Dime Community Bancshares, Inc.

Good day, and thank you for standing by. Welcome to the DIME Community Bank Shares, Inc. First Quarter Earnings Conference Call. Before we begin, the company would like to remind you that discussions during this call contain forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Such statements are subject to risk, uncertainties, and other factors that may cause actual results that differ materially from those contained in any such statements, including as set forth in today's press release, and the companies following the U.S. Securities and Exchange Commission to which we refer you. During this call, references will be made to non-GAAP financial measures as supplemental measures to review and assess operating performance. These non-GAAP financial measures are not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with the U.S. GAAP. For information about these non-GAAP measures and for reconciliation to GAAP, please refer to today's earnings release. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Stuart LeBeau, President and CEO. Please go ahead.

Good morning. Good morning. And thank you, Shannon. And thank you all for joining us this morning for our first quarter earnings call. With me this morning is Avi Reddy, our CFO. In my prepared remarks, I will touch upon key highlights for the first quarter of 2025. Avi will then provide some details on the quarter and thoughts for the remainder of the year. Core deposits were up $1.3 billion on a year-over-year basis. The deposit teams hired since 2023 have grown their deposit portfolios to $1.9 billion. This has allowed us to pay down our broker deposits to a fairly minimal level, as well as reduce our FHLB borrowing position. We have made significant progress in creating a core deposit-funded balance sheet. We reduced our cost of deposits to 2.09% in the first quarter. Our NIM has now increased for the fourth consecutive quarter to the 2.9% range. We continue to have several catalysts to continue to grow our NIM over the medium to long term, including a significant back book loan repricing opportunity. Even with the current uncertain rate environment, we remain very bullish on our continued NIM improvement over the medium and long term. Avi will get into that in more detail in his remarks. On the loan front, we continue to execute on our stated plan of growing business loans and reducing our CREE concentration. Business loans grew over $60 million in the first quarter and over $400 million on a year-over-year basis. Typically, our first quarter is our slowest growth quarter of the year. We have rebuilt our loan pipeline since year end, and the pipeline currently stands at approximately $1.1 billion with an average yield of 7.22. This compares to $750 million when we reported earnings in January. In addition, we have made several new hires who, once they find their feet, will contribute to the loan growth towards the year end. Our core earnings power has increased significantly over the past year. Core pre-tax provision income was $46 million in the first quarter of 2025 compared to $28 million a year ago. This translated into a core ROA of 77 basis points for the quarter. Finally, I will touch on our recruiting efforts. Disruption in our local marketplace remains very high, and our recruiting pipelines continue to be strong. As outlined in our earnings release, we have added numerous bankers across the organization. Our hiring efforts this year have been focused on growing both sides of the balance sheets. Many of you who are familiar with the New York City banking area are familiar with Tom Geisel, who was a key part of the growth and success of Sterling. We expect Tom to be an integral part of our continued transformation to a highly profitable commercial bank. I'd also like to note that we recently announced plans to expand into the Lakewood, New Jersey marketplace. In conclusion, the momentum in our business is extremely strong, and we continue to execute on our business plan of growing the business loans and core deposits. We have clearly differentiated our franchise from our local competitors as it relates to our growth trajectory and ability to attract talented bankers. I'm looking forward to the remainder of 2025 and want to again thank all our dedicated employees for their efforts in positioning the bank as the best business bank of New York. With that, I will turn the call over to Avi.

Thank you, Stu. Excluding the impact of the previously mentioned legacy Bridgehampton National Bank pension plan termination, adjusted EPS was 57 cents per share. This represents a 36% linked quarter increase and a 50% year over year increase. The reported NIM increased by 16 basis points and the NIM excluding purchase accounting accretion increased by 19 basis points to 294. NIM expansion was driven by a significant reduction in our cost of deposits. We did have around three to four basis points of prepayment fees in the first quarter NIM. Excluding prepayment fees and purchase accounting, the NIM would have been around 290 for the first quarter. Non-broker deposits were up approximately $65 million at March 31st versus year-end levels. As I mentioned on our fourth quarter earnings call, year-end 2024 deposits were inflated by approximately $200 million of title company-related deposits that were tied to a closing that left the bank in early January. Said differently, we grew non-broker deposits by approximately $250 million this quarter versus year-end levels if you exclude the title company deposits from year-end totals. We continue to manage expenses prudently. Core cash operating expenses for the first quarter, excluding intangible amortization, was $57.9 million. Non-core items for the first quarter included $7 million related to the previously disclosed termination of a legacy pension plan, which is now effectively complete. Non-interest income of $9.6 million for the first quarter reflected the full quarter impact of the BOLI repositioning transaction. We had a $9.6 million credit loss provision for the quarter. Net charge-offs to average loans decreased to 26 basis points, and the allowance to loans increased to 83 basis points. Capital levels continue to grow, and our common equity Tier 1 ratio increased 11.1%, and our total capital ratio grew to 15.7%. Having best-in-class capital ratios versus our local peer group allows us to take advantage of opportunities as they arise, and it speaks to dime strength and our ability to service our growing customer base. Next, I'll provide some thoughts on guidance for the remainder of 2025. As I mentioned previously, we had approximately three to four basis points of prepayment fee income in the first quarter NIM. Excluding this and purchase accounting accretion, the base NIM for the first quarter was closer to 290. We would use this as a starting point for modeling going forward as we don't expect the prepayment fees to repeat in that size in the coming quarter. We expect the second quarter NIM to remain range bound within a plus or minus three basis point range of the 290 base NIM. While we don't have a lot of low yielding repricing assets in the second quarter, starting in the second half of 2025, we have a meaningful increase in repricing assets and expect margin expansion to resume in the second half of the year. To give you a sense of the significant back book repricing opportunity in our adjustable and fixed rate loan portfolios, In the second half of 25 and the full year 26, we have 1.95 billion of adjustable and fixed rate loans across the loan portfolio at a weighted average rate of 4% that either reprice or mature in that timeframe. Assuming a 225 basis point spread on those loans over the forward five-year treasury, we could see a 35 basis point increase in NIMS from the repricing of these loans. As we look into the back book for 2027, We have another 1.75 billion of loans at a weighted average rate of 425 that will lead to continued NIM expansion in 2027. Moving on to the short end of the curve. When the Federal Reserve cut short-term rates in 2024, our NIM benefited by approximately five basis points for each 25 basis point rate cut. Should the Federal Reserve cut rates in the second half of 2025, we expect this trend to repeat assuming the behavior and deposits in loans hold for each subsequent rate cut and competition remains rational. In summary, assuming the market consensus forward curve plays out, we have a path to a structurally higher NIM and enhanced earnings power over time. With respect to balance sheet growth, we expect net loans to remain relatively flat in the second quarter and growth to pick up in the back half of 2025. In the first quarter, attrition in Cree and multifamily masked the growth in our business loan portfolio. We expect this trend to moderate towards the end of 2025. In addition, as Stu mentioned, we have several new hires who, once they find their feet, will contribute to loan growth towards the end of the year. With respect to core cash non-interest expenses, our previous full-year 2025 guidance was between $234 to $235 million. The prior guidance was based on our existing employee base at the end of 2024. Given the hires we have outlined in the press release, we are increasing our full-year core cash non-interest expense guidance to $236.5 to $237.5 million. With that, I'll turn the call back to Shannon, and we'll be happy to take your questions.

Thank you. As a reminder, to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Steve Moss with Raymond James. Your line is now open.

Good morning. Hi, Steve. Good morning. Hey, Steve. Maybe just starting on the loan pipeline, as you mentioned, nice pickup here relative to where it was at your end. Just curious the underlying mix within the loan pipeline.

the underlying mix of the loan?

Oh, yeah. So, I mean, again, it really continues the theme of CNI, owner-occupied CREE, and healthcare. So, at this point, we have about $350 million in CNI, approximately $185 million in owner-occupied CREE, and another $250 million in healthcare. And that's making up the bulk of the pipeline. We actually have about $200 million in loans approved waiting to close at a yield of about $725 million.

Okay, great. Appreciate that. And then, you know, you guys made a number of hires this quarter and, you know, obviously a year ago with the signature hires. Just, you know, curious in terms of how you're thinking about the pace of deposit growth and, you know, Any updates around the cost of new deposits you guys are bringing on these days?

Yes, Steve. So, you know, in terms of, you know, the team, as Stu said, they're up to $1.9 billion of deposits at this point. The total, you know, cost of deposits on them, including DDAs, is around $210 plus or minus. So they're bringing in stuff in the low twos. There's a very healthy mix of DDA in terms of what they're bringing in. It's around 35% to 40%. Like I said on the last, you know, earnings call, you know, it takes teams probably three to four years to probably reach a steady state. You know, most of the teams that we have have been with us, you know, probably a year or, you know, a couple of years at this point. I think on the last earnings call, Stu had mentioned that we'd opened around 11,000 accounts and 7,000 customers. We've grown that now to around 12,500 accounts and 7,800 customers. So, we're continuing to see, you know, steady growth in account opening as well. Like I said in my remarks, if you exclude the title company deposits that went out at the end – at the beginning of the year, we would have grown core deposits by around 250 million. So, it's basically Deposit tax broker, we have grown that by $215 million this quarter. So Q1 is typically slow for us. Q2 starts off with tax payments as well, and then it starts picking up once we get into May, June, July timeframe. So we're pretty optimistic that we've got the right channels in place to fund a lot of the loan growth that we have.

Yeah, and our pipelines are – we review our deposit pipelines and our loan pipelines. Our deposit pipelines are very strong, so we're very encouraged.

Okay, great. And then just one on the credit front here, you know, reserve bill was maybe a little bit less than I was thinking this quarter. Just kind of curious, any updated thoughts and guidance around that?

Yeah, so I mean, Steve, we kept the CISO model relatively unchanged from your end levels. We kind of used, you know, Moody's forecast as of March that's out there. I mean, total loans were flattish to down a little bit this quarter. So, you know, I think it's, you know, over time as Moody's adjusts the forecast as we close more of these, you know, C&I and business loans going forward, you'll see a natural, you know, uptick in the provision. Over time, again, our, you know, medium to longer term target is that, you know, 90 basis points to 1% area. But overall, it's, you know, it's hard to predict the provision every, you know, individual quarter. Like I said, you know, we're headed higher over time.

Okay, great. Nice quarter. Appreciate all the color here. Thanks.

Thank you. Our next question comes from the line of Mark Fitzgibbon with Piper Sandler. Your line is now open.

Hey, guys. Good morning. Hi, Mark. Avi, it strikes me that you guys are carrying a relatively large cash balance at a little over a billion dollars. Is that an opportunity for the margin as well? Do you think you could bring that cash level down over time? Is that the plan?

Yeah, I think that's fair, Mark. However, I think, you know, like, A lot of banks that had our profile, you know, two to three years back when rates went up 500 basis points, I think we're trying to run the balance sheet for the medium to longer term and have the right mix of floating rate assets and cash versus fixed rate assets. I know, you know, we're all gearing towards the Fed cutting rates, but we also just want to keep our ALM profile in check a little bit. And I think as we start putting on loans, some of that cash will get used up and also some of the loans that we're putting on our floating rates But in the interim, we don't want to rush out to buy securities and, you know, help the net interest income in the near term and, you know, hinder opportunities to grow loans in the longer term. But you're exactly right. Historically, we used to run the balance sheet with, you know, $200 to $300 million of cash. We're running it with, you know, multiple of that at this point.

Okay. And then on the deposit front, I know you had some purposeful runoff for the broker deposits this quarter, I think $137 million. You know, given that there isn't as much loan growth here in the first part of the year, was there a conscious decision to kind of, you know, put your foot on the brake a little bit on deposit growth here or just some seasonal patterns?

Yeah. You know, a bit seasonal, you know, first quarter is usually fairly weak. You know, we have some seasonal tax receiver money as well go out. And then April is also a little weak just because of tax payments. What we've tried to do, Mark, is really make sure that, you know, we have a keen discipline on the cost of deposits itself, right? So, if, you know, there are new customers coming in at a rate in the mid-fours, we're really not, you know, taking that at this point. We're really trying to keep it, you know, sub-fours on money market and making sure the overall cost is, you know, $225 to $250. I mean, over time, we're comfortable operating with the loan-to-deposit ratio between 90% and 95% plus or minus. So, You are right, you know, as the loan growth picks up, you know, we can put the pedal to the metal a little bit more on the deposit side.

Yeah, you know, we also purposely, we can manage our municipal portfolio a little bit more. So we had a significant municipal relationship that had, you know, in excess of $400 million in deposits. They were relatively high-cost funds based on, you know, Fed funds rate, et cetera. And we basically asked them if they would move $100 to $150 million out in terms of, you know, those deposits and those costs. And we replaced them with cheaper costs, you know, business deposits that we had brought in. So we do have some levers that we can push and pull to manage cost of funds and deposit flows. And if we wanted that money back, we certainly could go get it. and it's a relationship we've had for a very long time. So those are the kind of levers that we have today that we didn't always have.

Okay. And then lastly, Stu, I wondered if you could just share any color on the $8.7 million uptake in non-owner-occupied commercial real estate this quarter. Was it one credit, a couple credits, anything special there?

Yeah, it was just one credit mark. So we actually had – exit of one credit that we previously identified, the legacy bridge loan that we exited this quarter. So we took that out, and then we had one previously identified classified loan that we have. We have a purchase and sale agreement on that, and we expect to exit that in the second quarter. So nothing systemic. It was one item, but we do expect that credit to be gone by the end of the second quarter.

Thank you.

Thank you. Our next question comes from the line of Christopher O'Connell with KBW. Your line is now open.

Hey, good morning. Hey, Chris. How are you? Hey, Sue. So just want to follow up on, you know, the last question on the credit, you know, the purchase and sale agreement in place. Was that, is that marked to, you know, the expected purchase price in terms of either a charge-off or a specific reserve at this point?

Yes. Yes.

Great. And then I was hoping just to dig in, you know, you guys announced a number of hires over the course of the first quarter here, you know, that were highlighted in the release. And hoping to dig in on just production goals on both, you know, the loan and deposit side from, you know, the various teams and hires here. And I guess, you know, with the updated expense guidance, just kind of, you know, a break-even timeline.

Yeah, I'll start with the second question here. I mean, typically, our experience, Chris, on the deposit side is that teams probably break even within six months just because the deposits come in fairly quickly. Generally, teams have a couple of franchise clients that they're able to bring on early on, and they pay for themselves pretty quickly. On the loan side, it's going to take a little bit longer because it does take time to move loans over. You've got to wait for renewals, maturities, things like that on the other side. I think we'll just leave it at, as Stu mentioned, it's going to help with the pace of pickup, especially on the C&I and business side going forward into next year. It's probably going to help us get closer to that mid-single digits to high single-digit growth that we want in 2026. You know, it's obviously going to take a little bit of time for them to get going over here. So I'd say, you know, look for it to contribute, you know, to us starting in late 25 into 26.

Okay. And I guess just, you know, without, you know, the production goals in place, just, you know, the breakdown percentage-wise of, you know, the new hires of what you think is you know, deposit versus, you know, loan hires out of those in the first quarter?

Yeah, sure. So we hired one deposit team that's focused on the Queens market. So that one was specific, you know, just for deposits. We hired Jim Legato, who's focused on, you know, building out our presence in Manhattan. That's going to be on both the deposit and the loan side. We've hired Tom in our senior executive leadership role at the bank. You know, Tom's focused on bringing on teams to help build out our CNI and owner-occupied franchises. So that's also on the loan side. And then Tony came to us from M&T, so she's focused on the loan side. So I'd say, you know, it's probably 70% to 80% focused on the loan side, at least the highest to date. And I think that's consistent with what we said, you know, when we reported our last quarter earnings that, you know, focused on both sides of the balance sheet now as opposed to just the deposit side.

Understood. And then just, you know, looking into, you know, the second quarter, you know, and some of the commentary on, you know, loans relatively flat, you know, and NIM, you know, kind of core NIM being, you know, range bound around that 290. Just, you know, hoping to flesh out the dynamics there on, you know, why you're not, you know, a little bit more bullish even before, you know, the significant asset repricing begins in the second half of 25. you know, mostly just given, you know, it sounds like the, you know, relatively strong pipeline at, you know, still, you know, give or take 200 basis points above, you know, the portfolio yield. And if there's not that much fixed asset repricing in Q2, you know, I guess I would think that, you know, that dynamic is kind of, you know, driving, you know, loan yields higher into the second quarter. even without, you know, the fixed asset repricing beginning in the second half of the year.

Yeah, Chris, so what we said was, you know, 290 is the base NIM and we expect to be, you know, plus or minus three to four basis points. So there is wiggle room, you know, up and down from that. I mean, it's just a math exercise, right? If you close $200 million of loans in a quarter, you're probably going to get, you know, three basis points of NIM expansion out of that, just purely out of that piece, right? We did take that into account. We only have around $100 million of loans that are replacing in the second quarter. So it does come down to what's coming off the books versus what's coming on. Whereas if you go to the second quarter of this year, sorry, the second half of this year, in the third quarter, for example, we have $400 million of loans that are replacing. So it's a significant change in terms of that. And also these loans that are coming off the books, they know they're 350 to 4% plus. So it's kind of addition by subtraction from that. So, you know, we're focused on, you know, doing, you know, classic community commercial bank credits, you know, over here, you know, within the bank. And that's probably going to be, you know, three to four basis points, we think. So I think we've provided a range on that. You know, we just want to be thoughtful around the fact that, you know, April typically is when, you know, people pay taxes as well. So it's going to take a little bit of time to build back deposits. So we put all of that In there, I think the thing that I really focus on is really the destination on the NIM of, you know, where we think we're going to end up. You know, if you factor in rate cuts, which, you know, may or may not happen, but if they do, you know, we'll help us by five basis points. And then you take into account, you know, the volume of assets that are repricing, you know, we're still, as Stu said, you know, pretty bullish about, you know, the medium to longer term you know, getting to a NIM that's approaching the 350 area in 2027.

Yeah, and with the pipeline we have and the teams we brought on board, we're very, very, you know, excited about the opportunity. You know, I think we are generally being somewhat conservative for the second quarter. It will be predicated upon, you know, our loan closings and how quickly these deals get through the pipeline. But, you know, we are – you know, we are excited about the second half of the year into 26. Understood.

Thanks, Avi. Thanks, Stu.

Go ahead. Thank you. Our next question comes from the line of Manuel Navas with DA Davidson. Your line is now open.

Hey, good morning. Just wanted to kind of expand and hear more color on DA's what could the Lakeland, New Jersey branch kind of add and kind of how much more activity could there be around that branch going forward in terms of hiring?

Sure. So that's in Lakewood, Central Jersey. You know, we've already hired a banker to a private banker for that group in that area. It's an area I know very well, very – very attached to the Brooklyn community as well. And so it's a natural jumping off point and our first foray into New Jersey. I actually ran a bank in that area years back, so I know the area very well. And there's a significant amount of deposit and loan opportunity available. And we thought that, you know, as our first foray, it was the the appropriate location because there's such – it dovetails so well with an existing deposit base and customer base that we have in Brooklyn.

Okay. You talked a little bit about hiring pipelines staying high. Is there any other color you can add to what parts of the footprint are kind of – have the most activity, and is it going to continue to be lending-focused like the first quarter, or is there still kind of – some more deposit teams to come?

Yeah, I think it's a mix of both, Manuel. I mean, obviously, we've identified, you know, growing in Manhattan, growing in New Jersey, and then, you know, complementing some of the Long Island areas that we have. So, you know, everything's going to be, you know, in our existing footprint or in a targeted footprint that we have. And I think we've tried to be very surgical about what works for DIME. You know, over here, we have a client base, and we've seen what's worked for us. So we're very focused on what works for us. Like I said, we're going to pick and choose what works for us, and also it's important that the economics work for us, right? So we're very focused on making sure people that we bring on contribute to the bottom line within six to 12 months, and we want to stay with that discipline. So that's what we're going to do going forward.

Can you speak a bit to the levels of competition in the region on those hires first and then just kind of across pricing on loan and deposits?

Yeah, look, I think there are other banks that are interested in doing what, you know, what we've done. They've seen our success. I think we've been the most successful out of the cadre of institutions that have, you know, been somewhat more aggressive. I think we've done it in a much more, as Avi said, surgical way. We've kept our sight on the profitability of these teams, and we've shown success. Obviously, you can see it in our cost of funds and core deposit growth, et cetera. In terms of pricing, I think today it's rational. And I think some of the players who have had problems who have pushed some irrational deposit pricing are moderating. So, you know, it's certainly helpful. And so, I mean, from a loan and deposit standpoint, I think pricing is rational. Although we're not in the market, I think multifamily pricing has come down dramatically. But I think overall we're pretty happy with the current rate environment and the structure of our balance sheet. We'll prove to be very profitable for us as time moves on, as we continue to reprice the book.

I appreciate that. Thank you for the commentary.

Thank you. Our next question comes from the line of Matthew Brees with Steven Zink. Your line is now open.

Hey, good morning. Good morning, Matt. I wanted to start on deposit costs and the trajectory excluding additional Fed cuts. So the last time we spoke in January, the spot cost in deposits was 2 to 205. The only cost for the quarter was 209, so a modest, you know, a little bit of a pickup. Should we read into that at all or are deposit cost reductions nearing the end without additional rate cuts?

No. So, Matt, the way we typically operate with the deposit cost is we, you know, we initially start by passing on, you know, the full amount to a lot of customers. And then over time, you have some customers that come back and say, hey, I got this other rate from this other bank. Can you match it, right? And we never match it, but sometimes you meet in between, right? There's other banks that follow different strategies where they wait a month or two and, you know, cut differently. So I would say, look, as we bring in DDA, you know, into the bank, you know, our goal is to keep, you know, deposit costs in that, you know, low 2% area. We do have some CDs on the balance sheet that are repricing lower. So, you know, as that happens, we're probably retaining 80% to 90% of the CDs that we have at this point. We probably have around 750 million of CDs left. and the rates on those are probably 375-ish, plus or minus. Those are probably repricing in the low threes at this point. So there is some, but I would say the best environment for us is, you know, if the Fed cuts 25 basis points every three months, we'll have an opportunity then to pass on that to customers on the other side. But I would say, absent that, you know, given the Fed cuts that have happened, we still have a CD book that we're repricing down. But beyond that, you know, most of the cuts are in there.

Got it. Okay. And then with all the tariff noise, have lending spreads, particularly on commercial real estate and CNI, have they changed at all to account for incremental risk? And what exposures on your book are you monitoring more carefully in light of the tariffs?

Yeah, look, you know, it's a little too early. We haven't seen a lot of change in spreads on the on the book at this point on commercial real estate in particular. And, you know, generally we've done a deep dive into the portfolio. You know, look, we don't have a lot of import export or manufacturing. We don't have a lot of retail. The things that, you know, or consumer for that matter that you would typically be concerned with. And it's a little early to see how it all plays out within the general economy, whether it's in, you know, the service industry or construction. Those are the areas that we're looking at, you know, very closely and monitoring. We're looking at line usage and things of that nature, but it's a little early yet.

Okay. Next one for me is just that we're just over the two-year mark for the signature failure. Is that a significant milestone in any way? I'm thinking in terms of employee lock-up agreements. Are there going to be more opportunities this year to hire teams and individuals in the wake of that?

No, I don't think so, Matt, in terms of specific lock-up agreements. I mean, I can't comment on what the surviving bank there is doing, but You know, I think for us, we identified early on, you know, what markets we wanted to augment. You know, obviously there were certain areas of Long Island that we wanted to expand into, Staten Island, Westchester. So for us, it's more market-based and who works for, you know, the business model that we have. You know, there's still a lot of talented people over there. There's talented people at other banks too. You know, if you look at the hires that we've had, year to date, they've come from multiple banks, right? It's not been just from one bank. So I think that the opportunity that was there two years back doesn't exist anymore. But there are talented people, you know, across the board here. And I think as they see the success that we've had, you know, we're getting a lot of incoming calls going forward, not just from that bank, but from other banks as well.

Understood. Okay. Two other quick ones for me. I don't know if you addressed it in your opening comments, Avi. Could you touch on the fee income guide for the year? I think it was $40 to $42 million. Does that still hold?

Yeah. So this quarter, Matt, we didn't have any swap fee revenue. It was pretty close to zero. A lot of the deals got pushed to May and June type timeframe. So if you took the Q1 number and you assumed there was some moderate level of swaps in there, we would have been pretty close to that $40 to $42 million guide for the full year. So we can still keep that for the full year at this point.

And then you had mentioned just strong capital levels, particularly your CET1 ratio. Curious your thoughts on buybacks with the stock down where it is and potentially a slower growth environment. That's all I have. Thank you.

Yeah, look, I mean, the corporate finance view is, you know, to be buying back stock at this point significantly. However, I just think given the overall environment, you know, uncertainty with tariffs, things like that, it's important to have that, you know, especially as we You know have this loan pipeline that we're looking to close. I mean Tom's come on board You know to help us build out the you know, the CNI portfolio So having that little bit of excess capital is helpful right now, you know The other marker that we've set out there is to get our Cree ratio into the low 400 So we made further progress this quarter. We're probably at 440 at the end of the quarter So we'd like to see that decline a little bit as well. So you put that all together and We feel good with where we're at. At some point in the latter half of this year, under 2026, we'll probably revisit the buyback piece, but it's more from an optics and managing the environment as opposed to the intrinsic value in the stock.

And clearly with our pipeline and the teams we brought on board and the individuals we brought on board, we think there's going to be an opportunity to deploy that capital in a meaningful way and improve earnings as well.

That's all I had. Thank you.

Thanks, Matt.

Appreciate it.

Thank you. And I'm currently showing no further questions at this time. I'd like to turn the call back over to Stuart LeBeau for closing remarks.

Thank you, Shannon. And thank you all for joining us today and to our dedicated employees and shareholders for the continued support. We look forward to speaking with you after the second quarter.

this concludes today's conference call thank you for your participation you may now disconnect