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Edited Transcript of SSB earnings conference call or presentation 21-Apr-17 2:00pm GMT

Thomson Reuters StreetEvents

Q1 2017 South State Corp Earnings Call

Columbia May 4, 2017 (Thomson StreetEvents) -- Edited Transcript of South State Corp earnings conference call or presentation Friday, April 21, 2017 at 2:00:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* James C. Mabry

South State Corporation - EVP of IR and Mergers/Acquisitions

* John C. Pollok

South State Corporation - COO, CFO, Senior EVP and Director

* Robert R. Hill

South State Corporation - CEO and Executive Director

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Conference Call Participants

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* Catherine Mealor

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

* Christopher William Marinac

FIG Partners, LLC, Research Division - Director of Research

* Jennifer Haskew Demba

SunTrust Robinson Humphrey, Inc., Research Division - MD

* Nancy Avans Bush

NAB Research, LLC, Research Division - Research Analyst

* Peter Finley Ruiz

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

* Tyler Stafford

Stephens Inc., Research Division - Research Analyst

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Presentation

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Operator [1]

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Good morning, and welcome to the South State Corporation Quarterly Earnings Conference Call. Today's call is being recorded. (Operator Instructions)

I will now turn the call over to Jim Mabry, South State Corporation Executive Vice President, in charge of Investor Relations and M&A.

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James C. Mabry, South State Corporation - EVP of IR and Mergers/Acquisitions [2]

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Before beginning, I want to remind listeners that the discussion contains forward-looking statements regarding our financial condition and results. Please refer to Slide number 2 for cautions regarding forward-looking statements and discussion regarding the use of non-GAAP measures.

I would now like to introduce Robert Hill, our Chief Executive Officer, who will begin the call.

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Robert R. Hill, South State Corporation - CEO and Executive Director [3]

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Good morning. We'll begin the call with a few summary comments about the first quarter of 2017, offer an update on our merger with Southeastern Bank Financial Corporation and provide insight into our performance for the period.

Our results were strong this quarter and start us off on a good pace for 2017. Net income in the first quarter totaled $18.3 million or $0.63 per diluted share, which represents a return on average assets and a return on tangible equity of 0.68% and 8.87%, respectively.

With the closing of the merger in the first quarter, we incurred significant merger-related cost. Adjusting for these expenses, earnings were $33.4 million or $1.15 per share. This represents an adjusted return on average assets and return on tangible equity of 1.25% and 15.55%, respectively.

I'm very pleased with our team's accomplishments this quarter. We closed the Southeastern merger in early January and converted the systems in February. The team at Southeastern is a strong addition to the South State team, and we believe that the merger will be additive in many ways to the company.

We also welcome the addition of Grey Murray to our Board of Directors. Grey is the CEO of a logistics company based in Augusta, Georgia. With the merger, South State crossed $10 billion in assets. We've talked about this milestone for some time and have been preparing for it over the past several years. This preparation has not only resulted in improvements in the way we operate the bank but also enhance the customer experience. While there are still steps we can take to improve the way we do business, a lot of progress has been made throughout the company.

I will now turn the call over to John Pollok for more detail on the financial performance for the quarter.

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John C. Pollok, South State Corporation - COO, CFO, Senior EVP and Director [4]

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Thank you, Robert. From a balance sheet perspective, the combination of strong organic growth this quarter, coupled with the Southeastern merger closing, further strengthened our balance sheet.

We achieved 11% annualized net loan growth, excluding the $1 billion of loans acquired in the merger, with strong growth in the Upstate and Central South Carolina as well as the Charlotte and North Georgia markets.

Noninterest DDA growth totaled $400 million this quarter to $2.6 billion or 27% of our total funding. $279 million of the growth is from the Southeastern merger, and the remaining $121 million was organic growth.

NPAs were flat linked quarter and improved as a percent of assets down to 0.35% due to an increase in total assets from the merger. Annualized nonacquired net charge-offs totaled only 5 basis points again this quarter.

On Slide number 5, our net interest income increased $16.8 million linked quarter, and our margin expanded to 4.2%. We estimate the impact of the Southeastern merger accounts for approximately $15.8 million of the increase. The remaining $1 million is related to increases as a result of the December FOMC interest rate hike and the remix of interest-earning assets.

Turning to Slide number 6, you can see the mostly merger-related $1.6 billion increase in interest-earning assets and the increase in the investment securities portfolio as a percent of interest-earning assets. As you recall, Southeastern had a large investment portfolio and, as planned, we reduced the size of the investment portfolio and redeployed some of this liquidity into loan growth.

On Slide number 7, you can see the components of the $3.6 million increase in noninterest income with strong mortgage and wealth management quarters. Noninterest expenses increased $29.5 million linked quarter to $104.7 million, which included $21 million in merger-related cost. Excluding these items, adjusted noninterest expenses increased $13.3 million, mostly due to the Southeastern merger.

The legal closing transpired on January 3, and the systems conversions occurred over President's Day weekend. We estimate that we have another $11 million in annual cost saves to achieve, and we think we'll be on that run rate during the second half of the year.

The quarter was also positively impacted by a reduction in income tax expense, primarily the result of the adoption of the new accounting standard, which requires the excess tax benefit associated with vested or exercised stock awards to be included in the determination of the effective tax rate each reporting period.

On Slide number 8, you can see our efficiency ratio increased due primarily to merger-related expenses, and our adjusted efficiency ratio remained flat.

On Slide number 9, you can see the significant progress we have made over the years in earnings per share growth and the $1.15 adjusted EPS to start 2017.

Finally, on Slide number 10, you can see the $0.55 growth in tangible book value during the quarter, which was a nice increase given the $21 million in merger-related costs.

I will now turn the call over to Robert for some summary comments.

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Robert R. Hill, South State Corporation - CEO and Executive Director [5]

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Thank you, John. As we look forward to the rest of 2017, I believe we are well-positioned to continue the strong financial performance and growth. Our markets are economically vibrant, as evidenced by a double-digit loan growth, and we continue to take share from the larger banks.

That concludes our prepared remarks. So I would ask the operator to open the call for questions.

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Questions and Answers

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Operator [1]

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(Operator Instructions) The first question comes from Catherine Mealor at KBW.

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

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I was digging into the acquired loan yields just a little bit, and just wanted to make sure I'm thinking about this right. So the color you gave in your [ finance ] was really helpful in saying that excluding Southeastern, the acquired loan yields went from 7.60 -- or 7.47% to 7.66%. But if we think about the balances of how that portfolio declined quarter-over-quarter, is it fair to say on a dollar basis, your accretable yield, if you will, ex Southeastern, still declined quarter-over-quarter, and that higher yield is really just on a lower balance?

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John C. Pollok, South State Corporation - COO, CFO, Senior EVP and Director [3]

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Catherine, this is John. That's correct. If you take Southeastern out and just look at our runoff for the quarter, it's about a little over $80 million. So yes, you're correct.

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

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Okay. All right, great. And so then -- and as I do the math and back into what looks like Southeastern's coming in on, it looks like it's about -- I think it's around a 5.90% or so incremental yield...

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John C. Pollok, South State Corporation - COO, CFO, Senior EVP and Director [5]

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You're pretty close, that...

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

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And if you think about the direction of the core or the acquired yield now moving forward, we're probably moving outside of any kind of big changes in accretable yield, we're probably going -- I don't know, would you say to about a kind of 6.7% yield as we move through the rest of the year, or is that too far down, you think?

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John C. Pollok, South State Corporation - COO, CFO, Senior EVP and Director [7]

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I think it's still somewhat of a guess. We're early on. But I think those are reasonable. You're probably a tad high on your 5.90%, but that's fairly reasonable to think about it that way.

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Catherine Mealor, Keefe, Bruyette, & Woods, Inc., Research Division - MD and SVP [8]

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Okay. All right. That's helpful. And then as you think about the size of the securities book, that obviously increased with Southeastern, what -- how quickly do you think you can move that back down to your historical 12% level? Or are you comfortable staying around 15% for the near future?

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John C. Pollok, South State Corporation - COO, CFO, Senior EVP and Director [9]

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Well, on average balances, Catherine, it's about 15%, but if you look at period end, it's about 12.5%. So we've moved it down. But hey, 12.5%, for us, is a little high. Over time, as we grow our loan book, going back below 10% is not a problem. But yes, we're about 12.5% at period end.

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Operator [10]

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The next question is from Stephen Scouten at Sandler O'Neill.

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Peter Finley Ruiz, Sandler O'Neill + Partners, L.P., Research Division - VP, Equity Research [11]

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This is actually Peter Ruiz on for Stephen. Just I guess in terms of loan growth quickly, great growth again this quarter. Does it seem like a net pace of maybe in the low double-digit range is still reasonable going forward? What are you guys seeing in your markets? And kind of what's your outlook for growth going forward?

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Robert R. Hill, South State Corporation - CEO and Executive Director [12]

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I just think the overall just, I think, stability of our company and quality of our team, a lot of traction. If you look back over the last 5 quarters, we've been high single-digit, low double-digit every quarter. The pipeline -- that seems to be kind of a good run rate for us. It's kind of where we've typically been. If it gets too hot, we tend to dial it back through pricing or those types of things. So I think where you've seen us the last 5 quarters would be a pretty good indication of how we're feeling like the forward momentum looks.

I also think just in terms of diversity, we're just seeing it really across almost all of our markets. All but just a couple of our markets were up this quarter and fairly meaningful. Obviously, our metropolitan markets were growing at a little bit more rapid pace. But overall, the quality, the diversity, geographically and by line of business all feel good. I think one of the things that you've seen in our loan growth numbers has been when we bought First Federal a number of years ago, they were obviously a thrift, and so there was a lot of 1 to 4 on the balance sheet. We've been bringing that number down over the last few years. And now, it's really getting to be close, more closely in line with traditionally where we've kind of kept our 1 to 4 family book. So I think there's certainly some opportunity to see some enhanced growth on the consumer side.

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John C. Pollok, South State Corporation - COO, CFO, Senior EVP and Director [13]

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This is John. I'd just add with the growth, obviously, the rate hikes, our new loan yield production rate is up about 20 basis points. So we're seeing pricing on the loan side go up. As Robert mentioned, on the mortgage side, when you look at our forward pipelines, a little over 50% of the pipeline's going to go on balance sheet. It's kind of those 3/1s, 5/1s , 7/1 ARMs. So we really feel really good about what the future holds on the growth side.

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Robert R. Hill, South State Corporation - CEO and Executive Director [14]

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And just finally to wrap up is the C&I momentum has been a big focus the last few years, seeing really good traction. Q1 on an annualized basis, we were up 25% in the C&I book, but feel overall still positive momentum in the loan portfolio.

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Peter Finley Ruiz, Sandler O'Neill + Partners, L.P., Research Division - VP, Equity Research [15]

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That's great. Appreciate all the color. I guess, just maybe flipping to M&A. I guess, following the election and kind of where stock prices have gone, has the level of conversation changed at all? And I guess the second part to that question is, has your geographic interest changed at all? I know, traditionally, you've wanted to focus on the Carolinas. But has that changed at all to include maybe Atlanta or something like that?

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Robert R. Hill, South State Corporation - CEO and Executive Director [16]

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Yes. So I can take the first part, just in terms of momentum. Clearly, over the last 6 months, the activity level has increased pretty meaningfully. It's been steady. It's not like it was ever soft, but it's certainly increased a lot over the last 6 months, especially as we got into the latter part of last year and into this year. So that's always been there. We tend to look at a lot of deals before we do one, and we tend to focus on something that is geographically additive to our existing footprint when possible. But with that said, that does not preclude us from expanding our scope. Clearly, we will. I wouldn't say it's just targeted at an Atlanta, but certainly things in parts of Florida, more the central to the northern part of Florida, parts of Virginia, Tennessee. Obviously, still got a lot of work to do in North Carolina. So all those areas in terms of taking us out a few -- in another state or 2 are all in play if we can find the right companies to partner with.

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Operator [17]

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The next question is from Jennifer Demba at SunTrust.

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Jennifer Haskew Demba, SunTrust Robinson Humphrey, Inc., Research Division - MD [18]

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The loan-loss provision was a little higher than we were expecting. Can you just give us some color around the provisioning this quarter?

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John C. Pollok, South State Corporation - COO, CFO, Senior EVP and Director [19]

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Sure, Jennifer. This is John. Obviously, the first quarter after an acquisition can make the numbers a little confusing, especially when you merge with a company that has as high a loan quality as Southeastern does. So a couple things to think about when you think about our provision is we had about $50 million in nonacquired loan growth out of the Augusta market and which you're going to see. Actually, Augusta now is our fourth largest loan market that we have in terms of balances. So we had $50 million really kind of go into the nonacquired book, Jennifer. And so what that caused is a couple of things. One, it did have some effect on the margin, taking the margin up. But since those loans were really originated over there, we just felt like we needed to reserve more at the loan-loss rates that we did when we acquired the company. So that kind of put the provision up a few basis points.

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Operator [20]

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The next question is from Tyler Stafford at Stephens.

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Tyler Stafford, Stephens Inc., Research Division - Research Analyst [21]

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Maybe first, just to start on the margin, just a question on the funding cost. So the release did call out the 7 bps of funding cost increase from Southeastern quarter-over-quarter. So I think legacy deposit costs -- legacy South State deposit costs were up 4 bps or so, and I assume that's mostly just betas with rates. But is that in line with what you expected? And just curious generally what you were seeing from a market standpoint on pricing pressure.

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John C. Pollok, South State Corporation - COO, CFO, Senior EVP and Director [22]

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I'll start. Tyler, the reality is most of that increase is just really from the Southeastern deal. There might have been a tad more from the -- without Southeastern, but most of that's from Southeastern.

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Tyler Stafford, Stephens Inc., Research Division - Research Analyst [23]

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Okay. So you haven't really started to see pressure on the legacy deposit book just from higher rates yet?

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Robert R. Hill, South State Corporation - CEO and Executive Director [24]

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Tyler, this is Robert. Just color from kind of my perspective is our loan-to-deposit ratio is 87%. It went down this quarter. We had really strong core deposit growth, and that's without any -- really any additional firepower in terms of increased rates. So we feel really good about what we're doing on the core deposit side. You see a few outliers that have limited liquidity that are in the market, trying to grab some deposits, I guess, to fund their loan growth, but I'd say it's the exception, not the rule. And the majority of our competitors in terms -- from a market share perspective are the large banks. And obviously, their liquidity positions are very strong. So I think they'll be slower than even the mid and small banks in terms of raising rates over time. So we don't -- we have not sensed a lot of pressure on the deposit front yet.

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Tyler Stafford, Stephens Inc., Research Division - Research Analyst [25]

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Okay, great. Still within the margin, the $4.2 million of accretion out of the non-PCI book, should we basically expect to see that kind of steadily turned off from here, I guess, getting back to Catherine's earlier question?

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Robert R. Hill, South State Corporation - CEO and Executive Director [26]

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Yes, I would think so. And just remember, as I answered Jennifer's question a minute ago, a lot of that just came out of the margin and float over into the legacy reserve, right? So some of it's going to depend, especially next quarter, I think it's the first 2 quarters after an acquisition, you could see some more accretion in there and then it flow over. But yes, you are correct. That's going to trend down. But also think as that trends down, the reserve will also trend down some.

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Tyler Stafford, Stephens Inc., Research Division - Research Analyst [27]

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Do you have what the PCI accretion was this quarter? I believe it was $15.9 million last quarter.

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Robert R. Hill, South State Corporation - CEO and Executive Director [28]

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We'll have all that in the first quarter Q when we file that for you.

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Tyler Stafford, Stephens Inc., Research Division - Research Analyst [29]

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Okay. And then on the remaining cost saves, I think you said $11 million. Just remind us of the timing of those. Should all of that hit in 2017? Or will there be some that bleeds into next year?

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John C. Pollok, South State Corporation - COO, CFO, Senior EVP and Director [30]

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Well, we obviously just did the closing and conversion this quarter. So we got a little bit of that. So I think when you think on it on a per-share basis, we've got about another $0.07 to go. We won't get all of that next quarter, but we feel like the second half of the year that we'll be able to do that.

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Operator [31]

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The next question comes from Christopher Marinac at FIG Partners.

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Christopher William Marinac, FIG Partners, LLC, Research Division - Director of Research [32]

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John, want to follow up on the point about the 20 basis point move in loan yields. If we're fortunate to see additional Fed hikes, would there be kind of a rule of thumb on that where perhaps at 6% to 8%, that you can recapture as yields change?

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John C. Pollok, South State Corporation - COO, CFO, Senior EVP and Director [33]

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I didn't hear the last part of the question, Chris. Can you ask it one more time, please?

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Christopher William Marinac, FIG Partners, LLC, Research Division - Director of Research [34]

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Could rates -- would rates going up translate into a rule of thumb on the 20 basis point loan yield that you mentioned? I mean, is that something that we could use as a guidepost going forward?

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John C. Pollok, South State Corporation - COO, CFO, Senior EVP and Director [35]

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It's hard to tell. I think it's a little hard to tell. I mean, the rates go up, but then obviously, the market adjusts. So I think that's a little hard to know. But in general, they're going up. It was just nice to see that 20 basis points linked quarter.

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Christopher William Marinac, FIG Partners, LLC, Research Division - Director of Research [36]

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Okay. And then what is the opportunity to do additional fee income growth? And I guess I'm curious both on the deposit accounts just organically in addition to the mortgage business. Would you expect to see mortgage grow year-over-year?

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John C. Pollok, South State Corporation - COO, CFO, Senior EVP and Director [37]

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So on the mortgage side, a few things there. I think if you think back to when we announced the Southeastern deal, they had a nice area that did a lot of government lending, a lot of FHA and VA. We feel like that is another line of business embedded inside of mortgage that we can take company-wide. In fact, Chris, it was nice to see in the first quarter of this year, our number 1 mortgage originator was out of the Augusta market. So we feel like we're going to bring some things to the table in Augusta on the mortgage side, where they'll be able to do more business.

And then I think the last thing I would -- or 2 other things. We're continuing to still recruit very well on the mortgage side. So we're continuing to add originators. And then the last piece, one of the things we were excited about with the First Federal merger is, of course, the MSR asset. So rates are starting to move up. The value -- the length of time that those mortgage servicing assets are going to stay on the books is much longer. And, of course, when we did the First Federal merger, a lot of that mortgage servicing asset book was wholesale lending, and we feel like we've kind of squeezing most of that out. So we think we'll see some nice growth on the mortgage servicing asset.

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Christopher William Marinac, FIG Partners, LLC, Research Division - Director of Research [38]

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Great, John. That's very helpful. And, Robert, just a quick one for you. If you change the footprint and expand in some of the states that you mentioned, is there a size that is almost too large for you to look at, at this point? I'm just curious if there's a sort of fence around the size that makes sense for you at this point.

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Robert R. Hill, South State Corporation - CEO and Executive Director [39]

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No. Again, as it gets too small, the accretable impact on our EPS, there's certainly I'd say a lower end. And as you get down to $1 billion or lower, it certainly gets a little bit tougher to move the needle. But with that said, if it's the right franchise and in the right spot, we'd certainly absolutely look at those. We've really not bound ourselves on the upper end either. But as you -- I mean, you know us pretty well, I mean, we tend to take kind of methodical steps forward, and I think -- I don't think our M&A strategy will change a lot from kind of what you've seen historically.

Chris, let me touch on just briefly kind of what you asked on the fee income side to give you a little bit of color there outside of mortgage. So the wealth business has certainly been and continue to be a good contributor for us. We're -- about $5 billion is where we ended the quarter in terms of the assets in that area. And if you exclude Southeastern, our wealth group was up about 15%. So I think wealth will continue to be an area from a fee income line of business that we're growing nicely now and can continue to grow. On the fee income side from checking accounts and those types of things, we had 25% growth in C&I in terms of loan growth this quarter. But we're just in the mix on companies that we weren't able to be in the mix on in the past. And obviously, treasury is a significant component of that and provides really a nice upgrade -- nice opportunity, and we're going to upgrade our treasury platform. That's on our road map for the next 12 months, to kind of take it to another level.

So I think commercial treasury fees and I think also other products and services, we have a swap program now that we can sell on the swap side on some of our larger credits on the C&I customer. So I think where you'll see us be able to grow on the fee side is going to be on the commercial side, mostly. I think on the retail side, we're a big retail bank. So we've got 600 -- roughly 630,000 customers. I think the opportunity there is we're continuing to see a significant migration to self-service and significant migration to mobile. Our mobile was up about 15% in the first quarter, and that's been pretty consistent. And so I think what you're going to see on the retail front is just continued ability to really -- retail fee growth will be slower, but I think the efficiency opportunities are still pretty significant.

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Operator [40]

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(Operator Instructions) The next question is from Nancy Bush at NAB Research.

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Nancy Avans Bush, NAB Research, LLC, Research Division - Research Analyst [41]

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Quick question for you. You mentioned that you were recruiting mortgage bankers, and I can't help but reflect that some of the markets that you're in right now, Charlotte particularly, is experiencing a few tremors in the banking industry. And I'm wondering if you're having other recruiting successes as this sort of consolidation trend goes on. I'm thinking more about loan producers.

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Robert R. Hill, South State Corporation - CEO and Executive Director [42]

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Yes. I think that we've always seen kind of our number 1 priority as recruiting talent and growing the book organically. That's always been our number 1 focus. And kind of like M&A, it's -- we kind of know how we like to do it, and we're pretty steady and consistent with doing it, and we continue to see that. Our platform, our size, we're in a space that's really unique in our footprint from a size and capability perspective. And then, as I said earlier, it is our -- the banks that have the share in our markets are the large banks, and we compete very favorably against that. So that's how we've been building the company for the last 23 years, and we continue to see that momentum.

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Nancy Avans Bush, NAB Research, LLC, Research Division - Research Analyst [43]

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Okay. If I could also ask, on the wealth management business, as you get bigger, as you incorporate more franchises under your footprint, et cetera, is there a need to sort of grow that business in different ways? Are there products? Are there strategies, et cetera, that need to be added to this? And are you seeing any opportunities there for bringing new people on board?

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Robert R. Hill, South State Corporation - CEO and Executive Director [44]

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Yes. I think the wealth management piece is the piece that's provided the most opportunity for us. I think there -- I don't think there's significant product gaps that we're missing, particularly. Obviously, you're seeing kind of a migration of how people think and invest their money. I think the holistic approach that we bring from both a financial planning and investing and an estate planning is fairly unique. And we can fly a little bit under the radar screen. It doesn't take $50 million in assets to really get us interested. We can come in at a lower level than that. So -- and most of the money center banks or the brokerage houses are obviously at a much higher level. So I think that mix of those 3 things tends to work very well for us.

I think that we would -- I think that the answer primarily to growing that is to continue to recruit the right talent and give them the opportunity to kind of build their shop and build their business. Acquisitions in that space, we have those opportunities. I think they're tougher because most of the time, it's like the owners -- it's kind of like insurance, they've kind of built their businesses and they may be looking to sell because they want to exit, and so what are you really getting? So I think if we found the right partner from an M&A, to get some additional scale and product scope, that's certainly something we would do, but I feel good about really how we're executing it today. I feel good about the growth pace and are continuing to attract talent mostly from the larger companies.

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Nancy Avans Bush, NAB Research, LLC, Research Division - Research Analyst [45]

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Could you just remind us what kind of opportunities you got from the Augusta deal? I mean, there is a fair amount of wealth in Augusta, golf-related or not. But just did you get anything in terms of people on the wealth management side from the Augusta deal?

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Robert R. Hill, South State Corporation - CEO and Executive Director [46]

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Yes. Augusta had -- I mean, as you expect with most banks, that wealth isn't a fully developed -- with most smaller companies, it's not a fully developed line of business, but they had $700 million in assets under management. So -- and they have exceptional market share in that market. So they're dealing with the people who need those services. So I think back to your question a minute ago on scope, I think what we were able to bring is some -- a broader array of products, kind of a deeper product set. And their model was more outsourced. Ours is more managed in-house. And so I think we can -- have been able to have some -- we'll have some impact there. But they've got very deep ties in that community and with that relationships.

So I think a combination of the platform they have, the scope and higher level of sophistication of the platform that we have, along with the combined talent, I think there are certainly opportunities in Augusta to expand it. Same thing on the mortgage side. I think the opportunities we've had to combine resources and make it combine better has played out on the mortgage side as well. We've added government lending, which we weren't really good at; they were really good at. That's been a space, as John said, the number 1 originator in the company was from the Georgia Bank & Trust side for this quarter. So I think the same thing will play out on trust over time.

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Operator [47]

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There are no further questions so I will now turn the call back over to John Pollok.

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John C. Pollok, South State Corporation - COO, CFO, Senior EVP and Director [48]

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Thanks, everyone, for your time today. We will be participating in the SunTrust Robinson Humphrey Financial Services Conference in New York beginning on May 23. We look forward to reporting to you again soon.

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Operator [49]

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The conference has now concluded. Thank you for attending. You may now disconnect.