USCB Financial Holdings, Inc.

Good day and welcome to the USCB Financial Holdings, Inc. Quarter 2, 2026 Earnings Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on a touch-tone phone. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Luis de la Aguilera, President and CEO. Please go ahead.

Good morning, and thank you for joining us for the USCB Financial Holdings Second Quarter 2026 Earnings Call. I'm Luis de la Aguilera, Chairman, President, and CEO of USCB Financial Holdings. Joining me today are Rob Anderson, our Chief Financial Officer, and Sergio Garrido, our chief credit officer. Rob will walk you through our financial results in detail and Sergio will review credit quality. I'm very pleased to report another strong quarter, one that marks an important milestone for our company as we surpassed 3 billion in total assets, driven by record loan production, meaningful margin expansion, and continued pristine credit quality. For the quarter ended June 3rd, 2026, the company generated net income of 9.1 million were 49 cents per diluted share compared to 40 cents per diluted share in the second quarter of last year, a 22.5% increase year over year. Profitability metrics remain best in class with ROA of 1.26, ROAE of 15.9%, and an efficiency ratio that improved to 49.97%, below 50% for the first time and down from 52.34% in the first quarter. At a high level, total assets surpassed $3 billion, up 11% year over year. Loans grew to $2.3 billion, up 9.9% year over year, driven by record new loan fundings of $27.2 million, a 14.6% annualized increase over the prior quarter. Deposits reached $2.5 billion, up 5% year over year, with average DDA growing more than 32% annualized over the first quarter. Net interest margin expanded to 3.49, up from 3.27 for the first quarter, reflecting the earnings power of a growing loan book and the disciplined funding costs. Loan growth was broad-based across our C&I, commercial real estate, correspondent banking, and consumer lending portfolios. Second quarter loan production continued to be diversified along broad asset classes, with 42% of total loan production classified as commercial real estate and 58% as non-CRE. Our concerted focus on diversifying the loan portfolio is evident in the bank's loan composition trend, which shows a steady decline in commercial real estate concentration from 63% in 2020 to 57% by mid-2026. Importantly, this growth has not come at the expense of credit quality. Non-performing loans remain exceptionally low at 0.09% of total loans and net charge-offs were a nominal .05% for the quarter. Our deposit-focused business verticals, association banking, our private client group, and correspondent banking represent approximately 30% of total deposits, underscoring the strength and diversification of our funding franchise. As I step back and review Q2, I see a milestone quarter for USCB, the kind of quarter that validates the strategy we have been executing consistently since recapitalization. Crossing $3 billion in assets is more than a number. It reflects years of disciplined, relationship-driven growth and one of the most attractive banking markets in the country. South Florida continues to attract capital, talent, and business formation at a pace that most markets can only envy, and we are exceptionally well positioned to serve that ecosystem. From a financial performance standpoint, three themes of the quarter speak for themselves. We crossed the $3 billion. We delivered net interest margin approaching 3.5%, and we generated record loan production, all while maintaining pristine quality and an efficiency ratio below 50%. Our branch-light, relationship-intensive model, combined with our specialized deposit verticals, give us a funding advantage that is difficult to replicate. Our operating performance reflects our ongoing strategic decisions to invest in people, process, and products, leveraging technology to deliver best-in-class service as we continue to refine our delivery platforms. To this end, we operate an efficient branch light business model, which over the past years has been optimally repositioned from 18 branches to nine with the recently announced scheduled closure of Miami Lakes Branch later this year. Last quarter, we announced the launch of a new lending team headquartered in our main office. and focus on developing the three contiguous municipalities of Doral, Medley and Hialeah. Initially, the team commenced operating with a senior team leader, two business development officers and a commercially focused business lender. Two additional lenders are in the process of being hired in the third quarter. Similarly, in Q2, we launched a new deposit aggregating initiative focused on supporting 1031 exchange real estate transactions. In partnership with an experienced Florida-based qualified intermediary, U.S. Century will serve as a depository bank for these real estate transactions, helping clients plan when selling and reinvesting in real estate. This new value-added service is initially being marketed internally to transactional law firms, CPAs, and title companies, quickly generating $22 million in deposits since launch. We believe our differentiated relationship banking model combined with the attractive demographic and Economic Trends in South Florida position us well to continue growing both loans and core deposits while maintaining disciplined risk management. These are not isolated results. They are the products of consistent execution by a very talented team and one of the strongest markets in the country. The Miami-Dade Tri-County MSA remains exceptionally resilient because it continues to attract both people and capital at a pace few major U.S. markets can match. Florida's population reached approximately 23.7 million residents by mid-2026, grown by roughly 329,000 people annually, with virtually all growth coming from net migration rather than natural population increases. While some residents have migrated from Miami-Dade to more affordable areas within Florida, the county continues to benefit from substantial inflows of international residents, entrepreneurs, investors, and high-income households were drawn to its unique position as a financial and commercial gateway to Latin America. The economic strength of Miami-Dade is also reflected in its labor market, housing market, and ongoing development activity. Unemployment remains exceptionally low at 2.6%, signaling near full employment across the labor force. At the same time, the medium single-family home price remains between approximately 680,000 to 700,000, while the average home values exceeded 1.3 million, demonstrated significant household wealth and collateral strength. Residential investment remains robust as well. With approximately 36,300 multifamily units in the South Florida development pipeline, much of it concentrated in and around Miami's urban core, supporting construction employment, consumer spending, and long-term housing supply. Perhaps The most compelling from a banking perspective is Miami-Dade's emergence as one of the nation's fastest-growing corporate and financial centers. More than 74 major national and international companies relocated headquarters to Florida between 2020 and 2025, with South Florida capturing a significant share of that growth. With major firms relocating such as Citadel, JPMorgan, Amazon, Blackstone, and Microsoft Latin America, As a matter of fact, in late 2024, FIFA relocated its legal compliance division to the same building where U.S. Century has, or Coral Gables Banking Center. Similarly, FC Barcelona has relocated significant operations to Miami, and a growing number of technology, private equity, and financial services companies have expanded their Miami presence. Combined with Port Miami's throughput of more than a million containers annually, Miami-Dade continues to generate strong demand for commercial lending, Trade Finance, Treasury Management, Owner-Occupied Real Estate Financing, and Wealth Management Services. Taken together, low unemployment, substantial residential development, corporate relocations, population growth, and expanding international trade provide a powerful and sustainable foundation for both Miami-Dade economy and the banking industry it serves. With that overview, I'll now turn the call over to Rob to review the financial results in greater detail.

Thank you, Lou, and good morning, everyone. Looking at pages 6 and 7, you will see an excellent quarter for Team USCB, and notably, a quarter that will power earnings in the back half of 2026. First, total assets surpassed $3 billion. Average loans grew 15% annualized from the prior quarter. This was at the higher end of our stage of guidance, but it was powered by record new loan production. The strong loan growth drove an additional $1.3 million in provision expense, which weighed on current quarter earnings because the provision is recognized upfront, while the earnings benefit from the new loans will be more fully realized in Q3. Net interest income rose up to $24.4 million, up $2.3 million, or 42.6% annualized from the prior quarter. Net interest margin expanded 22 basis points to 3.49%. Credit remained pristine with a very small charge-off. Expenses remained controlled with the efficiency ratio just below 50%. Taxes are higher in the second quarter due to changes in our deferred tax inventory, including utilization of our current net operating loss. Year-to-date, the tax rate is 24%, and we project a 25% rate for the remainder of the year. And while we booked a return on average asset of 1.26%, the headline metric for this quarter is the pre-tax, pre-provision return on average assets of 1.93%. In fact, pre-tax, pre-provision income was just under $14 million, and that was up 47.9% annualized over the prior quarter. Return on average equity was 15.9%. Diluted earnings per share was 49 cents, up 22.5% over the prior year. Tangible book value per share increased to $12.64%, up 3.35% over the prior quarter. And with that overview, let's go to deposits on the next page. Average deposits for the quarter totaled approximately $2.5 billion, an increase of $61.9 million, or 10.2% annualized over the first quarter, and up $198 million, or 8.7% year over year. The real story this quarter was the quality of our funding mix. Average non-interest-bearing DDA increased $47.4 million, or 32.5% annualized, pushing average DDA above the $600 million threshold. This mixed shift was a key driver in bringing our total deposit cost down four basis points to 2.16%, a 30 basis point improvement year over year. On an end-of-period basis, deposits were modestly lower relative to the prior quarter. This was a deliberate strategic decision. We actively exited brokered CDs and other high-cost, non-relationship deposits from the balance sheet, replacing that funding with lower-cost FHLB advances. In a disciplined rate environment, we'd rather fund the balance sheet with wholesale advances at attractive rates than retain expensive deposits that don't carry the relationship depth and stability of our core franchise. This is exactly the kind of funding optimization we will continue to execute to maintain or improve profitability. Let's move on to the loan portfolio. On an average basis, loans increased $81.2 million quarter-over-quarter, 15% annualized, and grew $211 million, or 9.8%, year-over-year. Importantly, loan yield increased to 6.20%, up from 6.11% in the first quarter. Driven by full quarter impact of prior quarter originations and new loans added during the period, this is the earnings normalization we discussed last quarter beginning to materialize. Turning to new loan production, we had a record quarter, $272 million in new loan production, and consistent with prior patterns, the new loan closings were weighted to the back half of the quarter, with June accounting for $116 million, or 42.6% of total production. Correspondent banking loans represented $83 million, or 30.6% of quarterly closings, carrying a new loan yield of 5.22%. These are typically 180-day notes tied to SOFR. They add asset sensitivity and optionality and will be among the first assets to reprice higher in a rising rate environment. Excluding correspondent banking, the weighted average yield on the new loan production was 6.20%, which is consistent with the overall portfolio yield. While Q3 is typically a slow period in the market, the current pipeline is robust, and we will reiterate our guidance of high single-digit to low double-digit net loan growth for the back half of 2026. Turning to the margin, net interest margin expanded to 3.49%, up 22 basis points from the first quarter. Net interest income increased 2.3 million, or 42.6% annualized quarter over quarter, and 3.4 million or 15.9% year-over-year. The expansion was driven by a favorable shift toward higher-yielding earning assets, improving loan yields, and disciplined funding costs. As recently originated loans continue to season into earnings, we expect the margin trajectory to remain constructive. We are managing a balance sheet that is generating real earnings momentum. A NIM approaching 350 is a meaningful milestone for this franchise, and we believe underlying drivers support a continued constructive outlook. The ongoing rate volatility in the competitive deposit environment will be factors we continue to manage carefully. Looking forward, I would suggest a 340 to 350 NIM for near-term modeling. So with that, let me pass it over to Sergio to discuss asset quality.