United Community Banks, Inc. (UCBI) Q1 2023 Earnings Conference Call April 19, 2023 11:00 AM ET

Corporate Participants

Lynn Harton - Chairman and Chief Executive Officer

Jefferson Harralson - Chief Financial Officer

Rich Bradshaw - President and Chief Banking Officer

Rob Edwards - Chief Risk Officer

Conference Call Participants

Brad Milsaps - Piper Sandler

Brandon King - Truist

Catherine Mealor - KBW

Michael Rose - Raymond James

Kevin Fitzsimmons - D.A. Davidson

David Bishop - Hovde Group

Russell Gunther - Stephens

Christopher Marinac - Janney Montgomery Scott

Operator

Good morning, and welcome to the United Community Banks First Quarter 2023 Earnings Call. Hosting the call today are, Chairman and Chief Executive Officer, Lynn Harton; Chief Financial Officer, Jefferson Harralson; President and Chief Banking Officer, Rich Bradshaw; and Chief Risk Officer, Rob Edwards. United's presentation today includes references to operating earnings, pretax, pre-credit earnings and other non-GAAP financial information. For these non-GAAP financial measures, United has provided a reconciliation to the corresponding GAAP financial measure in the Financial Highlights section of the earnings release, as well as at the end of the investor presentation. Both are included on the website at ucbi.com.

Copies of the first quarter's earnings release and investor presentation were filed last night on Form 8-K with the SEC, and a replay of this call will be available in the Investor Relations section of the company's website at ucbi.com. Please be aware that during this call, forward-looking statements may be made by representatives of United. Any forward-looking statements should be considered in light of risks and uncertainties described on Pages 5 and 6 of the Company's 2022 Form 10-K as well as other information provided by the company in its filings with the SEC and included on its website.

At this time, I will turn the call over to Lynn Harton.

Lynn Harton

Good morning and thank you for joining our call today.

This has certainly been a busy and an interesting quarter. Despite the turmoil in the U.S. banking markets, we continue to perform well. While our reported operating earnings per share was $0.58. If you exclude the progress double dip credit provision, which I think is a better way of looking at it. Our operating EPS was $0.65 for the quarter, and our operating return on assets was 119 basis points.

Given the focus on liquidity and funding cost, we were pleased with our customer deposits growing at a 10% annualized rate in the quarter. The cost of deposits did increase, and our mix of deposits moved toward more interest bearing as would be expected in a higher rate environment. Our bankers work proactively with our customers after the news of Silicon Valley and Signature Bank. And we also saw mixed changes resulting in growth in our insured products. We ended the quarter with essentially no short-term borrowings or advances. However, we did incur extra costs during the quarter as we decided to hold higher levels of liquidity given the environment.