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First Midwest Bancorp Inc (NASDAQ:FMBI)
Q4 2019 Earnings Call
Jan 22, 2020, 11:00 a.m. ET

Contents:

  • Prepared Remarks
  • Questions and Answers
  • Call Participants

Prepared Remarks:

Operator

Good morning, ladies and gentlemen, and welcome to the First Midwest Bancorp 2019 Fourth Quarter and Full Year Earnings Conference Call. Following the close of the market yesterday, the Company released its earnings results for the fourth quarter and full year of 2019 and also issued presentation materials that will be referred to during the call today. These provide both historical financial information and the Company's outlook for 2020.

During the course of the discussion today, management's comments and the presentation materials may include forward-looking statements. These statements are based upon the Company's current beliefs and are not historical facts or guarantees of future performance or outcomes. Actual results or outcomes may differ. The risks, uncertainties and safe harbor information contained in the Company's most recent 10-K and other filings with the SEC, as well as the forward-looking statement, non-GAAP and other legends included in the Company's earnings release and presentation materials should be considered for the call today. Finally, the Company will not be updating any forward-looking statements after this call.

This call is being recorded and all participants are in a listen-only mode. Following the presentations by Mike Scudder, Chairman and Chief Executive Officer; Mark Sander, President and Chief Operating Officer; and Pat Barrett, Executive Vice President and Chief Financial Officer, the call will be opened for questions and answers for analysts only. I will now turn the call over to Mr. Scudder. Please go ahead.

Michael L. Scudder -- Chairman of the Board and Chief Executive Officer

Great. Good morning. Thank you everyone for joining us. It's great to be with you. I want to remind all of you that we've given and provided a supplemental presentation to follow along with as we move through our remarks. So as is our custom, I'll cover the highlights and then leave it to Mark and Pat and they can walk you through the details.

Looking back at the year, we closed what was truly a meaningful year for First Midwest. 2019 saw us grow to a record $18 billion in assets, as well as our EPS to a record $1.98 per share. Both of those represented growth levels at or greater than 15% year-over-year. The year also saw us closed on our acquisition of Bridgeview as well as expand into Milwaukee through our acquisition of Northern Oak very early in '19, as well as additions to our commercial lending teams there. This was further augmented by our announced and pending acquisition of Park Bank. So, very excited about all of those moves.

As a result of those activities, our profitability has improved with our return on tangible common equity increasing to 15.7%, that's up almost 60 basis points from last year. Our recovery of capital also accelerated, largely on the strength of that earnings as our tangible book value per share has increased by almost 15% over 2018 as well, all due to the fact that stronger earnings accelerate capital recovery and certainly the capital that we spend on our acquisition activity.

For the quarter, adjusted EPS was $0.51 for the fourth quarter, that's up $0.06 or about 6% over the fourth quarter of '18, down about $0.01 or 2% from the third quarter. As we expected, our performance continues to reflect the impact on revenue from the course reversal to lower rates from what we would have started the year at.

Highlights for the quarter's performance would include our loans were up 12% year-over-year, that's about 7% if you exclude the benefits of Bridgeview. On linked quarter, loans increased 2% annualized though that was largely on the strength of our consumer portfolio as we added diversification, duration and yield responsive to the rate environment there. Net interest income was down about 1.5% linked quarter, as margin declined by about 10 basis points, all as expected with our loans repricing in our mix shifting at a pace different in contrast to the repricing of deposits.

At the same time, fee-based revenues increased 8% from last quarter and 28% from last year, which largely helped offset the impact of lower rates. It was once again nice to see the investments that we've made in our wealth and mortgage platforms, along with a record quarter for our sale of derivative products drive the increase.

Credit costs were down slightly as our greater mix and the quality of the consumer lending originations that we put on the books warranted lower provisioning while charge-offs as a percentage of the portfolio were up slightly linked quarter. But as a whole, charge-offs were in line with trends that we've seen for the full year as well as down from what we would have seen from last year as a percentage of the portfolio.

Operating efficiency has been and continues to be a focus area for us. It came in at 56% for the quarter. That's up from last quarter's 54% but -- while the full quarter was -- full year excuse me was up almost 3 percentage points ahead of where we were for the full year last year. But half of our expense increase was tied to variable expenses, tied to revenue growth and our non-interest income portfolio with the remainder tied to timing related to some professional expenses that we incurred in building out our retail and consumer sales platforms and some investments that we made in our internal processes.

So with that, let me turn it over to Mark and Pat, and they can offer some additional color.

Mark G. Sander -- President and Chief Operating Officer

Thanks, Mike, and good morning all. As we take you through our fourth quarter performance, we'll also reference 2020 full-year guidance, excluding the impact of the Park acquisition. For ease and greater clarity, we note Park separately on each slide and then in total on Page 12 of our presentation.

Starting with loans on Page 4 of the deck. Q4 growth of 2% annualized was a result of solid production across all of our platforms, but this was partially offset by an abnormally high level of payoff activity in commercial. As we signaled last call, given the visibility we had to certain asset sales and credit market dynamics, payoffs were higher in both C&I and CRE in Q4. We faced this pressure throughout the year in CRE, but the combination of some unfortunate events for our clients as well as credit discipline resulted in lower C&I outstandings this quarter as well.

Consumer lending had a strong quarter on all fronts. We posted record mortgage originations aided by the favorable rate environment, but largely driven by our staff additions and sales disciplines over the course of the year. That was supplemented by some transactional purchases of high-quality mortgages, which we thought were good earning assets. Organic installment lending also grew nicely. So as we think about this year, our continuing solid commercial production and pipelines should drive net loan growth these next couple of quarters as payoff activity returns to more normalized levels.

While the market remains one of high competition and modest loan demand, our diversified business model and seasoned teams are expected to again generate solid organic results. We also see consumer lending remaining strong, given the overall steady economic landscape. Reflecting all of the above, we project mid-single-digit total organic loan growth for the year.

Asset quality results came in as expected in Q4, as Mike mentioned, as all key metrics remain consistent with Q3 and our guidance. With no change in the macro outlook expected, we think charge-offs will again be in a narrow range around 30 basis points over the course of 2020 away from CECL. Provision expense will cover charge-offs and net loan growth.

Deposits, as seen on Page 6, remained consistent, given our favorable composition. Our costs here came down 5 basis points from Q3 and remain a competitive advantage versus our peers.

Now over to Pat to discuss net interest income and margin.

Patrick S. Barrett -- Executive Vice President, Chief Financial Officer

Thanks, Mark. Good morning to everyone on the call. Turning to net interest income and margin on Slide 7. Net interest income decreased 1.5% compared to the prior quarter and was up $10 million or 7% compared to the same period in 2018. Decrease compared to the prior quarter was due to lower interest rates, partially offset by lower cost of funds and higher acquired loan accretion. Compared to the prior year, the increase was due to the acquisition of Bridgeview, securities purchases, loan growth and accretion, partly offset by higher funding costs.

Acquired loan accretion contributed $9.7 million to the quarter, up from $9.2 million in the prior quarter and $5.4 million compared to the same period a year ago. Accretion was higher than expected due to favorable resolution of certain acquired loans.

Moving to net interest margin. Tax equivalent NIM for the current quarter of 3.72% was down 10 basis points linked quarter and 24 basis points from the same period a year ago. Excluding accretion, core margin was 3.48% for the quarter, down 11 basis points linked quarter and 33 basis points from the same period a year ago. Margin compression reflected the impact of lower market rates on loan yields compared to both prior periods. Compared to the prior quarter, this was partially offset by lower cost of funds. Compared to the prior year, margin compression also reflected actions taken to reduce rate sensitivity combined with higher cost of funds.

Turning to earning assets and funding sources. Average earning assets were up $170 million linked quarter, reflecting loan growth and up $2 billion compared to the prior year, reflecting earning assets from the Bridgeview acquisition, loan growth and securities purchases. Average funding sources were up over $150 million linked quarter due to the higher levels of borrowed funds and up $2 billion from the prior year, reflecting the impact of acquisitions, organic deposit growth, and higher levels of borrowed funds.

Moving to our 2020 net NII outlook. We expect low to mid-single digit NII growth, excluding accretion and assuming no further rate cuts occur. To clarify with the inclusion of Park, this would be around mid-single digit growth. Accretion is expected to be approximately $16 million for the year, which occurs fairly evenly throughout the year, reflecting the CECL transition in which $5 million reclassifies to a lower provision for loan losses.

Our outlook for core NIM calls for a modest decline early in 2020 from Q4 '19 levels and stable thereafter. This assumes stable short-term rates. Once again, I want to remind you that projections are subject to volatility due to movements in interest rates, pace of loan growth, the impact of acquisitions.

Turn it back over to Mark to discuss non-interest income on Slide 8.

Mark G. Sander -- President and Chief Operating Officer

Thanks, Pat. Non-interest income came in stronger than we expected, up 8% linked quarter, following a rather robust Q3. We posted a record quarter in both swaps and mortgage fees aided by the rate environment. These revenue streams drove most of the favorable fee variance and impacted expenses as well as Pat will cover in a minute.

We also posted a solid quarter in wealth and treasury management. Combined with the benefit of our acquisitions, we generated 28% growth year-over-year in Q4. We continue to see organic opportunities for low to mid-single digit gains in our core fee revenue streams. The near-term outlook in the more volatile components of mortgage and swaps is also favorable. The results will not likely remain at the record levels we posted in Q4. In total, we are calling for low to mid-single digit non-interest income growth in 2020. This reflects our solid core business momentum, while factoring in a possible normalization of our outsized results in a couple of areas last year.

Pat will now pick up on expenses.

Patrick S. Barrett -- Executive Vice President, Chief Financial Officer

Moving to Slide 9, note that our current quarter, four quarter, includes $5 million of anticipated acquisition and integration-related expenses, largely driven by costs associated with the Bridgeview acquisition.

Away from these items, total expenses were up 6% compared to the third quarter and up 13% compared to the same quarter a year ago. The increase compared to the prior year was driven by our larger operating base due to acquisitions combined with higher staff costs reflecting higher salaries for merit increases, higher mortgage commissions due to higher production volumes, and higher professional services related to continuing investments in technology and process enhancements.

Compared to the prior quarter, expenses reflected increases in the professional services related to these technology and process enhancements, incentive compensation accruals, FDIC insurance premiums, and higher mortgage commissions. As a result, our efficiency ratio ticked up modestly compared to both the prior quarter and prior year, but it should be noted that our efficiency ratio can fluctuate quarter to quarter, and overall for 2019, was 55% compared to 58% in 2018. Our outlook for 2020 legacy expenses is around $440 million for the year with some quarterly variability, but generally spread evenly throughout the year.

Last note on taxes before I leave this slide. Our effective tax rate for the quarter was approximately 24%, lower than our guidance due to credits realized in the quarter. We expect our continuing effective tax rate of 25% into 2020.

Moving to capital on Slide 10. We continue to maintain capital at strong levels and are pleased with our track record of rapidly earning back the capital we've deployed on acquisitions. In addition, our tangible book value of $13.60 is up nearly 15% from a year ago. Capital accretion from excess earnings continues to provide us with flexibility to fund growth and continued share repurchases for which we have approximately $145 million remaining in the Board-approved authorization, although note that we have not been repurchasing due to the pending Park acquisition.

During the quarter, we paid a dividend to shareholders that represents more than a 17% increase from the same period a year ago. And lastly, on Slide 11, we summarized our current estimated range of impact to both capital and the allowance for credit losses of the adoption of CECL standard this quarter [Phonetic] Q1 of 2020. These estimates have not changed from what was presented in our prior quarter's presentation. And as a recap, overall, the estimated impact to our Tier 1 capital is relatively limited at 25 basis points to 40 basis points, approximately $35 million to $50 million representing one to two quarters of typical earnings capital generation.

Consistent with our usual practice, we've summarized our outlook for 2020 on Slide 12.

Now, I'll turn it back over to Mike for final remarks.

Michael L. Scudder -- Chairman of the Board and Chief Executive Officer

Thanks, Pat. So just to kind of recap, as you all know, the operating environment remains a little uneven to say the least while the rate backdrop certainly, it's tough for the industry as a whole and for us, it has the impact on early year momentum as we adjusted that transition. At the same time, we really like our positioning and remain focused on the execution of our core strategic priorities. We have and continue to build a great team here at First Midwest and a great work environment. We're very pleased to be recognized locally here as once again one of Chicago's best places to work in our markets, and certainly that's more noticeable as both our market profile and influence here in the market continues to grow with our size.

We worked very hard to build and maintain a tremendous core deposit foundation. And while this tends to be undervalued amid today's rate noise if you will, it continues to serve as a long-term strength of the Company. Our credit profile is more diverse certainly than what it was several years ago, and as such, we're better positioned as we move through the forward years.

Our earnings remains very strong, as we continue to organically build capital and this gives us tremendous flexibility to leverage the environment as well as that capital to both grow and optimize our mix. Operationally, our efforts in 2020 will continue to see us invest in and work to better leverage our resources, technology and processes to drive efficiency as well as a better and more efficient client experience, but also to better manage risk in an evolving risk landscape as well. 2020's environment and technology advancement from my perspective offer both the opportunity and the incentive just to do that.

So finally, I would also acknowledge our acquisition of Park Bank will certainly build on the presence that we've built in Milwaukee, and we have in southeast Wisconsin, adding about $1 billion in assets, and most importantly a very talented and engaged team of bankers. Organizational and integration planning on our -- from our perspective are well down the path with teams and roles aligned and metrics tracking within our expectations.

So in summary, we've got a strong balance sheet, engaged team, strong -- solid underlying opportunity, we have the flexibility to manage our capital to invest in our business and infrastructure as well as pursue those opportunities that make sense for us. As always, we will continue to do that with an eye on maximizing long-term shareholder return.

So with that, let's open it up for your questions.

Questions and Answers:

Operator

Thank you, sir. [Operator Instructions] The first question comes from Michael Young with SunTrust. Please go ahead.

Michael Young -- SunTrust -- Analyst

Hey. Good morning, everyone.

Michael L. Scudder -- Chairman of the Board and Chief Executive Officer

Good morning.

Michael Young -- SunTrust -- Analyst

First question is for Mark. Mark, you mentioned in your prepared remarks that you expected loan pay-downs potentially to slow next year. I was curious if you're seeing something in the environment that was giving you greater confidence or if that's just a normalization of the recent trends.

Mark G. Sander -- President and Chief Operating Officer

A little bit of both, Michael. I think it's a normalization. So, this was by far a higher year than we've ever seen before. So you expect not necessarily for that to repeat. I do think there were a couple of unique circumstances in '19 also events for clients, transitions of portfolio, you remember we bought two banks in the last 15 months. And as you transition those, we expect a little bit of drop there in the first year. So I think the combination of all that, I think it'll be a little bit more normalized, so to speak, year.

Michael Young -- SunTrust -- Analyst

And when those events are transpiring, are you guys capturing maybe that business in other parts of the bank?

Mark G. Sander -- President and Chief Operating Officer

Sometimes yes, and sometimes no. Certainly when businesses sell, we hope we have been having those conversations for years in advance relative to estate planning and investing types of things. But for the large part, I would say, no. There are certain places where we can continue relationships and others where we can't always.

Michael Young -- SunTrust -- Analyst

Okay. And maybe if I could just switch to Pat, just a clarification on NII guide. Is $552 million [Phonetic] the right base amount for that mid-single digit growth rate. And then, we're adding $16 million of purchase accounting accretion on top of that. Is that the right number to use?

Patrick S. Barrett -- Executive Vice President, Chief Financial Officer

Let me kind of put it this way. So, our all-in reported NII for the year at $588 million, which is inclusive of accretion. We're looking for that with the inclusion of Park to be up mid-single digit. So call it 5%. That's in the face of sharply declining accretion. So, we're going to be off nearly $20 million expected year-on-year as well as a slight negative impact from lower rates, as that rolls through the year. And keep in mind that we've got $5 million to transitions because of CECL out of NII and into a credit in our provision line item just to complicate things for everyone.

Michael Young -- SunTrust -- Analyst

Right. And the mid-single digit guide off the $588 million that is inclusive of that CECL piece.

Patrick S. Barrett -- Executive Vice President, Chief Financial Officer

But exclusive of the Park acquisition. So, we're just trying to demonstrate -- it's a really -- it's a tough quarter, we probably should have given multiple guides. That was the all in that I just gave you mid single-digit, the kind of low to mid-single digit would be away from accretion. If you just looked at our legacy NII with the drop in accretion away from Park, we'd be flat year-on-year. Hopefully, at least one of those comments resonates with your modeling.

Michael Young -- SunTrust -- Analyst

Okay. Thanks, Pat.

Patrick S. Barrett -- Executive Vice President, Chief Financial Officer

We'll follow up offline as needed. And I'm sure there would be some follow-up calls.

Operator

[Operator Instructions] The next question is from Chris McGratty with KBW. Please go ahead.

Kelly Motta -- KBW -- Analyst

Hi, this is actually Kelly Motta on for Chris. Thank you for taking my question. I wanted to maybe stay on NIM. I think you mentioned in your prepared remarks that assumes flat rates. I'm kind of wondering how to think about your -- the trajectory of your deposit costs from here and kind of -- if we were to get another cut, if you would still have room to kind of offset or how we should be thinking about overall NIM pressure if that were to happen.

Patrick S. Barrett -- Executive Vice President, Chief Financial Officer

Sure. Compound question, Kelly. So, let me do take my best shot at it. So, I'll answer the sensitivity question first. I think a 25 basis point change assuming that LIBOR and Fed move kind of in lockstep over time would be about $1.5 million a quarter, whether it's up or down at this point. So with deposit repricing kind of lagging loan repricing over the last two quarters, that state we see that stabilizing in Q1 and seeing a pretty stable NIM. So the continued impact of compression on loan yields should be reflected in lower funding costs. So, we think that we're going to after maybe a 2 basis point or 3 basis point drop in Q1, we think we're going to see NIM pretty much return to the levels we printed this quarter, so in the high-3.40s and we would expect that to persist throughout the year.

Kelly Motta -- KBW -- Analyst

Got it. Thank you. And just a point of clarification on the accretion, you said $16 million in total, and then Park is an additional $1 million or is that included in $16 million [Phonetic]?

Patrick S. Barrett -- Executive Vice President, Chief Financial Officer

Correct. Yeah.

Kelly Motta -- KBW -- Analyst

Okay. Perfect.

Patrick S. Barrett -- Executive Vice President, Chief Financial Officer

Park is an additional $1 million. So, we had to pick and choose how we give our guidance, ex are inclusive of park and we should have done both probably to make it clear, $16 million without; $17 million, with.

Kelly Motta -- KBW -- Analyst

Great. Thank you so much.

Operator

[Operator Instructions] If there are no further questions, I will now turn the call back over to Mr. Scudder for any closing comments. Pardon me, Mr. Scudder, we did have a late question coming, if you wanted to take it?

Michael L. Scudder -- Chairman of the Board and Chief Executive Officer

Sure. Happy to do that [Phonetic].

Operator

This will be from Cooper Brown with Stephens. Please go ahead.

Cooper Brown -- Stephens -- Analyst

Hey. Good morning, guys. This is Cooper Brown on for Terry. I had a quick question on the expense guide. I guess, what are your assumptions, specifically on the capital markets and mortgage banking revenue within that $440 million guide before Park?

Patrick S. Barrett -- Executive Vice President, Chief Financial Officer

Maybe I'll take a shot at that. So, I guess the bigger question is the assumptions on the revenue first, maybe Mark -- we're unclear as to whether we're going to see sustained record levels of capital markets income first of all, but that doesn't really drive a huge amount of our heightened expenses, mortgage banking does because for every $1 of revenue we print, $0.85 on that $1 gets paid out in commissions. So, it really does drive higher expense base. We're expecting mortgage to continue as long as this low rate environment does at call it relatively consistent levels with we've performed in the last couple of quarters. So those revenues will track at steady levels, but we'll pay it back out in heightened commissions. Capital markets, it's hard to predict much more than 30 to 60 days in the future on that. So, we are actually anticipating maybe a more of a normalization of that, which could bring it back down to kind of more of a $2.5 million to $3 million a quarter range, but that shouldn't really influence expenses.

Cooper Brown -- Stephens -- Analyst

Okay, great. That's all I had. Thank you.

Operator

The next question is a follow-up from Kelly Motta with KBW. Please go ahead.

Kelly Motta -- KBW -- Analyst

Hi. I just wanted to ask one last question about the buyback. You mentioned that you were out of the market because of Park. Just wondering with CECL coming up and you're healthy on capital, but kind of thinking is, would you be interested in stepping in and continue repurchase your stock when you're not blacked out from doing so and how you should kind of think about that going forward?

Patrick S. Barrett -- Executive Vice President, Chief Financial Officer

We would -- just kind of a reminder, we put the program in place to gear toward being able to consume our excess earnings over time rather than a one-time thing. So, the impact of Park -- I'm sorry, CECL is probably going to be roughly equal to a quarter's worth of earnings, maybe a little bit more than that. And so, you'll probably see our capital levels revert back to where they were Q3 level at the end of Q1. Then away from that, Park will consume maybe another 50 basis points. We still feel even with those two deployments of capital like we are very well capitalized and would expect to continue to use buybacks as a way to absorb excess earnings to maintain capital levels at or maybe a little bit lower than today's level.

Kelly Motta -- KBW -- Analyst

Great. Can you just remind us what's kind of your view about ratio that's your governor that we should be keeping in mind?

Patrick S. Barrett -- Executive Vice President, Chief Financial Officer

As far as capital?

Kelly Motta -- KBW -- Analyst

Yeah.

Patrick S. Barrett -- Executive Vice President, Chief Financial Officer

Yeah, our Tier 1 CET1 we like it to be in the 9% to 10% [Phonetic] range. Very comfortable with that. And the volatility that in short term that we incur with either acquisitions or other things kind of moves us up and down, so we're a little over the levels that we think is necessary or prudent given the outlook that we have for the environment, which is really benign at this point.

Michael L. Scudder -- Chairman of the Board and Chief Executive Officer

Yeah. Kelly, I just keep it -- we have the flexibility with that level of earnings generation to be flexible in terms of what's the best way to manage the capital and the environment that you're in.

Kelly Motta -- KBW -- Analyst

Great. Thank you.

Operator

The next question is a follow-up from Michael Young with SunTrust. Please go ahead.

Michael Young -- SunTrust -- Analyst

Thanks for the follow-up. We're looking a little light today, so I figured I could sneak one more in. Pat, just on the balance sheet overall, included in that NII guide, are there any assumptions relative to remix either with more securities purchases or a continuation of kind of the consumer indirect purchases in 2020?

Patrick S. Barrett -- Executive Vice President, Chief Financial Officer

Yeah. I think the purchases have been more residential one to four. Just to be clear, not on indirect financing or anything like that. So yeah, I think that we would expect the balance sheet mix to stay relatively steady with where it is. We feel good about that. We could have a little more securities, a little less securities, we're really thinking about one to four mortgages though as alternatives for excess liquidity and capital to buying mortgage-backed securities. So whether we were buying an agency paper MBS, CMBS, or similar versus a whole loan, we balance the yield adjusted for credit and make sure that we're getting paid better for the mortgage than we would be for the security with similar durations that have higher credit profile. So, we may continue to do that a little opportunistically kind of depends on organic growth that we see, but it's really more of a yield decision at this point.

Michael Young -- SunTrust -- Analyst

Okay. And can you help us frame what the provision at [Phonetic] is Day 1 on a new mortgage loan that you put on the books?

Patrick S. Barrett -- Executive Vice President, Chief Financial Officer

Yeah, we've kind of guided toward a rule of thumb of 1% in the past. It has historically been lower for mortgages and higher for C&I just because of the really long positive operating environment we're operating in right now. But on average, it comes back to around 1%. That under CECL is probably going to increase on average by 25% to 30%, call it a 1.25%, 1.30% [Phonetic] on average and the mix will shift a little bit. So, we'll be putting a little bit -- we'll bring more on for residential mortgages than we have historically and probably roughly the same on commercial just because our commercial book tends to be quite short-term anyway.

Michael Young -- SunTrust -- Analyst

Okay. Thanks, Pat, very helpful.

Operator

[Operator Instructions] Showing no further questions. I will now turn the call back over to Mr. Scudder for his closing comments.

Michael L. Scudder -- Chairman of the Board and Chief Executive Officer

All right. Great, thanks. Well, before closing, I think it's always important to take the opportunity, particularly as we recap a calendar year to thank our colleagues and take the opportunity to thank our colleagues. I know a number of whom listened to our calls and take the opportunity to thank them for their contributions too and investment in our performance. As a reminder to them and to all of us, they are the face of our Company, they are our greatest asset. And I would recognize that all of our colleagues at First Midwest have done a tremendous job this year, and I'm very proud of what we've accomplished and what we look forward to accomplishing in 2020. So, thank you all for your interest in and attention to our story, as we share our ongoing belief that First Midwest is a great investment. Have a great day, everybody.

Operator

[Operator Closing Remarks]

Duration: 32 minutes

Call participants:

Michael L. Scudder -- Chairman of the Board and Chief Executive Officer

Mark G. Sander -- President and Chief Operating Officer

Patrick S. Barrett -- Executive Vice President, Chief Financial Officer

Michael Young -- SunTrust -- Analyst

Kelly Motta -- KBW -- Analyst

Cooper Brown -- Stephens -- Analyst

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