First Internet Bancorp

Thank you for standing by. My name is Trevor and I will be your conference operator today. At this time, I would like to welcome everyone to the first Internet Bancorp earnings conference call for the third quarter 2026. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question, please press star 1 to raise your hand. To withdraw your question, press star 1 again. Please note that this event is being recorded. It is now my pleasure to turn the call over to Julia Ferreira from ICR. You may begin your conference.

Thank you, Operator. Good afternoon, everyone, and thank you for joining us to discuss First Internet Bancorp's third quarter 2026 financial results. The company issued its earnings press release earlier this afternoon, and it is available on the company's website at www.firstinternetbancorp.com. In addition, the company has included a slide presentation that you can refer to during the call. You can also access these slides on the website. Joining us from the management team today are Chairman and CEO David Becker, President and COO Nicole Lorch, and Executive Vice President and CFO Ken Lovik. David and Nicole will provide an overview, and Ken will discuss the financial results, and then we'll open up the call for your questions. Before we begin, I'd like to remind you that this conference call contains forward-looking statements with respect to the future performance and financial conditions of First Internet Bancorp that involves risk and uncertainty. Various factors could cause actual results to be materially different from any future results expressed or implied by such forward-looking statements. These factors are discussed in the company's SEC filings, which are available on the company's website. Thank you, Julia. Thank you.

Good afternoon, everyone, and thank you for joining us. Let me start with a headline. The fundamental earnings power of First Internet Bancorp continues to improve. We generated record revenue in the third quarter. We expanded net interest margin for the fourth consecutive quarter. We grew adjusted pre-provision net revenue 14% from the second quarter. We continue to improve the mix of loans and deposits while deploying capital efficiently. At the same time, the overall credit normalization we discussed last quarter is on track, with net charge-offs and delinquencies declining meaningfully. For the third quarter, we are reporting earnings of 54 cents per diluted share, excluding non-reoccurring expenses. Adjusted earnings per share rose to 57 cents, more than double what we reported last quarter. We also had one significant credit relationship move against us late in the quarter. I want to address that one directly. Earlier in the quarter, we were working with a franchise finance borrower on a forbearance arrangement. It was intended to give the borrower time to refinance with another lender. Late in the quarter, the borrower's financial condition deteriorated, and it became clear that refinancing was no longer viable in the near term. We moved the relationship to non-accrual. We established a $2.6 million specific reserve and reversed $600,000 of interest income. For this relationship, we believe there remains a path to repayment. However, based on what we knew at quarter end, including the delinquent status of the related loans, the prudent course of action was to recognize the deterioration, and we did. That's the bad news in the quarter, but it is important not to lose sight of what happened everywhere else in the business. Provision expense declined sequentially. Net charge-offs fell by more than half. Delinquencies fell to 48 basis points from 78 in the second quarter. That includes a significant drop in franchise finance delinquencies. Those are meaningful improvements, and they show the broader credit trends are moving in the direction we expected. More importantly, our operating performance gave us the capacity to absorb the impact of this relationship. We produced record revenue, record net interest income, and continued margin expansion. and we still grew adjusted pre-provision earnings by double digits. That's what I mean when I say the fundamental earnings power of this company is improving. We are confident in the direction of the business as we execute on our strategy with foresight and discipline. Nicole will talk about how that strategy is changing the economics of our business for the better and then Jen will walk through the financial results and what we expect in the fourth quarter. Nicole.