Forbright, Inc.

Good morning and welcome to the third quarter 2026 earnings call for Fulbright, Inc. At this time, all participants are in listen-only mode. A question and answer session will follow the speaker's prepared remarks. As a reminder, this conference call is being recorded. It is now my pleasure to turn the call over to Ben Wakana, Chief Public Affairs and Investment Relations Officer at Fulbright Bank.

Thanks, Andrew. Before we begin, I'll remind listeners that remarks on this call may contain forward-looking statements that are subject to risks and uncertainties. Please refer to the Safe Harbor statements found in today's earnings release and in our investor presentation for additional details. Management may also reference non-GAAP financial measures during the call. A reconciliation of non-GAAP measures can be found in our earnings release and investor presentation slides. Finally, I'll identify the speakers on the call this morning. They are John Delaney, Chairman and Chief Executive Officer of Fulbright, Inc., Don Cole, President and Chief Operating Officer of Fulbright, Inc., and Chief Executive Officer of Fulbright Bank, and Chris Lynch, our Chief Financial Officer. We're also joined in the room by Aaron Juda, our Chief Strategy Officer, who will participate in the Q&A. With that, I'll turn it over to John.

Thanks, Ben, and good morning, everyone. So I'll start by saying I'm somewhat superstitious by nature, so I'm always a little reluctant to call a quarter terrific. but this time the facts certainly merit that description to my mind. Our loan growth was very strong. NIM was stable despite meaningfully higher liquidity. Our credit performance was very good. We continue to build out what we view as a best in class digital deposit franchise and we made good progress on the efficiency metrics that will continue to improve as we scale the business. At a high level, the quarter reinforced three key themes. First, our ability to drive good and disciplined loan growth from our six national lending businesses. Our loan book grew 24% year over year, up 9.5% this quarter alone. Healthcare, which is our most mature strategy to some extent, drove most of our growth this quarter, but all of our specialty credit delivery verticals performed very well. And we would expect different strategies to outperform from quarter to quarter. There's a little bit of lumpiness. But again, I think the key theme here is that all of the strategies are seeing good opportunities with attractive structures and appropriate spreads. The second big theme was around our digital deposit platform, which raised over $1 billion in the last quarter, which represents a 24% increase from the prior quarter. The platform continues to provide a highly scalable source of funding as we grow the business. And I would describe our confidence as very high in terms of our ability to use this increasingly sophisticated platform to drive very precise deposit growth at optimal cost of funds at acquisition cost. We spoke last quarter about our new promotion engine which launched and was very successful and we expect this strategy to continue to work well for us in the future and our upcoming checking product is on track for a phased launch to begin in the first quarter next year. and then expect most of the promotion to the public to take place in the second quarter. And then finally, we view ourselves as very well positioned to improve operating efficiency as the business grows. We certainly remain on path to achieve the efficiency targets we've laid out for folks. Overall, we believe the business we've designed and built will perform very well in the banking and financial services environment of today, and importantly, the one of tomorrow. In that regard, we're spending a lot of time thinking about how artificial intelligence will affect banking and trying to plan accordingly. I co-wrote a piece in the Wall Street Journal a few weeks ago titled, AI Will Be a Boon for Savers. As I laid out in that article, our view is that the banking system is moving toward a world in which technology makes it easier for consumers to evaluate financial products, compare rates, and move their money to institutions that offer the best value. We view this trend as unambiguously good for consumers and therefore unstoppable. The speed of that transition, however, is very difficult to predict. but we believe a significant percentage of legacy branch deposit resemble a slow melting iceberg. Put another way, the move to digital deposits has been slow and steady, and that's exactly what the early part of an S-curve looks like. That's how every major technology is adopted. At some point, it accelerates, and when it does, it will happen faster than most people expect. Anyone who thinks today's pace is tomorrow's pace is missing the boat. We built our franchise for where deposits are going, not where they've been. We believe we're well positioned to be the bank of the future, and that means having the technology, the operating model, and the deposit franchise that can compete as customer expectations change. and we feel very good about where we are. Gathering deposits nationally through a digital platform, paying a fair rate and delivering a user-friendly experience through the platform we've built. Deploying that funding through specialized lending businesses where expertise travels nationally and where our teams can create value through speed, flexibility and insight elevates the confidence in our models. As part of our Digital First Focus, this quarter we announced the sale of our legacy Washington, D.C. area branches and associated deposits to an institution called Trustar Bank. That transition is moving ahead nicely. We anticipate regulatory approval or Trustar anticipates regulatory approval in the fourth quarter and closing will happen in the first quarter of 2027 based on the timing of lining up the two core service providers for that transition. And both teams have done a great job of planning a smooth transition for the customers. So before concluding, I want to reiterate the four key metrics that made this, in my judgment, a very strong quarter. We had very strong loan growth. We expect that to continue, perhaps not at the level we saw this quarter, but we certainly expect strong loan growth in the fourth quarter into the first quarter. Credit was very strong, which is in many ways the most important metric for our business. We had disciplined deposit pricing and very strong deposit growth. and we achieved solid execution on our expense management initiatives, which is now part of the culture of Forbrite. As we continue this work, we expect the machine we have built to become increasingly more productive and valuable. With that, I'll turn the call over to Don.