Let's Talk Loans - Vol. 102

Welcome back to another discussion about loans and banking. Written during breakfast while at the Vizo Financial Conference (#vizoFC24) in Asheville at the The Omni Grove Park Inn & Spa . The view is incredible. If you've not been before...it's worth the trip. This will be a quick post.

These next 4-5 weeks are tough as we live out of a suitcase. Last week was Chicago for the Raymond James Investment Banking conference. This week Vizo. Next week our very own Raymond James Whole Loan Conference. Then comes ACUMA (American Credit Union Mortgage Association) . After that the Mortgage Bankers Association annual conference. The America's Credit Unions lending conference follows. I think you get the gist. It's conference season and we are going to be out and in front of customers.

Raymond James investment banking conference was last week. Some notes for readers. M&A activity is resurging. I wrote last September that the conversations were just starting and that we were hopeful that 2024 would be a good year for deal activity. Those conversations have turned into action. A little bit of help from the market, the hope of a rate cut has put the RJ investment bankers on or near the top of the league tables. If conversations from this years conference are any indication, 2025 will be even brighter for our bankers as it appears the pipeline is quite full with more deals to be announced. A friendly reminder that we can support you in this very important discussions on your institutions future.

Here in Asheville / VIzo with more of a focus on CU's (who I might add have been on a bit of a heater for M&A themselves...).There are mixed emotions as to the potential of falling rates. On the liability side, the worry is the recent growth of certificates (CDs) and away from less expensive shares. Liabilities might prove more sticky and the cost of funds could remain elevated even as interest rates fall. On the asset side of the conversation, there is real excitement that lower rates might drive higher loan volumes. However, those in collections are monitoring performance as credit has deteriorated. The challenge for CFOs will be to manage stronger loan growth, at lower coupons, in the face of a higher cost of funds, pinched margins and a touch of credit to add some spice to the discussion.

A few comments as to trading volumes. Our fiscal year ends this month. Our desk was founded all the way back in 1991. We've been serving the loan trading and analytics market for over 30 years now. Year over year it looks as if our trading volumes will be up about 20-25% and we're on pace to have our 5th best year in our history. Very specifically we have seen activity climb in the last few months and we currently are feeling the tailwinds of the potential rate cuts to come. I'd like to take a moment to thank you for that success. We are fortunate to serve you and this vibrant community. To all the sales reps, traders, originators, managers, underwriters, attorneys, credit analysts, IT and data personnel - It takes a village - we couldn't do it without you. There's nothing easy about the business but we appreciate your relationship and support.

On a personal note, LinkedIn surprised me this week. I crossed the 18 year mark with Morgan Keegan / Raymond James. Seems like just yesterday that the whole journey started.

M24-597741