National Bank Holdings Corp. (NYSE:NBHC) Q1 2018 Earnings Conference Call - Final Transcript

Apr 27, 2018 • 11:00 am ET

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National Bank Holdings Corp. (NYSE:NBHC) Q1 2018 Earnings Conference Call - Final Transcript

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Q & A
Operator
Operator

[Operator Instructions]. Our first question comes from the line of Jeff Rulis from D.A. Davidson. Your line is open.

Executive
Tim Laney

Hi Jeff.

Analyst
Jeff Rulis

Thanks, good morning.

Executive
Tim Laney

Good morning.

Analyst
Jeff Rulis

Just a question on a cost saves that you've achieved so far with the conversion. I don't know if you've got a percent that you've acquired? Or those are approaching all-in cost saves, just kind of a check in on that number?

Executive
Tim Laney

What we had done, announce was approximately about $6 million pretax on the cost saves out of the bank and we've achieved that and fully expect to actually do better than that.

Analyst
Jeff Rulis

Okay, so complete, if not, over what you had targeted?

Executive
Tim Laney

That's right. Right. And Jeff, just to be clear, it's not all in the first quarter as we carried some other staff for the chunk of the quarter and converted during quarters. So that's our projection on a full year run-rate basis.

Analyst
Jeff Rulis

Okay, so -- right. You're still on track for it but you've -- as of 3/31, you hadn't -- it wasn't in the kind of the full run rate as well?

Executive
Tim Laney

Not fully realized, that's right.

Analyst
Jeff Rulis

Okay, and then on the credit side, it looks like about a net $4 million increase in nonperformers sequentially. Could any color on the added loans and were those brought on for Peoples?

Executive
Rick Newfield

Sure, Jeff, this is Rick. That's absolutely right. Approximately $7 million of nonperforming assets from Peoples, very granular and well handled. Net of that we actually reduced nonperformers, $3 million.

Executive
Tim Laney

And by the way, Jeff, no surprises. The team had a complete understanding of where there were concerns prior to the acquisition down during our due diligence. And Rick is at fair to say, the team feels good about managing their way through those loans.

Executive
Rick Newfield

Absolutely.

Analyst
Jeff Rulis

Great. And then maybe one last one, if I could. Just to -- I may have missed Brian's comment on the gains from OREO that the balance of the year you're expecting that to be sort of a neutral event, or incrementally positive as it had been prior to this quarter?

Executive
Rick Newfield

Well, we -- certainly we're within the whole $900,000 as I mentioned and we guide to realizing flat for the year. But it wouldn't be a surprise if its better.

Executive
Brian Lilly

I would say this. As we've always said, it's lumpy and if the team wants to realize their full performance pay potential, there will be a gain there.

Executive
Rick Newfield

And maybe just to clarify, just one point. There will be OREO gains. What Brian saying is, they will at least offset the problem loan and OREO expenses. But to Tim's point, we hold that team accountable for effectively being a profit center.

Analyst
Jeff Rulis

Yeah, I understand the cost versus the gains and that's clear. So thank you very much.

Executive
Tim Laney

Yeah. You bet, Jeff.

Operator
Operator

Our next question comes from the line of Chris McGratty from KBW. Your line is open.

Executive
Tim Laney

Hi good morning Chris.

Analyst
Chris McGratty

Hi good morning. Hi to all. Brian, just want to catch on