Spirit of Texas Bancshares, Inc.

Greetings, and welcome to the Spirit of Texas Bank Shares second quarter earnings conference call. At this time, all participants are in a listen-only mode. A brief 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, Jerry Goleman. Chief Operating Officer. Thank you, sir. You may begin.

Thank you, Operator, and good morning, everyone. We appreciate you joining us for the Spirit of Texas Bank Shares conference call and webcast to review 2021 second quarter results. With me today is Mr. Dean Bass, Chairman and Chief Executive Officer, Mr. David McGuire, President and Chief Lending Officer, and Ms. Allison Johnson, Chief Financial Officer. Following my opening remarks, we will provide a high-level review and commentary on the financial details of the second quarter before opening the call for Q&A. I'd now like to cover a few housekeeping items. There will be a replay of today's call, and it will be available by webcast on our website at www.sotb.com. There will also be a telephonic replay available until July 29, 2021, and more information on how to access these replay features was included in yesterday's release. Please note that the information reported on this call speaks only as of today, July 22, 2021, and therefore you are advised that time-sensitive information may no longer be accurate as of the time of any replay listening or transcript reading. In addition, the comments made by management during the conference call may contain certain 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 company's annual report, Form 10-K, filed with the SEC for the year ended December 31, 2020, to understand certain of those risks, uncertainties, and contingencies. The comments today will also include certain non-GAAP financial measures. Additional details and reconciliations to the most directly comparable GAAP financial measures are included in yesterday's earnings release, which can be found on the Superior Texas website. Now I'd like to turn the call over to our chairman and CEO, Mr. Dean Bass. Dean?

Thank you, Jerry, and good morning, everyone. Welcome. During the second quarter, we celebrated our third anniversary as a publicly traded company. Over those three years, we have grown asset size by over 200%, maintained asset quality through challenging times, and increased shareholder value through core earnings, share repurchases, and quarterly dividends. This quarter's results represent another strong performance and an established history of profitability and operational excellence. For the second quarter, we earned net income of $12.4 million, representing fully diluted EPS of 70 cents and a return on average assets of 1.57% annualized. Credit quality continues to improve with non-performing assets declining $2.4 million, or 23.9%, during the quarter. Additionally, we have been able to maintain the net interest margin above 4%, consistent with our goals. While we are pleased to report another quarter of solid results, a large aspect of ensuring superior performance in the future is understanding the overall economic trends and positioning ourselves appropriately. With the national and Texas economies booming, we have now shifted our internal discussions from borrower health and credit quality to Federal Reserve policy and overall macroeconomic trends, which impact the yield curve and our ability to enhance profitability in the future. Texas, like other parts of the country, is experiencing staffing pressures, supply shortages, and other inflationary forces. While we have not experienced significant labor shortages within our network of bankers, we must understand the impact that these challenges are having on our borrowers and the overall capital markets. Overall, we have exceeded expectations this quarter as well as over the past three years since becoming a public company. We continue to live in truly unprecedented times, and many of the traditional models of community banking are being challenged. But we are confident that we are well positioned to increase core profitability and continue to increase shareholder value. Now I'll turn the call over to David to discuss the loan portfolio and asset quality. David.