Home BancShares, Inc.

Greetings, ladies and gentlemen. Welcome to the Home Bank Shares Incorporated first quarter 2026 earnings call. The purpose of this call is to discuss the information and data provided in the earnings release issued after the market closed yesterday. The company presenters will begin with prepared remarks, then entertain questions. Please note that if you would like to ask a question during the question and answer session, please press star then one on your touchtone phone. If you decide you want to withdraw your question, please press star then two to remove yourself from the list. The company has asked me to remind everyone to refer to their cautionary notes regarding the forward-looking statements. You will find this note on page three of their Form 10-K filed with the SEC in February 2026. At this time, all participants are in listen-only mode, and this conference is being recorded. If you need operator assistance during the conference, please press star then zero. It is now my pleasure to turn the call over to Donna Townsall,

director of investor relations thank you good afternoon and welcome to our first quarter conference call with me for today's discussion is our chairman john allison stephen tipton chief executive officer of centennial banks kevin hester president and chief lending officer brian davis our chief financial officer chris fulton president of ccfg and Scott Walter of Shore Premier Finance. Our first quarter sets a strong tone for 2026. Results demonstrate sound expense control, consistent operating performance, and attractive returns, including record-setting metrics of book value per share of $22.15, tangible book value per share of $14.87, which is $1.72 per share increase year over year, for a 13% increase, by the way, CET1 at 16.7%, leverage of 14.3%, and Tier 1 capital of 16.7%. In today's economic environment, that is a meaningful accomplishment, and our team is pleased to walk through the quarter's results with you. Our opening remarks today will be from our chairman, John Allison.

Thank you and welcome to Home Bank Shares first quarter 26 earning report to shareholders. Thank you for joining us today. I think the headline and the quotes pretty much summarize the first quarter. I want to thank our team for getting us off to a great start in 26. For those of you who are not already Home Bank Shareholders but are interested in a better understanding of home, I think it's important that you look at the strength of the balance sheet. Couple that with the monthly and quarterly consistent level of performance over the last several years, primarily showcased by the last five quarters. The prior years reminded us of the highest interest rate cycle in the early 80s, where then almost all banks struggled because of poor balance sheet management. And the same story has been even more visible today, i.e. lack of liquidity. by investing into long-term securities, trying to stretch for yield. And private society home didn't suffer those problems during that time and was reporting record earnings while others were struggling. S&P Global just ranked home's performance for 2025 as number two of all banks in the US over $10 billion. We're honored by this elite ranking by one of the world's best and most respected experts. We were barely edged out for the number one position last year. Maybe we'll get it this year. We're happy to have completed the merger with our acquisition of Mountain Commerce and look forward to a successful combination. Due to the back office computer upgrade that was already in progress before Mountain Commerce, we will not be able to start converting Mountain Commerce until November. As a result, the maximum anticipated savings will not be realized until probably the end of 26. Once accomplished, we believe our new partners can soon begin helping us to continue the outstanding performance of Home Bank shares that is known in the U.S. and worldwide. Home is proud of our reputation, always known as one of the strongest, safest, most conservative, and best performing banks in the world. We'll continue to try to make our shareholders proud and happy to be part of this outstanding company. We know who we work for, and that is our shareholders. If you loan money, we all know problems can and will arise from time to time that has to be worked through. We had a $110 million Texas credit that we decided to non-perform this quarter. This is the same credit we've been talking about for a year and a half or two years. The credit remained current until this quarter. It has been one we've been monitoring intensely for about eight months. We've entered into a short term for barracks agreement with multiple deadlines and requirements. We are advised by legal counsel not to discuss in that. I can say we're either going to get paid off or we'll liquidate the existing collateral. We do not anticipate any additional loss, but if things were to result in some loss, home strength puts us in a position to deal with whatever comes. Because of the conservative balance sheet, we're trying right at $300 million in loan loss reserves, one of the highest reserve percentages in the world. Couple that with a couple of the strong reserves with a consistent quarterly pre-tax, pre-provision net revenue of $150 to $160 million, and we're confident of our ability with whatever happens and do not expect this loan to have any major impact on earnings, if any at all. It is our belief that there is more sufficient assets and personal guarantees to properly resolve this issue. I'm pleased with the results comparing Q1 to Q1 last year. The first quarter only had 90 days, and if we'd had the two extra days in the normal quarter, plus just a little touch of wind. I think I said last year we had the wind there back two or three times. We had no wind this time. This quarter we got zero wind, Brian. You always come up with wind. You didn't come up with any juice this time.