Sentiment Analysis of the earnings transcript to help figure out if there are any bullish or bearish sentiments that could be gathered from it. We're doing ML and AI based analysis on the earnings call to get some more insights.
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| But overall, we're very pleased with the level of retention among -- across our customer base, and we think we still have the opportunity to grow |
| As those risks ease and the banking sector continues to stabilize, we expect to normalize cash levels which will have a modest, but positive impact on net interest margins and capital ratios |
| Second thing we like is, uses where we have an exceptionally strong tenant |
| I think they're much better positioned today than they were in prior crisis easily over 2008-'09 |
| Finally, we expect capital to remain strong through the remainder of the year with a CET ratio of about 10% |
| Capital remains strong as we ended the period with a tangible book value per share of $17.93 and a CET1 ratio of 10.36%, both measures improving modestly since last quarter |
| As a reminder, we've been investing improving processes and longer-term strategic growth throughout this year focusing on expanding our C&I, deposit gathering, and residential businesses, as well as improving the revenue contribution of our branch network, increasing automation of internal processes, and improving infrastructure support across all lines of business |
| I think over time, lower brokerage is always better, but we're going to be -- I think we're in a good place now |
| We feel pretty good about it |
| There's a real customer experience improvement as well |
| Progress on this project remains on track, and we've made meaningful strides to improve both internal processes and the customer experience |
| And New Jersey has been doing remarkably well |
| Asset quality metrics remained strong with non-performing loans in criticized and classified assets, representing 1.3% and 0.2% of total loans, respectively |
| I am reassured that over the past year, our quarterly net interest income is only declined in the range of 5% and we are highly confident that our quarterly expense run rates as we finish 2023 are reverting to mid-2022 levels |
| And certainly, we think it could be a financially attractive thing to do |
| So that's a real positive |
| That's an opportunity for us to originate good assets and then put the assets that we want to put on the balance sheet in C&I and create rates that make the most sense for us |
| Some cases that could be government tenants, it could be credit tenants, but there's a structure to the cash flows that is highly reliable and where we can underwrite those, we think that that's a good bet |
| Year-to-date deposit growth of $859 million is a reflection of our thoughtful and concerted effort to win meaningful deposit relationships in today's competitive and higher cost deposit environment |
| As a result of the work performed on this project, we believe quarterly operating expenses will decline to the $58 million to $59 million range next quarter, representing an annualized reduction of between $20 million and $25 million going forward, compared to the current expense run rate that we're tremendously pleased |
| We've been able to fundamentally fix processes |
| We have a tremendously large deposit market, so while -- it's a tough environment to grow in, we have a very small market share, so I think we can continue to grow those |
| We were added -- were able to significantly reduce the amount of time it takes to open an account |
| And so, it's not an easy market without reducing vendors or reducing employees to do that, but we continue to have some opportunities |
| Whether or not this becomes a new normal for the industry remains to be seen, but I'm convinced that we will remain very competitive in whatever environment may evolve |
| We continue exploring additional opportunities to further improve our operating leverage in 2024 |
| They're not big levers, either one of them, but they are an opportunity |
| These efforts resulted in meaningful deposit growth, a substantial decrease in brokered CDs, and a measurable reduction in the loan-to-deposit ratio |
| Joe Lebel So, Dan, I think I'd start by saying that, I think we have opportunity to improve margin from the renewal of loan transactions |
| And so, the continuation of building out a procurement function vendor consolidation that leads to better negotiating power, we think will also add a little bit of wind |
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| On the loan origination side, we continue to see tempered growth as a result of reduced demand from customers and our pricing expectations given the cost of funding |
| Our earnings reflect net interest income of $91 million, representing a modest decline compared to the prior linked quarter of $92 million |
| I guess, what I'm trying to sort out is just -- the last 12 months have been challenging, right? Because the assets aren't repricing as fast as the liabilities have gone up |
| However, given the depressed stock prices that many banks are experiencing combined with the volatility of those stock prices that we've seen over the last few months |
| But the outlook for them in the short run is going to be constrained in this rate environment |
| We continued to maintain excess cash during the quarter, reflecting the stress liquidity environment and combined with continuing uncertainties around monetary policy and the risk of a government shutdown |
| So we'd have to actually break and penalize ourselves if we were going to reduce things further |
| The resulting mix shift in our deposits play some pressure on net interest margins, but that pressure is decreased significantly as compared to the past two quarters and appears to be reaching a point of equilibrium |
| I noticed in your 10-Q that the CRA rating was downgraded to needs improvement or needs to improve |
| Our third quarter results were impacted by modest margin pressure linked to our efforts to improve the bank's liquidity position and the quality of our deposit funding |
| The quarter included an $8.4 million charge-off on a single commercial real estate relationship as previously announced, which so far continues to be an outlier in our portfolio |
| The first thing that happened is we had some vacancy, but not -- I want to be cautious about that |
| But I think part of the challenge too has been that incremental margin on new assets hasn't been probably as good as it needs to be and I'm just trying to get a better handle of |
| And then, Philadelphia is still dealing with a public safety issue, so we're a little more cautious there |
| But I guess I'd caution you against thinking that our $58 million to $59 million could be lower because of those initiatives |
| And that's going to be a tough sell these days |
| So I think some additional deposit pressure, not a big mix shift |
| But before you get too excited, we do have to cover there will be an increase in deposit costs |
| Going back to the office loan charge off, was there anything idiosyncratic about that loan and charge-off or was it -- what we would expect at a New York office? Lower occupancy -- lower asking rents per square foot |
| While we continue to see the frequency and magnitude of external economic, geopolitical, and natural forces increase |
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