Bank of N.T. Butterfield & Son Limited (The)

Good morning. My name is Andrew and I will be your conference operator today. At this time, I would like to welcome everyone to the second quarter 2022 earnings call for the Bank of N.T. Butterfield and Sun Limited. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing star then zero on your telephone keypad. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. 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 Noah Fields, Butterfield's Head of Investor Relations.

Thank you. Good morning, everyone, and thank you for joining us. Today, we will be reviewing Butterfield's second quarter 2022 financial results. On the call, I'm joined by Michael Collins, Butterfield's Chairman and Chief Executive Officer, Craig Bridgewater, Group Chief Financial Officer, and Michael Scrum, President and Group Chief Risk Officer. Following their prepared remarks, we will open the call up for a question and answer session. Yesterday afternoon, we issued a press release announcing our second quarter results. The press release and financial statements, along with a slide presentation that we will refer to during our remarks on this call, are available on the investor relations section of our website at www.butterfieldgroup.com. Before I turn the call over to Michael Collins, I would like to remind everyone that today's discussions will refer to certain non-GAAP measures which we believe are important in evaluating the company's performance. For reconciliation of these measures to US GAAP, please refer to the earnings press release and slide presentation. Today's call and associated materials may also contain certain forward-looking statements, which are subject to risks, uncertainties, and other factors that may cause actual results to differ materially from those contemplated by these statements. Additional information regarding these risks can be found in our SEC filings. I will now turn the call over to Michael Collins.

Thank you, Noah, and thanks to everyone joining the call today. I am very pleased with the bank's financial and operational achievements during the second quarter of 2022. We have continued to benefit from rising interest rates, disciplined expense management, and increased non-interest earnings. This resulted in strong net income and earnings per share growth, as well as a very strong quarterly return on tangible common equity. Waterfield continues to be a leading provider of offshore banking and private trust products and services. with operations in highly regarded jurisdictions. Our banking business benefits from franchise-level market shares of between 30% and 40% in Bermuda and the Cayman Islands, with a growing presence in the Channel Islands. In the Bahamas, Switzerland, and Singapore, we provide specialized financial services offerings in addition to our prime central London mortgage products available to high net worth borrowers. I will turn now to slide four, where we provide a summary of second quarter highlights. Butterfield reported net income for the second quarter of $49.1 million, or 99 cents per diluted common share, and core net income of $50.2 million, or $1.01 per diluted share. Our core return on average tangible common equity was a record 27.8% in the quarter, compared to 21.9% in the prior quarter. Our net interest margin improved 23 basis points to 2.26%, with the cost of deposits rising 4 basis points to 16 basis points. The Board of Directors again declared a quarterly cash dividend of 44 cents per share. Share repurchases were paused in the quarter due to increasing OCI marks, which has continued to keep the TCE to TA ratio around 5%. We view share repurchases as an important part of capital management, and will recommend share buybacks when appropriate. I will now turn the call over to Craig Bridgewater to provide more details on the second quarter results.