Heritage Financial Corporation (NASDAQ:HFWA) Q1 2022 Earnings Conference Call April 21, 2022 2:00 PM ET
Company Participants
Jeff Deuel - Chief Executive Officer
Don Hinson - Chief Financial Officer
Bryan McDonald - President and Chief Operating Officer
Tony Chalfant - Chief Credit Officer
Conference Call Participants
Kelly Motta - KBW
Matthew Clark - Piper Sandler
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Operator
Good afternoon. Thank you for attending today's Heritage Financial Corporation Q1 2022 Earnings Conference Call. My name is Hannah and I will be your moderator for today's call. [Operator Instructions]
I would now like to pass the conference over to our host, Jeff Deuel, the CEO of Heritage Financial Corporation. Please go ahead.
Jeff Deuel
Thank you, Hannah. Welcome and good morning to everyone who called in and those who may listen later. This is Jeff Deuel, CEO of Heritage. Attending with me are Don Hinson, Chief Financial Officer; Bryan McDonald, President and Chief Operating Officer; and Tony Chalfant, Chief Credit Officer.
Our earnings release went out this morning pre-market and hopefully you would have had the opportunity to review it prior to the call. We have also posted an updated first quarter Investor Presentation on the Investor Relations portion of our website, which can be found at heritagebanknw.com. We will reference the presentation during the call. Please refer to the forward-looking statements in the press release.
We're happy to report on our -- on the positive progress we have made this quarter. Annualized loan growth ex PPP was a respectable 9.5% for the quarter. This growth was aided by lower payoffs, higher line utilization, and a pool of purchased residential mortgage loans.
We are pleased with the positive trend we see in the number of new commitments and new loan closings. Even with our conservative credit box, we're getting our fair share of the new deals. We continue to see deposit growth with minimal runoff resulting from our branch consolidations in 2021.
Our pipeline of loans and deposits is strong and we expect it to continue to grow through the balance of the year. We maintain our focus on carefully managing expenses with good success, as evidenced in the non-interest expense number which was down 7% from Q4 levels.
Notably our long-standing focus on credit quality and actively managing our loan portfolio continues to play out well for us as the pandemic recedes. Staying focused on our risk profile has enabled us to continue to report improving credit trends. We also continue to benefit from the recapture of a portion of the reserve build from 2020. ACL is now settling in at 1.07% ex PPP compared to the pre-pandemic ACL of 1.01%.