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Edited Transcript of SASR earnings conference call or presentation 17-Jan-19 7:00pm GMT

Q4 2018 Sandy Spring Bancorp Inc Earnings Call

Olney Jan 19, 2019 (Thomson StreetEvents) -- Edited Transcript of Sandy Spring Bancorp Inc earnings conference call or presentation Thursday, January 17, 2019 at 7:00:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Daniel J. Schrider

Sandy Spring Bancorp, Inc. - President, CEO & Non-Independent Director

* Philip J. Mantua

Sandy Spring Bancorp, Inc. - Executive VP & CFO

* Ronald E. Kuykendall

Sandy Spring Bancorp, Inc. - Executive VP, General Counsel & Secretary

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Conference Call Participants

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* Austin Lincoln Nicholas

Stephens Inc., Research Division - VP and Research Analyst

* Casey Cassiday Whitman

Sandler O'Neill + Partners, L.P., Research Division - MD of Equity Research

* Catherine Fitzhugh Summerson Mealor

Keefe, Bruyette, & Woods, Inc., Research Division - MD and SVP

* Steven Comery

G. Research, LLC - Research Analyst

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Presentation

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Operator [1]

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Good afternoon, everyone, and welcome to the Sandy Spring Bancorp, Inc. Earnings Conference Call and Webcast for Fourth Quarter 2018. (Operator Instructions) Please note that this event is being recorded.

I would now like to turn the conference over to Daniel J. Schrider, President and CEO. Please go ahead, sir.

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Daniel J. Schrider, Sandy Spring Bancorp, Inc. - President, CEO & Non-Independent Director [2]

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Thank you, and good afternoon, everyone. We appreciate you joining us for our conference call to discuss Sandy Spring Bancorp's performance for the fourth quarter of 2018. This is Dan Schrider, and I'm joined here by colleagues Phil Mantua, Chief Financial Officer; and Ron Kuykendall, General Counsel for Sandy Spring Bancorp.

As usual, our call is open to all investors, analysts and the media. There is a live webcast of today's call and a replay that will be available on our website later today.

After covering key highlights of the quarter, we will move to take your questions. But before we get started, Ron will give the customary safe harbor statement.

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Ronald E. Kuykendall, Sandy Spring Bancorp, Inc. - Executive VP, General Counsel & Secretary [3]

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Thank you, Dan. Good afternoon, ladies and gentlemen. Sandy Spring Bancorp will make forward-looking statements in this webcast that are subject to risk and uncertainties. These forward-looking statements include statements of goals, intentions, earnings and other expectations, estimates of risk and future costs and benefits, assessments of probable loan and lease losses, assessments of market risk and statements of the ability to achieve financial and other goals. These forward-looking statements are subject to significant uncertainties because they are based upon or affected by management's estimates and projections of future interest rates, market behavior and other economic conditions, future laws and regulations and a variety of other matters, which by their very nature, are subject to significant uncertainties. Because of these uncertainties, Sandy Spring Bancorp's actual future results may differ materially from those indicated. In addition, the company's past results of operations do not necessarily indicate its future results.

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Daniel J. Schrider, Sandy Spring Bancorp, Inc. - President, CEO & Non-Independent Director [4]

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Thank you, Ron. Overall, 2018 produced record annual earnings. We completed a very successful integration of WashingtonFirst Bank, expanding our presence throughout the region and achieving solid core growth. At the same time, our fourth quarter results were mixed, and I will explain the strategic initiatives that are already underway. However, the fact remains that the company is fundamentally strong and we are well positioned as we move through 2019. Positive results in the quarter were driven by deepening existing and acquired client relationships, driving strong loan growth in all key client segments, managing cost and operating efficiently, while continuing to invest in talent and technology. We broadened our funding strategies to facilitate ongoing growth in the Greater Washington region. And bringing together 2 very successful organizations, and we are thrilled to have a team of professionals and clients from WashingtonFirst together as 1 as we enter 2019. However, results in the quarter were hampered by disappointing mortgage gains, volatility in the equity markets affecting our wealth business and soft insurance revenue, and I will comment on these fee-based businesses later in my remarks.

But now I'll cover some of the highlights from our press release issued this morning. Net income for the fourth quarter of 2018 was $25.6 million or $0.72 per share compared to net income of $8.3 million or $0.34 per share for the fourth quarter of 2017, and net income of $29.2 million or $0.82 per share for the linked third quarter of 2018. As stated in today's release, the third quarter results did include $2 million of recovered interest income from a previously acquired credit impaired loan and $600,000 in merger expenses. Excluding the after-tax impact of these items, the net income for the third quarter would've been a $28.2 million or $0.79 per share. The fourth quarter of 2017 results included $1.8 million of merger expenses and $5.6 million in additional income tax expense from the revaluation of DTAs. Excluding the impact of these items, the fourth quarter 2017 EPS would approximate $0.67 per share. Net income for the full year 2018 was a record $100.9 million or $2.82 per diluted share. The after-tax effect of merger expenses net of interest recoveries was approximately $0.19 per share for the full year 2018. The net interest margin for the fourth quarter was stable at 3.57% compared to 3.57% for the fourth quarter of 2017 and 3.71% for the linked third quarter. Excluding the interest recoveries recognized in the third quarter, the net interest margin would have been 3.6%. The momentum in growth in our lending businesses in the quarter was very strong. On a linked-quarter basis, total average loans grew by 2.4% and grew 9% when compared to the post-acquisition combined portfolio at the beginning of 2018.

Our teams across the market continued to build strong pipelines of new opportunities in the highly competitive Greater Washington market. Average loan yields, when compared to the third quarter, expended 9 basis points comparing to 10 basis points on total deposits, this is net of all fair value marks and nonaccrual interest adjustments. This is on par with our experience in the third quarter. The provision for loan and lease losses was a charge of $3.4 million for the fourth quarter compared to a charge of $500,000 for the fourth quarter of '17 and $1.9 million in the linked third quarter. The provision expense reflects the impact of a very strong fourth quarter of organic production and the impact of acquired loans being refinanced as they reach maturity during the quarter. Overall, credit metrics across portfolios remain strong and all segments of our portfolios are performing very well. Our reserve coverage of nonperforming loans is very strong at 151%.

With our newly expanded market and the momentum in our lending activity, deposit growth is among of our most important objectives. 2018 proved a bit more challenging on the deposit front due to a more substantial deposit runoff in the WashingtonFirst portfolio, prior to closing on 1/1 of '18. And then there's changes in the deposit environment, which led to fierce competition and aggressive rates. Consumers and businesses started watching rates more closely, which drove shifts in cash management behavior, and we experienced approximately $150 million in the noncore deposit runoff in the fourth quarter, and also experienced normal seasonal fluctuations in the core commercial DDA base, primarily in our title business. On a linked-quarter basis, total average deposits were flat and post-acquisition growth for the year 2018 was 6%. The combination of heavier runoff in the fourth quarter combined with strong year-end loan growth, our loan-to-deposit ratio came in higher at 111%. We view the current level as short-term and as we've previously indicated, we are comfortable operating with this ratio in the 105% to 110% range. As we move through the current quarter, we will price deposits on select interest-bearing products at or near the top of the market, and our sales teams continue their focus on driving core transaction accounts as we win new relationships. We have many initiatives underway to enhance our deposit gathering success. We are also keenly focused on turning rate seekers into full banking relationships. A few of the initiatives include revamped incentive plans across the company, emphasizing deposit and client or household growth. We are also modifying the roles and goals of certain revenue positions. In short, we realized it's all of our jobs to drive deposits and help earn our clients full banking relationship. We'll have more aggressive pricing and promotion for select deposit products such as our Premier Money Market account time deposits and checking products. We're leveraging data analytics through salesforce.com, we call it CX 360 to develop additional strategies and calling list to reach respective deposit clients. We're continuing to invest in new additional talent to pursue deposit-rich industries in the greater D.C. market and implementation of a new online account creation platform that will launch in late second or early third quarter, allowing for a more seamless and expedited account opening experience for our clients.

The bottom line is that we're engaged in a corporate-wide, coordinated effort to continue to drive new deposit relationships to enable continued asset growth. We've been in these environments before and we know what to do, it's one of the benefits of being 150 years old. We have successfully navigated through times like these while growing new and existing client relationships, and we look forward to doing it again in 2019.

Noninterest income for the quarter increased 14% compared to the fourth quarter of 2017 and expanded 19% for the year. But for the fourth quarter of 2018, noninterest income declined 6.7% compared to the linked third quarter of 2018. Mortgage gains declined 32% compared to the linked third quarter, the result of a 23% decline in overall production, all in purchase money transactions. In the mortgage banking market both purchase money and refinance activity volumes have decreased. This is due to higher rates, lower demand and a decrease in the availability of new homes. Additionally, we experienced some disruption during the integration of the mortgage company from WashingtonFirst and a number of legacy originators departed the company during the third and fourth quarter. While this affected our fourth quarter production, we are actively hiring additional mortgage originators to drive additional production in 2019. Insurance agency commissions experienced typical fourth quarter seasonality and declined 43.5% compared to the linked third quarter. Comparing 2018 to 2017, overall insurance agency commissions were flat, while our commercial and personal lines experienced decent growth. Softness was in the physician's liability and bond business.

In an effort to grow revenue, we continue to focus on hiring new producers, identifying strategic partners and driving revenue from existing bank clients. Wealth management revenue continues to be strong, despite a 7% decline in market value at year-end. On a linked-quarter basis, wealth management revenue increased 2.7% and was bolstered by onetime fiduciary fees from our trust division. Comparing year-end 2018 to year-end 2017, wealth management revenue increased 8.7%. Assets under management totaled $2.9 billion at year-end compared to $2.8 billion at year-end 2017. Our wealth management business is staffed with accomplished professionals and poised for continued growth and success.

On the expense side, expenses are well managed and while we continue to invest in talented people and the new technology to drive future performance. For insurance, we increased minimum wage, we establish a bank-wide incentive plan that aligns with the interest of our shareholders and rewards our employees for the success of the company, and we enhanced our 401(k) company match. We made these enhancements and we announced this previously because it's the right thing to do and it will help us attract to retain the best people to serve our clients throughout their lifetime. On a technology front, we also invested in new loan origination system and online account opening technology that will be realized in 2019. The non-GAAP efficiency ratio was 51.78% for the fourth quarter compared to 55.69% for the fourth quarter of 2017 and 49.27% for the third quarter of 2018. Excluding the interest recovery, the non-GAAP efficiency ratio for the third quarter would've been 50.48%. Our capital position remains strong to support continued growth with total risk-based capital at 12.27%, tier 1 risk-based capital ratio of 11.07%, a Tier 1 leverage ratio of 9.51% and tangible common equity to tangible asset ratio of 9.23%.

As we move through 2019, we continue to invest in the people who will provide exceptional experiences and be true advocates for our clients. And the systems that will enable greater access for our clients in an effort that will help build strong communities. This aligns with our vision to make an impact in the lives of our clients, shareholders and employees. Despite a challenging rate environment and political environment, we will continue to take advantage of being a one-of-a-kind community bank that has thrived in one of the strongest regions in the country for 1.5 centuries, while achieving the financial performance and returns to satisfy our shareholders and position us for a future of continued growth and success.

That concludes my general comments for today, and we will now move on to discuss your questions.

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Questions and Answers

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Operator [1]

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(Operator Instructions) And our first question comes from Catherine Mealor with KBW.

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Catherine Fitzhugh Summerson Mealor, Keefe, Bruyette, & Woods, Inc., Research Division - MD and SVP [2]

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Can you just update us on your outlook for the margin? And especially the 12 bps of accretable yield that we saw this quarter, how do we think that should be trending over 2019?

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Philip J. Mantua, Sandy Spring Bancorp, Inc. - Executive VP & CFO [3]

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Catherine, this is Phil. I think very directly, I would suggest that the margin probably for the foreseeable future settled in, in the 3.50% range. The backdrop to that would be that our assumption or position on the general interest rate environment is going to be similar to what it is today. We've really backed off in our thought process about any more tightening by the Fed throughout -- actually all of 2019. And if anything, and I have looked towards whether or not -- the probabilities, as they predict might have a rate cut later in the year. But from the standpoint, how we're forecasting the margin for now and foreseeable future, we're expecting the rate environment to be fairly consistent with where it is today with the flat curve, as we look forward. As it relates to the remaining amounts of accretable yield that's left in -- fair value marks that are left from the WashingtonFirst transaction, just to -- from backdrop again. In 2018, we probably had about $8.7 million, $8.8 million worth of positive effects to the margin, which, I think, from time to time, we've estimated was worth about 12 basis points. Looking forward as to what's projected into -- through this year, that drops dramatically to around $1.5 million in terms of dollars absent of any anticipated payoffs or whatever that might accelerate it. But even there, it might approach a level of about $2 million. And so for the year, that's probably not going to be terribly significant as it relates to any additional accretion to the margin number that I gave you at around 3.50%.

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Catherine Fitzhugh Summerson Mealor, Keefe, Bruyette, & Woods, Inc., Research Division - MD and SVP [4]

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Got it. So the 3.50% -- in that 3.50% guide, a lot of that's going to be the accretable yield coming off. But as we think about funding cost, it feels like your scenario for that is that the Fed stops, but then you're also balancing the deposit initiatives that Dan laid out. So do you feel like it will -- is it fair to say, we may see another quarter or 2 of elevated deposit cost and then that kind of moderates as we get in the back half of the year? Or how should we think about that?

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Philip J. Mantua, Sandy Spring Bancorp, Inc. - Executive VP & CFO [5]

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I think that's exactly the way to look at it, absolutely. Yes, and we probably still have some additional increase on the loan yields side as things work their way through from where rates have gone just to offset that to some degree. But then, yes, I believe that you're right about deposit cost. Again, depending on how aggressive we think we need to be to fund that growth, but level off as we get through the year. I mean, we already saw in this quarter that the deposit beta itself came down to some degree, it was I think in the high 50% range in the third quarter, it's leveled in this quarter around 40%. And so I think that if rates are going to continue to kind of moderate as we think they will, then it'll eventually level out.

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Catherine Fitzhugh Summerson Mealor, Keefe, Bruyette, & Woods, Inc., Research Division - MD and SVP [6]

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Great. Okay. And then can you give us a little bit of color around the reserve bill and the additional provisioning you're putting against some of the WashingtonFirst credit that renewed? Is this a trend that should continue as we move into next year, perhaps driving higher provisions next year than we saw this year?

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Philip J. Mantua, Sandy Spring Bancorp, Inc. - Executive VP & CFO [7]

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Catherine, yes, this is Phil, again. So in terms of what happened through the quarter, the -- first of all, the most significant aspect of the bump up in the provision was certainly just the sheer level of a new loan production that took place in the quarter. So in the loan growth, it was about $187 million on a net basis. We actually had new loans in the quarter of over -- by about -- almost $320 million. And we also had some increases in existing loans, net increases to the tune of about $75.5 million, which are normal kind of year-end draws and things that occur in a lot of our lines in credit with our government contractors, et cetera. And then in addition to that, we did have about $58 million worth of -- what we would look at as the transfers from WashingtonFirst that were covered by fair value marks before it renewed and then rolled into, now, our reservable portfolio. So that part of the equation is going to continue to occur. And we don't really exhaust that until we get through '19 and into 2020. So some aspects of that -- and that was going on, by the way, throughout the year as well. So that kind of was already part of the existing provisioning that took place as we got to this point. So the majority of that heightened provision was really as much about the sheer level of loan growth as it was anything else that was different from any other quarter.

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Operator [8]

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And our next question comes from Austin Nicholas with Stephens.

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Austin Lincoln Nicholas, Stephens Inc., Research Division - VP and Research Analyst [9]

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Maybe just hitting back on the margin one more time. The 3.50% range that you mentioned, Phil, was that the core margin, which I think was at 3.45% this quarter? Are you expecting that to increase? Or is that 3.50% the kind of reported margin with your expectation for accretion?

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Philip J. Mantua, Sandy Spring Bancorp, Inc. - Executive VP & CFO [10]

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That's the reported margin. That's the way I would look at the reported margin as we look forward.

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Austin Lincoln Nicholas, Stephens Inc., Research Division - VP and Research Analyst [11]

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Got it. Understood. Okay, that's helpful. And then maybe just back to the expense outlook. Any comments on how that should trend, given some of the numbers that left of -- in the mortgage banking team and then maybe some of the rehiring you're doing?

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Philip J. Mantua, Sandy Spring Bancorp, Inc. - Executive VP & CFO [12]

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Yes, Austin, this is Phil, again. I would put out there that our expectation for overall year-over-year expense growth is probably around 3% and that would be inclusive of anything and everything we've talked about in that area or anywhere else. I mean, this quarter, there were -- I think, probably on the face of the press release, in the tables, there was a pretty good bump in professional fees that occurred during the quarter. The majority of that was things that are timing. We had loan review that occurs in the fourth quarter of every year that had significant dollar amount to it. There are a few other things in -- that happened. We had some attorney fees that were a little bit higher than they were the quarter before, those 2 together were probably half that number. And -- so just in terms of looking at what we incurred this quarter, majority of that increase, just in that one line, it was the most prominent thing, is -- I wouldn't say is recurring quarter-to-quarter. There is some seasonality of course with the loan review piece, but the rest of it is just stuff that happens from time to time. And I would come back around to saying, like I did, that the 3% is a good way to look at overall expense growth for the year.

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Austin Lincoln Nicholas, Stephens Inc., Research Division - VP and Research Analyst [13]

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Got it. That's helpful. And then maybe just on balance sheet growth, are you still comfortable with that 8% to 10% loan growth rate as we look to '19?

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Daniel J. Schrider, Sandy Spring Bancorp, Inc. - President, CEO & Non-Independent Director [14]

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Yes, that's the way we're looking at it right now. That momentum and what we experienced through 2018, we would expect to continue. That's the outlook. And I think a good bit of that is just the -- the good news is the pace in which our -- the work from the new folks from the integration of WashingtonFirst were able to perform. We -- when we originally were thinking about 2018, we thought there may be a little bit of a conversion lag, so to speak, and they hit the ground running and have been very effective along with our existing legacy team in producing. So that number looks like it's sustainable, which, obviously, to my earlier comments, puts a lot more pressure on the deposit gathering front.

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Austin Lincoln Nicholas, Stephens Inc., Research Division - VP and Research Analyst [15]

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Right, right. Makes sense. And then maybe just one quick last one. Given the government shutdown, and I think you mentioned some government contracting business within the book. Any comments on concern there? Or anything you're doing to help those clients out from maybe extending lines of credit? Or any change in behavior you're seeing from those customers, that'd be helpful?

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Daniel J. Schrider, Sandy Spring Bancorp, Inc. - President, CEO & Non-Independent Director [16]

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Yes, Austin, Dan. There are a couple of different approaches I'll comment on. One is, in our retail or consumer base, as you might imagine, we have a good number of our clients that are government employees and so like others in the marketplace, we jumped on that as we have in previous times when this type of thing has gone on, where we're -- we made adjustments to payment schedules and put some products out there to help folks through this gap of time. And so we've been very proactive in that from the consumer standpoint. On the commercial side, within our GC book, those are probably more handled on the case by case basis. Our clients in that space have not demonstrated as much concern as you might imagine. And I think the other thing that probably has a greater potential impact is the employees of those government contractors. And again, while some of those may not be clients, we've done outreach to our GC clients to see if there's things we might be able to do to help. But most of our government contract clients are well healed and would be able to weather this shutdown.

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Operator [17]

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(Operator Instructions) And our next question comes from Steven Comery with G. Research.

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Steven Comery, G. Research, LLC - Research Analyst [18]

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I just wanted to ask about kind of the seasonality associated with the DDA you guys called out. I mean, when do you expect to kind of get those deposits back? Is that like a Q1 event? Or is it going to filter in throughout the year?

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Philip J. Mantua, Sandy Spring Bancorp, Inc. - Executive VP & CFO [19]

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Yes, Steve, this is Phil. What's happened traditionally is that they trickle back in through and during the first quarter and it's a kind of a gradual build back towards the end of the quarter and then I think if we went back and I know we have, we went back and looked at this on a year-over-year basis, that's kind of the way that it normally performs. So that would be our expectation, that's the way we plan for it.

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Steven Comery, G. Research, LLC - Research Analyst [20]

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Okay, fair enough. And then just want to ask about the noninterest expense. Salaries kind of took a step down in the fourth quarter, I wasn't really anticipating that. Was there something -- was something specific going on there? And then kind of where do you think the run rate goes in Q1?

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Philip J. Mantua, Sandy Spring Bancorp, Inc. - Executive VP & CFO [21]

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Yes. And there's -- it's nothing really extraordinary there. I mean, some of that's just kind of year-end true-up on incentive accruals and things like that, that we normally do. But other than that, I don't think it's anything terribly extraordinary in there. I mean, if you look forward, one thing that happens to us after the first of the year is, some of the things related to payroll taxes and things get elevated just because things kickback into social security, et cetera. And then we do all of our annual performance reviews towards the tail end of the first quarter and hit the run rate in the beginning of the second quarter. So that's why we see some differences in some of those levels. But that's really about it.

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Steven Comery, G. Research, LLC - Research Analyst [22]

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Okay, that's helpful. And then during the prepared remarks, I believe, I heard $1.8 million of merger expenses. I was just kind of wondering, what line item did those come in?

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Daniel J. Schrider, Sandy Spring Bancorp, Inc. - President, CEO & Non-Independent Director [23]

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No, that's -- that -- I was reflecting back on the fourth quarter of 2017 results...

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Steven Comery, G. Research, LLC - Research Analyst [24]

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Okay.

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Daniel J. Schrider, Sandy Spring Bancorp, Inc. - President, CEO & Non-Independent Director [25]

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Yes.

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Steven Comery, G. Research, LLC - Research Analyst [26]

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Okay, yes, fine. My bad. I misunderstood that.

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Daniel J. Schrider, Sandy Spring Bancorp, Inc. - President, CEO & Non-Independent Director [27]

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Yes, that's all right.

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Steven Comery, G. Research, LLC - Research Analyst [28]

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Okay. And then just finally for me. I was just wondering if you guys could kind of talk about your efficiency ratio expectations, either for the quarter or the year going forward.

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Philip J. Mantua, Sandy Spring Bancorp, Inc. - Executive VP & CFO [29]

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Yes, Steve, this is Phil. I mean, I would look towards trying to manage that in that 50% range. 50%, 51-ish is just probably, given what I suggested earlier about overall expense growth where it would be, we've talked about this before and probably more likely than not, that number is as much dependent on our ability to grow the revenue side of things as it is really manage the expense piece of it. Although there's always room for things you can do there on a discretionary basis. But that's kind of where we would like it to be, given the nature of the way that we're delivering to the market at this point.

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Operator [30]

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And our next question comes from Casey Whitman with Sandler O'Neill.

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Casey Cassiday Whitman, Sandler O'Neill + Partners, L.P., Research Division - MD of Equity Research [31]

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So in your prepared remarks, I think you mentioned some onetime fiduciary fees in the fourth quarter. Can you be more specific as to what those were or how much?

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Philip J. Mantua, Sandy Spring Bancorp, Inc. - Executive VP & CFO [32]

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Yes, Casey, this is Phil. And these are, I guess, what you call postmortem fees or whatever, that are related to what happens when we settle out a trust or whatever, and they come in all at that one point. I think during the quarter, it was around $300,000. I think it's what got collected in the fourth quarter. And so we recognize that's a significant piece of the increase quarter-over-quarter because of what happened through the downturn from the standpoint of the -- in the equity markets and how that impacted the evaluation of the assets under management, which, of course, drives the fee revenue. To that end, just a little bit of color, the combined efforts of the trust in our subsidiary at West actually grew or so had net sales-type activity in terms of assets under management offsetting that to the tune of about $71 million, $72 million. So I mean, there is currently good momentum in terms of what we're delivering in that area, just the environmental aspect of the market downturn is what really kind of was the headwind in that regard.

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Casey Cassiday Whitman, Sandler O'Neill + Partners, L.P., Research Division - MD of Equity Research [33]

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Okay, great. And then, we look at the insurance piece, so those were down a little more than I would have thought this quarter. But just can you remind us what this seasonality looks like probably in 2019 for insurance? And also maybe give us a sense for what your outlook is for revenues after the year '19?

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Daniel J. Schrider, Sandy Spring Bancorp, Inc. - President, CEO & Non-Independent Director [34]

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Yes, Casey, this is Dan. We typically have seasonality related to contingent income that affects both the first quarter and the third quarter in the insurance business. And those are -- some of that's the property and casualty business and then the physician's liability, which line up at different points in the year. So you would expect to see somewhat of a rebound in the first quarter due to some of that contingent income. And from an overall standpoint, we're looking at a mid-single-digit revenue growth expectation in that business, and that's absent success in bringing in some producers, absent obviously success and bringing in other strategic partners.

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Casey Cassiday Whitman, Sandler O'Neill + Partners, L.P., Research Division - MD of Equity Research [35]

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Got it. And then one final question would be just the tax rate, a little higher than last quarter. What's your outlook for next year?

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Philip J. Mantua, Sandy Spring Bancorp, Inc. - Executive VP & CFO [36]

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I think on a -- Casey, this is Phil again. I think on a -- kind of an effective tax rate, I would probably use around 24%.

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Operator [37]

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And this concludes our question-and-answer session. I would like to turn the conference back over to Mr. Schrider for any closing remarks.

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Daniel J. Schrider, Sandy Spring Bancorp, Inc. - President, CEO & Non-Independent Director [38]

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Thank you, and thanks everyone for participating with us this afternoon. In addition, we'd love to receive any feedback to help us evaluate the effectiveness of our call. And obviously, we're available to you if you have other questions that would be helpful as we close out this call. So you can give us a buzz, or you can e-mail your comments at ir@sandyspringbank.com. Have a wonderful afternoon.

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Operator [39]

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The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.