First Citizens BancShares, Inc.

Hello, everyone. Thank you for your patience and the First Citizens Bank Shares first quarter 2024 earnings conference call will begin shortly. During the presentation, if you'd like to ask a question, you need to press star 1 on your telephone. The conference call will begin shortly. Ladies and gentlemen, thank you for standing by and welcome to the Fast Citizens Bankshare first quarter 2024 earnings conference call. At this time, all participants are in the listen-only mode. After the speaker's presentation, there will be a question and answer section. To ask a question during the section, you need to press star one on your telephone. If you require operator assistance during the program, please press star then zero. As a reminder, today's conference is being recorded. I would now like to introduce the host of this conference call, Ms. Deanna Hart, Senior Vice President of Investment Relations. You may begin.

Good morning. Welcome to First Citizen's first quarter earnings call. Joining me on the call today are Chairman and Chief Executive Officer Frank Holding and Chief Financial Officer Craig Nick. They will provide first quarter business and financial updates referencing our earnings call presentation, which you can find on our website. Our comments today will include forward-looking statements, which are subject to risks and uncertainties that may cause actual results to differ materially from expectations. We assume no obligation to update such statements. These risks are outlined on page three. We will also reference non-GAAP financial measures. Reconciliations of these measures against the most directly comparable GAAP measures can be found in section five of the presentation. Finally, First Citizens is not responsible for and does not edit nor guarantee the accuracy of earnings transcripts provided by third parties. I'll now turn it over to Frank.

Thank you, Deanna. Good morning, everyone. Let's start on page six. And I'll say that over the last 12 months, we've successfully focused on our SBB integration efforts regulatory readiness, strategic priorities, and financial performance. During the first quarter, we delivered earnings per share of $52.92, adjusting for notable items that are on page 51. Return metrics were strong, reflecting a peer-leading net interest margin, an adjusted efficiency ratio of 50%, and lower net charge-offs. These results exceeded our expectations with earnings increasing approximately 14% over the sequential quarter. We're pleased that all our segments, including SBB commercial, grew loans during the quarter and our liquidity and capital positions strengthened due to core deposits and earnings growth. We successfully submitted our capital plan to the Federal Reserve on April the 5th. The process included a full stress test, including the acquired SBB portfolios. Submission of this plan was an important milestone in our regulatory journey, and I'd like to thank all our associates for their hard work in submitting a quality plan. Turning to page seven, it's been a year since Silicon Valley Bank became part of First Citizens, which had has introduced a lot of change, but most of all, opportunity. I want to thank our associates for their hard work over the past year stabilizing the business and taking care of our clients. I also want to thank our clients for their confidence in us as we remain committed to them and the innovation economy. The SBB team continues to deliver exceptional service to our clients, and this is demonstrated by the fact that 80% of the VC firms on the Forbes Midas list are served by our company and our ability to onboard over 1,000 new clients in the first year of our acquisition. SBB also has more experience serving the innovation economy than any other financial services provider, thanks to our dedicated teams of sector experts. Their essential insights come from over 40 years of dedicated focus on innovators and investors, an average leadership tenure of over 20 years with SEB and the deepest and most experienced bench of over 1,500 innovation bankers and relationship advisors. Our team is well positioned despite some of the continued economic headwinds facing the innovation economy. Last year, VC fundraising hit its lowest level since 2017. The drawback in fundraising we witnessed in 2023 continued into the first quarter, even though there remains plenty of dry powder to invest. Despite the current environment, we are encouraged by the number of exit-ready companies poised to exit once the IPO market fully reopens. In fact, there is a record backlog of companies ready to exit given current market conditions. There is fundamental demand from investors, but only at the right price and for companies with good stories. We are beginning to see activity improve, and the signs that IPO activity may pick up this year. On page eight, we show that the SUV franchise has been stabilizing in terms of loans and client funds since the second quarter of last year, reflecting continued support of our innovation clients. Moving to page nine, our integration efforts helped us retain clients stabilized deposit balances, and developed strategic priorities for the combined organization. We continue to make meaningful progress on integration and remain committed to achieving our post-merger potential. While we have always focused on compliance with regulatory requirements, our growth has moved us to a significantly increased level of regulatory oversight, and we are investing and being proactive in enhancing our regulatory readiness. While there is more work to be done, we've made meaningful progress in maturing and refining our processes to support the change in our size and complexity. A few of these accomplishments include, first, implementing expanded risk management capabilities based on feedback from third-party gap assessments. Second, creating a dedicated regulatory remediation oversight team to manage and enhance regulatory response, as well as provide oversight, monitoring, and reporting of remediation efforts. Third, enhancing our dedicated regulatory affairs team to manage heightened regulatory activity and relationships with new examiners. And fourth, completing our first-time large financial institution regulatory filings on time. In addition, with our strong risk management culture, we will continue to invest in our capabilities here, and we're confident that over time we will effectively transform our program in accordance with new and changing regulatory requirements. Now let's look at page 10. We continue to invest in our wealth business, one of our primary income drivers. We believe there are significant opportunities and we've achieved remarkable organic growth here since 2013. In the third quarter, we announced the alignment of SVV Private and First Citizens Wealth under one leadership team to improve coordination and enhance services available to clients. Wealth is beginning to see the benefits of our bringing our capabilities together under one umbrella, creating a premier private banking and wealth business. Most recently, we rebranded all of our wealth services to First Citizens Wealth. The combined First Citizens Wealth organization can help any client, business, or institution regardless of size or complexity. We remain focused on maintaining deep client relationships, providing a boutique experience with big bank capabilities. Moving forward, we believe our combined product set, dedicated and experienced wealth professionals and client-centric engaged model will continue to accelerate the growth of our wealth franchise. And finally, turning to page 11, we're happy to be recognized and honored as a top 20 financial institution on Forbes list of America's best banks and by other organizations and publications listed on the page. This recognition reflects our solid track record taking care of our clients and our customers. To conclude, the positive momentum we started in 2023 continues. Despite the uncertainty in the current environment and the hard work ahead of us, we continue to protect and grow customer relationships Stabilize the SPV franchise. Grow core deposits and loans. And strengthen our balance sheet. Given our position of strength and dedicated associates, I'm excited about the opportunities ahead of us. And with that, Craig, I'll turn it over to you.