More broadly, Frank, you know, there was this expectation with Trump back in the White House that, uh, listen, you were going to see cut regulation, cut the red tape, it was just going to get easier to get deals done. Is that what you've been sort of seeing and experiencing here? Look, I, I didn't think it was difficult to get this deal done. Uh, we've had a really terrific relationship with our regulators going forward. Uh, yes, I do think we are going to see a change in the regulatory framework. Um, you know, I don't like to think about things in terms of too, you know, big regulation, small regulation, too much, too little. I like to think about appropriate sized regulation for institutions based on their size, their complexity, what they need to do. I do think that there will be a focus on permitting more M&A activity as the banking system changes. And I think that's smart regulation, and I think that's what we really need to focus more on. Smarter regulation to allow our economy to function. Banks are the, you know, they're the oil, the grease that, you know, makes the economy run. And so having a smartly regulated industry is probably a good place to go to. Frank, let's talk about the macro as well here. You know, Bloomberg did a report, I'm sure you saw this, that City is set to put aside hundreds of millions of dollars more than it did last quarter to account for potential losses on loans. So, a sign there that maybe big banks were preparing for what they see as a weaker, just weakening economic health. And I'm just curious what you see, Frank. You know, I've been hearing for probably 18 to 24 months that we are either in a recession, going to a recession, thinking about a recession. Soft landing, not so soft landing, whatever. From my perspective, we've been in a pretty robust economy for the last, I don't know how many years. And as I speak to our clients today on the ground, and it really doesn't matter what businesses they're in. Generally, things are pretty good. Now, again, I'm speaking about the New York Metro market, but people are feeling pretty good. Employment is strong, and that is the biggest, you know, variable in all of this. People have jobs, they have money, their, you know, their earnings are going up, their wages are going up. Uh, people are feeling good, they spend money, and the economy does well. Are there, you know, sort of some bubbles here and there? Things that we should be concerned about? Yes. Have there been some issues relative to whether it's liberation day, the tariffs, uh, you know, some apprehension about where the economy is going? Sure. But overall, our clients I think are doing quite well in this economy, and it's showing up in all the numbers. It's showing up in the employment numbers. It's showing up in consumer spending. It's showing up in credit trends. Even though some of those institutions you mentioned may have been putting away reserves, the credit trends have been quite benign. What about the commercial real estate market, Frank? I'm curious what you're seeing there in the tri-state area. So I love when people ask me about commercial real estate, so that's like walking into Baskin-Robbins and asking for an ice cream. Like, what part of it are we talking about? Are we talking about the multi-family portfolios, the office portfolios, retail portfolios? They all have a different, you know, sort of flavor to them. The office market, which is what's been really in focus, uh, past COVID, from because of remote work, has really made a stunning comeback. There's an enormous amount of activity within the office space. We're seeing buildings trade, we're seeing credit loosening up. We're seeing office buildings in central business, uh, New York City, getting record rents. So, definitely a change in the trend there. There are still some troubled assets, there are still some places where there are pockets of weakness, uh, but overall that is healing itself well. And the multi-family sector, right now the market's pretty tight. And so a lot of those buildings are still trading at, at, you know, really, uh, high valuations. The one place where there's a little bit of weakness is in the rent regulated portfolios, and hopefully there'll be some changes in that 2019 regulation to loosen up some of the challenges that are there. Yeah, Frank, Frank, I got to tell you, on that train I take every morning from New Jersey to New York City, it is jam-packed, Frank. People are back in the office. Thank you, sir. It's always great to have you on the show. You're welcome. Great to be with you. Errore nel recupero dei dati Effettua l'accesso per consultare il tuo portafoglio Errore nel recupero dei dati Errore nel recupero dei dati Errore nel recupero dei dati Errore nel recupero dei dati
Yahoo
11-06-2025
- Business
- Yahoo
ConnectOne Bank CEO talks completed merger, macro uncertainty
ConnectOne Bancorp (CNOB) has completed its merger with the First of Long Island Corp., expanding its total assets under management to $14 billion. ConnectOne Bank Founder and CEO Frank Sorrentino speaks with Josh Lipton about his company's expansion, new product offerings in the New York Metro market, banking and M&A regulations under the Trump administration, and how the regional bank is viewing the commercial real estate market and the odds of an economic soft landing. To watch more expert insights and analysis on the latest market action, check out more Asking for a Trend here.
Yahoo
31-01-2025
- Business
- Yahoo
ConnectOne Bancorp Inc (CNOB) Q4 2024 Earnings Call Highlights: Strong Net Income Growth and ...
Quarterly Net Income: Increased 21% quarter-over-quarter and 6% year-over-year. Core Deposits Growth: Increased more than 3% quarter-over-quarter. Loan Portfolio Growth: 2% quarter-over-quarter. Net Interest Margin: Improved by nearly 20 basis points during the quarter. Loan-to-Deposit Ratio: Declined from 108% to 106%. Net Interest Margin Projection: Expected to improve to approximately 2.90% in the first quarter of 2025. Operating Expenses: Projected to increase 2% to 3% sequentially in the first quarter of 2025. Provision for Credit Losses: $3.5 million for the quarter. Effective Tax Rate: Expected to return to 26% to 27% in the first quarter. Merger Impact on Net Interest Margin: Expected to enhance by about 10 basis points post-merger. Return on Tangible Common Equity Projection: Expected to be in the 12% to 13% range post-merger. Warning! GuruFocus has detected 3 Warning Sign with CNOB. Release Date: January 30, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. ConnectOne Bancorp Inc (NASDAQ:CNOB) reported a 21% quarter-over-quarter increase in net income available to common shareholders, driven by a wider net interest margin. The company experienced solid growth in both loans and core deposits, with a 3% increase in core deposits quarter-over-quarter. The merger with First National Bank of Long Island is progressing on schedule, expected to close in the second quarter of 2025, which is anticipated to enhance the net interest margin by about 10 basis points. ConnectOne Bancorp Inc (NASDAQ:CNOB) has a strong loan pipeline and expects continued loan portfolio growth, with a projected 2% increase in average loans for the first quarter of 2025. The company has maintained sound and stable credit trends, with charge-offs at reasonable levels and a low delinquency rate of just 4 basis points. Non-accrual loans increased slightly during the quarter, although they are expected to trend down in the next quarter. The company's criticized and classified loans increased from 2.2% to 2.7% as a percentage of the portfolio, indicating some pressure on credit quality. Operating expenses are projected to increase by 2% to 3% sequentially in the first quarter of 2025, which could impact profitability. The effective tax rate is expected to return to the 26% to 27% level in the first quarter, after a decrease due to year-end adjustments. The company plans to raise $175 million to $200 million in sub debt, which may affect its capital structure and cost of capital. Q: Can you provide insights into the loan growth and pipeline, given the better-than-expected results this quarter? A: Frank Sorrentino, CEO, explained that the loan pipeline has strengthened throughout the year, with a focus on relationship business. The hesitancy seen earlier in 2024 has decreased, leading to a strong fourth quarter and positive outlook for 2025. Bill Burns, CFO, added that loans were booked at 7.45% in the fourth quarter, with a pipeline weighted average rate of 7.62%. Q: What drove the noninterest-bearing deposit growth, and what are the expectations for deposit growth in 2025? A: Frank Sorrentino noted that the growth was due to a focus on high-quality relationship business and market disruptions leading clients to seek new banking partners. Bill Burns added that core non-interest-bearing demand is trending upwards, although the 50% annualized growth rate seen may not continue. Q: Are you planning a capital raise in the first quarter, and will it include repricing of sub debt? A: William Burns confirmed plans for a capital raise, including $100 million as part of the merger transaction and $75 million for repricing, totaling $175 million to $200 million. Q: How does the CRE concentration factor into loan growth, given its role in the fourth quarter? A: William Burns clarified that while the growth appears as CRE concentration, much of it was owner-occupied and construction loans. The CRE concentration is expected to trend downward. Q: What are the assumptions behind the NIM outlook, and how could rate changes impact it? A: William Burns explained that the NIM outlook assumes no rate cuts, with a projected 5 basis point increase in margin, 10 basis points from the merger, and potentially another 5 basis points from rate cuts, leading to a 3.20% NIM by 2026. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus.
Yahoo
31-01-2025
- Business
- Yahoo
Q4 2024 ConnectOne Bancorp Inc Earnings Call
Siya Vansia; Chief Brand & Innovation Officer; ConnectOne Bancorp Inc Frank Sorrentino; Chairman of the Board, Chief Executive Officer; ConnectOne Bancorp Inc William Burns; Chief Financial Officer, Executive Vice President; ConnectOne Bancorp Inc Matthew Breese; Analyst; Stephens Inc Daniel Tamayo; Analyst; Raymond James Timothy Switzer; Analyst; KBW Operator Hello, and thank you for standing by. My name is Bella, and I will be your conference operator today. At this time, I would like to welcome everyone to ConnectOne Bancorp, Inc. fourth quarter 2024 earnings call. (Operator Instructions) I would now like to turn the conference over to Siya Vansia, Chief Brand and Innovation Officer. Please go ahead. Siya Vansia Good morning, and welcome to today's conference call to review ConnectOne's results for the fourth quarter of 2024 and to update you on recent developments. On today's conference call will be Frank Sorrentino, Chairman and Chief Executive Officer; and Bill Burns, Senior Executive Vice President and Chief Financial Officer.I'd also like to caution you that we may make forward-looking statements during today's conference call that are subject to risks and uncertainties. Factors that may cause actual results to differ materially from expectations are detailed in our SEC filings. The forward-looking statements included in this conference call are only made as of the date of this call, and the company is not obligated to publicly update or revise addition, certain terms used in this call are non-GAAP financial measures, reconciliations of which are provided in the company's earnings release and accompanying tables or schedules, which have been filed today on Form 8-K with the SEC and may also be accessed through the company's website.I will now turn the call over to Frank Sorrentino. Frank, please go ahead. Frank Sorrentino Thank you, Siya, and we appreciate everyone joining us this morning. Last year, when we entered 2024, we fully recognize the challenges that lay ahead for the industry and for ConnectOne. Despite that challenging environment, the team here at ConnectOne persevered by reinforcing our focus on relationship banking, which strengthen our capital, loan mix and our core we are well positioned to dramatically improve our financial performance, which is accelerating as we look ahead to 2025. Our efforts also paved the way for our upcoming merger with First National Bank of Long strategic rationale of this financially attractive transaction remains compelling and has been reinforced in our view by increased economic optimism and a potential for more supportive regulatory -- of a more supportive regulatory merger is progressing on schedule, and we're optimistic closing will occur in the second quarter of 2025. The combined company will operate under the ConnectOne Bank brand on day one with the systems conversion following soon after the legal have teamed up with First of Long Island, proactively getting in front of its clients, anticipating and addressing their preferences and reinforcing a seamless transition. We're also actively engaging with First of Long Island's team to share ConnectOne's client-first culture, which centers on our relationship banking business model and a sense of urgency in everything we the merger efficiencies, we're already working these into the institutions on a stand-alone basis, which gives us a strong head start in realizing financial projections. From a systems perspective, an efficient and successful core conversion has been planned. These costs have already been negotiated at very attractive terms and on a timetable that's ready to be quickly at growth, we continue to see significant revenue synergies. This includes leveraging the Long Island footprint to extend client relationships and enhance our residential SBA and C&I lending. And we'll size up to nearly $15 billion in assets and a market capitalization of over $1.2 billion, placing ConnectOne in a larger, higher valuation peer group. We'll also be able to leverage the benefits of economic and market tailwinds, which have already accelerated due to our liability-sensitive short, I'm very excited about the opportunities the transaction offers. We look forward to serving the First of Long Island's clients and leveraging the expertise of its team to extend our reach across New York City, Long Island and now to ConnectOne stand-alone fourth quarter performance our financial results were strong, highlighted by 21% quarter-over-quarter and a 6% year-over-year increase in quarterly net income available to common shareholders, reflecting the wider net interest margin that we've been anticipating. We also realized solid growth in both loans and core ability to attract deposits is an important strength. One, we have nurtured by focusing on our unique client approach while adding talent that fits the ConnectOne team. Fourth quarter deposit activity accelerated with core deposits increasing more than 3% on a quarter-over-quarter basis, reflecting notable success in noninterest-bearing demand to lending. ConnectOne delivered quarter-over-quarter loan portfolio growth of 2%, a quarterly growth rate that we expect will continue. While remaining disciplined in our approach, we took advantage of strong market demand and we entered 2025 with solid momentum and a robust loan pipeline. Credit trends and key metrics remain sound and stable with all signs indicating this will continue into the bank's net interest margin improved by nearly 20 basis points during the quarter. Bill, of course, will go into further detail on that, but we benefited significantly from a more than 25 basis points improvement in our cost of into 2025, we continue to anticipate further margin expansion, and that is with or without any additional Fed rate cuts. Our performance metrics were much improved this quarter. We firmly believe that our unique operating philosophy focused on our culture of client obsession, forging a better place to be, while expanding with a 3x vision, together with our strong balance sheet, industry tailwinds and our pending merger supports our long-term focus on driving shareholder with that, I'm going to turn it over to Bill. William Burns All right. Thank you, Frank. Good morning to everyone on the call. I think as you saw in our earnings release issued this morning, our financial performance turned the corner in a meaningful way. Earnings were up 21% sequentially, client deposit growth, including noninterest-bearing demand accelerated, annualized loan growth increased 8%, driven by business loan demand. Our loan-to-deposit ratio declined from 108% to 106%. Efficiency and return metrics all improved. Credit quality remains sound, and the merger is moving ahead on those improved results are largely due to a significant sequential increase in net interest income, reflecting a 19 basis points widening in our net interest margin. And most of that margin increase was due to a steep decline in our average cost of deposits, while about 5 of those basis of the 19 and widening was due to elevated prepayment fees and the payoff and recapture of interest on a couple of nonaccrual loans.I also want to point out that the loan portfolio growth of 2% from September 30 occurred near year-end, and therefore, average loans for the quarter were about flat. So heading into the first quarter of '25, we've got a couple of things positively impacting projected net interest we project average loans to be about 2% higher in the first quarter versus the fourth quarter. And second, the margin is still expanding. Our reported margin for the quarter was 2.86%. The core margin, I put at about 2.81%. And looking forward, based on stronger spot rates today, we're projecting an improvement to approximately 2.90% in the first quarter one, on a stand-alone basis premerger, we still see our margin widening albeit at a slower pace due to the current hawkish view on short-term rates. We continue to have CD repricing. There's $2 billion set to reprice over the next year. That will be at a 50 basis points to 75 basis points improvement. And we have an adjustable rate loan portfolio that will continue to reprice upward over the next couple of years. I also want to point out that our margin widening is strictly organic. We have not utilized loss trades or restructuring transactions that would negatively impact tangible book value per share.I'm going to now turn to expenses. As disclosed in the release, we had roughly $1.4 million in after-tax non-operating adjustments that included merger expenses and a $500,000 charge on the sale of a previously closed branch location. But excluding the nonoperating items, expenses actually declined sequentially. That reflected some accrual adjustments as well as the very early stages of expense savings from the pending First of Long Island into the first quarter, I'm currently projecting a 2% to 3% sequential increase in OpEx. That's typical as we head into a new year. And on a stand-alone basis, expense growth would taper off a bit throughout the remainder of ' to credit quality, I want to expand on Frank's earlier comments. Charge-offs remain at a very reasonable level, and we don't anticipate any significant increase. Non-accruals were up slightly this quarter but appear to be trending down next quarter. Delinquent loans were just 4 basis points with 0 past due more than 60 days. I believe that's as good as it's ever been and our criticized and classified loans did increase from 2.2% to 2.7% as a percentage of the portfolio. That's well within our historical range and our credit outlook remains provision for credit losses of $3.5 million for the quarter largely reflected loan growth and specific reserves and charge-offs. With regard to the effective tax rate, you may have noticed a decrease this quarter that reflected some year-end adjustments and true-ups, but I would expect the effective rate to return to the 26% to 27% level in the first quarter.I'd like to now give you at least some color on the projected impact of the merger on our financials. Although the closing date of the merger with First of Long Island is not set, our expectations are for it to occur during the second quarter. After closing the transaction will enhance our net interest margin by about another 10 basis points. That reflects both First of Long Island stand-alone margin and purchase accounting. So our spot NIM projection at closing should be about 3.10%.As we head into 2026, with all cost saves fully implemented, our margin projection increased to 3.20%, while operating ROA is projected to reach 1.15% and return on tangible common equity expected to be in the 12% to 13% range.I'll also give you a quick update on the loan mark. Risk-free rates have increased since announcement, but the yield curve is no longer inverted, so-called liquidity premium has declined and that led to a total discount rate that's just slightly above where it was in September. So the loan mark is just slightly larger, increasing to about $250 million from $235 million when we announced the goal has always been to hit the ground running with this merger. Ahead of the actual closing, we are already making headway with regard to client engagement, staff integration, efficiency and revenue before I turn it back to Frank, I want to reiterate that we remain an especially compelling investment. In my view, it's one of the best out there. Our net interest margin, earnings and all performance metrics are quality remains sound, this value-enhancing transaction with First of Long Island will bolster our performance metric and increase our franchise value as a premier New York metro community bank. And with all of that, where we trade today, in our view, we're clearly at a discount to peer group with that, Frank, back to you. Frank Sorrentino Thanks, Bill. To summarize, we ended the year with meaningful earnings momentum, strong capital ratios, strong -- a solid balance sheet and a positive outlook for 2025. We're well positioned to expand our geographic footprint, strengthen client relationships and capitalize on the organic growth in our core we look forward to completing the First of Long Island merger, which will further support our efforts to drive sustainable value-enhancing growth. Maximizing shareholder value is a top commitment of our team, our Board and by me personally as one of the largest that, I'd like to turn it over for some questions. Operator? Operator (Operator Instructions)Matthew Breese, Stephens Inc. Matthew Breese Hi, good morning. Frank Sorrentino Hi, Matt. Matthew Breese Frank and Bill, I wanted to start with loan growth. Results were a bit better than expected for the quarter, and your commentary suggests that will continue. So I guess curious what the pipeline looks like you're seeing in terms of spreads? And I guess bigger picture, what's changed on this front? The last couple of quarters, there's been some hesitancy, some cautiousness here. It feels like this has turned for the better. What are you seeing from a boots on the ground perspective? Frank Sorrentino Matt, I'll let Bill comment on some of the spread and actual numbers and the nuts and bolts to the pipeline. But I can tell you that the pipeline has continued to strengthen throughout the year. Our loan pipeline was actually pretty strong going through all of 2024. But there was an emphasis here -- there was a couple of things at work. There was an emphasis here on deemphasizing nonrelationship so at the same time, we're bringing new loans on, we were also pushing some off where folks that have made promises to keep deposits with us and didn't. We sort of called through the portfolio and '24 was a year of doing we got closer to the end of the year, there's less and less of that to do, right? So the actual increase from the loan pipeline starts to add up. I do think there was some level of hesitancy on a number of our clients in the beginning part of '24, just through some of the uncertainty that was going on in the economy. And as we got closer to the end of the year, more things sort of got closer to completion, and there was a hell of a lot more confidence as we started to move through the fourth quarter. So the combination of all those things, I think, actually positions us well to have a fairly strong fourth quarter, and we see that continuing as we move through 2025. William Burns And Matt, this is Bill. In terms of spreads, first off, we always remain disciplined when we price loans and make sure we get the appropriate return spread on all the transactional loans that we do. To just give you some numbers for the fourth quarter we book loans at 7.45%. They came off at like 6.80%, 6.90%, so there's a little bit of spread improvement there. And our pipeline right now has a weighted average rate of 7.62. Matthew Breese Great. Okay. And then, Frank, one of the other positives this quarter was just deposit growth as a whole, but really within that noninterest-bearing deposit growth, hoping for some color as to what kind of drove that and expectations for both deposit growth and composition into 2025. Frank Sorrentino Yes. I think a lot of it was, again, just focused on bringing in high-quality relationship business going back to our existing clients and making sure that folks are doing what they promised to do. I think some of our deposit initiatives around the organization have been working quite well. People are finding ConnectOne to be a great bank to do business so that we've been able to cajole people to bring more deposits here. And as we've said in previous -- on previous calls, there's been a lot of disruption in the marketplace. And so there are a lot of people out there looking for a new home. And we've succeeded in a lot of those places. And so we're quite happy with the result and we see it continuing as we move through 2025. William Burns Let me add to that and Matt. I'm definitely seeing we track this every single day. And the core non-interest-bearing demand is heading upwards and it may be even accelerating. We did have some seasonal things, I would call it, that increased the growth rate even more. I don't think we're going to have a 50% annualized growth rate in noninterest-bearing demand, but the trends are that it is heading up nicely. Matthew Breese Great. And then last one for me. We're still kind of thinking about a capital raise in the first quarter I'm assuming. I'm curious if that will include the upcoming kind of repricing of sub debt for later this year and if you're still kind of considering sub debt versus some other form? William Burns Yes. No, we still have sub debt as part of our plans, $100 million as part of the transaction. And then we do have $75 million repricing. So I expect we probably do $175 million to $200 million to take care of all of that. Matthew Breese I'll leave it there. Thanks for taking my question. Frank Sorrentino Thank you, Matt. Operator (Operator Instructions)Daniel Tamayo, Raymond James. Daniel Tamayo Yes. Thank you. Good morning, guys. Maybe just a follow-up on the loan growth question. So clearly, really nice quarter from the perspective of loan growth. Just curious how the CRE concentration factors into that growth going forward, seeing as that was kind of a big driver of the growth in the fourth quarter. Yes, that's basically the question on the growth side. William Burns Yes, sure, Dan. It shows up on the SE codes, SEC codes as CRE concentration, but a lot of that was owner occupied as well as construction. So we're happy with the mix of growth. And I would still say that our CRE concentration will be trending downward. Daniel Tamayo Okay. Alright. I'm glad to hear the -- and then I guess you guys have -- you had a great quarter from a revenue perspective. The credit, you sounded relatively bullish given the increase in classified and NPLs. I appreciate your comments that NPLs sounded like they were trending down in the first quarter.I guess my question is, just curious how you feel about the sensitivity of your credit of the book overall to rates from here. If we do have declines or even increases, just how you view the overall sensitivity from a credit perspective? William Burns Well, Dan, we obviously watch that very closely. The repricing of loans as each quarter goes by, there is more and more of a track record, right, that's being built. We have a portfolio of some $875 million of loans have repriced recently at higher the credit quality of that portfolio, although under a little bit of stress, has been remarkably sound. And so we're going to continue to watch that. But so far, indications are that any increases in nonperforming loans or charge-offs can be handled through earnings as we've been doing the past few quarters. Daniel Tamayo And what would you say is -- do you have a sense for what's driving the decline in NPLs -- like what -- you had this run up probably due to higher rates? I mean, is it -- what do you think -- William Burns The portfolio of nonaccrual loans is like there's lots of ins and outs all the time. And I expect will be -- we've written loans -- a group of loans down to a certain level that we can pretty much unload it, but we're just working on negotiating pricing on that. And so that would be the driver of reducing our non-accruals. Daniel Tamayo Okay. Alright. That's helpful. Thanks for taking my question. William Burns Thanks, Daniel. Operator Tim Switzer, KBW. Timothy Switzer Hey, good morning. Thank you for taking my question. Great to hear you guys are confident in the merger closing in Q2. For modeling purposes, do you guys have any idea on if we should be doing this like middle of the quarter, back end of the quarter or anything like that? Frank Sorrentino Hard to tell at this time. I would say it should be somewhere in the second quarter. But at this moment, I think it would be very difficult to hem in whether it's in the beginning or the end. Timothy Switzer Yes, totally understand. And we appreciate the 2026 outlook you've provided. Are you able to discuss some of the expense assumptions you have behind that? You're expecting to get all the cost saves, but any guidelines in like an efficiency ratio or a core expense run rate would be helpful. William Burns I'm not ready to give that out at this moment, Tim, because I need to know the closing date as well as we'll need some time to fully implement those. But I'm confident that we're going to hit our numbers, whether it's through expense growth of the two separate entities versus the Street targets and the cost saves coming from the transactions, which will occur over time. So I'm bullish -- I feel good about what I see out there in terms of Street estimates for expenses that we can beat those. Timothy Switzer Great. Okay. And the last question I have is -- and sorry if I missed this, but what are the rate assumptions behind the NIM outlook at was you gave with the 3.10% spot and then 3.20% in 2026? And how could less or more rate cuts impact that? William Burns So I have to try to give you some guidance, there's always moving parts, right, that impact this. Fees and other things that I'll call non-recurring as well as the shape of the yield curve. But I'm generally expecting about a 5 basis point increase in the margin without any rate cuts, approximately 10 basis points from the merger and then maybe another 5 from any rate cuts should they materialize over the years. So you can add that up any way you want. And that gets us to about 3.20% or so at the start of '26. Timothy Switzer Okay, and that's -- so it sounds like that's assuming no rate cuts then. William Burns Right, right. Maybe one. Timothy Switzer Got it. Okay. Thank you. William Burns Thank you. Operator That concludes our Q&A session. I will now turn the conference back over to the management for closing remarks. Frank Sorrentino Well, thanks again for your time today. We look forward to speaking with you again during our first quarter earnings call in April. And with that, have a great day. Operator Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect. Sign in to access your portfolio
