Good morning, and welcome to our first quarter 2026 call. Mariner Kemper, Chairman and CEO, and Ram Shankar, CFO, will share a few comments about our results.

Then, we'll open the call for questions from equity research analysts. Jim Rine, President of the holding company and CEO of UMB Bank, along with Tom Terry, Chief Credit Officer, will be available for the question-and-answer session.

Before we begin, let me remind you that today's presentation contains forward-looking statements, including the discussion of future financial and operating results, as well as other opportunities management foresees. Forward-looking statements and any pro forma metrics are subject to assumptions, risks, and uncertainties as outlined in our SEC filings and summarized in our presentation on slide 50.

Actual results may differ from those set forth in forward-looking statements, which speak only as of today. We undertake no obligation to update them, except to the extent required by securities laws.

Presentation materials are available online at investorrelations.umb.com and include reconciliations of non-GAAP financial measures. All per-share metrics refer to common shares and are on a diluted-share basis.

Now, I'll turn the call over to Mariner Kemper.

Thank you, Kay, and good morning, everyone. We'll share some brief comments, then open it up for questions.

We reported another strong quarter, with results well ahead of expectations. We had 10.8% linked-quarter annualized loan growth, boosted by $2.3 billion in gross production; 9 basis points of core margin expansion, driven by a 24 basis point decrease in the cost of interest-bearing deposits; high-quality credit metrics, including 19 basis points of net charge-offs; and provisions of $27 million, driven mostly by the $1.4 billion increase in period-end loan balances; and finally, continued momentum in our fee businesses, with strong contributions from corporate trust, investment banking, and fund services, where assets under administration increased nearly $20 billion from the prior quarter, and stand at $555 billion.

I'll let Ram get into more detail around our results in a moment, but first, I'd like to address some of the headlines around the private credit industry, which appear to exaggerate exposures and risks at regional banks. Private credit has been around for years, and has been and will continue to be an important part of capital formation on a global basis.

We have heard some concern that, due to our varied lines of business, we may have some outsized exposures and could impact our performance. The fact is that we have negligible exposure to the private credit industry, and what exposure we do have is to high-quality and experienced operators that have diversified holdings, strong credit structures, and low leverage at the fund level, all underwritten to low loan-to-value metrics.

We are proud to partner with a few of the strongest players by providing asset servicing solutions to their funds. This quarter, we've added additional disclosures to our IR deck to explain what private credit means to us, and, more importantly, what it doesn't.

First, on slide 31, we have outlined our total NDFI lending exposure, providing additional color to the standard call report categories. As you can see, our total NDFI exposure is $2.6 billion, or just 6.6% of total loans.

Within that total, approximately $300 million, or less than 1% of loans, are to private credit funds. Further, a third of those loans are subscription lines, which carry an even lower level of risk.

As I noted earlier, these private credit funds are primarily secured by diversified holdings of senior secured loans, have strong borrowing bases, minimal exposure to at-risk industries, low leverage, and they have continued to see strong gross inflows. Just under $1 billion of our NDFI loans are to private equity funds, with the largest portion of these being subscription lines, also known as capital call lines.

As you can see from the definition included on page 31, subscription lines inherently carry even lower risk to lenders, as they are short-term lines that are repaid with funds received on capital calls made to investors who are contractually obligated to contribute the capital to the fund upon request. The slide gives other detail and characteristics of our high-quality portfolio, including the fact that over 98% of NDFI balances are pass-rated.

As you have heard us say before, lending to NDFIs is not a new phenomenon, and has long been a part of our C&I portfolio, with minimal historic losses. Turning to our fee income exposure to private credit funds, we've added some additional detail on asset servicing and custody slide on page 36.

Approximately $43 billion of our more than $565 billion in assets under administration is related to private credit, representing just 7.6% of the total. More significantly, the AUA tied to private credit funds increased nearly 5% from the end of the prior quarter.

The related annual fee income totals approximately $13 million, or just 1.6% of annualized first-quarter fee income. Similarly, any deposit impact from these funds is immaterial.

Moving on, our capital levels continue to build, with March 31 common equity tier 1 ratio of 11.16%, a 20 basis point improvement from December. While our capital priorities remain the same, with organic growth at the top of our list, our board approved an increased share repurchase authorization.

As you can see in our earnings release, we opportunistically repurchased approximately 178,000 shares in March. We will continue to remain opportunistic in the second quarter.

Finally, our results this quarter drove positive operating leverage of 6.4% on a linked-quarter basis, a 155 basis point improvement in operating ROTCE, and an operating efficiency ratio of 47.6%. We continue to expect positive operating leverage for the full year of 2026, even with the impact of lower expected contractual accretion benefits.

I'm extremely pleased with the performance of our newer markets, and am excited to continue the momentum throughout the remainder of this year. Now, I'll turn it over to Ram for some additional detail on the drivers of our first quarter results.

Ram?

Thanks, Mariner. The first quarter included $51 million in net interest income from purchase accounting adjustments, $15.1 million of which was related to accelerated accretion from early payoffs of acquired loans.

The benefit to net interest margin from total accretion was approximately 33 basis points. On slide 10 is the projected contractual accretion, which is estimated at approximately $71 million for the remainder of 2026, and $79 million for 2027.

These totals do not include any estimates for accelerated payoffs. Slides 12 and 13 include some key highlights and drivers of our quarter-over-quarter variances.

Non-interest income for the quarter was $204.8 million, an increase of $6.4 million, or 3.2%. Drivers included strong performance from both fund services and corporate trust, increased deposit service charges, and investment banking revenue, where municipal trading income increased by 39% from fourth-quarter levels.

Within the other income category, we had $5.9 million in non-recurring gains on previously charged-off HTLF loans, a variance of $5.4 million from the fourth quarter. We had a $3.8 million decline in BOLI income, which had a similar offset in reduced deferred compensation expense.

Adjusting for investment gains, the non-recurring items I noted, and mark-to-market on BOLI, our fee income for the first quarter was approximately $198 million. On the expense side, we had just $4.4 million in merger-related costs, compared to elevated levels in the prior quarter, when the largest portion of contract termination and conversion expenses were recognized.

Excluding the impact of one-time costs, operating non-interest expense was $375.4 million, a reduction of 4.2% compared to the fourth quarter. Largest drivers included a reduction of $5.9 million in salaries and benefits expense related to lower bonus and commissions accruals following strong fourth-quarter performance, and a $3.9 million reduction in deferred compensation expense, partially offset by seasonal increases in payroll taxes, insurance, and 401(k) expense.

Compared to the guidance I provided last quarter, the favorability in expenses was driven by timing of marketing and other spend, sooner than expected synergies realized on contract terminations, and deferred compensation expense. Looking ahead, we would expect second quarter operating expense to be in line with the current consensus expectations of $383 million.

The increase from first quarter primarily reflects one additional salary day, as well as the impact of our merit cycle that went into effect in April. Turning to the balance sheet, driving the 10.8% annualized growth that Mariner mentioned was 22% annualized growth in average C&I balances, led by strong activity in Texas.

Other regions, including California, St. Louis, Colorado, and Utah, posted double-digit quarterly growth.

It's great to see the momentum building in several of our acquired regions, along with Utah, where we opened our first physical bank location in December. Our pipeline remains strong heading into the second quarter.

Average deposits, as shown on slide 25, were essentially flat in the first quarter, as the 10.4% linked-quarter annualized increase in DDAs was largely offset by lower interest-bearing deposit balances. We added a metric this quarter that adds customer repurchase agreement balances, which are deposit surrogates.

Average customer funding increased $702 million, or 1.2% from the prior quarter, and 4.8% on a linked-quarter annualized basis. This balance remix, coupled with the residual impact of the rate cuts in the fourth quarter, drove our cost of total deposits down by 19 basis points to 2.06%, while cost of interest-bearing deposits declined by 24 basis points to 2.79%.

We realized a blended beta of 70% on total deposits for the quarter, driven by favorable mix shift, as well as continued outperformance for pricing on our soft index deposits. Reported net interest margin for the first quarter was 3.38%.

Excluding the 33 basis points contribution from purchase accounting adjustments, core margin was 3.05%, increasing 9 basis points sequentially. The primary drivers of the linked-quarter increase in core net interest margin included: benefits of a favorable deposit mix shift and repricing of deposits following the reduction in short-term interest rates; and the positive impact of day count in the quarter, partially offset by loan repricing and lower loan fees; and the impact of liquidity balances and a lower benefit from free funds.

Relative to the first quarter adjusted margin of 3.05% that excludes accretion, we expect second quarter margin to be relatively flat, as the benefits from fixed-asset repricing are offset by day effect and stable deposit costs and mix shift. I will add my typical caveat that actual margin and net interest income will depend on levels of DDA growth and excess liquidity, any SOFR movements, and mix shift within the lending and funding portfolios.

Finally, our effective tax rate was 21.1% for the first quarter, compared to 20.3% for the fourth quarter. Looking ahead, our tax rate is expected to be between 20% and 22% for 2026.

Now, I'll turn it back over to the operator to begin the question-and-answer session. At this time, I would like to remind everyone, in order to ask a question, press *, then the number 1 on your telephone keypad.

We'll pause for just a moment to compile the Q&A roster.

Hey, good morning everyone.

Morning, John.

Hey, good morning. Maybe Mariner or Jim for you guys on the pipelines.

Good number, the $2.3 billion, maybe it's a little seasonality in there, but do you expect that to continue to grow from here? You flagged this in the release, but have you seen any impact on pipelines from some of the geopolitical risks or higher energy costs?

I'll take that first. Jim, feel free to add anything.

I think this is a good news story, which is that I don't really have anything new to tell you from being in this seat for 22 years, it's the same thing every quarter for 22 years, which is the next quarter looks pretty good, and it is not seasonal at all. We continue to book loans based on our strategy, bottoms-up, capability, capacity of the officer, market share, opportunity in the markets that we're in and in the verticals we're in, and there's a very long runway for us across our entire footprint, including some new, very big markets, like California.

Anything?

The only thing I would add is continues to be strong, and it's from the cross section from all markets.

Yeah.

Okay. Then anything on the payoffs and paydowns slowing?

I know that number jumps around, but it was a pretty big step down in the quarter, and I guess, is there anything you would flag on that?

No. Actually, I would say that the anticipated payoffs and paydowns in the first quarter actually materialized, what we expected to happen, happened.

It can kind of bump around, the reality of it as we look forward is we're going to be higher for longer instead of seeing rates come down, we're not likely to see as much payoffs and paydowns for the rest of the year if that's going to be the case, which seems to be the prevailing thought that we're probably sticking where we are, we'll just say we don't anticipate any rates coming down anytime soon, so.

Yep. Okay.

All right, thank you very much. Appreciate it.

Thanks, John.

Thank you. Good morning.

Morning, Jared.

Hey, just looking at the fee income lines, you had some really good strength there this quarter. How should we think about fee income going out for the year and for the second quarter, sort of building off of what we saw this quarter?

Yeah. I can't give you any guidance on expectations for growth and fee income other than to point backwards.

We continue to expect the same kind of performance from the team, and the pipelines across all those businesses remain very strong, to include the two that drive it really for our business and have for some time, which would be fund services and corporate trust. Then, we've been giving you a little color over the last couple years of the success we've had with our private investment group.

We expect to continue to see exits and successes periodically there, as well. Yeah.

Expectations continue to be, without giving you any specific guidance, as strong as they have been. Pipelines are good.

Activity's strong. We're taking share across the board in all those businesses.

At the time of the Heartland deal, you talked about the opportunity of corporate trust into some of those new markets. Are you seeing any activity there yet, or is that still more in the future, as you build out those markets and capabilities?

I think the message intended with that, is that corporate trust is a very local business, and it's a brand business. I think the brand extension, having offices and signs and visibility across California and other places, and places for lawyers to meet together in offices and things like that, it is brand extension, pushes the business further.

It's hard really to point directly towards Heartland specifically, but we know that brand extension with those locations and stuff is helpful. We've also done a lift-out.

We talked about that, I think, last quarter, Wilmington Trust in California, and so, I would say I'd call it mostly brand extension. It helps.

This is Jim. Jared, in what Mariner has mentioned, we've continued to add to the team in all markets.

We look for that to do nothing but grow in the Heartland markets that we inherited.

Thanks. Then, if I could just follow up on the deposits, Ram, you had called out sort of the impact to NIM from potential deposit mix shift and DDA growth.

If we look at average DDAs versus end of period, it feels like there could be some good growth built in there. How should we think about sort of that DDA balance growing from here, or is there just sort of a lot of quarter-end variability?

I'm going to take that. Ram can jump in after me, but I think, as we've said many times, there's a couple dynamics for us.

Oftentimes, we try to guide you to be thinking about averages rather than point in time. That's because of a lot of the episodic nature of all of our institutional businesses and some of our larger corporate business, with things such as dividends, and tax payments, and all those kinds of things that can happen from quarter to quarter.

That's true, but also, I mentioned a moment ago taking up Wilmington Trust's team in California, adding a team that works across the country in our New York office, in our LA office, etc., in corporate trust and the momentum we have with fund services. The addition of more clients in between those episodes allows the base to grow over time.

The expectation, without knowing, is that DDA baseline grows over time, due to all the success and momentum we have in client acquisition that takes place in between those episodes.

Thanks

a lot. Yep.

Thanks, Jared.

Hey, good morning everybody. Hope you're doing well.

Good morning.

Maybe just kicking off here on capital. Any early read on the updated capital rules overall, and then specifically how it ties into how you think about 100 billion, and maybe pair that alongside the increased activity we saw in the buyback this quarter?

I'll take this. Based on our preliminary read, it's a net positive for us.

Obviously, a lot of relief around risk-weighted assets. We're still studying it on going from 100% to 95% on some of the commercial relationships, and LTV-based assignments on residential mortgages.

The negative is just the inclusion of AOCI. I still think it's a net positive for us in terms of what it means to our CET1, our total capital ratios.

I would just add, with the addition of Heartland and how efficient we've become, we're accreting capital very quickly on top of all that. It's just a beautiful position to be in, where we're in a position to have likely more flexibility with capital.

All the things that Ram just said along with our ability to accrete and grow capital, it's going to give us flexibility as we look into getting closer to 100. We feel well-positioned.

Then again, we also believe, because of the quality of our assets, we benefit from likely being able to support lower levels of capital than our peers, anyway, long term.

Okay. All right, fantastic.

Maybe pivoting to more of a top-level question on just the overall return profile. Pretty meaningful step-up in ROA over the past couple of quarters, and I get that things can move around, period-to-period, but just conceptually, are we at a level that you can more or less maintain going forward, or are there environmental pressures that kind of ease that back somewhat?

We expect to continue to perform. Ram, I don't know if you any other color you?

We don't give long-term guidance on our growth targets, but even if you exclude some of the purchase accounting things that go through our income statement, if you exclude that, our performance has been increasing because of strong operating leverage, good balance sheet growth, good margin trajectory. We feel pretty good about it.

Then, to just add to your previous question on capital, we still have almost $600 million of pre-tax accretion left to take through our income statement for the next two, three years, right? That's $6 of EPS and close to 100 basis points of capital.

That's on top of the regular outperformance that we see in our legacy operations before all the purchase accounting benefits. We're pretty excited.

The denominator that's growing at a fast clip, and so that's why you saw what we did this quarter, including doing some buybacks before our quiet period ended. Obviously, we had $1.4 billion of loan growth, and you heard the comments about the pipeline looking pretty strong.

Then, we will be more opportunistic about looking at our dividend and other opportunities.

I would also just add, as a reminder, one of the reasons we did Heartland was to gain strength on our retail business, which we've doubled our branch network, doubled our granular low-cost deposits, and that is a really nice leverage point going forward for us. Our retail business was a bit more of a drag on those profitability metrics, and that has gotten a lot more efficient.

We expect it to continue to do so as it grows.

Okay. Fantastic.

Thanks for taking my questions.

Thanks, Brendan.

Great. Thanks.

Good morning, guys. Wanted to touch on the NIM outlook from the loan yield side of things, just where are new money yields versus that 6.52% level in the first quarter?

Morning, Casey. You've got to look at our loan yields excluding accretion, right?

If you look at one of our pages, we show that the loan yields are close to just 6%, under 6%, if you exclude the accretion benefit from loans. For the first quarter, our production yields are somewhere between 6% and 6.25%, they are pretty accretive on new money coming in.

Then, there's the whole fixed-asset repricing that happens within the loan portfolio, as well. We have close to $3 billion of loans that have sub-5% rates that are repricing higher in today's environment.

Great. Yeah.

Understand that the core loan yields and the accretion impact. Then, apologies if I missed this, on the expenses, very good discipline here in the first quarter.

Just I guess some color on what drove that $10 million of surprise versus your guidance, and with the guide being up in the second quarter, what are some of the drivers there, because I think there were some seasonal roll-offs

into

2Q. Just a little color on what's going on with the expenses.

I explained it in my prepared comments, but I'll repeat it. Some of it was just timing of when we expected some of the marketing spend to happen, so that didn't happen as I had anticipated in the first quarter when I gave my guidance.

The other one is, we also did a great job doing the expense saves from some of the contract terminations, they happened sooner than what would be expected. That was part of our $385 million to $390 million guidance that I gave last quarter.

Then, the step-up in the second quarter is one more day, and then it's the merit cycle that goes into effect in April for our associate base. Those are the two drivers that take $375 million.

We also had an expense credit, if you will, of $3 million from our deferred comp. If you add that, our first quarter baseline is more like $378 million, and what I guided to is about $383 million.

That seems to step up because of the merit cycle and one more day.

Gotcha. Thank you.

Thanks, Casey.

Good morning.

Morning, Janet.

On deposits, I want to better understand the reason for the decline or the muted deposit growth in the quarter. I thought 1Q was there's a seasonal public fund inflows, and even if I look at it on an average basis on page 25, I see commercial balances decline, although other parts have been growing.

Just wanted to see whether this is just timing or seasonality, or whether there was something else that attributes to somewhat muted deposit growth for the quarter? Yeah.

Thanks, Janet. I tried to address that a moment ago, it's complex, I get it.

We have so many lines of business that make it harder to understand. How we like to describe it for you is that you need to think about it on averages instead of point in time anyway in general, and that we have a lot of episodic stuff that goes through a lot of those business lines that you see on that page, that 36, 35?

25. 25.

On 25. Most of those businesses other than public funds is a seasonal deal, so that's a draw down in the quarter, because of tax payments and such.

The rest of them are more episodic. That's why you have to think about averages.

I also like to point to 42, because you really need to think about what's happening to our deposits over time, not even just averages for a single quarter. We have a very long-term track record of adding clients.

In between on a quarter-to-quarter basis, you can see tax payments, and dividend payments, and putting money to work, and all those kinds of things that can kind of bump things around a little bit. You really need to think about kind of multiple linked quarters, and kind of year-over-year growth, and what we're able to do as a company.

That's the way I think about it, that's the way I would like to think you all should think about it. What is our long-term ability to grow deposits?

We have an exceptional deposit-generating machine. That's the way I would look at it.

I guess what I would end with is there's nothing to pick up from at the end of the quarter. It's just business as usual, business activity, client count is good, client count is growing, nothing to read into with those numbers.

There was not [unclear], is what in a nutshell, we did not lose any business. Yeah.

Great, thanks for the color. You've already touched on it earlier on total fees, and really appreciate all the color you gave on the private credit exposure on slide 36.

This means that, at least from either deposit or for the fee perspective, on the trust and security processing fees, which have been growing at a very strong pace, you're not seeing any disruption to that flow, and the trajectory of that line item should just be continued growth, since you're not really seeing any outflows on AUA and the fee income side of the business? Is that the fair way to put it?

That's absolutely correct. One of the things I think is really important to know about this business for us is from time to time, investors will ask, and I'm going to take you down a little history lane here for a second.

There was a time when hedge funds were leading the way. As you're all aware, hedge funds became out of favor.

During that same time, we got the same set of questions, "Oh, what's going to happen to your assets under administration as the hedge fund business slides away?" The answer to that is private investing is still leading the way, and so with our business, basically, as you go from hedge funds to private equity, and within private equity intervals come out and that's a popular vehicle.

Then private credit comes along, and then this conversation is taking place with private credit. It doesn't mean all this money goes to public investing.

It means it redistributes back through the other verticals within private investing. We are the beneficiary regardless, as that money moves around within the private investing universe.

We have benefited handsomely over time, regardless of which one of those verticals is accumulating capital calls.

Got it. Thanks for all the color.

Thanks, Janet.

Morning, everyone. Thanks for taking the questions.

Morning.

Just going back to the capital discussion, to your earlier points, you're generating a lot of capital internally just given the profitability profile. Obviously, eclipse your CET1 target this quarter.

Just given that the capital is building at such strong clips, even with double-digit balance sheet growth, how are you guys thinking about using the buyback authorization as more of a kind of a continuous tool to manage excess capital? I know it's been more episodic in the past, but just curious how you're thinking about buybacks as more of a kind of consistent component to excess capital management?

I'm going to repeat myself here. Sorry, Nathan.

We have a long-tested philosophy around that, which is as long as we're able to do what we've been able to do and expect to continue to do, the first and highest best use of our capital is put it in the loans, and we're very successful at it. We don't see that fading away.

We've got an excellent team, a big, deep pipeline. We've got long-tenured associates, we big new markets to pursue, having lots of success.

Really across the board, Wisconsin for us is on fire, Minneapolis has really turned on, California's doing great, New Mexico, I could go on and on. The new markets are really performing, and just we're kind of early days getting the benefit out of the new market, I think they're not even operating at their highest level.

First and foremost, loans. Then it's sort of the combination of the other capital uses based on lots of variables, right?

How's our currency trading with then all the other currencies, and what's going on in the economy, M&A, we still think it makes sense for us to do tuck-in acquisitions that meet our tests for low-cost, granular, underlevered deposits, well-run, smaller banks that fit into the markets where we're already operating in. That fits.

That's investing in the business, so that would probably be next. Then the next two on the list are going to be buybacks and dividends.

As we have been, we'll be opportunistic on the buyback side. Our expectation on the dividend side is that you as investors should expect, as long as we're performing, that you should see an increase in our dividend every year.

That's the way I think about it, is we're first going to be thinking about investing in our business, and then think about buybacks.

Understood. It makes sense.

Maybe a bigger picture question for you. It seems like to your point, you're kind of firing on all cylinders.

There's good opportunities to grow share across each vertical and line of business. Are there any segments or businesses where that's not working, or where you're seeing opportunities for greater efficiency or operational improvement going forward?

Anybody who's not trying to leverage technology and make their business more efficient should have their heads examined. We're always looking at ways to operate better, and machine learning is being deployed across the whole organization to get smarter, better, faster, bolder.

We're deploying that as we always have. I think AI is sort of a overused, misused term for, basically, being smart and using technology to make your business better, but so, we're looking for ways to do that all the time.

I think you'll see us do that successfully going forward. Otherwise, I would say, really, it's just making sure the sales force has everything they need, and we're staying out of the way, and letting our exceptional, tenured team of best in the business folks get out there and build our business.

I think we have a really tremendous opportunity as a company to sort of take the feel of local, national. We've been using that term.

We really think we can take local national from Illinois to California, and from Milwaukee and Twin Cities all the way down to New Mexico and all throughout Texas. We think we can kind of be the go-to bank with a team that's in place, and has deep pipelines.

Great. Great.

I appreciate all the color. Thanks, Mariner.

Thanks, Nathan.

Hi, good morning.

Morning, Brian.

Just wanted to follow up on the core net interest margin guidance for the second quarter. Ram, you mentioned that new loan growth is accretive to core loan yields.

You talked about the fixed-rate asset repricing. Can you just elaborate on some of the puts and takes and any headwinds that keep core NIM stable in 2Q as opposed to up?

It's just the incremental cost of deposits relative to what we can make on the asset side, right? If you look at our cost of interest-bearing deposits in the last quarter was about 2.80%.

As Mariner said, we have very diversified funding mix, and depends on where it comes from, whether it comes from DDAs or some of the other verticals, our cost of deposits can vary from one quarter to another quarter depending on where it's coming from. There are no headwinds in that regard.

I think it's the absence of tailwinds that we had with rate cuts. Our internal view is there might be one rate cut, maybe later this year, maybe not.

There are no more tailwinds from that standpoint that benefit our beta.

Neutral.

Neutral. As I said, we expect our deposit costs to be stable, and some accretion on the lending side because of new money yields and fixed-assets repricing.

Stable with the opportunity of outperformance on demand deposit. Again, I say opportunity, right?

That's a possibility for us, otherwise it would be stable, right?

Got it. Really appreciate that color.

Then, maybe just on the deposit side, you had really strong growth this quarter in the corporate trust deposits. Can you just remind us of some of the drivers for that business?

I know UMB has an aviation business, you have a relatively new CLO business, can you sort of just talk about what's working there, and what the environment is right now for corporate trust? Thanks.

Thank you. Exactly, the aviation business is hitting on all cylinders.

We have certain that our CLO business is firing up really well on a national basis, a lots of opportunity there. Infrastructure spending is finally happening on a national basis, our offices in the coasts have really started to pick up.

We did this lift-out, we talked about a couple times on the call already, so, there's a big list on the infrastructure side, and so it's really, I would say, across all those verticals. To your point, there are a couple of relatively new verticals.

I don't know, Jim, you want to add anything to that? It's really great.

I think you hit it. It's also across the board.

Just simply, more of what we've always been doing. Mm-hmm.

Got it. Really appreciate Yep.

We're number two and number three in the country by number of issues now. Our coastal offices are relatively new, I think there's a huge runway for what we're able to do out of Orange County and New York, up and down the coasts.

Got it. Really appreciate all the color, and thank you for taking my questions.

Thank you, Brian.

Oh, great. Morning.

Morning, Chris.

Ram, I appreciate the commitment to operating leverage this year. You think about the moving pieces over the medium term, you've got the accretion rundown, but it feels like this model is capable of operating leverage for the foreseeable future.

I get any response to that?

That's why even last time, and Mariner said it this time as well, right? Whether there's more private investment gains or less private investment gains, whether there's more accretion or less accretion, our job is to maintain positive operating leverage as we build scale.

Some of our strategic pillars are about building scale in each of the markets, and we're doing that very selectively. Then, we're being more profitable as we grow into our size, as well.

Definitely, this is not a environmental thing. We want to weather all economic environments and achieve positive operating leverage that way.

We judge ourselves on operating leverage. We think that's the way to think about it.

Every dollar spent should have positive leverage, and just how we operate business.

As a follow-up, is there anything magic about the 50% efficiency? You're kind of in the low-50s today, kind of balancing the need for investments, the benefits from AI and that dynamic.

Is there anything magic about 50?

I would say absolutely nothing magic about 50. As a matter of fact, we feel like we're doing really well where we are given the mix of business.

Being at 47 where we are right now is a top-of-class number for just a net interest margin shop. The fact that we're able to perform at 47 with all of our institutional businesses layered on top of that, we feel pretty damn good about that.

No, I think there's nothing magic about 50. All right.

Thank you.

Thanks, Chris.

Hey, good morning. Mariner, I definitely appreciate you led with anyone not using technology to get better needs to be examined, but I thought it was interesting, I think you said AI is overused or overhyped.

Can you just expand a little bit on where you think maybe the AI for banks is a little too much?

Sure. No, not too much.

No, that's not what I meant. What I said was I think the term is overused.

I think that this a big philosophical thing. I just think, at the end of the day, AI is the use of data to run your business better, and make better decisions, and move faster.

It's not a new subject, is my point. The TV, and Bloomberg, and CNBC, and The Wall Street Journal have all really made a big deal out of it, but at the end of the day, it's the use of machine learning to get better, smarter, faster, bolder, which is not a new subject.

That's all I was saying. I wasn't saying banks are doing too much of it or not enough of it, or whatever.

I was just saying you should sure as hell be doing it and leveraging the use of faster computing and better data to make your business better, smarter, faster, bolder. If you're not doing that, you should your head examined.

It wasn't people are doing too much or not enough of it. It was you sure as hell better be doing it.

Perfect. On M&A, as I'm sure you're aware, there just kind of became this narrative last year that somehow you were on the list to do a big deal.

I thought it was interesting, you kept using the word "tuck-in". Any other parameters you'd give on what a ideal tuck-in deal looks like for you, and maybe as an extension, if and when the $100 billion line finally goes up, does the definition of the size of a tuck-in change, or is it really independent of that move in regulation?

Yeah. First, I would say, I'm still surprised that somehow there was some narrative that we were going to go do some big deal.

I've never understood that. We would never give up control of our company, try to merge two management teams, give up half our board, blah, blah, blah, on and so forth.

We've never done that. We're never going to do that.

We have an fantastic management team and a great strategy, and I have no need to do that, no desire to do that. The purpose of using the term "tuck-in" is sort of to help with the definition of doing a deal that's not going to affect any of that, where we can tuck it in.

It can still be our management team. Don't have to give up half the board room, part of the board room, or whatever it is, and try to merge two cultures, etc.

That's what tuck-in's supposed to mean. Again, I think our definitions are long-used, I don't understand why my long-used definitions get misused or misunderstood, but what we say is a tuck-in, a smaller deal, and then it would be in-market or contiguous, where we can leverage our people, leverage synergies, leverage brand, and all that.

Really importantly for us would be a granular, low-cost deposits that are underlevered. That's another really important one.

We don't really want to do a deal where every next dollar we lend out has to be from acquired deposits. We love the idea of an institution that is leverageable, that has deposits that we can put to use.

Cuz we have the asset-generating machine, and we don't want to put that under pressure. Those are kind of the general themes, if that's helpful.

That is. Thank you so much.

Yep.

Thank you, everybody. As always, we love your interest in our company and the time you spend to get to know us better.

Hope that page 31 helped dispel some of the misguided understanding of what the private credit stuff means to us, less than 1% of our loans, etc. That we have a very long track record of being lenders that do the same thing across every asset class.

We lend the same way no matter what we're lending into. We've had a very long track record, which you can see on 42 and 22 is where the quality is.

The intersection of growth on 42 and the quality on 22, it is what we like to define as rarefied air that we live in. We've got a long-tenured team and a great track record.

I just point you to our track record, I guess, as you think about those issues. We're very excited about what lays ahead, and we appreciate your interest.

Thank you, Mariner. As always, if you have follow-up questions, you can reach us at 816-860-7106.

Thank you.