Amalgamated Financial Corp.

Good morning, ladies and gentlemen, and welcome to the Amalgamated Financial Second Quarter 2025 Earnings Call. During today's presentation, all parties will be in a listen-only mode. Following the presentation, the conference will be open for questions with instructions to follow at that time. As a reminder, this conference call is being recorded. I would now like to turn the call over to Mr. Jason Darby, Chief Financial Officer. Please go ahead, sir.

Thank you, operator, and good morning, everyone. We appreciate your participation in our earnings call. With me today is Priscilla Sims-Brown, our president and chief executive officer. Additionally, Sam Brown, our chief banking officer, is also here for the Q&A portion of today's call. As a reminder, a telephonic replay of this call will be available in the investor section of our website for an extended period of time. Additionally, a slide deck to complement today's discussion is also available in the investor section of our website. Before we begin, let me remind everyone that this call may contain certain statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We caution investors that actual results may differ from the expectations indicated or implied by any such forward-looking information or statements. Investors should refer to slide two of our earnings slide deck, as well as our 2024 10-K filed on March 6, 2025, for a list of risk factors that could cause actual results to differ materially from those indicated or implied by such statements. We will also discuss certain non-GAAP measures during today's call, which we believe are useful in evaluating our performance. The presentation of this additional information should not be considered in isolation or as a substitute for results prepared in accordance with U.S. GAAP. A reconciliation of these non-GAAP measures to the most comparable GAAP measure can be found on an earnings release as well as on our website. Let me now turn the call over to Priscilla.

Good morning, everyone, and thank you for joining us. I'd like to start by talking about how Amalgamated continues to perform well, regardless of the prevailing federal narrative and related headwinds. We again delivered solid results this quarter that continue to show the power and sustainability of our earnings and profitability, highlighted by core earnings per share of 88 cents. Reaching this EPS mark is something we're proud of, not simply because we hit our target, but rather because we now compete among some of the best-run banks in the country in terms of performance and results. And we are achieving our results because our banking model is flexible. We have many levers we can pull to drive performance, and that creates reliability and predictability for our shareholders, our customers, and our employees. Our Q2 results featured a balanced scorecard for both strong deposit gathering and solid loan origination from our commercial growth portfolios. This type of balance makes us optimistic for a great second half of 2025. And let me share some more details with you. Starting with deposits, we recognize $209 million of on-balance sheet deposit growth through the second quarter, which does not include $112 million of temporary ordinary pension funding deposits which were received on the last day of the quarter but withdrawn the following day. As a reminder from our Q1 call, we moved a majority of our Q1 off-balance sheet deposits on balance sheet to fund loan originations and security purchases as we focused on driving net interest income growth. Our political deposits were a bright spot yet again, increasing $137 million, or 13%, to $1.2 billion in the quarter as fundraising begins to accelerate looking to the midterm elections, which are just 15 months away. Through July 17, 2025, we have had a further $30 million of political deposit inflows. Our not-for-profit segment also grew deposits by more than $100 million as our mission-oriented bankers brought new customer relationships to the bank and took market share. Turning to assets, loan growth was balanced at over $60 million across our growth mode portfolios. Those are the multifamily, CRE, and CNI, and that drove about 2% loan growth. I was pleased to see these results, especially knowing that we also encountered a higher level of early payoffs and paydowns on loans. We do expect this rate of payoff activity to begin to slow in the third quarter. All in, despite the solid numbers, we were still modestly behind our 1.5% to 2% target across the entire loan portfolio due to declines in our consumer solar and residential real estate loan portfolios, which we have been deemphasizing and will continue to run off over time. Going forward, I think we have built the team we need to achieve our loan growth targets, and I'm excited to share more about that with you now. Since joining Amalgamated more than four years ago, I have been focused on expanding our lending platform through recruiting performance-oriented bankers. This expansion has led to improved loan growth as we have increased our loan portfolio at a 10% compound annual growth rate from $3.1 billion at the end of the second quarter of 2021 to now $4.7 billion at the end of the 2025 second quarter. Additionally, our PACE portfolio has grown at over 22% compound annual growth rate to $1.2 billion over that same period. While I'm very pleased with our success growing our team and our portfolio, I see an opportunity to further expand our lending platform as well as our presence in large and growing markets. For example, California is a market where we currently have a presence in San Francisco. but we see the whole state as a large growth opportunity for both loans and deposits. To accomplish this, Sam Brown and John Saltos, our Director of Commercial Banking, have been recruiting experienced bankers, and they have made great strides during the second quarter. And so I'd like to make a few key introductions this morning. Leading off, Brian Choi has joined the bank as our Western Regional Director, where he will lead our banking efforts in the West. Brian has 25 years of banking experience in California, where he was most recently the Vice President of Lending Strategy and Sales at First Republic Bank. Next, Ken Gaten has also joined Amalgamated as a Senior Relationship Manager in charge of growing our commercial real estate portfolio in the West, as well as leading our strategic efforts to further grow our customer base in California with a focus on the Bay Area. Ken has more than 25 years of CRE lending experience on the West Coast and ascending leadership roles at multiple financial services firms. Additionally, Ken Edens has joined as our director of climate and C&I lending. Ken brings more than two decades of lending experience on the West Coast, most recently at East West Bank, where he led that organization's project finance practice in multiple asset classes, including renewable energy. Ken will lead our climate and CNI lending team nationally to help us accelerate our overall CNI lending growth. I emphasize overall CNI lending in reference to my earlier point about our flexible business model. The recently passed budget law will add pressure on areas of the renewable sector that rely on tax credits. And while we expect a minimal impact on our business, given that tax credits will not be phased out until 2027, and that the projects we have in our pipeline are shovel-ready and will fund prior to that, we nevertheless seek additional CNI channels and healthy risk-adjusted returns that are mission-aligned, and Ken is the right person to lead us. Hopefully, you're picking up my themes for growth and optimism. If you recall, we entered this plan year with a bit of negative operating leverage, as we said we needed to make investments for the purpose of growing revenue, and we've been doing just that. We've mainly spoken about producer investments to open up markets and channels, but now I'd like to talk a bit about our progress on infrastructure investments, which are critical for scalable growth that prioritizes revenue per share in the future. When I first started, I introduced our four-pillar strategic framework to guide our team. As part of our driving effectiveness and efficiency pillar, we have been investing in data-first, fully integrated digital monetization which will drive improved productivity, provide a holistic view of our customers to better understand their needs, and provide more customized solutions and ultimately deliver improved revenue growth. This platform will go live in the third quarter, and it's absolutely essential to remain competitive and to drive loyalty. When the platform comes online, it will drive an uptick in our second-half expenses, which we've expected. But as I discussed on our first quarter call, we are carefully managing our investment spend to ensure we maintain core efficiency ratio at an outer band of approximately 52%. This is part of our modernization roadmap as we make the necessary investments to drive organic growth and ready amalgamated for our eventual move through the $10 billion mark in assets. Closing my remarks, We are seeing a normalization in the political narrative as the rhetoric has started to subside, while mission-oriented businesses increasingly see Amalgamated as a destination with a strong financial foundation. Our mission alignment is the reason customers choose to do business with the bank, and Perseverance continues to build for many of our core customer segments, which bodes positively for the second half of the year. I would also note that we are seeing a strong level of new customer acquisitions with a healthy pipeline of new potential relationships as we look forward to the back half of the year. This provides confidence in our ability to maintain and deliver on our earnings guidance once again this year. And one last thing, I mentioned that we now compete against the best banks in the country in terms of performance results. Jason will have some interesting stats to share with all of you. So with that, let me turn the call over to Jason.