SmartFinancial, Inc.

Hello everyone and welcome to the Smart Financial first quarter 2025 earnings release and conference call. My name is Ezra and I will be your coordinator today. If you would like to ask a question, please press star followed by one on your telephone keypad. If you change your mind, please press star followed by two. We will be taking questions at the end of the call. I will now hand over to Nathan Stroll, Director of Investors Relations to begin. Nathan, please go ahead.

Thank you, Ezra. Good morning, everyone, and thank you for joining us for Smart Financial's first quarter 2025 earnings conference call. During today's call, we will reference the slides and press release that are available in the investor relations section on our website, smartbank.com. Billy Carroll, our president and chief executive officer, will begin our call, followed by Ron Garzinski, our chief financial officer, who will provide some additional commentary. We will be available to answer your questions at the end of our call. Our comments include forward-looking statements. These statements are subject to risks and uncertainties, and the actual results could vary materially. We list the factors that might cause these results to differ materially in our press release and in our SEC filings, which are available on our website. We do not assume any obligation to update any forward-looking statements because of new information, early developments, or otherwise, except as may be required by law. During the call, we will reference non-GAAP financial measures related to the company's performance. You may see the reconciliation of these measures in the appendices of the earnings release and investor presentation filed on April 21, 2025 with the SEC. And now, I'll turn it over to Billy Carroll to open our call.

Thanks, Nate, and good morning, everyone. Great to be with you, and thank you for joining us today and for your interest in SMBK. I'll open our call today with some commentary and hand it over to Ron to walk through the numbers in some greater detail. After our prepared comments, we'll open it up with Ron, Nate, Rhett, Miller and myself available for Q&A. So let's jump right in. Another very nice quarter for us as we kick off 2025 and continue executing on what we've been messaging. The start of the year has been a bit more volatile than any of us would prefer. And while the uncertainty is making it a little more difficult to plan longer term, we're not letting that deter us from our objectives. As you'll hear on this call, this company is continuing to execute and we're remaining very bullish on where we're headed. For the quarter, we posted net income gap and operating of $11.3 million or 67 cents per diluted share. I continue to be very proud of the way our team is performing, and I'm excited to watch us gain operating leverage as we've anticipated. Jumping into the highlights, I'll be referring to the first few pages in our deck. First, and in my opinion, one of the most important metrics, we continue to increase the tangible book value of our company, moving up to $23.61 per share, including the impacts of AOCI, and $24.76, excluding that impact. That's over 9% annualized, quarter over quarter, excluding the AOCI movement. Looking at the graph on the lower right on page five, you'll see the value increase we continued to deliver for our shares. On balance sheet growth, we had a very solid start of the year. On the loan side, we grew at a 9% annualized pace for Q1, right on top of our expectations as our market teams are continuing to add outstanding new relationships. On the deposit side of the balance sheet, growth was also sound at 10% quarter over quarter annualized. While we did have some mixed shift, which is common for the first quarter of the year, I was pleased with the team's focus on bringing in new deposit clients. Ron will provide some more detail on that in a moment. Our history of strong credit continues with a metric at just 19 basis points and NPAs. Credit is always a focus for our company, and I'm proud to see these numbers continue at exceptionally low levels. Total revenue came in at $46.8 million as net interest income continued to expand as we had anticipated. We also had another very nice non-interest income quarter. Non-interest expenses held to the same level as last quarter at just over $32 million. I feel we continue to hold expense growth to very reasonable levels during 2025. That operating leverage we've talked about is happening. as we continue to grow the revenue line with manageable investment on the expense end. Looking at the charts on pages four and five, you'll see very nice trends. All of those charts are great graphics to illustrate what we've been messaging, and I look forward and are expecting to see those trends continue. So just a couple of additional high-level comments from me on growth. We have executed well over the last several quarters, and it is a direct result of the outstanding work of our sales teams. In regard to loans, a nice start to the year, particularly after posting outsized growth in Q4. As I stated, we grew our loan book at 9% annualized quarter over quarter. The sales momentum in our company is very good, and it's balanced across all regions. Our average portfolio yield, including fees and accretion, was 5.97%, down just slightly from Q4, but still very solid after absorbing the fourth quarter Fed rate cuts. and new loan production continues to come onto the books, accretive to our total portfolio yield levels. In regard to deposits, I mentioned it a moment ago, I'm very pleased with the deposit growth we've seen, particularly during a quarter where we normally see some seasonality. Our loan to deposit ratios held from year end at 83%, which is a nice spot for us, and this strong position gives us continued flexibility to leverage that strong deposit base. Our balance sheet pipelines continue to feel solid. I'm holding to our past guidance of mid to high single digits on growth as we look forward. And I also think we can pace deposits organically to fund this growth. So all in all, a very nice way to start the year. I'm going to stop there. I'm going to hand it over to Ron and let him dive into some additional details. Ron?