RBB Bancorp Q4 FY2024 earnings call

• David Morris acknowledged support for wildfire-affected communities and reported net income decrease due to credit, while net interest margin increased. Congratulated Johnny Lee on new role as President and CEO.
• Johnny Lee discussed loan production of $126 million, loan declines due to paydowns, healthy loan pipeline for future growth, and focus on resolving non-performing loans.
• Lynn Hopkins provided details on fourth quarter financial performance, net interest margin, non-interest income/expenses, provision for credit losses, loan portfolio details, deposit franchise, and strong capital levels.

RBB Bancorp reported fourth quarter net income of $4.4 million or $0.25 per share. Net interest margin increased by 8 basis points due to a 33 basis point decline in the cost of interest bearing deposits. Loan balances declined in the fourth quarter with $126 million in loan production. Deposits declined slightly but non-interest bearing deposits increased by $20 million. Non-interest income was $2.7 million, non-interest expenses increased by $297,000 to $17.6 million, and provision for credit losses was $6 million. The overall loan portfolio yield decreased 10 basis points.

• Lynn Hopkins expressed interest in a stock buyback again in 2025.
• David Morris and others indicated aiming for low to mid-single digit loan growth, with potential for second half acceleration due to pipeline and market conditions.

• Impact of wildfires on communities and potential exposures.
• Credit risks related to non-performing loans, including specific reserves for a $26 million C&D loan.
• Interest rate environment effects on deposit repricing and loan prepayments.

Q: Brendan Nosal asked about the $26 million C&D loan and capital allocation.

A: Lynn Hopkins responded on the C&D loan's status and fair value estimate, and interest in stock buyback in 2025.

Q: Matthew Clark asked about margin, CD maturities, loan growth, and expenses.

A: Lynn Hopkins and David Morris discussed margin movement, CD maturities, loan growth expectations, and expense trends.

Q: Jackson Laurent asked about non-interest bearing deposits and M&A strategy.

A: Johnny Lee talked about non-interest bearing deposit drivers and ongoing M&A interest in Asian American banks.

Q: Kelly Motta asked about credit NPLs, resolution timeline, and M&A vs NPA resolution.

A: David Morris and Lynn Hopkins addressed NPL details, resolution timeline, and ongoing work on both NPA resolution and M&A.

Q: Tim Coffey asked about deposit costs, loan growth pace, and mitigating payoffs.

A: Lynn Hopkins and Johnny Lee discussed deposit cost drivers, loan growth expectations, and strategies to mitigate loan payoffs.