Provident Financial Services, Inc

Again, press the star one. Thank you. Adriano Duarte, Investor Relations Officer, you may begin your conference.

Thank you, Rob. Good morning, everyone, and thank you for joining us for our third quarter earnings call. Today's presenters are President and CEO Tony Labazzetta and Senior Executive Vice President and Chief Financial Officer Tom Lyons. Before beginning the review of our financial results, we ask that you please take note of our standard caution as to any forward-looking statements that may be made during the course of today's call. Our full disclaimer is contained in last night's earnings release, which has been posted to the investor relations page on our website, providence.bank. Now, it's my pleasure to introduce Tony LaBazzetta, who will offer his perspective on our third quarter. Tony?

Thank you, Adriano. Good morning, everyone, and welcome to the Providence Financial Services earnings call. The third quarter was marked by rising interest rates and persistent inflationary pressures. These conditions have presented substantial challenges to many in the banking sector. Against that backdrop, I'm pleased to report that Provident has demonstrated its resilience and agility, delivering results that point towards the underlying strength of our operation and our commitment to responsible growth. Despite the difficult economic environment, Provident produced good financial results this quarter. which once again demonstrates the strength of the franchise and talented management team. As such, we've reported earnings of $0.38 per share, an annualized return on average assets of 0.81%, and a return on average tangible equity of 9.47%. Excluding merger-related charges, our core pre-tax, pre-provision return on average assets was 1.48%. At quarter end, our capital was strong. and exceeded well-capitalized levels. Tangible book value per share was $15.41, and our common tangible, tangible common equity ratio was solid at 8.54%. As such, our board of directors approved a quarterly cash dividend of 24 cents per share, payable on November 24th. Presently, our uninsured and uncollateralized deposits are 2.5 billion. or approximately 25% of our total deposits. Our unbalanced sheet liquidity plus borrowing capacity is 3.6 billion or 144% of uninsured deposits. Our core deposits are a valuable component of our franchise. During the quarter, our average core deposits decreased 85 million or 0.9%, which we attribute to normal business activities and customers seeking higher yielding investment alternatives in this environment. Our rising rate cycle-to-date deposit data was approximately 29.5%, which we believe is among the best in the peer group and is reflective of the quality of our deposit base. Consequently, our total cost of deposits increased and in large part drove our total cost of funds of 33 basis points to 2.04%. compressing our net interest margin 15 basis points to 2.96%. Our commercial lending team closed approximately 330 million of new commercial loans during the third quarter. Payoffs decreased 16% to about 94 million as compared to the trailing quarter. Our credit metrics continue to be excellent in the third quarter, and we are maintaining prudent underwriting standards, particularly in Cree lending. As part of our normal pre-monitoring processes, we have performed targeted in-depth analysis to evaluate portfolio segments, concentrations, and loan level risk. These enhanced evaluations of our portfolio have not indicated any meaningful deterioration despite difficulties in the wider market. Our line of credit utilization percentage decreased 1.9% in the third quarter to 33%, remaining below our historical average of approximately 40%. As a result of the improved production and reduced prepayments offset by a decreased line of credit utilization, our commercial loans grew approximately 134 million or 1.48% for the quarter. For the nine months, we grew 296 million or 4.9%, which is pacing at an annualized growth rate of about 6.5%. The pull through in our commercial loan pipeline during the third quarter was good. and the gross pipeline remains strong at approximately $1.7 billion. The pull-through adjusted pipeline, including loans pending closing, is approximately $1.1 billion, and our projected pipeline rate increased 39 basis points to 7.62%. We are encouraged by the strength and quality of our pipeline. In addition, payoffs have slowed, and as a result, we expect to achieve our commercial lending growth targets for the remainder of 2023. Our fee-based business has performed well. Despite a hardening insurance market, Provident Protection Plus had a strong third quarter with 63% organic growth, which resulted in an 11.9% increase in revenue and a 12.3% increase in operating profit as compared to the same quarter last year. Beacon Trust performed in line with expectations as conditions in the financial markets continue to remain volatile. The income remains stable despite the reduction in assets under management, which was due in part to market conditions. Beacon's investment performance compares favorably to the applicable benchmarks. With respect to our previously announced merger with Lakeland Bancorp, we are continuing our engagement with the regulators and have complied with all information requested, and now we await final approval of the merger. The companies have made significant progress in various integration initiatives through outstanding team works from both banks. While regulatory approval is not within our control, preparations for our merger with Lakeland continues to progress as both companies eagerly await approval. As we look forward, we remain focused on growing and strengthening the fundamentals of our business. However, being disciplined and remaining committed to our responsible risk management principles is critical during these challenging times. While we await for regulatory approval, we expect to close and integrate the merger with Lakeland Bank in the near future, which we believe will create value for all of our stakeholders. Now I'll turn the call over to Tom for his comments on our financial performance. Tom?