Cambridge Bancorp (NASDAQ:CATC) Q3 2022 Earnings Conference Call October 18, 2022 11:00 AM ET

Company Participants

Denis Sheahan - Chairman, President and Chief Executive Officer

Michael Carotenuto - Executive Vice President and Chief Financial Officer

Conference Call Participants

Mark Fitzgibbon - Piper Sandler & Co.

Chris O'Connell - Keefe, Bruyette, & Woods, Inc.

Operator

Welcome to the Cambridge Bancorp Third Quarter Earnings Conference Call. We will be making forward-looking statements during this call and actual results may differ materially. We encourage you to review the disclaimer in our earnings release dealing with forward-looking information, which applies to statements made in this call. In addition, some of our discussion may include references to non-GAAP financial measures. Information about those measures, including reconciliation to GAAP measures may be found in our SEC filings and in our earnings release.

All participants will be in listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded.

I would now like to turn the conference over to Mr. Denis Sheahan, Chairman, President and Chief Executive Officer. Please go ahead, sir.

Denis Sheahan

Thank you, Marlins, and good morning everyone. Thank you for joining our earnings conference call today. I'm joined by our Chief Financial Officer, Mike Carotenuto who will provide an update for the remainder of this year.

To begin, I would like to welcome our new colleagues who recently joined from our merger with Northmark Bank. The merger closing was completed on October 1st representing about 4.5 months from announcement to close. Over these past few months I’ve gotten to know the team from Northmark and I look forward to working with each of them as we build the Cambridge Trust brand in these new markets.

I am also pleased to report another solid quarter. As expected, loan growth continued; asset quality remains excellent; and the net interest margin expanded, all balanced against the challenging period for deposit growth and wealth’s revenue as a result of market volatility.

The key highlights were loan growth continued during the third quarter in both commercial and residential lending with 3% linked quarter growth. Asset quality remains superb, non-performing assets are just 12 basis points of total assets and we are not seeing concerns in either consumer nor commercial credit at this point.

Core deposits decreased by 2% from the second quarter as a result of clients using funds for real estate purchase, business investment opportunities combined with market competition and certainly search for yield. The adjusted net interest margin expanded by 12 basis points to 2.93% during the third quarter reflective of our asset sensitive position and our core deposit base.