RBB Bancorp

Thank you, Matthew. Good day, everyone. And thank you for joining us to discuss RBB Bancorp results for the first quarter of 2025. With me today are Johnny Lin, David Morris, Lynn Hopkins, and Jeffrey Yang. David, Johnny, and Lynn will briefly summarize the results which can be found in the earnings press release and investor presentation that are available on our investor relations website. And then we'll open up the call to your questions. I would ask that everyone please refer to the disclaimer regarding forward-looking statements in the investor presentation and the company's SEC filings. Now I'd like to turn over the call to RBD Bancorp's Chief Executive Officer, David Morris. David?

Thank you, Rebecca. Good day, everyone, and thank you for joining us today. First quarter net income declined to $2.3 million, or 13 cents per share. as we took decisive strategic action to address our nonperforming assets. We reduced our nonperforming assets by 20% and our net exposure to nonperforming loans by 32% to $51 million. To accomplish this, we sold 18 million of loans, recognized provisions of $6.7 million, and received paydowns of $1.8 million. We believe the provisions we have taken over the last few quarters have addressed the vast majority of potential losses in our non-performing loans. As we said last quarter, we are focusing on resolving our non-performing loans as quickly as possible while minimizing the impact of earnings and capital, and we think our actions in the first quarter helped accomplish this. We continue to work through our remaining non-performing assets and expect to be able to report additional progress in the coming quarters. We did downgrade a $5.3 million New York CRE loan to non-performing in the first quarter after the largest tenant moved out. While unfortunate, we feel relatively confident that it will be resolved without any loss of principle as the borrower is actively working to fill the vacancy and has also listed the property for sale. A recently completed appraisal on the property indicates an LTV of about 85%. Now, I'll hand it over to Johnny to talk about happier subjects like loan growth and margin expansion. Johnny?

Thank you, David. As David mentioned, in addition to making good progress resolving our travel loans, we had strong loan growth in the first quarter, another quarter of NIM expansion. Loan sales or investment grew by $90 million, or 12% on an annualized basis, driven by the continued execution of our growth initiatives. Growth in commercial, SBA, and SFR balances more than offset the decline in C&D loans. We've seen especially strong results from our in-house mortgage origination business, which, despite the rare environment, originated $112 million in mortgages in the first quarter. These contributed nicely to our total first quarter loan originations of $201 million at a blended yield of 6.77%, which will continue to support our asset yields and margins going forward. Our pipelines remain full, So we expect to continue to see loan growth, though likely at a more moderate pace than we experienced in the first quarter. Net interest margin increased 12 basis point to 2.88% due primarily to a 29 basis point decline in the cost of our interest-bearing deposit, which drove a 17 basis point decline in our overall cost of fund. We expect some incremental decreases in funding costs from here, but likely at a slower pace than we've seen since they peaked in the third quarter last year. It's worth highlighting that since that time, we've reduced the cost of deposits by 50 basis points and the total cost of funds by 42 basis points. With that, I'll hand it over to Lynn to talk about the results in more detail. Lynn.