CapStar Financial Holdings, Inc. (NASDAQ:CSTR) Q4 2022 Earnings Call Transcript

Tim Schools: Well, I’ll comment first and then Mike can comment. I’ll just say first of all, we’ve got outstanding competitors in Nashville and Tennessee and I think everybody does a great job, and so I think, everybody is fighting through this, the same way. I think you could make an argument to that. I think it goes back to Kevin Fitzsimmons. You know, if I can see that attrition is facing are slowing down, I would be for the same thing. I know it’s not what we all want or I want long-term, but I think you know we are a great bank or the third or fourth largest bank in the state and have a long future. And you are in this for the long-term, but I think there is markets where it’s not the goal isn’t to have the nice margin, it’s to have growth in earnings and a good ROA and ROE.

So, I think they’re doing a good strategy. I don’t follow all of their exact balance sheets. But we have seen that I’m not sure if that’s what they were doing or I think it’s more what Kevin was asking earlier. I think they’re just sort of ploughing through it and saying in the short-term environment we’re going to grow NII and it’s going to cost us to do it. And overtime that will set allows and I’m hopeful we can get there in the first half of the year.

Mike Fowler: Yes, thank you, Tim. And I would add to that I think I might have mentioned, I might have touched on this a little bit earlier and discussing the margin. Again, hard to predict but I did mention to your point that we have seen competitor pricing including from, I think some of the banks you had in mind more aggressive, we don’t know to what extent that may be, I mean we’ve seen banks in our markets that are trying to get ahead and deal with their liquidity challenges. I don’t know to what extent the rates we’re competing with might be getting ahead of the next Fed move. We hope that is the case. And — but we don’t know so that is certainly a possibility. We hope to see that and which would give us some potential upside in Q1.

But as Tim said, I think we want to be conservative and cautious in any outlook we provide, so I would say, time will tell. We are monitoring conditions really day by day. We have very active dialog with people in the field on what they’re seeing. And so we do hope that the rates that we’ve been competing with will slow.

Brett Rabatin: Okay, that’s helpful appreciate it. Thanks guys.

Operator: And thank you. And I’m showing no further questions. I would now like to turn the call back over to Tim Schools for closing remarks.

Tim Schools: Okay, this concludes the call and we appreciate everybody taking time out of their day today to listen and speak with us. Have a good weekend.

Operator: This concludes today’s conference call. Thank you for participating. You may now disconnect.