First Foundation Inc (NASDAQ:FFWM) Q2 2019 Earnings Conference Call Transcript

Jul 24, 2019 • 11:00 am ET

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First Foundation Inc (NASDAQ:FFWM) Q2 2019 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Greetings and welcome to First Foundation's Second Quarter 2019 Earnings Conference Call. Today's call is being recorded. [Operator Instructions]

Speaking today will be Scott Kavanaugh, First Foundation's Chief Executive Officer; John Michel, Chief Financial Officer; David DePillo, President; and John Hakopian, President of First Foundation Advisors.

Before I hand the call over to Scott, please note that management will make certain predictive statements during today's call that reflect their current views and expectations about the company's performance and financial results. These forward-looking statements are made subject to the Safe Harbor statement included in today's earnings release. In addition, some of the discussion may include non-GAAP financial measures. For a more complete discussion of the risks and uncertainties that could cause actual results to differ materially from any forward-looking statements and reconciliations of non-GAAP financial measures, see the company's filings with the Securities and Exchange Commission.

And now, I would like to turn the call over to Scott Cavanaugh.

Executive
Scott F. Kavanaugh

Thank you. Hello and thank you for joining us. We would like to welcome all of you to our second quarter 2019 earnings conference call. We will be providing some prepared comments regarding our activities and then we will respond to questions.

As highlighted in the press release this morning, we experienced another strong quarter across key financial metrics of the firm. Earnings for the second quarter were $12.4 million, a 141% increase over the second quarter of 2018 or $0.28 per share. Total revenues were $51 million for the quarter, an increase of 18% year-over-year. Our efficiency ratio for the second quarter was 63.5% and our tangible book value per share ended the quarter at $10.94 per share. I'm very proud of our executive team, our business unit leaders and all of our employees for helping us achieve these results. They all contributed to helping us manage expenses and focus on generating high quality revenue during the first half of the year. This puts us in a position that I expect to set up for the success for the remainder of the year and beyond.

Our banking operations continue to experience growth. Loan originations totaled $494 million in the second quarter and year-to-date. Our deposits have grown by $211 million. Our industry continues to experience challenges due to the uncertainty in the interest rate environment, including an inverted yield curve, yet our business model allows us to deliver results like what we announced today.

In particular, our multi-channel approach through attracting deposits has helped lead us through the challenge. For instance, as retail deposits became more and more expensive in the first half of 2019, we were able to leverage our experience in attracting deposits from other channels, including specialty deposits which helped generate the results we reported this morning. As we start to save large money center banks drop rates in the retail channel, we could see retail become attractive again. We will continue to monitor our funding sources and make any adjustments as needed, especially in light of any future