Cambridge Bancorp (NASDAQ:CATC) Q2 2022 Earnings Conference Call July 19, 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.

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

Operator

Good morning. Welcome to the Cambridge Bancorp Second 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 a 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, and thank you for joining our earnings conference call today. My comments will focus on key items within the quarter and what we are seeing within our local markets. I'm joined today by our Chief Banking Officer, Tom Fontaine; and our Chief Financial Officer, Mike Carotenuto. And Mike will provide commentary regarding estimates for the remainder of this year and in particular, the impact of rising rates as well as an outlook for loan and deposit growth and wealth revenue.

I'm pleased to report another solid period of robust loan growth, continued strength in asset quality, and an expanding net interest margin due to our asset sensitive position. This is balanced against a challenging period for wealth revenue led by market volatility and asset flows. We also announced during the second quarter the proposed merger of Northmark Bank into Cambridge Trust, which brings together two high-quality banks in terrific markets.

As expected, loan growth continued during the second quarter in both commercial and residential lending with 3% linked-quarter growth. Looking ahead, we feel good about continued prospects for growth in commercial lending. Asset quality remains superb with non-performing assets at just 12 basis points of total assets. Core deposits decreased by 4% from the first quarter as a result of tax payments and clients using funds for investment opportunities. We still see the opportunity for core deposit growth for the year and Mike will provide further commentary in a few minutes.