Old National Bancorp. (NASDAQ:ONB) Q3 2019 Earnings Conference Call - Final Transcript

Oct 21, 2019 • 08:00 am ET

Previous

Old National Bancorp. (NASDAQ:ONB) Q3 2019 Earnings Conference Call - Final Transcript

Share
Close

Loading Event

Loading Transcript

Q & A
Operator
Operator

At this time, I would like to remind everybody in order to ask a question [Operator Instructions] Your first question comes from the line of Scott Siefers of Sandler O'Neill.

Executive
James C. Ryan III

Good morning, Scott. How are you?

Analyst
Scott Siefers

Good, good. Thank you. I appreciate you taking the question. I think, first question is just on the cost base, got some really positive momentums here in the third quarter as you had articulated would be the case. So that was a good result. Just curious as to what you're thinking for the fourth quarter. I think in your prepared remarks you had suggested that we fully realize the client savings. Is it possible that we could see another downdraft in expenses or would more flattish kind of be the way you're thinking now that the cost savings are all in there?

Executive
Brendon B. Falconer

Yes, I think flattish from here. I just. Scott, just point you back to the $1.9 million occupancy expense line item that won't be recurring. That keeps it on the low 120s going forward.

Analyst
Scott Siefers

Okay, perfect. Low on 120. All right, perfect. Thank you. And then, I appreciate the disclosure on the CECL day-one impact. I guess, to the extent you're comfortable, I'm just curious if you have any thoughts on what the day-two impact will look like as well. Do the purchase accounting benefits, do those sort of go away or just sort of get re-categorized into the provision? Do you guys have any thoughts that you're comfortable sharing at this point?

Executive
James C. Ryan III

Well, I think what I can share with you, Scott, is that the legacy book and provisioning for new loan growth will be relatively small change moving forward. So not a material impact to how we provision going forward for loan growth.

Analyst
Scott Siefers

Okay. All right. That sounds perfect. Great. I appreciate it.

Executive
James C. Ryan III

Thanks, Scott.

Operator
Operator

Your next question comes from the line of Chris McGratty with KBW.

Executive
James C. Ryan III

Good morning, Chris.

Analyst
Chris McGratty

Hey, good morning, Jim. Good morning Brendon. Quick question on kind of the capital and the growth dynamic. Looking over the past year, you've built a lot of capital despite being fairly aggressive with the buyback. I guess the bigger question is what turns a loan growth from here, anything you're kind of -- any views on the pre-payment activity, what might make that abate a little bit and also I think you've got about 1.5 shares, anything keeping the company from authorizing additional buybacks? Thanks.

Executive
Brendon B. Falconer

I'll let Jim talk about the loan growth and I will comment on the share buyback.

Executive
James C. Ryan III

Yes, as both Jim and Brendon pointed out, pipeline continue to be really strong, production is great. Hopefully, we see a slowdown in paiddowns but private equity continues to be aggressive, a lot of companies continue to sell, they don't have succession plans, a lot of the commercial real estate continues to look to refinancing the secondary market.

So we would like to see that slow but short of that, we're really just focused on what we can control