National Bank Holdings Corp. (NYSE:NBHC) Q1 2019 Earnings Conference Call Transcript

Apr 24, 2019 • 11:00 am ET

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National Bank Holdings Corp. (NYSE:NBHC) Q1 2019 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Good morning, everyone, and welcome to the National Bank Holdings Corporation 2019 First Quarter Earnings Call. My name is Mariama, and I will be your conference operator for today. At this time, all participants are in a listen-only mode. We will conduct a question-and-answer session following the presentation. As a reminder, this conference is being recorded for replay purposes.

I would like to remind you that this conference call will contain forward-looking statements, including statements regarding the Company's loans and loan growth, deposits, strategic capital, potential income streams, gross margin taxes and non-interest expense. Actual results could differ materially from those discussed today. These forward-looking statements are subject to risks, uncertainties and other factors which are disclosed in more detail in the Company's most recent filings with the US Securities and Exchange Commission. These statements speak only as of the date of this call and National Bank Holdings Corporation undertakes no obligation to update or revise these statements.

It is now my pleasure to turn the call over and introduce National Bank Holdings Corporation's Chairman, President and CEO, Mr. Tim Laney.

Executive
G. Timothy Laney

Thanks, Mariama. Good morning, and thank you for joining National Bank Holdings' first quarter 2019 earnings call. I have with me our Chief Financial Officer, Aldis Birkans; and Rick Newfield, our Chief Risk Management Officer.

I'll begin by thanking my teammates for their continued focus on building full relationships with our clients. We genuinely believe in creating win-win solutions for our clients and our bank, and the results are positive. We're off to a solid start with record quarterly earnings of $0.60 per share. Our focus on providing fair and simple solutions while offering uniquely personal service fueled annualized loan growth of 16.3%.

Equally important, the loan growth continued to be very diverse and granular in nature. This has translated into solid credit metrics with annualized net-charge offs of just 2 basis points. With the growth of full client relationships, we realized spot transaction deposit growth during the quarter of 20.9%. Notably, we saw our non-interest-bearing demand deposit to total deposit mix actually improved during the quarter.

Now, if there was a negative for the quarter, it was the delayed closing of some of the previously acquired OREO. We actually absorbed the bulk of the related OREO expense during the first quarter, but now do not expect to realize those gains until the second or possibly the third quarter of this year.

So on that note, I'll turn the call over to Aldis to cover the quarter in more detail. Aldis?

Executive
Aldis Birkans

All right. Thank you, Tim, and good morning.

As Tim mentioned, we are very pleased with our record earnings of $18.9 million for the first quarter of 2019 and the record earnings per diluted share of $0.60. Our earnings results were driven by expanding net interest margin, strong loan and deposit growth, which resulted in a net -- in a solid net interest income increase along with low credit costs and continued focus on expense management.

After the first