Bank of N T Butterfield & Son Ltd Q3 2018 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Michael Anthony Perito - Keefe, Bruyette, & Woods, Inc., Research Division - Analyst : Most of my questions have been asked already. But I did want to spend maybe a little bit more time on the margin, because it did seem like in the third quarter, a part of that sequential increase was due to the lower kind of liquidity and, I guess, the remix, if you will, on the international side. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 24, 2018 / 2:00PM, NTB.N - Q3 2018 Bank of N T Butterfield & Son Ltd Earnings Call So I guess, under that backdrop here, we're at 3.37% today, sounds like less liquidity is coming over from Deutsche. And, obviously, the cash balances at least conservatively are going to be lower as we move into next year. So I guess, any initial thoughts kind of how all these pieces come together and what you can kind of expect? What we can kind of expect from a margin perspective as we move into next year?

Question: Michael Anthony Perito - Keefe, Bruyette, & Woods, Inc., Research Division - Analyst : That's helpful, Michael. As it stands today with your current kind of economic projections, I guess, I mean, any initial thoughts may be, specifically, as we think about the first quarter next year once all this billion dollars of deposits are theoretically fully on the balance sheet, what type of spread you think you're going to be able to earn on those? And would this type of impact you believe to see near term on the NIM from that?

Question: Michael Anthony Perito - Keefe, Bruyette, & Woods, Inc., Research Division - Analyst : Got it. Helpful. Just last question kind of a, I guess it could be a question hard to quantify and apologize if I don't word it correctly. But just as we think about the deposit base, I think if I'm trying to understand -- I guess it's kind of a 2-part question. I guess, one, is there -- I guess where does your flexibility go in terms of wanting to maintain versus lose clients over time. And I guess, secondly, as we think about the makeup of your client deposit rather your deposit base today, is there a way to measure, I mean, how -- what type of money would be able to kind of search for rate elsewhere versus that would be more inclined to stay? I don't know if I'm wording that in a way that makes a lot of sense. But I guess, I'm just trying to get a better sense of what portion of the deposit base could in fact perhaps be a bit more at risk from a rate perspective versus could be pretty stable? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 24, 2018 / 2:00PM, NTB.N - Q3 2018 Bank of N T Butterfield & Son Ltd Earnings Call