First Interstate BancSystem, Inc.

Good day and welcome to the First Interstate Bank System, Inc. Second Quarter Earnings. At this time, all participants are in a listen-only mode. Later, there will be a question and answer session. You may queue for a question at any time by pressing the star key followed by the number one on your telephone keypad. Please be advised that today's conference is being recorded. Should you require operator assistance, you may press star zero. I'd now like to turn the call over to Andrea Walton. Please go ahead.

Good morning. Thank you for joining us for our second quarter earnings conference call. As we begin, please note that the information provided during this call will contain forward-looking statements. Actual results or outcomes may differ materially from those expressed by those statements. I'd like to direct all listeners to read the cautionary note regarding forward-looking statements contained in our most recent annual report on Form 10-K, filed with the SEC and in our earnings release, as well as the risk factors identified in the annual report and our most recent periodic reports filed with the SEC. Relevant factors that could cause actual results to differ materially from any forward-looking statements are included in the earnings release and in our SEC filings. The company does not undertake to update any of the forward-looking statements made today. A copy of our earnings release, which contains non-GAAP financial measures, is available on our website at fibk.com. Information regarding our use of the non-GAAP financial measures may be found in the body of the earnings release, and a reconciliation to their most directly comparable GAAP financial measures is included at the end of the earnings release for your reference. Joining us from management this morning is Kevin Riley, our Chief Executive Officer, and Marcy Mutch, our Chief Financial Officer, along with other members of our management team. At this time, I'll turn the call over to Kevin Reilly. Kevin?

Thanks, Andrea. Good morning, and thanks again to all of you for joining us on our call today. Again this quarter, along with our earnings release, we have published an updated investor presentation that has some additional disclosures, which we believe will be helpful. The presentation can be accessed on our investor relations website. And if you have not downloaded a copy yet, I would encourage you to do so. I'm going to start today by providing an overview of the major highlights of the quarter, and then I'll turn the call over to Marcy to provide more details on our financials. Let's get to our results. We generated 60 million in net income in the second quarter or 58 cents per share. We continue to exercise well in the second quarter and our results were generally in line with our expectations, including a seven basis point expansion in our net interest margin to 3%. We were pleased to see improvements and criticize the nonperforming asset metrics. Our capital and liquidity position remains strong and our allowance for credit losses is sufficient for our credit profile. All these factors, along with our anticipation of steady expansion in our net interest margin, reinforces our belief that we are well positioned for the remainder of 2024 and into 2025. Expense control remains a key tenet for us, and our expenses came in better than we expected in the second quarter. This was driven primarily by the ongoing prudent management of our base salaries. Our medical expenses continue to run below expectations. And as I said, our persistent focus on controllable expenses. We have managing expense reductions while at the same time, continuing to make internal investments into our systems and our people. Last quarter, we said one of our focal points for internal investment is treasury solutions. And we are seeing early success in that area. Our treasury service income, which is a component of our service charges on our deposit accounts, increased by mid single digits in the second quarter, which helped us meet our expectations for our fee businesses overall. Within this line of business, our enhancers are helping us better serve our customers and improve our relationship banking model. We remain optimistic about future successes in this area. We recorded 42.6 million in non-interest income in the second quarter, which is an increase of 1.2% from the prior quarter. Our asset quality improved in the second quarter. Criticized, classified, and non-performing loans all declined in the period, and non-performing assets declined by 7.7%. In the previous two quarters, we discussed two large non-performing loans. And Marci will give you an update on those in a moment. Now on to deposits. Our deposits increased by 60.7 million in the second quarter. I want to note that this end of period figure did include one customer deposit that was larger than normal at period end, which will partially impact our seasonality and mute our third quarter growth. This impact is incorporated in both our deposit and NII guidance. Asset repricing is the driver of our forward margin projections, and we are not assuming any immediate material decrease in our deposit costs. Our liquidity remains stable and healthy, with our loan deposit ratio of 79.7% at quarter end. Before I turn the call over to Marcy, I want to take the opportunity to announce that we have just added two strong talents to our risk management team. The first is Matt Cookes, who will see Michael Ludley as our chief credit officer when Mike retires in September. Matt has over 25 years of experience in this field, most recently as a chief credit officer of transaction banking at Goldman Sachs. We have also hired a new director of fraud risk management. who brings many years of experience in this area, most recently in creating fraud programs for two FinTech startups. Both of these very accomplished individuals are a great fit for our team. And now I'd like to turn the call over to Marcie for some details on our financials.