Eagle Bancorp, Inc.

Good day, and thank you for standing by. Welcome to the Eagle Bancorp, Inc. Second Quarter 2025 Earnings Call. 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 you 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 first speaker today, Eric Newell, Chief Financial Officer of Eric Bancourt. Please go ahead.

Good morning. Before we begin the presentation, I'd like to remind everyone that some of the comments made during this call are forward-looking statements. The current market environment is uncertain and we cannot make any promises about future performance and caution you not to place undue reliance on these forward-looking statements. Our Form 10-K for the fiscal year 2024, Form 10-Q for the quarter ended March 31, 2025, and current reports on Form 8-K, including the earnings presentation slides, identify risk factors that could cause the company's actual results to differ materially from any forward-looking statements made this morning, which speak only as of today. Eagle Bancorp does not undertake to update any forward-looking statements as a result of new information or future events or developments unless required by law. This morning's commentary will include non-GAAP financial information. The earnings release, which is posted in the investor relations section of our website and filed with the SEC, contains reconciliations of this information to the most directly comparable GAAP information. Our periodic reports are available from the company online at our website or on the SEC's website. With me today is our Chair, President, and CEO, Susan Reel, Chief Lending Officer for Commercial Real Estate, Ryan Reel, and our Chief Credit Officer, Kevin Gagin. I'll turn it over to Susan.

Thank you, Eric. Good morning, everyone. As I mentioned in our first quarter earnings call, we anticipated taking a proactive approach to the resolution of challenged office loans and to addressing related valuation pressures. Our second quarter results reflect the expected outcome of that approach. While the financial impact is significant, We believe these actions were prudent and necessary given our belief that the changes affecting the office sector are long-term and structural. At the same time, we are making tangible progress toward meeting our objectives outlined in our strategic plan. We are seeing steady growth from our CNI team, and the shift in our portfolio mix toward CNI is underway. Importantly, we are beginning to see the results of our targeted relationship deposit efforts with core deposit growth contributing to a reduction in our wholesale funding reliance. While the second quarter performance is disappointing, these steps are deliberate and designed to more quickly normalize provision expenses in the future. The provision this quarter reflects not only continued market deterioration, but also our receipt of new valuation data on office properties. As a result, we are reserving for substandard performing office loans at 31.2%, with the total coverage ratio of the office portfolio at 11.5%. Much of the provisioning this quarter is tied to specific exit strategies. For example, we restructured our largest non-accrual office loan into an AB note. Continuing payment performance allowed us to return the A portion of this loan to accrual status. We also made progress on other resolution strategies. Two non-accrual office loans were moved to held for sale, and we've executed a letter of intent on one of those. We expect that sale to close in the third quarter. I'll now turn it to Kevin who will talk more about our credit provision.