Southside Bancshares, Inc.

Good day and thank you for standing by. Welcome to the Southside Bank Shares four-quarter 2024 earnings call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Lindsay Bills, Vice President, Investor Relations. Please go ahead.

Thank you, Marvin. Good morning, everyone, and welcome to Southside Bank Shares' first quarter 2024 earnings call. A transcript of today's call will be posted on southside.com under Investor Relations. During today's call and in other disclosures and presentations, I will remind you that any forward-looking statements are subject to risk and uncertainties. Factors that could materially change our current forward-looking assumptions are described in our earnings release in our Form 10-K. Joining me today are Lee Gibson, President and CEO, and Julie Shanberger, CFO. First, Lee will share his comments on the quarter, and then Julie will give an overview of our financial results. I will now turn the call over to Lee.

Thank you, Lindsay. Good morning, everyone, and welcome to Southside Bank Shares' first quarter 2024 earnings call. This morning, we reported first quarter net income of $21.5 million, earnings per share of $0.71, a return on average tangible common equity of 15.07%, and continued strong asset quality metrics. Linked quarter, loans increased and annualized 4.7%, just slightly below our projected 5% loan growth for 2024. Our loan pipeline is solid and the markets we serve remain healthy and continue to grow and perform well. Linked quarter, our net interest margin decreased 13 basis points. During the quarter, three of our Lower interest rate cash flow swaps totaling $120 million matured and the rate for that funding increased over 4%. Our BTFP funding renewed at a higher rate for an additional year and we continue to experience deposit pricing pressures. We do not have any additional swaps maturing during 2024. While we anticipate ongoing deposit pricing pressure in the absence of the Fed cutting interest rates, we believe anticipated loan growth will help partially mitigate any further NIM compression. During the quarter, we implemented several initiatives associated with our new five-year strategic plan. One of the initiatives is to carefully examine additional revenue as well as cost containment opportunities. Through retirements, reduction in workforce, and attrition during the first quarter of 2024, we currently anticipate annualized cost savings of approximately $3.5 million, 80% of which should be reflected beginning in the third quarter of this year and 100% in 2025. During the quarter, we expensed approximately $618,000 associated with these expense reductions. We continue to evaluate expenses as well as revenue opportunities and will update you on any further progress in future quarters. I look forward to answering your questions following Julie's remarks. I will now turn the call over to Julie.