Byline Bancorp, Inc.

Good day and welcome to the Byline Bancorp first quarter 2021 earnings conference call. All participants will be in a 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 stars and one. Please note that this event is being recorded. I would now like to turn the conference over to Tony Rossi of Financial Profiles. Please go ahead.

Thank you, Colt. Good morning, everyone, and thank you for joining us today for the Byline Bancorp first quarter 2021 earnings call. We'll be using a slide presentation as part of our discussion this morning. Please visit the events and presentations page of Byline's investor relations website for access to the presentation. Before we begin, I'd like to remind you that this conference call contains forward-looking statements with respect to the future performance and financial condition of Byline Bancorp that involve risks and uncertainties, including the impact of the COVID-19 pandemic. Various factors could cause actual results to be materially different from any future results expressed or implied by such forward-looking statements. These factors are discussed in the company's SEC filings, which are available on the company's website. The company disclaims any obligation to update any forward-looking statements made during the call. Management may refer to non-GAAP measures, which are intended to supplement but not substitute for the most directly comparable GAAP measures. The press release, available on the website, contains the financial and other quantitative information to be discussed today, as well as the reconciliation of the gap to non-gap measures. And with that, I'd like to turn the call over to Alberto Periccini, President of Byline Bancorp.

Great. Thank you, Tony, and good morning, everyone, and welcome to our first quarter earnings call. Thank you for participating in the call this morning, and joining me on this call are Roberto Herencia, our Executive Chairman and CEO, Lindsay Corby, our CFO, and Mark Fusinato, our Chief Credit Officer. As is our normal practice, I'll start the call with a summary of our results and provide you with highlights for the quarter before I turn the call over to Lindsay, who will walk you through our financials in more detail. After that, I'll come back with some closing remarks before we open the call up for questions. As always, you can follow our comments with presentation materials you can find on the investor relations section of our website. Overall, we had a very productive first quarter. Net income was a record $21.8 million or $0.56 per share. This was up substantially both compared to last quarter and on a year-over-year basis. Profitability and return metrics were excellent across the board. ROA came in at 134 basis points while ROTCE was 14.86%, both record levels for the company. Pre-tax pre-provision ROA came in at 206 basis points, and was up from the previous quarter and at the highest level over the last five quarters. One highlight for the quarter was our strong participation in round two of the PPP program, which is summarized on page four of the deck. We continue to support both existing small business customers as well as new customers drawn in by the positive experience of working with a relationship-oriented bank in the market. We have approved more than 2,400 loans, totaling $330 million during the current round. And when combined with the first round, we've processed over 6,600 loans, totaling $965 million. We also remain active in helping customers navigate the forgiveness process with 173 million in loans forgiven during the quarter. All in all, an excellent job by our bankers in supporting our small business customers and their employees. Economic activity continued to pick up this quarter, and our asset base increased by 5.6% to $6.8 billion. Outside of originations related to PPP, we had a good quarter of business development with $152 million of new originations with strong contributions coming from all areas of our commercial banking platform, inclusive of our leasing business. Loan balances, excluding PPP, increased during the quarter, which is notable given PPP activity, the high level of liquidity built up among our commercial clients, and the fact that the first quarter tends to be a seasonally slow period for us. On a year-over-year basis, new loan originations increased by 24%. Our government-guaranteed lending business also had a strong quarter of production with $112 million in closed loans, which was, as expected, lower than the fourth quarter but up $32 million over the same period a year ago. Premiums in the secondary market remain at record levels. On a year-over-year basis, our net gains on sales of loans increased 74% to $8.3 million. On the deposit side, we saw continued strong inflows of commercial deposits stemming from the addition of new relationships and the buildup of liquidity among existing commercial clients. Our deposit mix remains outstanding, with DDAs now representing 40.1% of total deposits and core balances exceeding 90% of deposit balances. The improved mix helped us to drive our cost of deposits lower by three basis points to 12 basis points at the end of the quarter, which allowed the margin to remain stable with deposit costs helping to offset the impact of increased liquidity and lower security fields. Asset quality improved with both NPLs and NPAs declining from the prior quarter. Reserve levels remain solid with the allowance representing 1.47% of loans and 1.71% of loans excluding PPP. Net charge-ups remain stable at 47 basis points and our coverage improved to 177% of non-performing loans. Classified loans also declined from 2.7% last quarter to 2.4% at the end of the quarter. Capital remained strong with CET at 12.1% and total capital of just under 16% at the end of the quarter. Combined with our strong financial performance, we were well positioned to return capital to shareholders during the quarter, where we repurchased approximately 333,000 shares of our common stock. Our balance sheet strength positions as well to support organic growth, return capital to shareholders, and pursue M&A opportunities. Turning over to slide five, total deferrals declined by $46.2 million to $54.4 million and now represent 1.42% of loans, excluding PPP. Deferrals in the government-guaranteed portfolio stood at $34.7 million, a decline of $40.8 million from the prior quarter. Nearly half of the deferrals outstanding consist of loans to borrowers in accommodation and food service industries. Please refer to the appendix for more detail of loans to COVID-affected industries. And with that, I'd like to turn over the call to Lindsay, who will walk you through our financials.