Earnings Call Transcript - ABCB Q4 2025

Operator, Operator

Good day, and welcome to the Ameris Bancorp Fourth Quarter Conference Call. Please note, this event is being recorded. I would now like to turn the conference over to Nicole Stokes, Chief Financial Officer. Please go ahead.

Nicole Stokes, Chief Financial Officer

Thank you, Megan, and thank you to all who have joined our call today. During the call, we will be referencing the press release and the financial highlights that are available on the Investor Relations section of our website at amerisbank.com. I'm joined today by Palmer Proctor, our CEO; and Doug Strange, our Chief Credit Officer. Palmer will begin, and then I will discuss the details of our financial results before we open up for Q&A. But before we begin, I'll remind you that our comments may include forward-looking statements. These statements are subject to risks and uncertainties. The actual results could vary materially. We list some of the factors that might cause results to differ in our press release and in our SEC filings, which are available on our website. We do not assume any obligation to update any forward-looking statements as a result of new information, early developments or otherwise, except as required by law. Also during the call, we will discuss certain non-GAAP financial measures in reference to the company's performance. You can see our reconciliation of these measures and GAAP financial measures in the appendix to our presentation. And with that, I'll turn it over to Palmer.

H. Proctor, CEO

Thank you, Nicole. Good morning, everyone. I appreciate you taking the time to join our call this morning. I'm proud of our fourth quarter performance and our record-setting results for the full year of 2025. We continue to operate at a high level of consistent core profitability while remaining focused on capital returns and accretive growth to enhance our shareholder value. We're positioned extremely well going into 2026, both from a growth and profitability level. Not only are we in the best southeastern markets that are growing faster than the national average, but we also have bankers who are focused on servicing our customers and growing our franchise organically. The call is going to talk about the details of our financials in just a minute, but I did want to give you just a few top-level comments about our core profitability. We reported record earnings for 2025 at over $412 million for the year with our diluted EPS hitting $6 per share for the first time in our history. That's a 15% increase in EPS year-over-year, and we did it organically. Our PPNR ROA was consistently above 2% this year. Our margin expanded every quarter, and our efficiency ratio improved throughout the year. We remain focused on generating revenue growth and positive operating leverage. We reported a 6% growth in revenue for the year, while our expenses declined by 1%. Combined, this positive operating leverage pushed our efficiency ratio to 50% for the year. This core profitability led to tangible book value growth of over 14% for this year. We remain diligent with our capital planning and are focused on generating shareholder returns. We paid off all of our sub debt during 2025, and as a result, have a very simple common stock capital structure going forward. During the fourth quarter, we announced an increased share repurchase program, and we were active in the fourth quarter buying back almost 1% of our stock at an average price of $72. For the year, we repurchased $77 million or 2% of the company at an average price under $67. Capital ratios remained strong, ending the year with common equity Tier 1 at 13.2% and tangible common equity ratio growing to 11.4%. Capital at this level positions us well for future growth expectations. On the growth front, we were very pleased with our asset generation during the fourth quarter, growing earning assets by almost 6%. We experienced unusually high payoffs in the CRE portfolio this quarter, which is indicative of a healthy economy, but does affect our net loan growth. Notwithstanding, we grew loans almost 5% in the fourth quarter, even with the elevated CRE payoffs of over $500 million. Under normal CRE payoffs, our loan growth would have approached double digits. Our pipelines remain strong, and we saw the highest level of loan production since 2022, coming in at $2.4 billion for the quarter, which was a 16% increase above third quarter levels. Asset quality for the year remained strong with net charge-offs and NPAs improving from the prior year. Our allowance remains healthy at 1.62% of loans. CRE and construction concentrations were consistent at 262% and 43%, respectively. On the funding side, we remain focused on core deposits and relationship banking. Our noninterest-bearing deposits represent a strong 29% of total deposits, even with typical seasonality of the fourth quarter. We're well positioned for future growth, both from the strength of our balance sheet and our fundamental operating model. We have strong momentum into 2026 on our organic growth strategies, which will be complemented by the disruption with our growing Southeastern markets. We have strong core profitability with diversified and durable revenue streams. These will continue to grow tangible book value, franchise value, and shareholder value in 2026 and beyond. I'll stop there and turn it over to Nicole to discuss our financial results in more detail.

Nicole Stokes, Chief Financial Officer

Thank you, Palmer. In the fourth quarter, we reported a net income of $108.4 million, which translates to $1.59 per diluted share. Our return on assets was 157%. We achieved a PPNR ROA of 2.38% and a return on tangible common equity of 14.5% for the quarter. For the entire year of 2025, our net income reached a record $412.2 million, or $6 per diluted share, resulting in a full year ROA of $1.54, up from $1.38 last year. Year-to-date, our PPNR ROA was $2.25, compared to $2.05 in 2024, and our full year ROTCE increased to 14.51 from 14.41 last year. Tangible book value grew by $1.28 in the fourth quarter, ending at an undisclosed value. For the full year, tangible book value increased by $5.59 per share, or 14.5%. As Palmer highlighted, our capital levels are strong. We actively repurchased $40.8 million worth of common stock, totaling about 564,000 shares at an average price of $72.36 during the quarter. At year-end, our remaining share repurchase authorization stood at $159.2 million. On the revenue side, our net interest income rose by $7.3 million in the quarter, equating to a 12.2% annualized growth. The core bank's income grew by approximately $8.7 million, whereas mortgage and premium finance experienced some seasonal declines in spread revenue. However, for the first time this year, both components of spread revenue showed improvement; interest income grew by $3 million, while interest expense decreased by $4.3 million. Our net interest margin improved by 5 basis points to a strong 3.85% for the fourth quarter, due to a 10 basis point positive effect on the funding side, which more than offset a 5 basis point decline on the asset side. For the full year, net interest income went up by $87.7 million or 10.3% from 2024, with the margin expanding from 3.56% last year to 3.79% for the full year. While we have positioned ourselves to be mostly neutral regarding asset-liability sensitivity, we expect some slight margin compression in the coming quarters due to rising deposit costs. As we anticipate increased loan growth, we expect further pressure on deposits as we fund this growth in 2026. In the fourth quarter, we recorded a provision expense of $23 million, with $6.3 million related to reserves for unfunded commitments, which is a positive indicator for future loan growth. Our reserves remain robust at 1.62% of total loans, unchanged from the previous quarter. Annualized net charge-offs normalized to 26 basis points this quarter, improving from 19 basis points to 18 basis points over the full year. We expect net charge-offs to remain in the 20 to 25 basis points range in 2026. Overall, asset quality trends are positive, with low levels of nonperforming assets, net charge-offs, and both classified and criticized assets. Moving to noninterest income, adjusted noninterest income fell by $10.5 million this quarter, primarily due to seasonal declines in the mortgage sector. For the full year 2025, adjusted noninterest income actually increased by $1.4 million year-over-year. Total noninterest expenses decreased by $11.5 million last quarter, mainly due to lower compensation and reduced marketing and advertising costs. For the full year 2025, total noninterest expense declined by $3.8 million or nearly 1% year-over-year. The majority of this decrease came from the mortgage division as variable costs fell due to decreased production affected by the current interest rate environment. In the fourth quarter, our efficiency ratio improved to 46.6%, and for the full year 2025, it stood at 50%, an improvement from 53.2% the previous year. I expect the efficiency ratio to rise above 50% in the first quarter, especially considering our seasonally heavy payroll taxes and 401(k) contributions. Reviewing our balance sheet, we concluded the quarter with total assets of $27.5 billion, compared to $27.1 billion last quarter and $26.3 billion at the end of Q4. This reflects a 4.8% growth in our balance sheet and a 5.5% growth in earning assets. Profitability metrics, including NII and EPS, grew over 10% during this same period, reinforcing our emphasis on profitable growth and positive operating leverage. Deposits increased by $148 million due to strong seasonal growth in public funds, though partially offset by typical seasonal outflows in mortgage-related escrow deposits, which will rebalance throughout the year. Given the seasonal nature of deposits, our NIB to total deposit ratio typically reaches its lowest point at year-end and remains strong this year at 28.7%. Broker deposits remained stable, constituting only 5% of total deposits at year-end. We continue to expect loan and deposit growth in the mid-single-digit range and anticipate that longer-term deposit growth will govern loan growth. I will now conclude and turn the call back over to Megan for any questions. Megan, please go ahead.

Operator, Operator

The first question comes from Stephen Scouten with Piper Sandler.

Stephen Scouten, Analyst

It was a strong quarter for loan production. Palmer, you mentioned that if payoffs had been more typical, loan growth could have reached double digits. Can you share your insights on future payoffs and why they were unexpectedly high this quarter? Additionally, how are loans maturing and renewing? Are they following the same pace, and what factors led to the increased paydowns? How should we consider this trend as we move into the new year?

H. Proctor, CEO

Yes, there are two points to mention. First, we are encouraged by the ongoing development of our pipeline. More importantly, the fourth quarter is usually one of our busiest periods for payoffs, which is consistent with reports from many banks. We expect this trend to moderate as we enter the first and second quarters of the year, which is a positive sign. Activity is continuing to improve, and we are pleased with the trends we are seeing throughout the entire bank, not just in specific areas but across all pipelines. As for the mortgage sector, we will have to see how things unfold over the next ten years, as this could provide significant support for us depending on the developments. Overall, we are feeling quite optimistic.

Stephen Scouten, Analyst

Okay. If rates continue to trend down, do you think that would accelerate paydowns even more, or would you be more optimistic about a rise in production and activity to balance out any potential issues?

H. Proctor, CEO

Yes. I believe that at our current stage of business development, fluctuations in rates will actually enhance our opportunities. Regarding payoffs, I don't anticipate that there will be significant movement towards refinancing elsewhere since most people are either depending on their loan conditions or are locked into term loans. Like many banks, we have prepayment and refinance penalties in place, so I don’t expect that to greatly contribute to outward movement.

Stephen Scouten, Analyst

Got it. Makes sense. That's great. And then I guess, in terms of thoughts around new hiring activity, I mean this has come up on every earnings call. I think I've been on the Southeast this quarter and people are calling it somewhat of a generational opportunity. I think your approach to it maybe has sounded different in terms of just improving your talent throughout the spectrum of your bank, but maybe not adding just pure head count quite as aggressively. Can you talk a little further about that if I'm hearing you right when I summarize that and kind of how you're thinking about it in the new year with the opportunity set?

H. Proctor, CEO

Yes. I think ours is very different. And like we've said for several years, when I look at the budget and our expectations, we do not have the compulsion and the need to have to go out and hire massive amounts of people to accomplish what we want to do here. We've been very fortunate with the level of talent that we have. We've been very fortunate with the retention, and we stay focused on that. But in perspective, I mean, we hired 21 lenders this year. But net-net, we were up 3. So what we do a constant view of is looking at the talent how it's progressing or not. And so what we've been able to do is upgrade talent on a consistent basis, thereby eliminating a lot of the churn and the constant need to have to add additional bankers. We've got great bankers and they can help us deliver on what we need to deliver on. And that being said, we obviously will remain selective, and if there are opportunities out there. But in terms of having a need to drive up noninterest expense and add on a bunch of bankers each quarter, we're in a very fortunate position, which we don't have to do that.

Operator, Operator

The next question comes from Catherine Mealor with KBW.

Catherine Mealor, Analyst

I wanted to ask about the margin. Nicole, I appreciate your caution regarding the possibility of margin decline next year as deposit costs rise, but we're currently at a much higher level compared to historical trends. I believe you've mentioned a margin range of 360 to 365, but we are significantly above that today. Could you provide a range for your margin expectations for the year?

Nicole Stokes, Chief Financial Officer

Yes, absolutely. And I know this is yet another quarter of saying that it's going to go down and then it went up. But real quickly on that 5 basis points of expansion, 2 basis points of that expansion really came from our sub debt payoff. So really, we only had kind of 3 basis points from both the loan and deposit side. So when I look out over the next few quarters, so much of our guidance is dependent on those deposit costs and the deposit pressure that we see as we see growth accelerating. So I feel like 5 to 10 basis points over the next few quarters. And then longer term, it's really going to depend kind of on growth and interest rate environment and where we are after that kind of 1-year horizon.

Catherine Mealor, Analyst

Okay. And that's 5 to 10 basis points from today's level or the full year '25?

Nicole Stokes, Chief Financial Officer

That would be kind of where we are today.

Catherine Mealor, Analyst

Got it. Okay. Great. And then maybe on expenses, I know there was a big reduction in expenses this quarter just from personnel. Can you help us get a range as for where a good starting point is for 1Q just given the increase in payroll taxes and things like that?

Nicole Stokes, Chief Financial Officer

Absolutely. When examining the fourth quarter and the first quarter, there are notable variances. In the fourth quarter, there are differences due to payroll taxes and the 401(k) match, with much of that being front-loaded in the first quarter. We anticipate about a $5 million shift expected to return in the first quarter. Additionally, there was a reduction in incentive accrual in the fourth quarter, as we adjusted those figures based on year-end data, which accounts for another $2.5 million. In the fourth quarter, our figure was $143 million; if we incorporate that $7.5 million, we would return to a range of approximately $150 million to $151 million. For guidance this year, while the consensus looks strong, the first quarter may appear slightly inflated. The year-to-date consensus may be solid, but it may lean towards being elevated in the first quarter. We might see some figures come in later as growth speeds up throughout the year, including certain expenses like commissions. Therefore, a good starting point for the first quarter is probably around $154 million to $155 million.

Operator, Operator

The next question comes from Russell Gunther from Stephens.

Russell Gunther, Analyst

I wanted to start with just a margin follow-up, if I could. Nicole, could you give us a sense of where kind of new production is coming online relative to the incremental cost of deposits and sort of along that question set, just the cadence of the fourth quarter margin over the course quarter of that quarter, kind of where we exited?

Nicole Stokes, Chief Financial Officer

In the fourth quarter, loan production reached approximately $635 million across all divisions, including the bank, premium finance, and warehouse. In comparison, deposit production was around 2%. This indicates a spread on production that supports growth and positively impacts margin. However, when comparing the loan spread to just the interest-bearing deposits, it was somewhat dilutive. This highlights our ongoing focus on growing non-interest-bearing deposits and core deposit growth to alleviate the pressure on interest-bearing spreads. Regarding the quarter, we maintained consistency at $385 million, with fluctuations of only 1 or 2 basis points each month and no major variations during the quarter.

Russell Gunther, Analyst

Okay. Very helpful, Nicole. And then maybe just switching gears to capital. Very robust position here. You got reserve levels that are incredibly healthy. Just level set us in terms of your kind of CET1 bogey in order to get a sense of what you guys might consider excess? And then given how quickly you accrete capital, how do you guys plan to put a dent in that over the course of the year?

H. Proctor, CEO

Our capital priorities have not changed. I mean obviously, first and foremost, it's growing into organic and levering it up. Then as you saw, we were active in the buybacks, we will remain opportunistic there. Then the dividend and then obviously, last would be any sort of external activity. But given the markets we're in now and the opportunities we see, that would be far, far down the list. In terms of target for us, I think we would be looking more on the TCE level, probably around 10%, 10.5%. And then on the CET1 target of around 12%, if you wanted to look at it longer term.

Russell Gunther, Analyst

That's really helpful, Palmer. Just one more question from me. I'm interested in the charge-off guide for the year. The fourth quarter results seemed to fall at the high end of that. Could you quickly discuss the factors driving the net charge-off activity this quarter and possibly the specific contributions?

Douglas Strange, Chief Credit Officer

Well, Russell, this is Doug. First of all, Equipment Finance performed consistently throughout the year. We did have some consumer medical notes that we wrote off, but our charge-offs fluctuate from quarter to quarter, and the fourth quarter followed two quarters with very low charge-offs at 14 basis points. However, as Nicole mentioned, when looking at it for the year at 18 basis points, we remained below the prior year and below expectations. To reiterate, we are still guiding for this year in the range of 20 to 25 basis points.

Operator, Operator

The next question comes from John McDonald with Truist Securities.

John McDonald, Analyst

Nicole, I was wondering if you could give us a little more color on the puts and takes on deposit trends in the fourth quarter. There's a little bit of a decline in NIB and wondering if you've seen some of that come back? And then just as you think about your mid-single digit outlook for this year, what kind of mix evolution are you planning for in the overall deposit mix?

Nicole Stokes, Chief Financial Officer

We experienced some cyclical patterns in our balance sheet this year, as usual. In the fourth quarter, we see public funds coming in while mortgage escrow deposits flow out, making it our lowest point for noninterest-bearing mix. We were satisfied that it ended the year close to 29%. This year was slightly different; our noninterest-bearing accounts have continued to rise. The decline in noninterest-bearing was due to two factors: the mortgage escrow deposits and some customers, not just a few, but spread across 20 to 30 accounts, moving money out at year-end. We believe some of this was for tax planning and some for balance sheet management at year-end. However, we have already seen much of that money return. Although it might seem like an anomaly, our main focus remains on noninterest-bearing growth. Given the number of accounts we are opening, we remain optimistic about noninterest-bearing growth. This aligns with your second question about our growth expectations. We are committed to expanding core deposits and strengthening our role as relationship bankers, which we see as crucial for navigating potential market disruptions. We aim to grow core deposits through relationships, focusing on operating accounts and money market accounts while maintaining brokered deposits at 5% year-over-year.

John McDonald, Analyst

Great. Just to follow up on the idea that deposit growth influences loan growth, if we are expecting mid-single-digit growth for both, are these forecasts related or independent? It seems that as Palmer mentioned, loan growth paydowns normalizing could result in better than mid-single-digit growth. I'm curious if these are connected in the forecast.

Nicole Stokes, Chief Financial Officer

We do forecast and budget for core deposit growth. However, looking at our balance sheet, there are various components of our loan portfolio that don't necessarily come with a deposit feature. Our core loan growth comes from core deposits as well as other lines of business. If we need to fund those other lines with brokered or wholesale sources, we will do so, but we remain focused on maintaining our margin. This offers insight into our forecasting. For our core bank growth, we are committed to funding that primarily through core deposits.

John McDonald, Analyst

Great. And one last follow-up. On the provision build this quarter, some of it was for unfunded commitments. Is that relationship of growth to provision build something that had anything unique about it this quarter? Or is that how we should think about it going forward?

Nicole Stokes, Chief Financial Officer

I believe much of the unfunded commitment has been consistent over the past two quarters. Looking back, we've limited our commercial real estate and construction lending, including homebuilder projects, which has led to a slowdown in unfunded commitments. Now, we're gradually increasing that balance again. In a typical situation, this would remain steady without needing a refill. We're starting from a lower level, but it's nearly back to full. If we experience a strong production quarter, we could see an increase in unfunded commitments, which we view positively. It indicates that we've produced and closed loans that are yet to be funded. Each increase in unfunded commitments prompts us to anticipate future loan growth since we know these loans are in the pipeline.

Operator, Operator

The next question comes from Gary Tenner with D.A. Davidson.

Gary Tenner, Analyst

I've got a couple of questions on the mortgage segment. You had the $2 million net revenue decline from the MSR sale and the valuation change. But given the flattish production and gain on sale margins. Can you talk about kind of what drew the remainder of that $10 million quarter-over-quarter decline in fee income in the division?

Nicole Stokes, Chief Financial Officer

Certainly. Although mortgage production and gain on sales remained relatively stable, the fourth quarter experienced a larger share of wholesale production, which is generally less profitable compared to retail origination. There is also some seasonal variation in the fourth quarter due to lower pipeline levels. If we consider the year-to-date results and exclude last year's MSR gain, we can better understand the overall trend. Mortgage revenue decreased by approximately $13 million, or about 8%, from 2024 to 2025, while expenses fell by $6 million, or around 4%. This aligns with our expectations of adjusting to a 50% efficiency ratio in the mortgage group. Despite some irregularities in the fourth quarter, the overall performance balances out for the year.

Gary Tenner, Analyst

Okay. Great. Can you provide the unpaid principal balance of the servicing portfolio at year-end?

Nicole Stokes, Chief Financial Officer

Yes, at the end of the year, our unpaid principal balance was about $8.7 billion, which is about 4% of Tier 1 capital. So well below the 25% regulatory threshold.

Gary Tenner, Analyst

Great. And then last question for me, just a follow-up on the capital side. Proctor, you talked about your remaining opportunistic there. I'm just curious if you're willing to talk about any kind of sensitivities around price levels. I mean the stock is up 15% from where you repurchased in the fourth quarter. Obviously, the capital accretion outlook remains very strong. So just wondering how you balance kind of the relative price versus your appetite there?

H. Proctor, CEO

Yes. No, it is a balancing act. But the way we look at it right or wrong is if you see a lot of M&A out there in the market. And if there was a mini Ameris Bancorp sale out there, what would we be willing to pay for it is another way to look at it and who better to invest in than yourself. So we'll still be selective there in terms of buyback opportunities.

Operator, Operator

The next question comes from David Feaster with Raymond James.

David Feaster, Analyst

I wanted to revisit the production aspect. This year has been the strongest in the past three years. Could you provide insight into how this increase in productivity compares to the changes in demand? I'm also interested in whether there are markets that are shifting more towards opportunities.

H. Proctor, CEO

David, this is Palmer. I'll attempt to address your question. Your connection seems to be poor, making it difficult to understand. I would respond by saying that it's a combination of factors. We have many dedicated individuals here producing excellent results, even with the challenges presented by market changes from mergers and acquisitions. Moreover, recent activities are likely to provide us with even more opportunities. Our positioning in high-growth markets is beneficial as we look ahead, and if the overall economic situation continues to improve, we will be well-positioned for enhanced growth. We're cautious with our predictions because we prefer to realize gains rather than merely promise them.

David Feaster, Analyst

Yes, okay. Staying on the loan side, we've been hearing a lot about increasing competition. I'm curious about your perspective on the competitive landscape in lending. Has the competition mainly been focused on previous loans, or are you starting to encounter more pressure on standards and structures as well?

H. Proctor, CEO

No, it's mainly been on pricing. I mean structure, fortunately for us and for the industry, which is a good sign, has held up relatively well. You'd have some folks get a little more aggressive than others. But good for us. We've grown up in a very competitive environment when you're in these high-growth markets. So the competition is nothing new to us to have to adapt and adjust to, and we will get our fair share of the opportunities.

David Feaster, Analyst

Okay. Regarding premium finance, I know you all are quite enthusiastic about this segment. You mentioned some seasonality in the prepared remarks. I'm curious about what you are observing in that segment, your growth expectations, and any additional opportunities.

H. Proctor, CEO

No. Thank you for the question. Premium Finance has been a consistent and reliable performer for us. In terms of balance sheet composition, it won't take up much more, but it will continue to generate significant earnings for the company moving forward. Our pipelines remain full, and we anticipate additional opportunities in the market. We're committed to this space, and it has clearly benefited us.

Operator, Operator

Our next question comes from Christopher Marinac with Janney Montgomery Scott.

Christopher Marinac, Analyst

Palmer and Nicole, I wanted to discuss the growth over the past couple of years regarding the accounts of DDAs, noninterest accounts, and NOW accounts. It appears that you're experiencing about a 4% to 5% increase in both categories, as well as in money markets. I'm interested to know if, considering the increase in net new accounts, you have any strategies in place to encourage faster growth in balances. Does this begin with acquiring accounts on a net basis?

Nicole Stokes, Chief Financial Officer

Yes, Chris, I apologize for the technical difficulties. You’re right that the first step is bringing a customer in and opening the account. The next step is about growing that relationship; it starts with one account and then figuring out how to gain more. We anticipate some market disruptions might allow us to convert additional deposits as we strengthen our current relationships, especially if customers face issues with their existing banking partners. Therefore, our approach is twofold: we need to increase both the number of accounts and the depth of relationships we have. It’s important to grow within those relationships as well. So yes, it’s definitely about both aspects.

H. Proctor, CEO

And Chris, just to add a further comment, our incentive plans are geared around that, too, and motivate that type of behavior. And one of the things I think that a lot of folks in the industry, the exception of a few, overlook is a lot of the value of the consumer accounts. And while they may not add as much in the way of total deposits and funding, what they do add are meaningful, sticky, stable relationships. So we have not lost focus on the consumer, and we're able to leverage our branches and the retail land extremely well, and we'll continue to do that. And then a lot of the additive to with us is the investments we made in treasury management over the last several years. A lot of people talk about lenders that they've hired, but we like to focus on the deposit side and on the treasury side, equally, if not more. And so I think that's been a big driver for us as we look forward into opportunities for good commercial deposit growth.

Christopher Marinac, Analyst

Is the treasury success going to show up in just the NOW accounts or will it show up in money market to some extent, too?

H. Proctor, CEO

Both. You're right, both. I mean you got your operating payroll accounts. And then obviously, any excess funds will be swept into a money market type of account or higher interest-bearing account.

Christopher Marinac, Analyst

And you've had success dropping the cost of funds we see every quarter here. And I'm just curious, do you have any opportunity to kind of tweak deposit pricing to get more dollars in and still keep your margin where you are trying to manage?

H. Proctor, CEO

It's becoming increasingly competitive out there. When you observe the rates offered by banks and nonbanks, along with the influx of new players promoting attractive rates, it’s clear that many are after the quick returns. However, we aim to focus on building core relationships rather than participating in what I see as short-term, high-yield strategies. Of course, we understand the need to remain competitive at times, but our priority is on nurturing relationships. I would prefer to offer a higher rate on a certificate of deposit to an existing customer rather than just acquiring funds from new clients attracted by high rates.

Operator, Operator

This concludes our question-and-answer session. I would now like to turn the conference back over to Palmer Proctor, CEO, for any closing remarks.

H. Proctor, CEO

Great. Thank you, Megan. Finally, I'd like to also thank all of our Ameris teammates for their contributions to a record year 2025. I'd also like to thank everybody again for listening to our fourth quarter and full year 2025 earnings call. We're proud of another solid quarter of performance, and we're really looking forward to 2026. And please note that we remain focused on core profitability, organic growth and enhancing value through our core deposit base and tangible book value growth. We appreciate your continued interest in Ameris Bank. Thank you.

Operator, Operator

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.