Banner Corporation (NASDAQ:BANR) Q1 2018 Earnings Conference Call - Final Transcript

Apr 24, 2018 • 11:00 am ET

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Banner Corporation (NASDAQ:BANR) Q1 2018 Earnings Conference Call - Final Transcript

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Q & A
Executive
Peter Conner

That number has the biggest single component of where the margin is going to go over the second half of the year. So I characterize our first quarter as very strong, but not representative of our run rates going into the second quarter. I'd be delighted if we could hold that number in the second quarter, but the reality is structurally, it's going to have some compression in it going into Q2.

Analyst
Matthew Clark

Okay. And then just on the increase in multifamily loans held for sale, do you plan on selling down those balances here in the second quarter and at what kind of margin do think you might take a gain on?

Executive
Peter Conner

Yes. As we've talked previously, multifamily, our operation is one of origination and sale on a bulk basis. And the typical origination-to-sales cycle is 90 to 120 days. Most of our multifamily production in the first quarter happened in February and March, and so they had not seasoned to that 90- to 120-day point just yet. And so we do anticipate sales in the second quarter to bring that held-for-sale balance down, but that's just typical -- somewhat lumpy multifamily business for us. But there's nothing unusual about seeing that balance creep up over the quarter and the way it did.

Analyst
Matthew Clark

And your 1% margin reasonable assumption in terms of gain on sale?

Executive
Peter Conner

In the multi -- yes, it's, I would characterize that 1% net of all the fees would be a reasonable assumption.

Analyst
Matthew Clark

Okay. Thanks again Lloyd. Hope you enjoy some quality time with the family.

Executive
Lloyd Baker

Thank you, Matt.

Executive
Mark J. Grescovich

Thank you, Matthew.

Operator
Operator

This concludes our question-and-answer session. I would like to turn the conference back over to Mark Grescovich for any closing remarks.

Executive
Mark J. Grescovich

Thank you, Rochelle. As I stated and the executive team here stated, we're pleased with our solid performance in the first quarter of 2018 and see it as evidence that we're making substantial and sustainable progress on our disciplined, strategic plan to build shareholder value by executing on our super community bank model by growing market share, strengthening our deposit franchise, improving our core operating performance, maintaining a moderate risk profile and prudently deploying excess capital. I would like to thank all of my colleagues, especially Mr. Baker here for driving this solid performance for our company over the years. Thank you for your interest in Banner and for joining our call today. We look forward to reporting our results to you, again, in the future. Have a great day, everyone.

Operator
Operator

[Operator Closing Remarks]