Greetings, ladies and gentlemen. Welcome to the Home Bancshares Incorporated Second Quarter twenty twenty five Earnings Call. Purpose of this call is to discuss the information and data provided in the quarterly earnings release issued after the market closed yesterday. The company presenters will begin with prepared remarks, then entertain questions. The company has asked me to remind everyone to refer to their cautionary notes regarding the forward looking statements. You will find this note on Page three of their Form 10 ks filed with the SEC in February 2025. At this time, all participants are in listen only mode, and this conference is being recorded. It is now my pleasure to turn the call over to Donna Townsell, Director of Investor Relations. Thank you. Good afternoon, and welcome to our second quarter conference call. With me for today's discussion is our Chairman, John Allison Stephen Tipton, Chief Executive Officer of Centennial Bank Kevin Hester, President and Chief Lending Officer Brian Davis, our Chief Financial Officer Chris Fulton, President of CCFG and Scott Walter of Shore Premier Finance. Opening remarks today will be from our Chairman, John Allison. Thank you. Welcome everyone. I want to thank you for joining today. Today is the seventy sixth quarter that we've had the privilege to report to our shareholders since going public in June. I have to say that we've come a long way since June '6 and even a longer way from the day in 1998 when my cofounder, Buddy Adcock, and myself made our original purchase of the $22,000,000 Holly Grove Bank in Holly Grove, Arkansas. We've come from $22,000,000 in total assets then to almost 23,000,000,000 now. From five employees then to 2,600 now and from one small office in Holly Grove, Arkansas to 217 banking offices in five states. From a pretax this is pretax now income of R400,000 to an after tax income of over 400,000,000 now. And from our purchase price of $4,500,000 in 1998 to the values New York Stock Exchange market cap of just short of $6,000,000,000 I have to say that Home Bancshares' story is certainly one for the record books. Many of you have been with us and enjoyed this amazing ride through the years, and we're extremely appreciative of your long term loyalty to what has turned into one of America's best and most profitable banks. For that money, thank you, and I thank you, and our 2,600 associates thank you. We have moved from one of the smallest, it was about 10,000 bank sales I recall, to number 64 in total asset size U. Wide. But with our $5,900,000,000 New York Stock Exchange market cap, our company ranks number 35 in The U. S. In market value. I said on the conference call last quarter that the second quarter would look a lot like the first quarter and we were right on the button. However, this quarter was a little better with record earnings of $119,400,000 or $0.60 earnings per share, producing a return on assets of $2.08 versus last quarter $115,200,000 in earnings producing a return on assets of $2.07 pretty consistent, I'd say, in the quarter. Those were non GAAP numbers, but I'll take them. The non GAAP ROTCE return on tangible common equity was 18.2617.68% GAAP return on tangible common equity. Loan loss reserves remain strong at 1.86%. Tier one capital continues to build at 15.6%. Leverage ratio at 13.4%. Total risk based capital of 19.3 Over the past twelve months, we have grown tangible common equity by $1.36 or 11.25% from $12.8 to $13.44 While at the same time, the company bought back over 3,000,000 shares equaling about $86,000,000 worth of our common stock and paid out about $150,000,000 in dividends to our shareholders, all while continuing to grow cash flow common equity. That performance displays the earnings power of your company. We continue to add more strength to our already fortress balance sheet. And as we say, strength is no accident. And you never know when you're gonna use it, and it's comforting to know that you have it. We've continued to be aggressive on stock buybacks, buying 1,000,000 shares for both the first and the second quarter. That's 2,000,000 shares so far this year. And we're to reduce for the first time the buyback yield. That's an incremental increase value for each individual shareholder based on the reduction in the number of shares. In addition, we have paid $0.20 per share for quarterly dividends to reward our shareholders. Over the last eight years, we have bought back $520,000,000 of our stock, approximately 22,000,000 shares at an average value of $22.6 while at the same time continue to grow tangible common equity. Donna, it is what it is, so far so good, nice start to 2025 with already $233,600,000 in non GAAP earnings and that certainly is a record income for this company. Last year at this time, I think we're around $2.00 1,000,000 in non GAAP and $2.00 3,000,000 in GAAP. So for the first six months, so far this year, we're up a little over 15%. I certainly can't ask for much more of these assets. We need to find something to buy that will be additive to our income. I was looking this year for about $450,000,000 in the income. And next year, I kind of have target a $05,000,000,000 I guess that brings the bell with me. I'm use the term $500,000,000 $500,000,000 kind of brings some mail for '26. But we need to acquire some more assets to get that done. We are presently looking at several opportunities, and we will pick the best of the line to keep the forward progress moving in a positive direction. The intention is to hopefully have an announcement before the next quarter's report. Back to you, Ms. Donna. Okay. Well, thank you very much for a great report and congratulations on a strong quarter. Our next report today will come from Steven Sipton. Thanks, Donna. As Johnny mentioned, the second quarter was another strong performance by Home and Centennial Bank. Highlighted by strong revenue and stable core expense trends, we were able to produce an adjusted return on assets of 2.02% and an adjusted efficiency ratio of 42.01%. The reported net interest margin came in at 4.44%, in line with prior quarter even with the lower level of event income. The core margin excluding event income was 4.43% versus 4.42% in Q1 and is up 20 basis points from the same period one year ago. I'm encouraged to see the trajectory of the margin in June as we enter the second half of the year. Deposits ended slightly lower in Q2, down 53,000,000 as a result of seasonal tax payments that occurred in April, but we are pleased to see balances grow in both May and June. As we observed the deposit activity early in the quarter, we hated to see the money go out, but we are comforted to know that we have core customers that are doing well, making money and operating in dynamic growing states like Arkansas, Texas, Alabama and Florida. In our other business lines, the Trust, Wealth Management and Mortgage divisions continue to improve and show meaningful additions to the bottom line. I'd like to thank our Regional and Division Presidents and all of our bankers on another great quarter. With that, I'll turn it back over to you. Thank you, Stephen. Next, we will hear from Kevin Hester on the lending portfolio. Thanks, Donna. We continue to achieve recoveries from the charges taken in the fourth quarter cleanup. This quarter, we recovered a total of $2,000,000 and we remain on track to achieve the expected $30,000,000 in total recoveries over time. One large non accrual loan from that group remains very close to being resolved in a positive manner, but that resolution will have to wait another quarter. In addition, the multifamily construction in the north part of the DFW Metroplex is complete and we will begin leasing activities this month. Asset quality metrics were mixed, but none of the changes were material in either direction. The slight increase in NPLs was primarily due to a large yacht for which we are in the middle of the arrest process. We have possession of the vessel, which is in very good condition, and we expect a full payoff on this loan once we exit the arrest process. Solid loan growth split evenly between CCFG and the Community Bank complete the results of another impressive quarter. Donna, I'll give it back to you. Thank you, Kevin. And now Chris Polson will provide an update on CCFG. Thank you, Donna, and good afternoon. Uptick in originations for Q2 led to portfolio growth for CCFG. For the quarter, we closed approximately $500,000,000 in new commitments, which brought our year to date total just over $800,000,000 which compares favorably to prior years. The portfolio grew by about CAD122 million during the quarter taking our total over CAD1.8 billion and putting us in plus territory for year to date as well. Our unfunded commitments approximately $1,000,000,000 which has been fairly consistent over the past year. As we look forward, we may see an uptick in payoffs during Q3, but ultimately we expect the portfolio to be stable to up over time. Donna, that concludes my brief update from CCFG. Thank you, Chris. Johnny, before we go to Q and A, do you have any additional comments? Well, I feel like we need to have a slurry. I haven't had a slurpee in a while. We've had two record quarters back to back, and that's how we who was it? I agree. Let's see if anybody in the crowd wants to send us a GoFundMe this time. GoFundMe slurpee. Who did that? I believe that was Michael Rose. I believe it was Michael Rose. So So Challenge extended. Yeah. Well, it was a great, great start to the year. The first six months are outstanding, so I'm I'm pretty pleased with what's going on. And I expect that the third quarter will be about like the first and second quarters. We've kind of had the wind our back, had a little extra income in both the first and the second quarters, and we got a shot at having some extra income in the third quarter here too. So hopefully, we'll continue to keep it strong till we find something else. We need to find something that makes sense for us that's in our marketplace or close to our marketplace that we can be added to the EPS of this company. So anyway, we're working on that, and I guess we're ready for Q and A. Thank you. First question comes from Stephen Scouten with Piper Sandler. Your line is open. Please go ahead. Good afternoon, I wanted to start around loan growth. Another really nice quarter, CCFG here in the Community Bank. And and year to date, this is it seems like the best organic loan growth you guys had in really as long as I can remember. And so I'm just wondering what you're seeing from your customer base, if there's been an kind of an increase in aggressiveness to drive that new loan growth or really what might be driving the success there? Hey, Stephen. This is Kevin. I mean, Johnny says we take what the market gives us. I wouldn't say that we're more aggressive. I would say that we've got some markets in which there's still some really good things happening and our folks are hitting on all cylinders in some of those markets. It is tough. We've got some competition that I think has loaned into the rate cuts that have not occurred yet and tried to reach out and maybe lock some of that in for a little bit. So that's made it a challenge really across our footprint. All of our presidents are talking about that. So that's a challenge. But, we just had some you know we're we're in a lot of really good markets and including what Chris does with his group. We just got a lot of good markets to loan in, and we're that's why we're here. So why we're in those markets. We had loan committee yesterday, and and we had a almost a $100,000,000 project, a couple of $30,000,000 projects. It was a pretty good loan committee yesterday. It wasn't many loans. It was a lot of big loans yesterday. We've been working on for some time, and they just come to fruition. So we're seeing that, but, you know, we we might the rest of the market might force us down at some point in time because they're they're already already writing it. You know, they didn't they didn't chase us on the way up, but they but they're leading on the way down. So, I mean, the real truth is anybody giving away. So I'm not sure this is over yet. I mean, I I if I think we're banking on Trump and Powell having a having a drink together or something in Florida right. So that may happen. It may not happen. But what we don't need to happen that happened if we take breaks, president Trump, who I'm as you know, I'm a huge supporter of, talked about going back to 1% money. If we do that again, we'll have inflation again running rapid. So that's that's the scary part of that. We don't need we need a slow premeditated drop in interest rates. We don't need a quick drop in them. That would that could really kinda screw things up. Yep. Makes sense. And then maybe going to the m and a side of things. Obviously, we've seen some more deals in Texas as of late. You noted earlier that you guys are looking at a few things currently. I'm curious, maybe if you could give us an idea of what size opportunities you might be targeting here in the near term. And then would there be anything that you all would pursue right now similar to CCFG or Marine where you're acquiring loan assets versus a whole bank deal? Well, we're probably not on the the whole bank deal. I mean, we where are we looking for a whole bank? Probably not on the subsidiary operation or loans. We're probably not I mean, not that we wouldn't do it. We just hadn't seen it. So if we saw it, Kevin, look at it and let us know. But we are pursuing a couple of banks that give us an opportunity to grow. And we've seen a couple. We're gonna talk about a couple next week, and then I'm going to see one next week. So, we we, we're trying to find something. You know, you can't you run a call it GAAP or non GAAP, two two two zero eight ROI. You can't ask for much more than that out of your people. So we've about milked all we can get out of this turret, so it's time to to find something else for us to buy, and and we're we're on the path. This has to be a pretty, pretty, and makes sense. And if somebody out there wants to join a company that's growing and making lots of money and got a strong financial statement, we're the one. So or we're one of. There's we're not the only one. There's more more than us, but I don't know if that answers your question or not. Yeah. It does. And and and you kinda led to my last question. It's just with the way the math works today with with the marks and the interest rate marks still, do you think you can get a triple accretive deal still at this time? Or do you have to take a de minimis amount of dilution to get something across the finish line? We haven't taken dilution before. Interesting you say that. I went back and looked at the serial, acquirers recently. If you go back and look at some of those, one of my look back, they outbid me ten years ago, and the stock's the same price today that it was ten years ago, and the dividend's the same price. They're paying the same dividend that they did ten years ago. And the people that, I mean, they they bought the bank, but they didn't do anything. I mean, they nobody got any appreciation out of that trade. So you go back and look at those serial diluters five and ten years back, it is I just started looking one day at those that beat us on some beds back in those days. And, actually, this one is is is at the same price it was ten years ago. It was a buck and a half down, but bank stocks have risen a little bit lately. So where I will get into that game, I don't know what I don't know what people are thinking when they dilute themselves into infinity. We have no intention to do that. We're not gonna do that. And, I mean, when do six month dilution? Maybe if it's the right deal that was EPS accretive, maybe. But to go out and dilute myself I mean, some of these people buy bought some of these deals that we turned down. I mean, we saw some of those deals and and we turned down. And we saw biotech Barton? Veritex. Veritex. Veritex. Veritex got a nice deal with a good company. That's a nice trade for them. I congratulate them on that trade. So we didn't we were not on that trade, but we were on one of the others who got done recently. I don't know. You get me off get me off on that. When I look back how we got outbid on these deals five, six, seven, eight years ago and the stock's less tonight than it was then, and they're still paying the same dividend, then nobody got anything. You know? That's that's the problem. Do a four year earn back to 10 Yeah. I think I know the deal you're talking about in Florida right there. I think I I think I remember the one you're talking about there. So I think that's why you're stuck trades where it goes, Connie. So I appreciate all the color. Thanks for the time. Thank you for thank you for appreciate our patience and our our holding power. We now turn to Matt Olney with Stephens. Your line is open. Please go ahead. Hey, guys. Thanks for taking the question. Probably for Tipton, I want to ask about deposit pricing in the footprint. Saw some good results in 2Q, but just curious what you're seeing as far as deposit pricing. Any incremental pressure you saw during the course of 2Q and some of your peers have talked about seeing some potentially some higher deposit cost in the third quarter or at least until the Fed makes its next move. Just curious what you're seeing with respect to deposit cost competition in the footprint? Yes. Hey, good afternoon. It's about the same as we talked about in the first quarter. I mean, you kind of got some of the same guys running the same specials here that they have been for the last six months or so. Our folks negotiate against those well and we're able to price them slightly lower than what of the competition is doing. We've got a decent amount, about $1.1 or so in CDs that mature in the second half of this year and hoping that we can optimistic that we can get those down just a little bit from where they're maturing at. Okay. I appreciate that, Stephen. And then I guess the other question is more for, I guess, for Johnny. Johnny, you mentioned that buyback yield in the press release and in the prepared remarks. Just curious about your thoughts on the buyback and the million share pace that you mentioned in 1Q, 2Q. Just trying to appreciate if you still have a similar appetite for that pace even at these current valuations. Well, that's a good question. We we we we're we'll see if we can put some money to work here in the next thirty days, some capital to work. It having the we've continued to buy the stock back. It has been diluted to us to buy it back as as we know. We've had we have I think your group is running numbers on that and also also DD and F's running those numbers on that on the buyback yield and give us a better understanding of where we need to be. But as of right, we talked about a special dividend to all our shareholders. We're actually we're looking to have a seriously considered and still unseriously considered a special dividend to our shareholders. But let's see what we get bought in the next thirty days here. And we maybe we'll have we got about how much cash at the holding company right now? About 400,000,000. 400,000,000. Well, that's a comfortable side. Anyway, we we've got a few things. We've gotta pay off 140,000,000. 140,000,000. I thought that paid off July 1. It paid off July 31. Right? Right. So that we got a 140,000,000 on to pay off happy sub debt, and we'll pay that off when that comes up. So we'll probably sit for a little bit, but, actually, we've we've got so much capital as it's gonna reward our shareholders. And we might do that anyway. It's certainly a thought that that's on our mind to to do is is to do something with that. Perfect. Okay. Thanks, guys. Great quarter. Alright. Thank you very much. Our next question comes from Brett Rabatin with Hovde Group. Your line is open. Please go ahead. Hey, guys. Good afternoon. Wanted to I guess, first, Johnny, you mentioned the $450,000,000 this year and 500,000,000 next year. Are those just kind of round numbers? Because that would imply a bit of, net income atrophy in the back half of this year. Well, we're at 233,000,000 today. We are that's just about what we're running. Right? We're running about a 110, a 115, a $120,000,000 a quarter. So that's annualized. That that's about where that is. I don't think that's a reach. I think next year's the reach. I think next year's the reach. I mean, we may not get $4.50 this year. It might be $4.40 or it might get four sixty. Depends on what happens between now and the end of the year. But I think 500,000,000 is realistic if we can get some assets under total. We can get our hands on some assets, that's the key. We we can't you know, I guess I And and I said I was at a bank conference recently, and I said, can't ask our people for any more than a 2% ROI. And Donna said, yeah. But you do. So, you know, we'll ask for it, but it's not realistic. So Yeah. Is that $4.50? Is that on reported or the core earnings? It'd be reported earnings. Yeah. But it's for shareholders. Okay. It'll be better than that, Brett. I think that was just a round number. Okay. Do you hear that? I like what he I like what he said. That's the first time I heard him. He he voted for the $420,000,000 budget, and and I voted against him. And then it sounds like the loans loan volumes are still strong, but you're expecting some payoffs in 3Q. Any color on the pipeline relative to 1Q and then just what the production was this quarter? Brett, this is Kevin. The pipeline is still pretty strong. You are right. We had a couple of things that we thought would probably pay off in the second quarter that moved into third quarter. So last quarter, I was saying we had an uphill climb because of what we saw coming to pay off. It's a little bit pushed to third quarter. Production is good. I think $1,000,000,000 last quarter. Pipeline is still like it was. Okay. And then maybe just last one around the margin. And if the Fed does cut in September perhaps, how do you guys think about the impact to your margin? Brett. This is Steven. I think the same thought process we've communicated in the past. I mean, we still screen to be a little asset sensitive. But I think in the first 2550 whatever it is down scenario that gives us certainly some cover to lower deposit rates. We've seen a little bit of sensitivity around 4% or three percent in some of our deposit book and going below there. And so I think if you see the Fed make a move at some point, it'll that'll give us the news and the ability to be able to lower that and hopefully be able to offset what occurs on the loan side from the variable rates. You didn't ask this question, but I have to get it out. Our expenses were high this quarter, and they were high because of lawsuit settlement that we had that had been going on for several years. It was about three and a half million dollars. Actually, expenses, you take the one timers out, according to Steven, is a 111,500,000. And I did the numbers myself, and that's pretty close when you take the one timers out. So the expenses don't think the expenses have run off the rails. They haven't run off the rails. So we we'll we'll do a better job next quarter, but that was something that brewing. We've been dealing with for years. We dealt with it and on the expense side, but we had some we had something offsetting the income item there. We we sold fintech operation out of Happy Bank that brought us about $3,500,000 in pretax income in. So, anyway, the expenses will be back around the $1.11, $1.12 mark for the for next quarter, it should be. Okay. Good to hear. Congrats on the quarter, and hope things cool off a little bit in Arkansas now. Yeah. They're not gonna cool off here too high. Kevin told us what was that we looked at ten day advanced weather. The the low is today at 96 or something. Right, Kevin? That's correct. We now turn to Jon Arfstrom with RBC. Your line is open. Please go ahead. Hey, thanks. Good afternoon, everyone. Hi, Jon. Hi. Steven, maybe for you, just to clean up on the margin. In your prepared comments, you talked about being optimistic about the June margin. Can you give us a little bit more detail on that? It seems to indicate you think it's going to step up, but just curious your thoughts on that. Yes. Yes. So thanks, John. The core NIM excluding event income in June was 4.47%. So it was up ample of basis points from where the quarter averaged. Some of that was loan yields were up a couple of basis points, deposit costs were flat and then the investment portfolios performed a little better as of late. Okay. Okay. Very helpful on that. And then just a couple more smaller ones. But can you talk a little bit about the mortgage banking outlook? I know it's a small line item, but maybe it's symbolic of a little better activity in some of your footprints on housing. Can you talk about that a little bit? John. This is Kevin. Yeah. I mean, think it's been up and down. We'll have a good month of locks and then the next month will not be good. Don't know that there's gonna be you know, until there there are some rate drops that get get the mortgage rates down, you know, below where they are today, I don't know that we're gonna see any kind of real positive, you know, multi month trend there. Okay. This is Steven. I I mean, I would say we're we're committed to I'm sorry, John. I was gonna say we're committed We to the to the we brought a team in in DFW area onboard kinda late first quarter of this year. They had a good second quarter and are profitable already. So, I mean, I think we'll continue to be in that space and continue to try to grow it the right way. Okay. And then a small one on shore. I know you mentioned the yacht. Is there anything else in there that's really substantially all of the change in non accrual loans? Yes. That was the change for this quarter was that and that's been on our radar a solid six months. The arrest process takes quite a while. It takes longer than I would hope even when it's here in The US. And so it we we think we're in good shape once we're able to do something with it. But right now, it's it's sitting in our possession and working through the legal process. It's a it's a $9,000,000 yacht with less than $5,000,000 payoff on it. So it it's just a matter of getting your hand when you get your hands on it, get it sold. There's not a loss in there's not a loss in this. Alright. Maybe if it brings 5,000,000, we got legal fees, maybe some, but there there should not be a loss. Let me say that. Just the process Yeah. The big change with the We anticipate to take it. The the process just just continues on, but I think we're about to get the process is about over. Right? The sheriff arrests it, takes it, puts it in, then the judge gives them x number of days to pay us off. And they don't get us paid off, then we get the vote. So we're we're at the we're at the point of getting the vote, I think, Kevin. We're we're close. It's close. Okay. All right. Thanks a lot. Nice job. Thank you. We now turn to Catherine Mealor with KBW. Your line is open. Please go ahead. Thanks. Good afternoon. Hi, Kathryn. How are you? Most of my questions I am great. You had a really nice quarter. And most of my questions were asked and answered. But one follow-up is just on credit. You mentioned you still have about $30,000,000 leftover of charge offs just from the Texas cleanup a few quarters ago. Any update on the cadence of that $30,000,000 of how we should see that come through over time? Yeah. Just to to make sure to be clear there, what I was mentioning was the 30,000,000 recoveries that that we think that we're On the gonna able recoveries. Excuse me. Yes. I missed the coverage. Yes. Largely largely, it's a 1,000,000 point dollars a quarter. There's there's a couple of chunks in there. You know, we could get, if if one works out, this quarter, we could get $1,000,000 on top of that. But but from a recurring standpoint, it's $1,000,000 a quarter on one of the loans that we charged off. Okay, great. And then maybe just one more back on the buyback. I mean, is it you've been really active in lieu of not having any M and A in the past few quarters. Is it fair to assume that that pulls back if you do announce a deal that you're looking at this quarter that we probably pull back on the buyback for a period of time just depending on what that looks like? Or do you think you're outside of when you're not able to buy back stock just with the deal pending, you're just going to be continually buying back stock, you know, kind of alongside M and A? We have not quit buying back stock, and we'll we'll probably won't quit if if we run into we'd see I don't see the capital restraints keeping us from doing what we need to do even if we buy $4.05, $67,000,000 worth of assets. So I would we actually Steve and I talk about it nearly three or four times a week. Whether we wanna do it or don't wanna do it where we are, we have a 10:10 meeting executive meeting every day, and we cover all those items. So to say we're gonna quit buying back, I wouldn't say that. But to say we're gonna buy a million, I can't say that. But I'm sure if we'll continue to buy back stock. You know, I just I have a this nondilution idea that I don't wanna dilute. We don't dilute, and then we turn around by the stock back, and we actually dilute ourselves by the stock back. And I I wondered sometimes if that was the right thing for us to do. And we have a couple of companies running that analysis for us as we speak and go to make presentations to us. I wanna see that. You know, the the the I would I really wasn't familiar with the buyback yield. We've seen the buyback yield now. We we started adding it to our chart. It does add incremental check to our shareholders. But I said I said to Donna, I said, did you feel that kick last quarter? And she said, no. And I said, well, if I did a big stock dividend, would you feel that kick? And she said, yeah. I would. So the answer is we'll probably continue to buy back stock unless we need money for an acquisition. That makes sense. Well, especially given your capital I mean, if you're and if you're saying you're looking at deals, did you say you're looking at adding 400,000,000 to 700,000,000 in assets? I mean, that's just as small given your your capital levels. But certainly, you'll have plenty of capital still unless you do multiple deals. Right? Oh, did I billion. I and I didn't say did I say million? I'm sorry. Billion. Billion. 4 to 600,000,000,000. Oh my goodness. Okay. 4 Good. 4 to 6,000,000,000. Sorry. Today? I mean, we'd buy that makes. We'd buy $400,000,000 if it was good enough trade for us. It takes a lot of work. But you and you're also not the kind that would issue cash with an acquisition. Right? It's always stock for stock given your currency. Cash in an acquisition, would you do cash? Well, we haven't. We haven't. Gets diluted. Right? It's really diluted. Right. Our dollar bill's worth our dollar bill's worth two and a quarter. So, you know, it it it sure works better to use your currency and and do a trade. Yep. But we throw some cash in the deal. We used to throw cash in about every deal we did. We put 10 or 20% cash in. We're not afraid to do that. It does creep right up on the dilution. It gets there pretty quick, doesn't it, Brian? Yeah. It does. Great. Alright. Great. Thank you so much. Great quarter. Looking to see what you've got for us over the next few months. Thank you. Appreciate your support. We now turn to Michael Rose with Raymond James. Your line is open. Please go ahead. Hey, thanks. Good afternoon, everyone. Just a question on hiring. We've seen a lot of banks disclose hiring plans, some formal, some informal. Just wanted to get a sense from you guys what the, what the hiring plans were for you if you plan to accelerate them. You know, I know, the expense run rate will come down next quarter, which you said earlier, but, you know, is there an opportunity here? Is it is it a little too rich for, what you guys are looking at at this point? Thanks. You said hiring plan? Well, we don't we don't we don't Yes. Hiring of lenders is what I was referring to. We we don't do that. We well, that's not our style. I think that's chicken shit. Pardon my expression. I I really do. I don't I don't I don't I don't like that. And we've had, I don't know, over the years, seven or eight teams in here, people wanting to walk out of their company. Some of them I don't know how you face those CEOs, Michael. I I walk in we just had them here in our office one time, and we I went to a a meeting in Dallas, and I walked right into the CEO of the company they were leaving. And and and and just something that that bothers me. You take a young loan officer, you bring him up through the ranks, and you help him build his his book and his portfolio, and then someone offers him another 200,000 and a bonus, and they walk out the door. That's not our style. We don't do that. We'll be not to say we won't hire somebody from somebody from another company, but that's just not our style. We don't we don't do that. We don't plan on doing it. That's not gonna be a a focus for us. Alright then. Maybe just just one more separately for maybe for Chris. You know, obviously devastating what happened out in California. You guys have an office out there. There's going be some some rebuilding. How much of an opportunity is that for you all? And is that something that we should consider as we're thinking about growth potential over the next couple of years? Thanks. Yeah. Thanks, Michael. I think it remains to be seen in terms of, you know, in terms of what kind of opportunity it's going to be. It's a long term opportunity if it's an opportunity. I think I read the other day, I was talking to somebody, they've issued 50 building permits total since then. I find it very hard to believe California will start rebuilding in the near term. All right. Thanks for taking my questions. Yes. We now turn to Brian Martin with Janney Montgomery. Your line is open. Please go ahead. Hey. Good afternoon. Good afternoon. Maybe hey, Johnny. Maybe just one back on the M and A. I think last quarter, you talked about maybe preferring some smaller deals as opposed to bigger deals, but, you know, depending on what's available and what you're looking at. I mean, any any change in your outlook or just, you know, thoughts on just the, you know, the sizing of, you know, things you're looking at near term here, what what they look like or, you know, geographically, any little bit more color on that? No. They're in the they're in the 2 to $6,000,000,000 range, and they're in our United States. And they're in our footprint or outside. Does that help you? Yeah. So so 2,000,000,000 to $6,000,000,000 in The US and your preference in terms of multiple multiple deals versus one deal? Is it any any preference there still in terms of how you're thinking about that? I it doesn't matter. You know? If that's probably what'll happen. We'll we'll we'll sign up a deal, and then there'll be another one pop right behind it. But if it is a good deal and it works, we'll go ahead with it. Provide guidelines. Will ask to do that. I assume they will. Okay. Gotcha. Okay. That's fine. And then how about just one for, Steven on the margin? Steven, I think the, it sounds like the margin, you know, in the I guess, it exited versus where it's at today, it's up a little bit this quarter to date or this, you know, yeah, this quarter to date. But on top of that, you've also got the the sub debt coming off. And I guess so just the benefit, I mean, is your expectation then that, I guess, what's the impact of that sub debt on the on the margin as you get into 3Q? Sure. So Brian and I were talking before the call. It's about five or six basis points that it will benefit the NIM when it goes away. Again, it's going to go away end of this month or August 1. So you'll have two thirds of the benefit this quarter and then the full benefit in Q4. But absent that, I mean, I still say pleased with where June ended. But if we can hold in this 4.45 range and then layer a little benefit from the sub debt, I think we'd be pleased for that in Q3. I mean, we talked a little earlier about what you're seeing on loan pricing and some of those things and we'll see where that goes. But very pleased with I think we're just short of $1,000,000,000 of route price between now and the end of the year, Stephen? Yes. We got a little less than $800,000,000 in loans, fixed rate loans that mature in the second half of this year. Those are coming off at $5.46 So there will be an opportunity to get those up some. We've got about $1,000,000,000 next year that's at 5,990,000,000.00 So who knows what happens with interest rates between now and then. But certainly in the second half of this year, I think there's an opportunity to get a little extra yield on what's maturing. Got you. Okay. That's perfect. I was going ask on the loan yield, that's, something you addressed. And then just on the, I think Johnny said or maybe I think Johnny on the expense number, you know, the core number, just in reconciling to that 111,000,000, I guess the, when you get down kind of that level this quarter, Steven, what outside of the 3,300,000.0, you know, if you're 116,000,000 in in reported expenses absent the 3,300,000.0 you know, what else comes out of that to kind of, you know, get down to that, $111,000,000 this type of number is Yeah. More We had 1.3 a little over $1,300,000 in legal expenses related to our West Texas lawsuit. And we talked a little bit about that last quarter. I think we had one fairly large invoice in April that was from the prior month. Those invoices have gone down to a nominal number now. So assuming we get that settled in the near future, I would expect those legal expenses go away and that kind of gets you down into the you know, $111,500,000 range. One thing you do need add back one thing we do need to add back to the number is that we had that special assessment reduction. And so that was our FDIC number was down $1,500,000 Yes. And if you look at where salary expenses landed for Q2, they were a little elevated just from fee income, particularly at CTFG incentive comp and then kind of same on mortgage. Mortgage had a good quarter. So I'm holistically saying that incentive comp was up a similar number to what we had offset from the FDIC credit. So there's about Okay. Those cancel each other out. There's about $4,500,000 that I would not expect to reoccur. Okay. So the extra that's in there is in the salary line and that's how to think about that to kind of get to the core number? Yes. Yes. Okay. And then, Steven, just the the I think last quarter and maybe Kevin talked about this, but the the the payoffs versus originations, you guys had expected some payoffs. It sounds like those maybe are going to roll into the next quarter. But just what were the payoffs in the originations this quarter? Yes. Payoffs this quarter were $756,000,000 And you're right, there are a handful of those that we expected to occur in Q2 that slid may slide into early Q3. So $755,000,000 they were about $650,000,000 last quarter. And then origination Kevin mentioned origination volume was about 1,000,000,000 point Typically about half of that is funded at quarter end. Got you. Okay. And then maybe just one for Kevin on the credit quality. It sounds like, I guess, the expectation was that the credit, I guess, there was maybe one large credit I thought was going to kind of come off or maybe a couple that are going to come off this quarter. Is that kind of the one you're referring to? I guess, at least when we think about third quarter, kind of what the that improvement that was kind of expected this quarter, would you are you suggesting that that's likely in I thought it was in the 10,000,000 or $12,000,000 range, that maybe we see that type of improvement in non performing in the third quarter here or just some benefit there? Yeah. You're on your own point. That is around 12, and and I really was hoping to be able to announce that that we had it moved in the second quarter, but it it looks like it'll be third quarter. And then we got another one in OREO that I don't think it's quite time yet, but we will be we'll start leasing the apartments this quarter. We'll see how that takes off well, then it'll generate activity with somebody coming in wanting to buy it. So we're making progress. Got you. Okay. And just the reserve level, it kind of drifted down a little bit this quarter. Just this kind of this level is where you're comfortable for now and it just it kinda hangs around where it's at. Is that how you're thinking about it given the current, you know, credit outlook? Yeah. We're comfortable. We're comfortable with extremely comfortable with reserve. We had an opportunity. We'll build it. We'll build it at some point in time. So I still like a 2% reserve. I just like it. You know, I just always run a 2% reserve. And if I get a chance to build it to 2%, I'll I'll take it to 2%. I just sleep better than I. You should too. But I sleep pretty I sleep pretty good if you make sense to what I've got. All right. Well, congratulations on the quarter, and thanks for taking the questions, guys. You bet. Thank you for such your support. This concludes our Q and A. I'm going hand back to Mr. Allison for any final remarks. Good quarter. Thanks, everybody, for your participation. I hope you enjoyed the earnings release. And I guess next quarter will be 77. Is that right, Donna? Next one will be 77. So, Bunny, Bunny's in here. What else do you guys need to say to the folks? No. Just fantastic quarter. That's what I would say. I'd say, on behalf of all of the other board members, we're very, very, very proud of this group sitting in this room today and all that you've done. Well, thank you. Appreciate it. Brian? Yes, sir. Got anything that you wanted to say or anything we left out you think we need to cover? No. I think we pretty much covered it all. Steven, anything else? No. Good quarter. Kevin? I'm good, sir. Donna? Not here. Not here? Not here. All right. Well, we're going be gone. We'll see you and talk to you in ninety days. Thank you. Ladies and gentlemen, today's call has now concluded. We'd like to thank you for your participation. You may now disconnect your lines.