Columbia Banking System, Inc. Q1 FY2026 earnings call

• Continued execution against core priorities: optimizing balance sheet, returning excess capital. - Completed PAC Premier Systems conversion and consolidated nine branches, on track for full acquisition - related cost savings. - Operating results reflected momentum, solid CNI production offset decline in below - market - rate transactional loan balance. - Reduced reliance on wholesale funding as customer deposits expanded. - Cost - conscious culture enhances profitability. - AI used for efficiency, including in systems conversion and customer support. - Credit fundamentals sound, office portfolio performing, NDFI exposure minimal. - Increased share buybacks, returning $200 million to shareholders.

Earnings per share were 66 cents and operating earnings per share were 72 cents. Average earning assets were $60.8 billion. Net interest margin was 3.96. Provision expense was $28 million. Customer deposits increased $110 million. New loan origination volume was $1.2 billion, up 38% year - ago. Commercial loan portfolio increased 6% annualized. Operating non - interest income up 25 million or 44% from prior year.

• Balance sheet size expected to remain relatively stable with commercial loan growth offsetting contraction in transactional portfolio. - Anticipate net interest margin to grow modestly in Q2, crossing over 4% at some point. - Expect non - interest revenues in low to mid $80 million range for Q2. - Non - interest expense expected in $335 to $345 million range for Q2, declining in Q3 as all cost savings related to transaction are realized by June 30th. - Expect share repurchases to remain in $150 to $200 million range per quarter through current authorization. - Use 25% all - in effective tax rate for modeling.

• Macroeconomic headlines can drive outsized stock price reactions and unilaterally treat all banks the same. - Credit risks in ag industry, such as the hop industry relationship that drove modest increase in net charge - offs and non - performing assets. - Potential impact of regulatory changes and capital relief on capital priorities and ratios.

Q: John Arfstrom of RBC Capital Markets asked about loans and margin, originations trends.

A: Tori said new loan origination volume was $1.2 billion, up 38% year - ago, spread throughout the company.

Q: David Feaster of Raymond James asked about Pacific Premier conversion, integration, hiring, excess capital.

A: Clint said conversion went very smooth, no customer disruption; Tori and Chris talked about hiring in various geographies and business lines; Ivan said excess capital still has buybacks as focus.

Q: Jeff Rulis of DA Davidson asked about credit, loan growth.

A: Frank talked about ag loan charge - offs in hop industry; Tori talked about pipeline.

Q: Matthew Clark of Piper Sandler asked about expenses, tax rate, ag loan.

A: Ivan talked about expense guide, tax rate; Frank talked about ag loan provision.

Q: Christopher McGrady of KBW asked about expenses, TCE ratio, tax rate, ag loan.

A: Ivan talked about expense range, TCE ratio; Ivan talked about tax rate and ag loan provision.

Q: David Cervarini of Jefferies asked about deposits, non - interest - bearing deposits.

A: Chris talked about deposit campaigns; Tory talked about deposit outlook.

Q: Janet Lee of TD Cal asked about NII, PAA.

A: Ivan talked about NII and PAA.

Q: Anthony Ilion of JP Morgan asked about deposits, ACL.

A: Ivan talked about deposit seasonal flows; Ivan talked about ACL level.

Q: Samuel Varga of UBS asked about loan growth.

A: Tory talked about loan growth and transactional loan payoffs