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Good morning, and welcome to the Prosperity Bancshares Second Quarter 2025 Earnings Conference Call. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Charlotte Rasche. Please go ahead.

Thank you. Good morning, ladies and gentlemen, and welcome to Prosperity Bancshares Second Quarter 2025 Earnings Conference Call. This call is being broadcast live on our website and will be available for replay for the next few weeks. I'm Charlotte Rasche, Executive Vice President and General Counsel of Prosperity Bancshares. And here with me today is David

Thank you, Charlotte. I would like to welcome and thank everyone listening to our second quarter 2025 conference call. I'm proud to announce that we entered into a definitive agreement with American Bank Holding Company in Corpus Christi to merge. We have followed American Bank closely for more than 2 decades and have tremendous respect for the bank and for the people that have contributed to its success. Our banks have a complementary footprint, and we are familiar with and remain committed to the communities that American Bank serves including with both financial products and community support. This combination will strengthen our presence and operations in South Texas and surrounding areas and enhance our presence in Central Texas, including in San Antonio, a highly desirable, high- growth area. With regard to earnings, our net income was $135 million for the 3 months ending June 30, 2025, compared with $111 million for the same period in 2024, an increase of $23 million or 21%. The net income per diluted common share was $1.42 for the 3 months ending June 30, 2025, compared with $1.17 for the same period in 2024, an increase of 21%. Net income for 3 months ending June 30, 2024 included the impact of a merger-related credit loss provision and merger-related expenses from the Lone Star transaction, the FDIC special assessment, a net gain on the Visa Stock Exchange and the Sullivan investment securities. Excluding these onetime items for the 3 months ending in June 30, 2024, the net income was $116 million and earnings per share was $1.22. When comparing these results with the quarter ended June 30, 2025, net income increased $18 million to $135 million or 16%, and our earnings per share increased $0.20 or 16.4%. Our annualized return on average assets and average tangible common equity for the quarter ending June 30, 2025, compared with the same period in 2024 were a 1.41% return on average tangible -- on average assets compared with 1.17% and 13.44% return on average tangible common equity compared to 12.34%. The net interest margin on a tax equivalent basis was 3.18% for the 3 months ending June 30, 2025, compared with 2.94% for the same period in 2024 and with 3.14% for the 3 months ending March 30, 2025. As mentioned on prior calls, these are the results we expected and we anticipate these tailwinds should continue to be positive for the near future. Loans were $22.1 billion at June 30, 2025, a decrease of $123 million compared with $22.3 billion at June 30, 2024. Our linked quarter loans increased $219 million or 1% -- 4% annualized from $21.9 billion at March 31, 2025. Overall, the bank grew loans by $220 million in the second quarter of 2025 or 4% on an annualized basis, where most of the growth attributable to the seasonal strength of the mortgage warehouse business. However, we remain positive on our ability to grow loans in the second half of the year. We saw consistently higher monthly new production numbers in the second quarter, and core commercial loans, excluding mortgage warehouse loans were up $73 million or 2.4% annualized. We have been focused on using our liquidity to fund commercial loan growth, and we are starting to see progress. Deposits were $27.4 billion at June 30, 2025, a decrease of $459 million or 1.6% when compared with $27.9 billion at June 30, 2024. The linked quarter deposits decreased $553 million or 2% from $28 billion at March 31, 2025, primarily due to decreases in public fund deposits, higher-cost deposits acquired in the recent acquisitions and business deposits and our disciplined deposit pricing. Prosperity generally experiences seasonality with its public fund deposits as public funds customers use the tax dollars that they receive in December and January throughout the year, resulting in lower deposit balances in the second and third quarters of the year. Our bankers' focus is on building core deposits. Our noninterest-bearing deposits represented 34.3% of our total deposits at June 30, 2025. With regard to asset quality, our nonperforming assets totaled $110 million or 33 basis points of quarterly average interest-earning assets at June 30, 2025, compared with $89 million or 25 basis points of quarterly average interest-earning assets at June 30, 2024, and $81 million or 24 basis points of quarterly average interest-earning assets at March 31, 2025, with a significant portion of the balance for each period attributable to the acquired loans. At June 30, 2025, the allowance for credit losses and loans was $346 million and the allowance for credit losses on loans and off- balance sheet credit exposure was $383 million. The allowance for credit losses on loans was 3.47x the amount of nonperforming assets. We are very excited about our pending merger with American Bank Holding Company and American Banking Corpus Christi. We also continue to have conversations with other bankers considering strategic opportunities. We believe that higher technology and staffing costs, funding costs -- staffing costs and funding costs, loan competition, succession planning concerns and increased regulatory burden all point to continued consolidation. We remain ready to move forward in the event a transaction materializes and will be beneficial to our company's long-term future and increased shareholder value. Texas was rated as a second best state for business in 2025 by CNBC. However, we believe we should have been #1, that's just a little humor guys, and get going. Texas continues to shine as more people and companies move to the state because of the business- friendly political structure and no state income tax. Prosperity continues to focus on building core customer relationships, maintaining sound asset quality and operating the bank in an efficient manner while investing in ever-changing technology and product distribution channels. We intend to continue to grow the company both organically and through mergers and acquisitions. I want to thank everyone involved in our company for helping to make it the success it has become. Thanks again for your support of our company. Let me turn over our discussion to Asylbek Osmonov, our Chief Financial Officer, to discuss some of the specific financial results we achieved. Asylbek?

Thank you, Mr.

Thank you, Asylbek. Nonperforming assets at quarter end June 30, 2025, totaled $110,487,000 or 50 basis points of loans and other real estate, compared to $81,419,000 or 37 basis points at March 31, 2025. This is an increase of $29,068,000 on a linked-quarter basis. Since June 30, 2025, $1,138,000 of nonperforming assets have been put under contract for sale. At June 30, 2025, nonperforming asset total was made up of $102,607,000 in loans, $6,000 in repossessed assets and $7,874,000 in other real estate. Net charge-offs for the 3 months ended June 30, 2025, were $3,017,000 compared to net charge-offs of $2,704,000 for the quarter ended March 31, 2025. This is an increase of $313,000 on a linked-quarter basis. There was no addition to the allowance for credit losses during the quarter ended June 30, 2025. No dollars were taken into income from the allowance during the quarter ended June 30, 2025. The average monthly new loan production for the quarter ended June 30, 2025, was $353 million, compared to $317 million for the quarter ended March 31, 2025. This is a $36 million increase on a linked-quarter basis. Loans outstanding at June 30, 2025, were approximately $22.197 billion, compared to $21.978 billion at March 31, 2025. The June 30, 2025 loan total is made up of 36% fixed rate loans, 34% floating rate loans and 30% variable rate loans. I will now turn it over to Charlotte Rasche.

Thank you, Tim. At this time, we are prepared to answer your questions, our call operator will assist us with questions.

[Operator Instructions] Our first question comes from Michael Rose with Raymond James.

Just wanted to get some color. It looks like there was some purchase loan decline this quarter. But -- can we just get an update on any sort of revised expectations for loan growth ex warehouse? It seems like the industry is starting to pick up a little bit here. I assume you had some paydowns as well that were kind of impacting this quarter's growth. I did sense some optimism at the front of the call. So just trying to get an update there. And then if Kevin is there, would love the update on the warehouse. Just it looks like it did a little bit better on average than what you talked about last quarter?

Yes. Thanks, Michael. I'll try to tackle both and see if anybody wants to add on. I think in terms of loan growth, the quarter has started off a little better than the prior quarters. We do have some loan growth, not a ton, call it, $40 million worth so far for the quarter. Pipeline looks pretty good. So I think single -- low single-digit growth for the rest of the year is probably achievable. Just as a side, we've also had some okay core deposit growth, I think, almost maybe $90 million so far for the quarter. So both of those seems to have stabilized a bit. Loan demand is okay. If there's been another point of weakness, it's been usage on corporate or middle market kind of revolvers, usage is down quite a bit from where it had been with people taking excess cash and paying down debt rather than growing their balance sheets and we'll see whether that shifts around or not. I think a lot of that was tariff related. On the warehouse, just by way of background, we averaged for the last quarter, $1.179 billion. We thought it would be about $1.150 billion. So we're just slightly ahead of where we were thinking. So far for this quarter, Michael, through last night, we have averaged $1.307 billion to be exact. And last night, we closed out a little lower than normal at $1.226 billion. That's not unusual for this time of the month. We get a lot of Ginnie Mae settlements in the 20, 21, 22 of every month. On balance, I think we will probably average a little better this quarter than last, at $1.250 billion. Typically, our third quarter is our best quarter in normal times, and these are more kind of normal times. So I do expect it to be a little bit better, close to $100 million better on average than Q2.

I think the thing that we liked about it, too, rightly or wrongly we really saw commercial, our commercial loans pick up and mortgage loans went down. But again, we have so many mortgage loans that we seen that the -- there were $73 million more in commercial loans increase. I think that was good. And we do seem to see a lot of -- I don't know, I wouldn't call it a production, but there's a lot of stuff going through loan committee now. So things look pretty good, I think.

Michael, this is Tim. Yes, with regard to what David just said. And I do see coming up the next handful of months, basically the same way that Kevin does. So I think he's spot on.

Very helpful. And then maybe one for Asylbek. Just on the margin, not as much momentum there, I think, as we would have thought. You have the range that you talked about 3.25% to 3.30%. I noticed that interest-bearing deposit costs were flat. So maybe just walk us through some of the puts and takes as we think about the next couple of quarters, bond portfolio pricing pick up, further ability to lower deposit costs, CDs maturing, kind of, et cetera. And just how we should think about the trend relative to what you talked about earlier this year?

Michael, let me just start off. I have kind of the model in front of me and just to kind of give you some color. I mean, our net interest margin continues and Mike, it continues to grow. I think we're showing with no change in interest rates at 3.35% net interest margin in 6 months. If interest rates go down 100 basis points in that 6 months, it's at 3.3%. On a 12-month time frame with no change in interest rates, we get to 3.48% and with 100 basis points down in 12 months, we're at 3.40%. 24 months, and I won't go past that, we're at 3.76% with no change in our net interest margin and 3.61% with 100 basis points down. So our model still continue to show great expansion in the net interest margin over a period of time. Sorry to jump in on you.

No, that's absolutely right. And just to give you a little bit of a color on the question why we're achieving these numbers. If you look at our model, our cost of deposit model shows it's going to continue to stay as is. There's not much downward decrease on the cost of deposits. But what we see is the repricing of 2 things, right? First of all, it's our bond portfolio, as we mentioned, we have about $1.9 billion of cash flow in each year and rate on that is about 2.15% give and take. So that's going to be repricing at least depending on if you put it on the loans, repricing it 300-plus basis points. But if you were going to put it in securities, it's still more than 2.5%. On the loan side, we have about $5 billion cash flow coming in. So out of that, about 60% or $3 billion, it's more like fixed variable rate, that's going to reprice higher than what we put in currently on the loans. So those drivers showing in our model that it will help us to continue to increase the margin and net interest income. So I think we are -- our model still continue to show that we should be on average for the year to be as the range we provide to 3.25% to 3.3% NIM for the year.

The next question is from Catherine Mealor with KBW.

I just want to follow up on the margin was just the size of the balance sheet as we kind of think about -- yes, I saw the cash and average earning assets kind of came down. Just your what -- how should we be thinking about just the size of the bond book and the size of cash in the next couple of quarters?

Well, again, I'll start off. I mean I think the balance sheet size, if you look year-over-year, we were down 1.6% on the deposit side. And when you look at this quarter, as mentioned earlier, this is seasonally a time when we do lose deposits. So we think that the deposits probably are perhaps stabilized. And so I think that you'll probably see -- probably the third quarter is still kind of, I guess, just I guess, where we're at kind of right now, but should start picking up in the fourth quarter for sure. So we should see fourth and first quarter pickup in that. And I think that a lot of it depends on interest rates, I think, in general. I mean, if we really wanted to build the balance sheet, I mean -- and we weren't as disciplined as we were, you could easily -- I mean we don't have any broker deposits. We could easily bring in a bigger balance sheet, if you're willing to pay at the 5%, 4.5% -- 4.5%, 5% interest rate. So you can build the balance sheet, but we've been trying to be very disciplined and really manage our net interest margin. That's kind of where we're at right now. But overall, to answer your question, I think that we have stabilized, and I think you will see growth going forward, not tremendous growth, but growth.

Yes. I agree. That's exactly right. And I'll just say on the model, fundamentally, nothing changed from us. It just was the deposit drop off we saw in the second quarter impacted NII as we saw it. But fundamentally, our model is still showing that the continued expansion in the margin and net interest income.

We've also have reduced your borrowings from the Federal Home Loan bank compared to last year where we were 3.9% last year...

Yes. In the beginning of 3.9% and we'd reduced to 2.9% this year kind of ended up.

And again, we -- again, that was a big drop in the asset size. It shouldn't affect the net interest income, but just a big drop in the asset side.

Got it. Okay. That's helpful. And then on loan yields, also I feel like mix shift just within your balance sheet is what's driving the margin expansion. But curious if you see some more upward momentum in loan yields as maybe growth improved into the back half of the year as well?

I'd say, yes, a couple of things is mix, less mortgage, more commercial. So I think we'll pick it up there, as Asylbek said, stripped out of bonds and into loans also improves. And as we looked at it, you probably -- someone mentioned earlier in the early reports this morning that loans held for investment, the yield was down 1 basis point. And that's really just in terms of inside baseball, we always have -- not always, but typically have some nonaccrual pickup income in the quarter. We had more than usual last quarter, maybe $2.3 million, $2.4 million and we had $400,000 this quarter. And that -- but believe it or not, on the overall loan yields, that changed loan yields minus 1 basis point versus up 2 or 3. So that's just a small inside baseball piece of it. So this quarter -- maybe last quarter wasn't quite as good as it was advertised or written, and this quarter is not as bad, just a couple of basis point difference. But we don't see that number being down this quarter. It's an aberration, not a trend.

Okay. That's very helpful. So still upward momentum in loan pricing as expected?

Yes.

The next question is from Manan Gosalia with Morgan Stanley.

I wanted to focus on the acquisition and -- specifically on the NII accretion from the acquisition. Can you comment on I guess, what sort of NII you think you can get from the acquisition? Are there any revenue synergies that you're building in? Is there any benefit on the deposit cost side? And if there's any loans that you might want to run off after completing the acquisition?

Okay. I'll take that one. And I'll start off with deposit and what we notice in Americas has really good deposit base and very similar to ours. That's what attracted us to the American Bank. And if you look at their cost of deposits, this was 1.66%, very close to ours comparing, if you look just overall industry very low. That was -- we have a very strong deposit base. On the loans, they're yielding higher than ours. I think their loan yield about 6.43%. So both of them taking those is very going to be accretive to our margin. If you look overall on dollar-wise, I think on an annual basis, it's going to bring -- if you just take the run rate, it's about $85 million to $90 million on NII on themselves. But in addition, we're going to be having some markups on those loans to the fair value. And also, we're going to have AOCI adjustment on their bond, which kind of generate additional $15 million per year, $15 million to $16 million. So combining those, we know it's going to be a pretty strong expansion on our net interest income. If you look at on margin wise, if we calculated it gives about mid-single digit on the margin increase overall.

I think you could say also that American Bank is very similar to us. If you look at our cost of deposits, their cost of deposits were very close. And again, I don't think you're going to see a -- with some banks that join us, we know going in there's going to be a pretty good loan runoff and a pretty good deposit runoff. We don't see that in American Bank. We feel comfortable. They're very much like we are, and I don't see -- I don't -- I just -- I think it's just a good core bank really, it's a peach.

That's helpful. And then maybe on capital deployment priorities from here? I think you mentioned in your opening comments that you continue to have conversations. It looks like you're opened in more M&A. But this is also an all-stock acquisition. Is there any ability to maybe buy back some of the stock you've issued in the open market once the acquisition closes?

Right now, there's a lot of activity in M&A. And again, I suspect that we'll be using some of that capital that we have going forward probably in M&A.

The next question is from Peter Winter with D.A. Davidson.

I wanted to ask about the Lone Star portfolio. Loans were down about $180 million year-over-year and deposits were down about $250 million year-over-year. So are you nearing a bottom? And then maybe if you can talk about the quality of American Bank's loans and deposits, would you expect some runoff once you close that deal?

I'll start. The Lone Star deal -- Lone Star Bank did have a lot of higher cost deposits. So we're not rattled by that amount of deposits, and they were extremely high cost, sometimes 100 basis points more than what we were paying. So we suspected that. As far as the loan side, somebody may be able to help me with the loan side, I know that we -- I think overall, the loan quality was really pretty good. We have one large loan that got thrown into the nonperforming assets, that was $13 million or $14 million. But again, it's well securitized. I don't think that we see any loss in that. Their underwriting at Lone Star Bank was very good, I think. I mean, with the exception of this one credit that we have, I think they were very good. Going forward with American Bank, again, a little bit different than some underwriting. But I think if anybody came and looked at us from another bank, they would think we're different than them. I think overall, I don't see the deposit loss or the -- not -- there's always be some, but I don't see the deposit loss or the loan loss in the American deal. I think it's just a really good core bank. It's hard to find real good core banks like this, and this is really a good core bank.

And David, one thing I would mention. I do think that Lone Star has stabilized in terms of loans and deposits, both. The future will tell us. But, I do feel like they're stabilized.

We knew going in, there were a certain portion, they were about 100%.

There were some 5% CDs that were going to go...

That's correct. And from day 1, they have worked very closely and very well with us to address those issues and deal with them.

We knew that even going in. So it wasn't anything none of us expected, let me say that.

That's correct.

By recap, I think we're done or near done with Lone Star shrinking. And I think American Bank is just -- it's a different animal. It's been around 50-plus years, really, really solid deposit franchise. I mean very, very solid. Credit quality good, maybe underwriting a little different than us, but the credit quality, very good. Does that mean there'll be 0 runoff? No, but it's going to be very mild, very mild. This is not a big shift in terms of what they're paying on deposits versus us. It's a high-quality franchise. We're lucky to get it.

Yes. I think the American Bank deal makes -- we have a big strong position in the Houston market. We have a strong position in the Dallas market and a good position in the Austin market, but again, along the Gulf of America, we have Victoria. And again, it was such a great merger with us. I mean we -- they joined us, and they -- we became the #1 market share in that whole second-tier market. But right down the road is Corpus Christi, and this gives us the #1 market share in Corpus Christi. And I mean -- so we really have become #1 market share, or major market shares in these second-tier markets like Victoria, like Corpus Christi, like Odessa, Lubbock, Midland, Bryan-College Station. And those are really great markets, and this just fits in just perfectly with that, not to mention that it gives us -- we really needed some locations in the San Antonio market where we only had 1. And I think this gives us what 4 more locations in the San Antonio market. So it really helps us get a jump in the San Antonio market as well. So we're really excited about that.

I could ask on credit. I'm certainly not worried about credit with you guys, but just curious about the -- what drove the increase, a $29 million increase in nonperforming assets. And then just what's the outlook for nonperforming assets going forward, just given the comment, most of it is acquired loans, which you have reserves against. But I'm just wondering when those starts -- should start to decline?

I think I can address that for you. The increase is really made up of 3 buckets, so to speak. One is a $13 million loan that David referred to a minute ago from Lone Star State Bank. It's real estate secured. We think we're probably not going to lose any money from that loan, time will tell, but that's our forecast right now. So that's $13 million. There's another one, $19 million that's from the legacy Texas portfolio. It's secured by notes on used vehicles. We do think there's a bit of a loss there, but it's fully reserved. So we don't see any negative impact from that standpoint. The biggest change is we've got about $51 million in single-family homes included in the nonperforming. We made efforts starting a couple of years ago to increase our minority home loans. And the result is we've taken several homes back. The good news is, as we are able to foreclose on them, we've been able to sell them all relatively quickly. So we think this is something that we're going to work through over the course of the next year. But if you look at those 3 buckets, one is $51 million, one is $13 million and one is $19 million. That's a huge percentage of the total nonperforming assets. So we think we're dealing with all those effectively.

Yes. And just to add to that. What we see in the future -- you never know what's going to happen in the future, but we don't see anything in our commercial loan system that's particularly worrisome at this stage of the game. I would say that there is a chance, maybe even likelihood that we continue to tick up just a little bit on the single-family mortgage portfolio from that $51 million that it's at today. Fortunately, that asset class is a very low loss given default. And I think the bottom line is as we sit here today, obviously, we went through all of this in our reserve analysis at the end of the quarter for quarter end and concluded we didn't need to add to reserves, and I don't -- we'll see where we are next quarter. But I don't see anything on the horizon that's going to change that.

We also cut the product off that. This is a product that was designed just for minority lending, low-income lending that, again, that there's not much money down and you even get some walking around money when you go, and this was to help with fair lending. And again, it's kind of a catch 22, if you don't produce a certain amount of this kind of production, then if you really want to expand and grow, you're out of the game also. So it's just part of the deal. But again, I think that we've got all under control. And the good news is that as we repossess this stuff, we've gotten out of it pretty quick with very little loss.

That's right. And we did discontinue that type of loan actually over a year ago.

Right, over a year ago.

The next question is from Stephen Scouten with Piper Sandler.

Just going back to American Bank. And David, you noted the 4 additional branches in San Antonio. Given that that's -- I think you guys said the third largest MSA in Texas, do you look to deepen that franchise further in San Antonio beyond this acquisition? Could you look at new hires or could incremental M&A in that market be in the cards?

I guess I should just say stay tuned, I guess.

Okay. Fair enough. And then maybe on pricing around the deal. I mean the 3-year earn-back feels like maybe towards the longer end of what we've seen from you guys. Would you say that, that was kind of pushing the limits of what you would want to do from an earn back perspective on a deal?

That 3-year, Kevin, help me does that 3-year include the way it was priced, it looked like it was priced higher than some of the other deals at 2.2x. But again, when we looked at the bank and you added back the AOCI, the price was like 1.8x, which for a bank like that, we thought was a very, very good deal. So that 3-year was that based on the...

It does include that. Yes.

It does include that. But again, I think for a bank that's a quality bank like this, that 3 years is not unreasonable at all, and I'd do it again tomorrow, if we get another bank like that, it's really a sweet bank.

Okay. Great. And then just as you think about future targets, I mean, I know the last 3 deals have been maybe towards the smaller and more digestible into the spectrum. Do you think about maybe a more meaningfully sized deal. And additionally, would you look at anything outside of Texas and Oklahoma today? Or do you want to continue to deepen that footprint in the strength of those markets?

I guess I'd just say stay tuned. I mean, there's a lot of activity going on right now and hard to give -- again, I can repeat what we've said in the past that we always like Texas and it's always a fill-in. And because we -- if you're in a car and you drive 30 minutes anywhere you're going to see one of our banks. And so when we can fill in, I don't think we're in the valley, that may be the first part of the valley and probably El Paso anywhere else -- you go to Texas, you're going to see us wherever you go. So I think that our first and foremost is always in Texas, and we're in Oklahoma too if something developed there. But again, of a certain -- if an asset we're outside the state, again, we're not going to go outside the state for a $2.5 billion deal. But again, if it's a deal that really has a true market share and that we can -- it's really helpful, and it helps us from a strategic point of view from where we're going and where we're going to be, the answer to that would be yes.

Great. And maybe one last point of clarification. On the NIM trajectory you talked about, David, I think you said 3.35% could happen in 6 months 3.48% over 12 months, et cetera. Does that include the mid-single-digit impact to the margin from American Bank? Or is that kind of on your existing balance sheet?

No, this is just our existing balance sheet. So that should help, no question.

The next question is from Ebrahim Poonawala with Bank of America.

This is Eric on for EB. Just had one on the fee income line. It has been running above, I think previously, you've talked about $36 million to $38 million as kind of the run rate that you view, but it's been above that for several quarters now. Is the run rate in your mind higher now? Like how should we think about that kind of moving forward?

Yes, Eric, I agree. I think that I would probably update our run rate to $38 million to $40 million now because what we've seen very strong, our service fees and debit card fees overall has increased because of the volume. So yes, we see increase on overall noninterest income. So I would say I would update range to $38 million to $40 million.

Okay. That's helpful. And then maybe one more on M&A, David, based on everything you've said, I have a guess of what you'll say, but does the American deal limit the ability to complete any other deals until that closes? Or are you still very active?

No, we're still very active.

The next question is from Jon Arfstrom with RBC Capital Markets.

Just a follow-up on that. I know you guys had a tough time with the last deal getting to close on time. Any evidence of less regulatory pressures, David. I mean I don't think you're going to get into that situation again. But any evidence of that?

I hope so. You saw the Cadence deal closing in just a few months. But again, we understand that bank industry bank, they wanted to get that off of their books before something else happens. So -- but everybody else that we've talked to so far, it looks -- historically, we used to get a bank deal done in 3 months. And I'm hoping that Charlotte may jump in, but I'm still thinking that we're going to go back to those 3 to 4 months. I think that's what we're looking at. That last year we started off with the DOJ in a town of 10,000 people that we were big bank, and I mean there were so many miles from Tyler or something. I don't want to get into all the details, and then it was another deal after that. From what everybody tells me, they're more focused on substance to set a forum right now and that unless something changes in the administration, which I don't see happening right now, I think it seems to be a lot, much cleaner and clearer path where we're going. I think everybody kind of knows where they're going right now.

Okay. And then you kind of alluded to this -- I have 2 more questions here, but you kind of alluded to this, but do you feel like you have enough branch density in some of your larger markets? And then also curious about some of the faster-growing outer suburbs of the big cities in Texas. Do you feel like you have density there? Or is that a target for you?

Well, that's what we're building right now. I mean, I do think if you look at Houston, Dallas, Austin, probably the only place that we don't have enough stores or locations is probably the San Antonio market, which we would much -- like be much bigger there. And any time we can move into a market and be a #1 market share in the second tier like Corpus Christi, that's the stuff we love. And I mean, we've done that Victoria, Corpus, Midland, Odessa, Lubbock area, Bryan-College Station. So whenever we can do that, that's really a sweet spot for us, really.

Okay. And then Kevin, one for you, a follow-up from very early. You talked about revolvers being down a bit, and you thought it was maybe just -- maybe from some of the uncertainty last quarter. But anything else in your mind driving that change? And do you expect that to stabilize?

I do. I do. We spent the better part of a couple of days digging into it here, last week and this week and talking to clients. And I think it's not only going to stabilize, it's probably going to go the other way.

Okay. And you feel like that it's starting to turn now?

It is.

This concludes our question-and-answer session. I would like to turn the conference back over to Charlotte Rasche for any closing remarks.

Thank you. Thank you, ladies and gentlemen, for taking the time to participate in our call today. We appreciate your support of our company, and we will continue to work on building shareholder value.