United Financial Bancorp, Inc. (NASDAQ:UBNK) Q1 2019 Earnings Conference Call Transcript

Apr 17, 2019 • 10:00 am ET


United Financial Bancorp, Inc. (NASDAQ:UBNK) Q1 2019 Earnings Conference Call Transcript


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Good day and welcome to the United Financial Bancorp Incorporated's First Quarter 2019 Earnings Call. All participants will be in listen-only mode. (Operator instructions). After today's presentation there will an opportunity to ask questions. (Operator instructions). Please note, this event is being recorded.

I'd now like to turn the conference over to Marliese Shaw. Please go ahead.

Marliese L. Shaw

Thank you, Shawn, and good morning, everyone. Welcome to our first quarter conference call. Before we begin, we would like to remind you to read our Safe Harbor advisement and forward-looking statements on our earnings announcement. Forward-looking statements by their nature are subject to risks and uncertainties. Certain factors could cause actual results to differ materially from our expected results. Our comments today are intended to qualify for the Safe Harbor afforded by that advisement.

And now, I would like to introduce Bill Crawford, our Chief Executive Officer and President.

William H. W. Crawford

Thank you, Marliese, and thanks to all of you for joining us on today's call. Today, I'll make a few high-level comments and then turn the call over to our CFO, Eric Newell. Clearly this was a tough quarter for United Financial Bancorp. Funding pressure and an accounting change impacted the net interest margin and earnings, despite strong loan growth.

By now you've seen our updated disclosures on D.C. Solar. The fraud alleged by the US Department of Justice against the D.C. Solar companies and several of their affiliates appears to have been perpetrated against other financial institutions that were investors as well.

Eric will get into more detail regarding the D.C. Solar situation, but I want to emphasize that our institution remains well capitalized with strong credit quality, liquidity and strong interest rate risk management. The current yield curve in repricing deposits is certainly creating a difficult operating environment for many banks.

United will remain focused on its four key objectives, while expanding customer relationships and building new ones. We have a very talented team of bankers focused on supporting our customers and communities. I want to take this opportunity to thank our United Bank employees for their steadfast focus on serving both of those constituencies.

I'll now turn the call over to Eric Newell, our CFO.

Eric R. Newell

Thanks, Bill, and good morning. Yesterday, the company reported earnings for the first quarter of 2019 of $0.25 per diluted share, which compares to the linked quarter earnings of $0.24 per diluted share and $0.31 per diluted share reported in the comparable quarter of 2018. I'll discuss some of the highlights of the quarter in a moment.

First, I'd like to discuss our subsequent disclosure and further information as it pertains to three investments the company has made into limited liability funds, all of which are borrowers of and lessees to two related companies D.C Solar Solutions and D.C Solar Distribution respectively.

The two D.C Solar companies and several of their affiliates filed for Chapter 11 bankruptcy in late January and early February 2019, following allegations of fraud by the US Department of Justice. On learning