First Bank

Ladies and gentlemen, good morning and welcome to the Origin Bancorp Inc. second quarter 2024 earnings conference call. My name is David and I will be your ever call coordinator. The format of this call includes prepared remarks from the company, followed by a question and answer session. Please note that this event is being recorded and all participants will be on listen only mode until the Q&A portion of the call. I would now like to turn the conference over to Chris Riegelman, Executive Director of Investor Relations. Please, Chris, go ahead.

Good morning, and thank you for joining us today. We issued our earnings press release yesterday afternoon, a copy of which is available on our website, along with the slide presentation that we will refer to during this call. Please refer to page two of our slide presentation, which includes our safe harbor statements regarding forward-looking statements and use of non-GAAP financial measures. For those joining by phone, please note the slide presentation is available on our website at www.ir.origin.bank. Please also note that our safe harbor statements are available on page five of our earnings release file with the SEC yesterday. All comments made during today's call are subject to the safe harbor statements in our slide presentation and earnings release. I'm joined this morning by Origin Bank Corp's Chairman, President and CEO, Drake Mills, President and CEO of Origin Bank, Lance Hall, our Chief Financial Officer, Wally Wallace, Chief Risk Officer, Jim Crowell, our Chief Accounting Officer, Steve Brawley, and our Chief Credit and Banking Officer, Preston Moore. After the presentation, we'll be happy to address any questions you may have. Drake, the call is yours.

Thanks, Chris. As we enter the second half of the year, I am pleased with our company's momentum moving forward, and I'm very proud of our bankers as they continue to battle for deposit growth in highly competitive markets. Our bankers are experiencing success in new customer acquisition as well as expanding current relationships. On a core operating basis, our second quarter results were in line with our expectations. Our EPS results were positively impacted by 15 cents due to evaluation adjustment of our investment in Argent Financial and by the sale of one of our former Houston locations. However, the generally positive results for the second quarter were negatively impacted by a 25-cent hit to EPS related to questioned activity of a recently terminated banker in our East Texas market. This questioned activity is subject to ongoing disputes, so we are limited to what we can say at this time. We can share that the former banker violated bank policy by facilitating advances in and among accounts of a small number of customers in our East Texas market without properly documenting those transactions. We have terminated the banker, engaged the affected customers, and conducted a review of the banker's relationships. We've also engaged external accounting and legal resources to assist our review. We are actively working to resolve issues related to this question of activity, and at this time do not believe any losses we might realize will be material to our financial position. However, based on how we have to account for this type of issue, the financial impact of the activity reduced EPS by 25 cents during the quarter. Again, backing out notable items referenced in our presentation, financial results for the quarter were generally in line with our expectations. We were particularly pleased with continued growth in net interest income, expansion in net interest margin, and our non-interest income trends remain strong. We are making great progress in our new southeast market and have received regulatory approval for our Mobile and Fort Walton Beach locations. We have built an attractive footprint in some of the best markets in the country and have a team of bankers focused on delivering profitable customer relationships. I have a great deal of confidence in our team and our ability to deliver long-term value to our stakeholders. Now I turn it over to Lance. Thanks, and good morning.