Southside Bancshares, Inc.

Ladies and gentlemen, thank you for standing by. Welcome to Southside Bank Shares third quarter 2024 earnings call. At this time, all participants are in a listen-only mode. After speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 111 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would like now to turn the conference over to your speaker today, Lindsay Bales, Vice President, Investor Relations. Please go ahead.

Thank you, Michelle. Good morning, everyone, and welcome to Southside Bank Shares' third 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, CEO, and Julie Schamburger, CFO. Firstly, we'll 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. This morning we reported third quarter net income of 20.5 million, earnings per share of 68 cents, a return on average tangible common equity of 13.69%, and continued strong asset quality metrics. Linked quarter, our net interest income increased $1.86 million, and our net interest margin increased eight basis points to 2.95%. During the quarter, we sold approximately $28 million of lower-yielding AFS municipal securities, unwound the related fair value swaps, and recorded a loss of $1.9 million. We reinvested the proceeds in higher-yielding agency mortgage-backed securities, The decrease in other non-interest income was primarily due to recording an impairment charge of $868,000 on the sale of approximately $10 million of AFS municipal securities and the unwind of the related fair value swaps on October 1. Recent investments made in our Wealth Management and Trust Department are paying dividends as reflected by the steady growth in new clients and quarterly fee income. We anticipate this trend will continue. Linked quarter loans decreased slightly as we experienced a few large payoffs at the end of the quarter. Our loan pipeline remains solid. However, headwinds of anticipated additional loan payoffs have caused us to reduce our target loan growth for 2024 from 5% to 3%. Our initiative to expand C&I lending in our metropolitan markets is progressing and as we are hiring additional relationship managers and we expect to begin seeing results in 2025. The markets we serve remain healthy and continue to grow and perform well. I look forward to answering your questions following Julie's remarks. I will now turn the call over to Julie.