F.N.B. Corporation

Good morning, and welcome to the FMB Corporation's second quarter 2021 earnings call. All participants will be in listen-only mode. Should you need assistance, please click the World Conference special and start 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 your touch-tone phone. To withdraw your question, please press star, then two. Please note, today's event is being recorded. I would now like to turn the conference over to Lisa Constantine, Investor Relations. Ms. Constantine, please go ahead.

Thank you. Good morning, everyone, and welcome to our earnings call. This conference call of SMB Corporation and the report it files with the Securities and Exchange Commission often contain forward-looking statements and non-GAAP financial measures. Non-GAAP financial measures should be viewed in addition to and not as an alternative for a reported result prepared in accordance with GAAP. Reconciliations of GAAP to non-GAAP operating measures to the most directly comparable GAAP financial measures are included in our presentation material and in our earnings release. Please refer to these non-GAAP and forward-looking statement disclosures contained in our related materials, reports, and registration statements filed with the Securities and Exchange Commission and available on our corporate website. A replay of this call will be available until July 27th and the webcast link will be posted to the About Us Investor Relations and Shareholder Services section of our corporate website. I will now turn the call over to Vince DeLee, Chairman, President, and CEO.

Thank you, and welcome to our earnings call. Joining me today are Vince Calabrese, our Chief Financial Officer, and Gary Guerreri, our Chief Credit Officer. First, I will provide a short review of the second quarter financial results. Then I'll cover recent performance trends of our key business lines before turning the call over to Gary and Vince for their remarks. Lastly, I'll wrap up the call by discussing the key consideration of last week's merger announcement with Howard Bancorp Bank. FMB second quarter earnings per share totaled 31 cents, representing an 11% increase on a linked quarter basis. Operating net income reached a record $101 million, and total revenue increased to $308 million. Our performance resulted in a return on tangible common equity of 16%, and growth in tangible book value per share to $8.20, an increase of 19 cents or 2%. The quarter's efficiency ratio of 56.8% improved due to the benefit of increased revenue and continued expense discipline as we achieved the 2021 operating cost savings goal of $20 million. Our company remains well capitalized, with an estimated CEP1 ratio of 10.02%, for the second quarter. Second quarter revenue was supported by record wealth management revenues and strong contributions across a number of segments, including insurance, mortgage banking, capital markets, and SBA lending. Many of these areas have continued to benefit from our expansion into higher growth markets. On a year-to-date basis, wealth management revenues increased over 6 million, as total wealth management and insurance revenues increased 26% and 8% respectively. Looking at the balance sheet on an annualized linked quarter basis, F&B demonstrated strong fundamental performance as we saw a pickup in lending activity that translated into significant spot loan growth of 9% when excluding the impact of PPP loans. On a spot basis, total deposits were flat with seasonal outflows and a decline in time deposit balance. Non-interest-bearing deposits grew to $10.2 billion on June 30th and now comprise a third of total deposits. This brings our loan-to-deposit ratio to 82.4%, providing F&B with ample liquidity and a favorable funding mix moving forward. Diving deeper into the wholesale bank's performance this quarter, we are encouraged that the commercial loan activity has begun to pick up across the footprint. and pipelines are healthy entering the second half of the year. We have significant opportunities within the commercial pipelines in the Carolinas, Pittsburgh, and Mid-Atlantic markets, which reached the highest level in the last two years. Additionally, strength in the total near-term pipeline give us optimism for a strong second half for commercial loan origination. Consistent with our comments on the April call, Activity levels around commercial pipelines, as well as consumer, are encouraging given our goal to reach mid-single-digit loan growth on a spot basis by the end of the year. However, I'll note that commercial line utilization rates remain well below historical levels. We are optimistic that the utilization rates could move higher in the second half of this year as remaining PPP loans are processed through the forgiveness period and the U.S. economy begins to accelerate as the supply chain for many industries improves. As we discussed on the prior call, our mortgage banking business continues to see near-record production volumes. However, gain-on-sale margins contracted across the industry during the quarter reflecting the current market conditions. In addition to mortgage banking, the overall consumer pipelines have grown significantly since the beginning of the year. We've begun to experience lending growth across the consumer product set. As economic activity has begun to pick up, we are experiencing increased loan demand in commercial and consumer banking and favorable credit trends. With that, I'll turn the call over to Gary so he can provide additional detail on asset quality. Gary?