Banner(BANR)2022-07-21 22:38Financial Data and Key Metrics Changes - Banner Corporation reported a net profit available to common shareholders of 1.39 per diluted share for Q2 2022, compared to 1.27 per share in Q1 2022 [8][22] - Pre-tax pre-provision earnings were 49.7 million in Q1 2022 [9] - Core revenue from operations increased 8% to 137.6 million in Q1 2022 [10] - Return on average assets was 1.16% for Q2 2022 [10] Business Line Data and Key Metrics Changes - Core deposits increased by 5% compared to June 30, 2021, representing 95% of total deposits [11] - Core portfolio loan growth, excluding PPP loans, was 94 million in Q2 2022, with balances now 5% higher than reported as of June 2021 [16] - The consumer mortgage portfolio grew by 36 million or 8% [20] Market Data and Key Metrics Changes - Delinquent loans as of June 30 remained low at 0.19% of total loans, down from 0.21% in the prior quarter [14] - Adversely classified loans decreased to 1.63% of total loans, down from 1.95% in the linked quarter [14] - Nonperforming assets were low at 1.5 million [12] - The company received recognition for client satisfaction, being ranked 1 bank in the Northwest by J.D. Power [12] Q&A Session Summary Question: Loan growth outlook and campaigns - Management confirmed that small business and residential mortgage campaigns are ongoing and expected to continue until the end of the month [34][36] Question: Provisioning and reserve ratio - Management indicated that provisioning is influenced by loan growth and economic conditions, with a conservative approach expected moving forward [38][39] Question: Deposit runoff behavior - Management noted that while some deposit outflows are anticipated due to rate sensitivity, the core deposit base remains resilient [42][45] Question: Loan growth expectations for the second half of the year - Management expects to maintain high single-digit loan growth, supported by strong pipelines in commercial and agricultural sectors [49][48] Question: M&A discussions and appetite - Management stated that while M&A activity has slowed, discussions continue, and they remain open to opportunities when market conditions are favorable [51][52] Question: Revenue opportunities from Banner Forward - Management anticipates sustained loan growth and fee income improvements as a result of the Banner Forward initiative [54][56] Question: Underwriting and portfolio maintenance - Management confirmed that underwriting practices remain conservative, with ongoing monitoring of credit quality [60][61] Question: Expense guidance and inflation pressures - Management acknowledged wage inflation pressures and adjusted core expense guidance to the high 80s to low 90 million range [68][70]