Ameris Bancorp

Good morning and welcome to the Ameris Bancorp third quarter 2020 financial results 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 a question. To ask a question, you may press star then one on your touchtone 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 Nicole Stokes, Chief Financial Officer. Please go ahead.

Great. Thank you, Eileen. And thank you to all who have joined our call today. During the call, we will be referencing the press release and the financial highlights that are available on the investor relations section of our website at amerisbank.com. I'm joined today by Palmer Proctor, our CEO, and John Edwards, our Chief Credit Officer. Palmer will begin with some opening general comments and then I'll discuss the details of our financial results before we open it up for Q&A. Before we begin, I'll remind you that our comments may include forward-looking statements. These statements are subject to risks and uncertainty, and the actual results could vary materially. We list some of the factors that may cause results to differ in our press release and in our SEC filings, which are available on our website. We do not assume any obligation to update any forward-looking statements as a result of new information, early developments, or otherwise, except as required by law. Also during the call, we will discuss certain non-GAAP financial measures in reference to the company's performance. You can see our reconciliation of these measures and GAAP financial measures in the appendix to our presentation. And with that, I'll turn it over to Palmer for opening comments.

Thank you, Nicole, and thank you to everybody who's joined our call today. We've got some exciting news to talk about this morning. You know, I closed last quarter's call with our new marketing campaign of Back to Business Together, and I think the third quarter results speak for themselves and reflect that commitment. Nicole's going to update you a little bit later on some more detailed financial results in a minute, but before we get there, I did want to share some highlights from the quarter as well as a few other successes we've recently had which positively impact our outlook as we go forward. For the quarter, we earned $116.9 million, or $1.69 for diluted share on an adjusted basis, which is up over 70% compared to the third quarter last year. This represents a 235 return on average assets and a 30.53% return on tangible equity. Our efficiency ratio improved under 50%, which is the first time in our history, down to 47.34% on an adjusted basis. For the year-to-date period, we earned $198.5 million, or $2.86 per diluted share on an adjusted basis, which is consistent with the $2.85 reported for the same period last year. The big difference being this year, we've also provided over $130 million more to the loan loss reserve than we did last year. And that's important to note. The 2020 results represented a year-to-date ROA of 139, and a year-to-date return on average tangible equity of 17.84%. We're pleased with the organic growth and that's both on the loan and the deposit side. Loans grew over 330 million or 12.2% annualized during the third quarter and that leaves our year-to-date annualized loan growth at 22.1% and that's including PPP loans and 11% excluding the PPP loans. We do have anticipated seasonal loan runoff in the fourth quarter. and that'll bring our loan growth closer to our original estimates of mid-single digits for the full year of 2020. On the deposit side, we continue to see a lot of success there in growing non-interest-bearing deposits, which is where our focus remains, and now we have accounts that non-interest-bearing accounts equate to over 36% of total deposits. As for capital, we've said for several quarters that we're focused on capital preservation, growth in TCE and growth in tangible book value, During the third quarter, we grew both TCE and tangible book value by over 7%, which is very meaningful. As you know, this quarter we successfully issued $110 million of sub-debt at a low rate of 3.78%, and this will positively impact our total risk-based capital ratios by approximately 60 basis points. While we remain focused on capital preservation, we announced in our release this morning that our board did approve extending our share repurchase program through October 31st of next year. While we don't anticipate executing on this during the remainder of 2020, we do like having the option to repurchase our shares if the right opportunity presents itself. As for our dividend, we remain comfortable with where our dividend is today and do not anticipate any change at this time. Moving on to credit, John Edwards, our Chief Credit Officer, is with us today and he's available to take any questions after our prepared remarks, but I did want to hit a few highlights in terms of credit. We do believe that the heavy lifting of the reserve is complete now barring any further economic downturn and additional provision expense would solely be related to deterioration specific credits. This brings our allowance coverage ratio including the unfunded commitments to 1.48% net of PPP loans. Our annualized net charge off ratio was 10 basis points of total loans and that compares to 27 basis points last quarter. Our MPAs as a percent of total assets increased to 83 basis points compared to 59 basis points last quarter, mostly due to the increased non-accrual loans in the residential real estate and commercial real estate loan categories. And finally, the loans that remain on deferral at the end of the third quarter of 2020 were approximately 4.3% of total loans, which is down approximately 19% of total loans at the end of the second quarter of 2020. Outside of our strong financial results, we've had a lot of other success around our company. We announced several key commercial treasury hires in new and existing markets. In addition to that, we announced our new diversity inclusion officer. We're excited to be able to identify talent within the organization that promoted from within for this key leadership position. As for COVID, all I can say is we are definitely fortunate to have such a strong presence in the Southeast. We opened about half our retail lobbies and the branches this third quarter with minimal disruption. Our operations support staff is also beginning to return to work safely on a rotational basis and our customers, like many others, have learned to embrace the digital channels and mobile banking and we continue to have several initiatives there underway just to make that a better experience all the way around for our customers on a remote digital perspective. Branch optimization, we touched on this last time. That is really what's allowed us to reallocate resources to pay for a lot of the innovation and the new hires that I mentioned earlier. We closed eight branches on October 1st. We have one additional branch closure in process. That'll bring our total branch count down to 161 from the pre-fidelity acquisition pro forma of 199 branches. So these initiatives, like many others, have been well executed. It's been very thoughtful, but yet expeditious, and we continue with our cost-save initiatives there. I'll stop now and turn it over to Nicole to discuss our financial results.