SmartFinancial, Inc.

Hello all and welcome to the Smart Financial third quarter 2021 earnings call. My name is Lydia and I'll be your operator today. You'll have the opportunity to ask a question at the end of the presentation and you may do so by pressing star followed by one on your telephone keypad. It's my pleasure to now hand you over to our host, Miller Welbin, to begin. Please go ahead, Miller.

Thank you, Lydia. Good morning and thanks for joining us this morning for our Q3 2021 earnings call. We always love visiting with this group each quarter to talk about our progress and our company. Joining me today on the call are Billy Carroll, our president and CEO, Ron Gorczynski, our CFO, Rhett Jordan, our chief credit officer, and Nate Strall, our director of corporate strategy. Before we get started, I'd like each of you to please refer to page two of our deck that we filed this morning for the normal and customary disclaimers and forward-looking statements, comments. Please take a minute to review these. What a fantastic quarter by our team here at the bank. I challenge anyone to find a bank with more energy, drive, and commitment than our team here at SmartBank. We demonstrated, again, our ability to outwork the competition and execute our strategic plan. Our organic pace of growth has been impressive, and we see nothing slowing that down in the months ahead. Between very strong markets and the addition of several new sales team members that Billy will talk about shortly, We feel we're well positioned to continue on our current pace. As we march toward the end of 2021, we're excited about what we have accomplished this year to date. With that, I'm going to turn it over to Doug.

Thanks, Miller, and good morning, everyone. This was another extremely solid quarter for our company. This year has been a very busy one from this final round of PPP to an acquisition to the lift outs to several new expansion markets. 2021 has been a transformative year. I'll provide some high level thoughts on our recent accomplishments and then turn it over to Ron for financials and then Rhett for credit. First, we have some great highlights for our quarter, referring to page three of our slide deck, starting with earnings and tangible book value, a very nice income quarter with operating earnings coming in at 9.9 million or 63 cents per share. Tangible Book Value has increased to $19.03, a 7% quarter-over-quarter increase. Returns were solid as well, with 13% return on Tangible Common, and credit remains pristine with non-performance at 0.14% to assets. In addition to their financial performance, you'll see we've eclipsed the $4 billion in asset mark, continuing to add size in a relatively small peer set. Getting into this $4 to $6 billion range has been a focus where we now have the size and the earnings momentum to better leverage opportunities. We also had outstanding growth this quarter. Net organic loan growth, excluding PPP, was over $52 million, or approximately 9% annualized. Our lending teams continue to do a great job, and we're seeing growth balance throughout all of our markets. If we weren't surprised by anything, it continues to be the growth on the deposit side of the balance sheet. We've not been surprised that our bankers continue to do a great job in growing our core client base, but that volume coupled with the existing clients continuing to hold and grow their balances has us in an extremely large liquidity position. Deposit balances grew 29% annualized during the quarter, and we are currently in a cash position of approximately $1 billion. Ron will go into some greater detail on this, but it does have an impact on them and returns in the near term, but I really believe puts us in a position of strength strategically over the longer term. We completed our acquisition of Sevier County Bank in September and will be converting and rebranding this coming weekend. We also made the decision to sell the Richmond piece of this deal. This was simply a play to keep our focus in the southeast. With the expansion opportunities that were presented to us over the last couple of quarters to build density in our current zones, it made a lot of sense to spend this piece out. That now done, we're excited to get this one integrated. The process has gone very well. We are on target, if not ahead of target, with our 60 plus percent cost savings. Segueing into some of our recent opportunities, the next couple of slides highlight some of the things we've been working on over the last few months. Looking at the map on slide four, you'll visually see the recent expansions for our company. We've taken advantage of this unusual opportunity to bring on a number of outstanding bankers in some great southeastern markets. Building on the lift out of the banking team in our Gulf Coast region earlier in the year, we've now added teams in Montgomery, Dothan, and Auburn, Alabama, as well as Tallahassee, Florida during the last few months. While we've always had solid organic growth, this recent lift out focus represents a pivot for us and our company as we move more strongly to an organic model with a stronger focus on density building and zones where we operate. Flipping to slides five and six, you will see some detail on these new markets that we've entered as well as some of our other 2021 achievements. I've spoken previously about equipment finance acquisition and that team is performing well. We've also started to leverage our footprint to expand our prospecting efforts with that group We're very pleased so far with this new line of business and very bullish on the outlook. Also of note, we have a new dealer floor plan group through a lift out that will be based in Birmingham. I'm going to let Rhett speak to this a little more in a moment, but a nice niche lending area that will yield some great opportunities. These are all big investments for us, and while we know we'll have some modest EPS drag over the next few quarters, we feel this is the right investment to make for long-term shareholder value. So let me hand it over to Ron now to jump into financials.