NASDAQ:FSBC Five Star Bancorp Q1 2024 Earnings Report $26.41 +0.21 (+0.80%) Closing price 04/17/2025 04:00 PM EasternExtended Trading$26.42 +0.02 (+0.06%) As of 04/17/2025 04:05 PM Eastern Extended trading is trading that happens on electronic markets outside of regular trading hours. This is a fair market value extended hours price provided by Polygon.io. Learn more. Earnings HistoryForecast Five Star Bancorp EPS ResultsActual EPS$0.62Consensus EPS $0.57Beat/MissBeat by +$0.05One Year Ago EPS$0.77Five Star Bancorp Revenue ResultsActual Revenue$49.37 millionExpected RevenueN/ABeat/MissN/AYoY Revenue GrowthN/AFive Star Bancorp Announcement DetailsQuarterQ1 2024Date4/29/2024TimeAfter Market ClosesConference Call DateTuesday, April 30, 2024Conference Call Time1:00PM ETUpcoming EarningsFive Star Bancorp's Q1 2025 earnings is scheduled for Monday, April 28, 2025, with a conference call scheduled on Tuesday, April 29, 2025 at 1:00 PM ET. Check back for transcripts, audio, and key financial metrics as they become available.Conference Call ResourcesConference Call AudioConference Call TranscriptSlide DeckPress Release (8-K)Quarterly Report (10-Q)Earnings HistoryCompany ProfileSlide DeckFull Screen Slide DeckPowered by Five Star Bancorp Q1 2024 Earnings Call TranscriptProvided by QuartrApril 30, 2024 ShareLink copied to clipboard.There are 5 speakers on the call. Operator00:00:00Welcome to the 5 Star Bancorp First Quarter Earnings Webcast. Please note, this is a closed conference call and you are encouraged to listen via the Before we get started, let me remind you that today's meeting will include some forward looking statements within the meaning of applicable securities laws. These forward looking statements relate to, among other things, current plans, expectations, events and industry trends that may affect the company's future operating results and financial position. Such statements involve risks and uncertainties, and future activities and results may differ materially from these expectations. For a more complete discussion of the risks and uncertainties that may cause actual results to differ materially from the company's forward looking statements, Please see the company's annual report on Form 10 ks for the year ended December 31, 2023, and in particular, the information set forth in Item 1A, Risk Factors. Operator00:01:23Please refer to Slide 2 of the presentation, which includes disclaimers regarding forward looking statements, industry data and non GAAP financial information included in this presentation. Reconciliations of non GAAP financial measures to their most directly comparable GAAP figures are included in the appendix to the presentation. Please note, this event is being recorded. I would now like to turn the presentation over to James Beckwith, 5 Star Bancorp's President and CEO. Please go ahead. Speaker 100:01:59Thank you for joining us to review 5 Star Bancorp's financial results for the Q1 of 2024. Joining me today is Heather Luck, Senior Vice President and Chief Financial Officer. Our comments today will refer to financial information that was included in the earnings announcement released yesterday. To obtain a copy of the release, please visit our website at 5starbank.com and click on the Investor Relations tab. Our organic growth story continued in the Q1 with the announcement of our underwritten public offering of 3,450,000 shares of the bank's common stock and underwriters option to purchase up to an additional 517,500 shares with the intention of using the net proceeds for general corporate purposes to support our continued growth and for working capital. Speaker 100:03:01We also added 5 more seasoned professionals to support our expansion in the San Francisco Bay Area market and continued to add new core deposit accounts and relationships as seen in the increase of non wholesale deposits of $112,000,000 in the 3 months ended March 31, 2024. Despite continued external headwinds, we maintained our ability to conservatively underwrite as evidenced by a 50% LTV on commercial real estate, manage expenses with our 45% efficiency ratio and deliver value to our shareholders with our $0.20 per share dividends for the Q4 of 2023 and the Q1 of 2024. The Q1 of 2024 exhibited continued margin compression, although slowing compared to prior quarters. We remain focused on the execution of our organic growth strategy and we're able to maintain earnings and expense management trends during the quarter. Loans have consistently grown since prior periods. Speaker 100:04:19The decrease in deposits and total assets during the quarter is the result of relying less on wholesale deposits and short term borrowings, which positions us well for future growth. Our pipeline continues to remain solid at the end of the Q1 of 2024 within verticals we have historically operated in as presented in the loan portfolio diversification slide. Loans held for investment increased during the quarter by $22,400,000 or 0.73 percent from the prior quarter, primarily within the consumer concentration of the loan portfolio. Loan originations during the quarter were approximately $149,900,000 while payoffs and paydowns were $77,200,000 dollars 50,300,000 respectively. Asset quality continues to remain strong, though non performing loans increased beginning in the Q3 of 2023, they continued to represent only 0.06 of the portfolio at the end of the first quarter. Speaker 100:05:43At the end of the first quarter, the allowance for credit losses totaled 34,700,000 qualitative reserves and reduction in reserves for qualitative factors. The ratio of the allowance for credit losses to total loans held for investment was 1.12% at quarter end. Loans designated as substandard totaled approximately 1,900,000 at the end of the quarter, which was a decrease from the 2,000,000 at the end of the previous quarter. During the Q1, deposits decreased by $71,700,000 or 2.35 percent as compared to the previous quarter. Non interest bearing deposits as a percentage of total deposits at the end of the first quarter increased slightly to 27.7% from 27.5% at the end of the previous quarter. Speaker 100:06:58As noted earlier, we are pleased we had a net non wholesale deposit inflows for the 3 months ended March 31, 2024. Our ability to grow deposit accounts supports our differentiated customer centric model that our customers trust and value. As seen through the mix of high dollar accounts and the duration of certain customer relations, we believe we have a reliable core deposit base. To offer more detail on our deposit composition, I want to highlight that deposit relationships totaling at least $5,000,000 constituted approximately 58% of total deposits and the average age of these accounts was approximately 9 years. Local agency depositors accounted for approximately 24% of deposits as of March 31, 2024. Speaker 100:08:02Overall deposit balances have decreased when compared to the prior quarter. Focus to rely less on costly wholesale deposits. Wholesale deposits, which we defined as broker deposits and public time deposits decreased by $183,100,000 Non wholesale deposits increased by $112,000,000 driven by a $125,700,000 increase in interest bearing deposits, partially offset by a $13,700,000 decrease in non interest bearing deposits. Cost of total deposits was 253 basis points during the Q4. We continue to be well capitalized with all capital ratios well above regulatory thresholds for the quarter. Speaker 100:08:58Our common equity Tier 1 ratio increased from 9.07% to 9.13 between December 31, 2023 March 31, 2024. On April 19, we announced by a declaration by our Board of Directors a cash dividend of $0.20 per share on the company's voting common stock expected to be paid on May 13, 2024 to shareholders of record as of May 6, 2024. On that note, I will hand it over to Heather to discuss the results of operations. Heather? Speaker 200:09:39Thank you, James, and hello, everyone. Net income for the quarter was 10,600,000 return on average assets was 1.22 percent and return on average equity was 14.84%. Average loan yield for the quarter was 5.71 percent representing an increase of 7 basis points over the prior quarter. Our net interest margin was 3.14 percent for the quarter, while net interest margin for the prior quarter was 3.19%. Fed rate increases in 2023 continue to put the pressure on deposit costs. Speaker 200:10:23As a result of changes in interest rates and other factors, our other comprehensive loss was 0 point $7,000,000 during the 3 months ended March 31, 2024, as unrealized losses, net of tax effect, increased on available for sale debt securities from $11,800,000 as of December 31, 2023 to $12,400,000 as of March 31, 2024. Non interest income decreased to $1,800,000 in the first quarter from $1,900,000 in the previous quarter due primarily to reductions in gains from distributions on investments in venture backed funds and the recognition of rate lock and swap referral fees during the 3 months ended March 31, 2024. The decreases were partially offset by a reduction in net losses on the sale of securities, which did not occur in the Q1 of 2024. Non interest expense grew by $53,000 in the 3 months ended March 31, 2024 compared to the 3 months ended December 31, 2023. This is primarily due to an increase in salaries and employee benefits, partially offset by declines in advertising and promotional expenses as well as other operating expenses during the quarter. Speaker 200:11:49Now that we've discussed the overall results of operations, I will now hand it back to James to provide some closing remarks. Speaker 100:11:56Thank you, Heather. I want to thank everyone for joining us as we discussed Q1 results. 5 Star Bank has a reputation built on trust, speed to serve and certainty of execution, which support our client success. Our financial performance is a result of a truly differentiated customer experience, which continues to power the demand for 5 Star Bank's relationship based services. We attribute sustained success to our prudent business model and treating customers with an empathetic spirit, understanding and care. Speaker 100:12:36We are very proud to have earned the trust of those we serve, including our shareholders. As we lean into 2024, we are guided by continued focus on shareholder value as we monitor market conditions. We are confident in the company's resilience in any environment and remain focused on the future and our long term strategy. We will continue to execute on our organic growth and disciplined business practices, which we believe will benefit our customers, employees, community and shareholders. We appreciate your time today. Speaker 100:13:15This concludes today's presentation. Now Heather and I will be happy to take any questions that you might have. Operator00:13:25We will now begin the question and answer Speaker 300:13:44The Operator00:13:50first question today comes from Andrew Terrell with Stephens. Please go ahead. Speaker 300:13:57Hey, good afternoon. Speaker 100:13:59Hey, good afternoon, Andrew. Speaker 300:14:03Just a couple around deposits for me. When did the runoff in the brokered deposits and then public fund time deposits occurred during the quarter? I mean, Heather, do you have the weighted average cost of those deposits? Speaker 200:14:21So going into the Q1 for the year, we had a weighted average rate of about 5.2 6% on the wholesale deposits and that had a balance of about $360,000,000 We really did, would say, probably the second half of the quarter when most of the wholesale deposits ran off. So now we're currently sitting at a weighted average rate of 5.12%. And the total balance is 177,000,000 Speaker 300:14:53dollars Yes. And then can you talk about your I mean the remix this quarter was obviously very impressive. You've got something like 177 left of wholesale. Can you just remind us the kind of deposit growth expectations for the year? And then would you expect any more runoff in the wholesale deposits within that kind of deposit guidance? Speaker 100:15:20Sure. We're going to stick to our 10% of deposit growth. We plan to end up in that at 10%. That includes accounting for runoff of Q1 runoff of wholesale deposits. I think as we sit right now, I wouldn't expect too great of a continued runoff of wholesale. Speaker 100:15:47It will probably be pretty static Andrew for the rest of the year, but we'll look at this on a quarter by quarter basis. We kind of like where we are and in a certain respect maintaining relationships particularly with the State left in July. $42,000,000 $42,000,000 which hopefully we'll be able to eliminate that. But nothing probably greater than that, Andrew. Speaker 300:16:19Okay, great. I appreciate it. And then could you maybe just compare and contrast for the non wholesale deposit growth, I think it was $112,000,000 or so this quarter. Just the weighted average cost you're bringing kind of new money on the balance sheet today versus what we saw roll off in the Q1? Speaker 100:16:42Sure. A lot of the balances that we're bringing on right now are interest bearing. And when I think about if I was to amalgamate what we expect in terms of non interest bearing and interest bearing, that weighted average rate is probably around little shy of 3%. But the interest bearing stuff is probably has about a 4% handle on it as I'm thinking all this through. And so we're successful in our for the remainder of the year with non interest bearing deposit increases and that's really driven by new relationships that we're bringing on. Speaker 100:17:25That will work those numbers down. I think our San Francisco effort in terms of yield that we're paying those deposit customers. Heather, do you have that information on because I'm going to recall it off the top of my head. Speaker 200:17:40I want to say it's close to 3%. Speaker 100:17:42Yes, it's a little shy of 3%, 2.77%, I think that was in DJ's deck. Correct. So that's kind of what we're looking at right now in terms of what we're bringing on these new relationships on. And Andrew, it's important to note as we bank these new customers across our entire footprint, we're really after their operating accounts and their liquidity. So we look at things in totality in terms of cost of funds. Speaker 100:18:18So if we can pay somebody 4% for their liquidity and just bank their transactional account, if you will, We think that that's a winning strategy and hopefully we can deliver the entire relationship sub-three percent. Speaker 300:18:36Yes, totally appreciate that. Understood. If I could ask just one last one, Heather, around the margin. Do you have the margin in the month of Speaker 200:18:47March? In the month of March, I do. So our net interest margin for apologies, let me pull up that piece of it. Net interest margin just for the month of March was about 3.18 Operator00:19:14The next question comes from Gary Tenner with D. A. Davidson. Please go ahead. Speaker 400:19:20Thanks. Good morning. I wanted to ask on the expense side, what the near term thinking is on expense levels kind of fully loaded for new hires? Speaker 200:19:34Yes. So I think if we look at for Q2, I think if we add about $500,000 for Q2's expenses to what we incurred for Q1, that should put your model in good shape there. We do have some new hires, but then also some expenses for conferences that we have running through that are a little bigger than Q1. Speaker 100:19:55And our advertising spend is going to go up in the Q2, Q3, Q4 as we continue to develop the Bay Area. Speaker 400:20:07Okay. Appreciate it. And then I may have missed this answer a second here. I heard you mentioned, I think, the March NIM, Heather, but did you provide the spot rates as of March 31? If you did, I apologize for missing it. Speaker 200:20:19No, sure. Spot rate for cost of deposits was 2.49 Speaker 100:20:29dollars Operator00:20:31This concludes our question and answer session. I would like to turn the conference back over to management for any closing remarks. Speaker 100:20:39Great. Thank you. 5 Star Bancorp is on a continued path of growth as we execute on strategic initiatives, which include growing our verticals and geographies while attracting and retaining talent. Our people, technology, operating efficiencies, conservative underwriting practices and expense management have also contributed to the success we share with our shareholders employees. These successes include numerous rating and awards. Speaker 100:21:10In the Q1, the company's leadership was recognized by the Sacramento Business Journal on the Power 100 list and the Women Who Mean Business list. Company leadership also received a National Association of Women Business Owners Outstanding Women Leaders Executive Woman Award. Also in the Q1, 2 of our customers were recognized by the Sacramento Small Business Administration in the categories of Family Owned Small Business of the Year and Minority Small Business Champion. 5 Star Bank continues to be a driving force for economic development, a trusted resource for our customers and a committed advocate for our community. We look forward to speaking with you again in July to discuss earnings for the Q2 of 2024. Speaker 100:22:04Have a great day and thank you for listening. Operator00:22:09The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.Read morePowered by Conference Call Audio Live Call not available Earnings Conference CallFive Star Bancorp Q1 202400:00 / 00:00Speed:1x1.25x1.5x2x Earnings DocumentsSlide DeckPress Release(8-K)Quarterly report(10-Q) Five Star Bancorp Earnings HeadlinesFive Star Bancorp Announces First Quarter 2025 Earnings Release Date and WebcastApril 15, 2025 | markets.businessinsider.comFive Star Bancorp Announces First Quarter 2025 Earnings Release Date and WebcastApril 15, 2025 | globenewswire.comWarning: “DOGE Collapse” imminentElon Strikes Back You may already sense that the tide is turning against Elon Musk and DOGE. Just this week, President Trump promised to buy a Tesla to help support Musk in the face of a boycott against his company. But according to one research group, with connections to the Pentagon and the U.S. government, Elon's preparing to strike back in a much bigger way in the days ahead.April 19, 2025 | Altimetry (Ad)Five Star Bancorp FSBCMarch 13, 2025 | morningstar.comFive Star Bancorp EVP Don Kurtze buys $2,846 in common stockMarch 11, 2025 | investing.comInstitutional investors own a significant stake of 48% in Five Star Bancorp (NASDAQ:FSBC)March 11, 2025 | finance.yahoo.comSee More Five Star Bancorp Headlines Get Earnings Announcements in your inboxWant to stay updated on the latest earnings announcements and upcoming reports for companies like Five Star Bancorp? Sign up for Earnings360's daily newsletter to receive timely earnings updates on Five Star Bancorp and other key companies, straight to your email. Email Address About Five Star BancorpFive Star Bancorp (NASDAQ:FSBC) operates as the bank holding company for Five Star Bank that provides a range of banking products and services to small and medium-sized businesses, professionals, and individuals in Northern California. It accepts various deposits, such as money market accounts, noninterest-bearing and interest checking accounts, savings accounts, term certificate accounts, and time deposits. The company also offers loan products, including commercial and residential real estate loans; commercial loans; commercial land loans; farmland loans; commercial and residential construction loans; and consumer and other loans, as well as operating lines of credit. In addition, it provides debit cards; and remote deposit capture, online and mobile banking, and direct deposit services. Five Star Bancorp was founded in 1999 and is headquartered in Rancho Cordova, California.View Five Star Bancorp ProfileRead more More Earnings Resources from MarketBeat Earnings Tools Today's Earnings Tomorrow's Earnings Next Week's Earnings Upcoming Earnings Calls Earnings Newsletter Earnings Call Transcripts Earnings Beats & Misses Corporate Guidance Earnings Screener Earnings By Country U.S. Earnings Reports Canadian Earnings Reports U.K. Earnings Reports Latest Articles Archer Aviation Unveils NYC Network Ahead of Key Earnings Report3 Reasons to Like the Look of Amazon Ahead of EarningsTesla Stock Eyes Breakout With Earnings on DeckJohnson & Johnson Earnings Were More Good Than Bad—Time to Buy? 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There are 5 speakers on the call. Operator00:00:00Welcome to the 5 Star Bancorp First Quarter Earnings Webcast. Please note, this is a closed conference call and you are encouraged to listen via the Before we get started, let me remind you that today's meeting will include some forward looking statements within the meaning of applicable securities laws. These forward looking statements relate to, among other things, current plans, expectations, events and industry trends that may affect the company's future operating results and financial position. Such statements involve risks and uncertainties, and future activities and results may differ materially from these expectations. For a more complete discussion of the risks and uncertainties that may cause actual results to differ materially from the company's forward looking statements, Please see the company's annual report on Form 10 ks for the year ended December 31, 2023, and in particular, the information set forth in Item 1A, Risk Factors. Operator00:01:23Please refer to Slide 2 of the presentation, which includes disclaimers regarding forward looking statements, industry data and non GAAP financial information included in this presentation. Reconciliations of non GAAP financial measures to their most directly comparable GAAP figures are included in the appendix to the presentation. Please note, this event is being recorded. I would now like to turn the presentation over to James Beckwith, 5 Star Bancorp's President and CEO. Please go ahead. Speaker 100:01:59Thank you for joining us to review 5 Star Bancorp's financial results for the Q1 of 2024. Joining me today is Heather Luck, Senior Vice President and Chief Financial Officer. Our comments today will refer to financial information that was included in the earnings announcement released yesterday. To obtain a copy of the release, please visit our website at 5starbank.com and click on the Investor Relations tab. Our organic growth story continued in the Q1 with the announcement of our underwritten public offering of 3,450,000 shares of the bank's common stock and underwriters option to purchase up to an additional 517,500 shares with the intention of using the net proceeds for general corporate purposes to support our continued growth and for working capital. Speaker 100:03:01We also added 5 more seasoned professionals to support our expansion in the San Francisco Bay Area market and continued to add new core deposit accounts and relationships as seen in the increase of non wholesale deposits of $112,000,000 in the 3 months ended March 31, 2024. Despite continued external headwinds, we maintained our ability to conservatively underwrite as evidenced by a 50% LTV on commercial real estate, manage expenses with our 45% efficiency ratio and deliver value to our shareholders with our $0.20 per share dividends for the Q4 of 2023 and the Q1 of 2024. The Q1 of 2024 exhibited continued margin compression, although slowing compared to prior quarters. We remain focused on the execution of our organic growth strategy and we're able to maintain earnings and expense management trends during the quarter. Loans have consistently grown since prior periods. Speaker 100:04:19The decrease in deposits and total assets during the quarter is the result of relying less on wholesale deposits and short term borrowings, which positions us well for future growth. Our pipeline continues to remain solid at the end of the Q1 of 2024 within verticals we have historically operated in as presented in the loan portfolio diversification slide. Loans held for investment increased during the quarter by $22,400,000 or 0.73 percent from the prior quarter, primarily within the consumer concentration of the loan portfolio. Loan originations during the quarter were approximately $149,900,000 while payoffs and paydowns were $77,200,000 dollars 50,300,000 respectively. Asset quality continues to remain strong, though non performing loans increased beginning in the Q3 of 2023, they continued to represent only 0.06 of the portfolio at the end of the first quarter. Speaker 100:05:43At the end of the first quarter, the allowance for credit losses totaled 34,700,000 qualitative reserves and reduction in reserves for qualitative factors. The ratio of the allowance for credit losses to total loans held for investment was 1.12% at quarter end. Loans designated as substandard totaled approximately 1,900,000 at the end of the quarter, which was a decrease from the 2,000,000 at the end of the previous quarter. During the Q1, deposits decreased by $71,700,000 or 2.35 percent as compared to the previous quarter. Non interest bearing deposits as a percentage of total deposits at the end of the first quarter increased slightly to 27.7% from 27.5% at the end of the previous quarter. Speaker 100:06:58As noted earlier, we are pleased we had a net non wholesale deposit inflows for the 3 months ended March 31, 2024. Our ability to grow deposit accounts supports our differentiated customer centric model that our customers trust and value. As seen through the mix of high dollar accounts and the duration of certain customer relations, we believe we have a reliable core deposit base. To offer more detail on our deposit composition, I want to highlight that deposit relationships totaling at least $5,000,000 constituted approximately 58% of total deposits and the average age of these accounts was approximately 9 years. Local agency depositors accounted for approximately 24% of deposits as of March 31, 2024. Speaker 100:08:02Overall deposit balances have decreased when compared to the prior quarter. Focus to rely less on costly wholesale deposits. Wholesale deposits, which we defined as broker deposits and public time deposits decreased by $183,100,000 Non wholesale deposits increased by $112,000,000 driven by a $125,700,000 increase in interest bearing deposits, partially offset by a $13,700,000 decrease in non interest bearing deposits. Cost of total deposits was 253 basis points during the Q4. We continue to be well capitalized with all capital ratios well above regulatory thresholds for the quarter. Speaker 100:08:58Our common equity Tier 1 ratio increased from 9.07% to 9.13 between December 31, 2023 March 31, 2024. On April 19, we announced by a declaration by our Board of Directors a cash dividend of $0.20 per share on the company's voting common stock expected to be paid on May 13, 2024 to shareholders of record as of May 6, 2024. On that note, I will hand it over to Heather to discuss the results of operations. Heather? Speaker 200:09:39Thank you, James, and hello, everyone. Net income for the quarter was 10,600,000 return on average assets was 1.22 percent and return on average equity was 14.84%. Average loan yield for the quarter was 5.71 percent representing an increase of 7 basis points over the prior quarter. Our net interest margin was 3.14 percent for the quarter, while net interest margin for the prior quarter was 3.19%. Fed rate increases in 2023 continue to put the pressure on deposit costs. Speaker 200:10:23As a result of changes in interest rates and other factors, our other comprehensive loss was 0 point $7,000,000 during the 3 months ended March 31, 2024, as unrealized losses, net of tax effect, increased on available for sale debt securities from $11,800,000 as of December 31, 2023 to $12,400,000 as of March 31, 2024. Non interest income decreased to $1,800,000 in the first quarter from $1,900,000 in the previous quarter due primarily to reductions in gains from distributions on investments in venture backed funds and the recognition of rate lock and swap referral fees during the 3 months ended March 31, 2024. The decreases were partially offset by a reduction in net losses on the sale of securities, which did not occur in the Q1 of 2024. Non interest expense grew by $53,000 in the 3 months ended March 31, 2024 compared to the 3 months ended December 31, 2023. This is primarily due to an increase in salaries and employee benefits, partially offset by declines in advertising and promotional expenses as well as other operating expenses during the quarter. Speaker 200:11:49Now that we've discussed the overall results of operations, I will now hand it back to James to provide some closing remarks. Speaker 100:11:56Thank you, Heather. I want to thank everyone for joining us as we discussed Q1 results. 5 Star Bank has a reputation built on trust, speed to serve and certainty of execution, which support our client success. Our financial performance is a result of a truly differentiated customer experience, which continues to power the demand for 5 Star Bank's relationship based services. We attribute sustained success to our prudent business model and treating customers with an empathetic spirit, understanding and care. Speaker 100:12:36We are very proud to have earned the trust of those we serve, including our shareholders. As we lean into 2024, we are guided by continued focus on shareholder value as we monitor market conditions. We are confident in the company's resilience in any environment and remain focused on the future and our long term strategy. We will continue to execute on our organic growth and disciplined business practices, which we believe will benefit our customers, employees, community and shareholders. We appreciate your time today. Speaker 100:13:15This concludes today's presentation. Now Heather and I will be happy to take any questions that you might have. Operator00:13:25We will now begin the question and answer Speaker 300:13:44The Operator00:13:50first question today comes from Andrew Terrell with Stephens. Please go ahead. Speaker 300:13:57Hey, good afternoon. Speaker 100:13:59Hey, good afternoon, Andrew. Speaker 300:14:03Just a couple around deposits for me. When did the runoff in the brokered deposits and then public fund time deposits occurred during the quarter? I mean, Heather, do you have the weighted average cost of those deposits? Speaker 200:14:21So going into the Q1 for the year, we had a weighted average rate of about 5.2 6% on the wholesale deposits and that had a balance of about $360,000,000 We really did, would say, probably the second half of the quarter when most of the wholesale deposits ran off. So now we're currently sitting at a weighted average rate of 5.12%. And the total balance is 177,000,000 Speaker 300:14:53dollars Yes. And then can you talk about your I mean the remix this quarter was obviously very impressive. You've got something like 177 left of wholesale. Can you just remind us the kind of deposit growth expectations for the year? And then would you expect any more runoff in the wholesale deposits within that kind of deposit guidance? Speaker 100:15:20Sure. We're going to stick to our 10% of deposit growth. We plan to end up in that at 10%. That includes accounting for runoff of Q1 runoff of wholesale deposits. I think as we sit right now, I wouldn't expect too great of a continued runoff of wholesale. Speaker 100:15:47It will probably be pretty static Andrew for the rest of the year, but we'll look at this on a quarter by quarter basis. We kind of like where we are and in a certain respect maintaining relationships particularly with the State left in July. $42,000,000 $42,000,000 which hopefully we'll be able to eliminate that. But nothing probably greater than that, Andrew. Speaker 300:16:19Okay, great. I appreciate it. And then could you maybe just compare and contrast for the non wholesale deposit growth, I think it was $112,000,000 or so this quarter. Just the weighted average cost you're bringing kind of new money on the balance sheet today versus what we saw roll off in the Q1? Speaker 100:16:42Sure. A lot of the balances that we're bringing on right now are interest bearing. And when I think about if I was to amalgamate what we expect in terms of non interest bearing and interest bearing, that weighted average rate is probably around little shy of 3%. But the interest bearing stuff is probably has about a 4% handle on it as I'm thinking all this through. And so we're successful in our for the remainder of the year with non interest bearing deposit increases and that's really driven by new relationships that we're bringing on. Speaker 100:17:25That will work those numbers down. I think our San Francisco effort in terms of yield that we're paying those deposit customers. Heather, do you have that information on because I'm going to recall it off the top of my head. Speaker 200:17:40I want to say it's close to 3%. Speaker 100:17:42Yes, it's a little shy of 3%, 2.77%, I think that was in DJ's deck. Correct. So that's kind of what we're looking at right now in terms of what we're bringing on these new relationships on. And Andrew, it's important to note as we bank these new customers across our entire footprint, we're really after their operating accounts and their liquidity. So we look at things in totality in terms of cost of funds. Speaker 100:18:18So if we can pay somebody 4% for their liquidity and just bank their transactional account, if you will, We think that that's a winning strategy and hopefully we can deliver the entire relationship sub-three percent. Speaker 300:18:36Yes, totally appreciate that. Understood. If I could ask just one last one, Heather, around the margin. Do you have the margin in the month of Speaker 200:18:47March? In the month of March, I do. So our net interest margin for apologies, let me pull up that piece of it. Net interest margin just for the month of March was about 3.18 Operator00:19:14The next question comes from Gary Tenner with D. A. Davidson. Please go ahead. Speaker 400:19:20Thanks. Good morning. I wanted to ask on the expense side, what the near term thinking is on expense levels kind of fully loaded for new hires? Speaker 200:19:34Yes. So I think if we look at for Q2, I think if we add about $500,000 for Q2's expenses to what we incurred for Q1, that should put your model in good shape there. We do have some new hires, but then also some expenses for conferences that we have running through that are a little bigger than Q1. Speaker 100:19:55And our advertising spend is going to go up in the Q2, Q3, Q4 as we continue to develop the Bay Area. Speaker 400:20:07Okay. Appreciate it. And then I may have missed this answer a second here. I heard you mentioned, I think, the March NIM, Heather, but did you provide the spot rates as of March 31? If you did, I apologize for missing it. Speaker 200:20:19No, sure. Spot rate for cost of deposits was 2.49 Speaker 100:20:29dollars Operator00:20:31This concludes our question and answer session. I would like to turn the conference back over to management for any closing remarks. Speaker 100:20:39Great. Thank you. 5 Star Bancorp is on a continued path of growth as we execute on strategic initiatives, which include growing our verticals and geographies while attracting and retaining talent. Our people, technology, operating efficiencies, conservative underwriting practices and expense management have also contributed to the success we share with our shareholders employees. These successes include numerous rating and awards. Speaker 100:21:10In the Q1, the company's leadership was recognized by the Sacramento Business Journal on the Power 100 list and the Women Who Mean Business list. Company leadership also received a National Association of Women Business Owners Outstanding Women Leaders Executive Woman Award. Also in the Q1, 2 of our customers were recognized by the Sacramento Small Business Administration in the categories of Family Owned Small Business of the Year and Minority Small Business Champion. 5 Star Bank continues to be a driving force for economic development, a trusted resource for our customers and a committed advocate for our community. We look forward to speaking with you again in July to discuss earnings for the Q2 of 2024. Speaker 100:22:04Have a great day and thank you for listening. Operator00:22:09The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.Read morePowered by