Heritage Financial Corporation

Greetings and welcome to the Third Coast Bank fourth quarter and full year 2024 conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Natalie Harrison of Investor Relations. Thank you. You may begin.

Thank you, operator, and good morning, everyone. We appreciate you joining us for Third Coast Bank Shares conference call and webcast to review our fourth quarter and full year 2024 results. With me today is Bart Carraway, Chairman, President, and Chief Executive Officer, John McWhorter, Chief Financial Officer, and Audrey Duncan, Chief Credit Officer. First, a few housekeeping items. There will be a replay of today's call, and it will be available by webcast on the Investors section of our website at ir.thirdcoast.bank. There will also be a telephonic replay available until January 28th, and more information on how to access these replay features was included in yesterday's earnings release. Please note that information reported on this call speaks only as of today, January 23rd, 2025, and therefore you are advised that any time-sensitive information may no longer be accurate as at the time of any replay listening or transcript reading. In addition, the comments made by management during this conference call may contain forward-looking statements within the meaning of the United States federal securities laws. These forward-looking statements reflect the current views of management. However, various risks, uncertainties, and contingencies could cause actual results, performance, or achievements to differ materially from those expressed in the statements made by management. The listener or reader is encouraged to read the annual report on Form 10-K that was filed on March 7, 2024, to better understand those risks, uncertainties, and contingencies. The comments made today will also include certain non-GAAP financial measures. Additional details and reconciliation to the most directly comparable GAAP financial measures were included in yesterday's earnings release, which can be found on the Third Coast website. Now, I would like to turn the call over to Third Coast Chairman, President, and CEO, Mr. Bart Carraway. Bart?

Good morning, everyone, and thank you, Natalie. I'll begin by sharing the key highlights from the earnings release, followed by John's review of the financials, and Audrey's review of credit quality. After that, I will outline our plans for the future. There are several things to highlight. First, we are proud to achieve 14 consecutive positive quarters of net interest income growth. In the fourth quarter, our net interest income reached $43.4 million, reflecting a 7.6% rise from $40.4 million in the third quarter of this year, and a 16.4% increase from $37.3 million in the fourth quarter of the previous year. Second, fourth quarter loan growth rose by $76.6 million, up 2%, while for the full year, loans grew by $327.6 million, or 9%. We increased deposits by $316 million or 7.9% in the fourth quarter, while the full year they grew by $507.4 million or 13.3%. Our dedication to customer service has been instrumental in driving this growth. By understanding the unique needs of our customers and offering tailored financial solutions, we have strengthened our relationships and broadened our base of full wallet customers. A keystone of our strategy is our commitment to operational excellence, ensuring we improve efficiency as we scale. In the fourth quarter, we improved our efficiency ratio to 58.8%. For the second consecutive quarter, we exceeded our initial internal efficiency ratio target of below 60%. This significant milestone underscores our determined pursuit of cost management and process optimization. Our 1% improvement initiative has proven to be an effective tool, motivating our team to explore innovative ways to streamline operations, leverage technology, reduce overhead, and enhance productivity. These efforts are essential for maintaining profitability as we continue to expand our operations and market presence. Overall, I'm extremely pleased with the fourth quarter and full year results for 2024. Our team has shown exceptional focus and discipline in implementing the bank's strategic priorities, which has resulted in these tremendous results. Their hard work not only has driven impressive financial performance, but has also laid a strong foundation for future successes. With that, I'll turn the call over to John for the company's financial update. John?