First Financial Bancorp. Q2 2025 Earnings Report

First Financial Bancorp. EPS Results

• Actual EPS: $0.74
• Consensus EPS: $0.69
• Beat/Miss: Beat by +$0.05
• One Year Ago EPS: $0.64

First Financial Bancorp. Revenue Results

• Actual Revenue: $226.30 million
• Expected Revenue: $219.95 million
• Beat/Miss: Beat by +$6.35 million
• YoY Revenue Growth: N/A

First Financial Bancorp. Announcement Details

• Quarter: Q2 2025
• Date: 7/24/2025
• Time: After Market Closes
• Conference Call Date: Friday, July 25, 2025
• Conference Call Time: 8:30AM ET

First Financial Bancorp. (NASDAQ:FFBC) operates as the bank holding company for First Financial Bank that provides commercial banking and related services to individuals and businesses in Ohio, Indiana, Kentucky, and Illinois. The company offers checking, savings, and money-market accounts; and accepts various deposit products, such as interest-bearing and non-interest-bearing accounts, time deposits, and cash management services for commercial customers. It also provides real estate loans secured by residential property, such as one to four family residential housing units or commercial property comprising owner-occupied and/or investor income producing real estate consisting of apartments, shopping centers, and office buildings; commercial and industrial loans for various purposes, including inventory, receivables, and equipment, as well as equipment and leasehold improvement financing for franchisees; consumer loans comprising new and used vehicle loans, second mortgages on residential real estate, and unsecured loans; and home equity lines of credit. In addition, the company offers commercial financing to the insurance industry, registered investment advisors, certified public accountants, indirect auto finance companies, and restaurant franchisees. Further, it provides a range of trust and wealth management services; lease and equipment financing services; and currency payments, foreign exchange hedging, and other advisory products. First Financial Bancorp. was founded in 1863 and is headquartered in Cincinnati, Ohio.

First Financial Bancorp. Q2 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Record Q2 revenue of $226.3 million (up 5% YoY), adjusted EPS of $0.74, ROA of 1.54%, and ROTCE of 20%.
• Positive Sentiment: Net interest margin strengthened to 4.05%, rising 17 bps QoQ on reduced deposit costs and higher asset yields.
• Positive Sentiment: Adjusted noninterest income increased 11% QoQ to $67.8 million, driven by broad‐based fee growth in mortgage, bank card, leasing, and foreign exchange.
• Positive Sentiment: Capital ratios remain robust with tangible common equity at 8.4%, tangible book value per share up 4% QoQ to $15.40, and a 4.2% dividend increase to $0.25.
• Neutral Sentiment: Loan balances grew 2% annualized with non‐CRE portfolios expanding, while CRE payoffs weighed on growth; Q3 loans are guided to low‐mid single‐digit annualized gains.

Presentation

[Operator]

Thank you for standing by, and welcome to the First Financial Bancorp Second Quarter twenty twenty five Earnings Conference Call and Webcast. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. Thank you. I'd now like to turn the call over to Scott Crawley. You may begin.

[Scott Crawley, Controller at First Financial Bancorp]

Good morning. Thank you, Rob. Good morning, everybody, and thank you for joining us on today's conference call to discuss First Financial Bancorp's second quarter and year to date financial results. Participating on today's call will be Archie Brown, President and Chief Executive Officer Jamie Anderson, Chief Financial Officer and Bill Harrod, Chief Credit Officer. Both the press release we issued yesterday and the accompanying slide presentation are available on our website at www.bankatfirst.com under the Investor Relations section.

[Scott Crawley, Controller at First Financial Bancorp]

We'll make reference to the slides contained in the accompanying presentation during today's call. Additionally, please refer to the forward looking statement disclosure contained in the second quarter twenty twenty five earnings release as well as our SEC filings for a full discussion of the company's risk factors. The information we will provide today is accurate as of 06/30/2025, and we will not be updating any forward looking statements to reflect facts or circumstances after the call. I'll now turn it over to Archie Brown.

[Archie Brown, President & CEO at First Financial Bancorp]

Thank you, Scott. Good morning, everyone, and thank you for joining us on today's call. Yesterday afternoon, we announced our financial results for the second quarter, and I'm thrilled with our performance this quarter. We achieved record revenue of $226,300,000 which represents a 5% increase over the same quarter one year ago and drove adjusted earnings per share of $0.74 a return on assets of 1.54% and a return on tangible common equity of 20%.

[Archie Brown, President & CEO at First Financial Bancorp]

The company's industry leading profitability was once again driven by a robust net interest margin. Loan growth was 2% on an annualized basis, and we were pleased with broad based growth in most portfolios apart from commercial real estate, which declined due to higher payoffs. Q3 scheduled maturities in the IC portfolio are lower, and we expect higher overall loan growth in the second half of this year. We recorded adjusted noninterest income of $67,800,000 in the second quarter, which was an 11% increase over the linked quarter and a 10% increase over the second quarter of twenty twenty four. Growth in fees was broad based with mortgage, bank card, leasing business and foreign exchange income all increasing by double digit percentages over the linked quarter.

[Archie Brown, President & CEO at First Financial Bancorp]

We were also pleased with our expense management with adjusted non interest expenses increasing 1% compared to the first quarter. Excluding leasing business expenses, which continue to increase as our operating lease portfolio grows, adjusted non interest expenses increased by less than 2% on a year over year basis. Asset quality was stable for the quarter. Net charge offs declined 15 basis points from the first quarter to 21 basis points of total loans, and classified asset balances were relatively flat. Our outlook for asset quality remains positive, and we expect net charge offs to be in the 20 to 25 basis points range for the remainder of this year.

[Archie Brown, President & CEO at First Financial Bancorp]

We're pleased with the strength of our capital levels. Regulatory ratios are very strong and tangible common equity has continued to grow, increasing 16 over last year to 8.4%. Tangible book value per share increased to $15.4 which was a 4% increase from the linked quarter and a 19% over the same period a 19% increase over the same period last year. We're also pleased to announce that our Board of Directors approved a $01 or 4.2% increase in the common dividend to $0.25 The dividend payout remains approximately 35% of net income and continues to provide an attractive yield. With that, I'll now turn the call over to Jamie to discuss these results in greater detail.

[Archie Brown, President & CEO at First Financial Bancorp]

After Jamie's discussion, I'll wrap up with some additional forward looking commentary and closing remarks.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

Thank you, Archie. Good morning, everyone. Slides four, five and six provide a summary of our most recent financial results. The second quarter results were excellent and included strong earnings, record revenues driven by a robust net interest margin, solid loan and deposit growth and declining net charge offs. Our net interest margin remains very strong at 4.05%, which represented a 17 basis point increase from the first quarter.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

Funding costs declined 12 basis points, driven by a 13 basis point decrease in deposit costs, while asset yields increased five basis points. Loan balances increased modestly during the quarter as growth in C and I, consumer and our specialty businesses offset elevated prepayments in the ICRE portfolio. Average deposit balances increased $114,000,000 due primarily to a seasonal influx in public funds and higher noninterest bearing deposits. We maintained 21% of our total balances in non interest bearing accounts and remain focused on growing lower cost deposit balances. Turning to the income statement.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

Second quarter fee income was solid, led by double digit percentage growth in mortgage and bank card income. Additionally, our leasing and foreign exchange businesses had good quarters. Non interest expenses increased slightly from the linked quarter due to increases in marketing expenses and incentive compensation, which is tied to the company's overall performance. Our efficiency efforts continue to impact our results positively, and we expect to see further benefits in the coming periods. Our ACL coverage increased slightly during the quarter to 1.34% of total loans.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

We recorded $9,800,000 of provision expense during the period, which was driven by net charge offs and loan growth. Overall, quality trends were stable. Net charge offs declined 42% to 21 basis points on an annualized basis, while NPAs as a percentage of assets increased slightly during the period. Classified asset balances were relatively unchanged during the period of 1.15% of total assets. From a capital standpoint, our ratios are in excess of both internal and regulatory targets.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

Tangible book value increased $0.60 to $15.4 while our tangible common equity ratio increased 24 basis points to 8.4%. Additionally, our Board of Directors elected to increase our common dividend during the period. Increasing the common dividend is further proof of our commitment to deliver value to our shareholders. Slide seven reconciles our GAAP earnings to adjusted earnings, highlighting items that we believe are important to understanding our quarterly performance. Adjusted net income was $70,600,000 or $0.74 per share for the quarter.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

Non interest income was adjusted for gains on the sales of investment securities, while non interest expense adjustments exclude the impact of acquisition and efficiency costs and other expenses not expected to recur. As depicted on Slide eight, these adjusted earnings equate to a return on average assets of 1.54% and a return on average tangible common equity of 20% and a pre tax pre provision ROA of 2.14%. Turning to slides nine and ten. Net interest margin increased 17 basis points from the linked quarter to 4.05%. Asset yields increased five basis points compared to the prior quarter as loan yields increased three basis points and the yield on the investment portfolio increased nine basis points.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

Total funding costs declined 12 basis points driven by a 13 basis point decrease in deposit costs compared to the linked quarter. Slide 12 illustrates our current loan mix and balance changes compared to the linked quarter. Loan balances increased 2% on an annualized basis with growth in C and I, consumer and specialty businesses outpacing a decline in ICRE driven by elevated prepayment activity. Slide 14 shows our deposit mix as well as the progression of average deposits from the linked quarter. In total, average deposit balances increased $114,000,000 during the quarter.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

There was a seasonal influx in public funds and we had solid growth in non interest bearing deposits. While on the consumer side, growth in retail CDs helped to offset declines in money market and interest bearing demand accounts. Slide 15 illustrates trends in our average personal, business and public fund deposits as well as the comparison of our borrowing capacity to our uninsured deposits. On the bottom right of the slide, you can see our adjusted uninsured deposits were $3,800,000,000 This equates to 27 of our total deposits. We remain comfortable with this concentration and believe our borrowing capacity provides sufficient flexibility to respond to any event that would stress our larger deposit balances.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

Slide 16 highlights our noninterest income for the quarter. Total adjusted fee income was $68,000,000 with leasing, mortgage and interchange having strong growth quarters. Non interest expense for the quarter is outlined on Slide 17. Core expenses increased $1,000,000 during the period. This was driven primarily by higher incentive compensation tied to the company's strong results as well as increases in marketing expenses.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

As I mentioned earlier, our ongoing efficiency initiative is positively impacting our results, and we expect this work to continue in the back half of twenty twenty five. Turning now to Slides eighteen and nineteen. Our ACL model resulted in a total allowance, which includes both funded and unfunded reserves of $176,000,000 and $9,800,000 of total provision expense during the period. This resulted in an ACL that was 1.34% of total loans, which was a slight increase from the first quarter. Provision expense was primarily driven by loan growth and net charge offs, which were 21 basis points for the period.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

Overall, credit trends were stable with a 42% reduction in net charge offs and classified asset balances totaling 1.15% total assets. As expected, our ACL coverage was relatively flat compared to the linked quarter, and we continue to believe we have modeled conservatively to build a reserve that reflects the losses we expect from our portfolio. We anticipate our ACL coverage will remain flat or increase slightly in future periods as our model responds to changes in the macroeconomic environment. Finally, as shown on Slides twenty and twenty one, capital ratios remain in excess of regulatory minimums and internal targets. The TCE ratio increased 24 basis points to 8.4% and our tangible book value per share increased 4% to 15.4 Our total shareholder return remains strong with 33% of our earnings returned to our shareholders during the period through the common dividend.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

As I mentioned earlier, we were very pleased that the Board elected to increase the common dividend, demonstrating our commitment to provide an attractive return to our shareholders. I'll now turn it back over to Archie for some comments on our outlook. Archie?

[Archie Brown, President & CEO at First Financial Bancorp]

Thanks, Jamie. Before we end our prepared remarks, I want to comment on our forward looking guidance for the third quarter, which can be found on Slide 22. Loan pipelines remain strong. Over the second half of the year, we expect easing payoff pressures combined with higher production to accelerate our growth.

[Archie Brown, President & CEO at First Financial Bancorp]

Specific to the third quarter, we expect loan growth to be in the low to mid single digits on an annualized basis. Core deposit balances are expected to be stable over the next quarter, excluding seasonal deposit outflows. Our net interest margin remains very strong and industry leading, and we expect it to be in the range between 44.05% over the next quarter, assuming a 25 basis point rate cut in September. We expect our credit cost to approximate prior quarter levels and charge offs to be in the 20 to 25 basis point range for the third quarter, while ACL coverage as a percentage of loans is expected to be stable to slightly increasing. We anticipate fee income to be between 67,000,000 and $69,000,000 which includes 14,000,000 to $16,000,000 for foreign exchange and 19,000,000 to $21,000,000 for leasing business revenue.

[Archie Brown, President & CEO at First Financial Bancorp]

Non interest expense is expected to be between 128,000,000 and $130,000,000 and reflect our continued focus on expense management. We're excited about our recent announcement to acquire Westfield Bank in Northeast Ohio and are actively engaged in the integration process. Appropriate applications have been filed with our regulators, and we continue to expect approval and closing to occur this year. In summary, we're very pleased with our second quarter and year to date financial performance, and we remain very excited about our outlook for the remainder of 2025 and beyond. We'll now open up the call for questions. Rob?

[Operator]

Thank you. We will now begin the question and answer session. Your first question comes from the line of Daniel Tamayo from Raymond James. Your line is open.

[Daniel Tamayo, Vice President at Raymond James Financial]

Thank you. Good morning, guys.

[Archie Brown, President & CEO at First Financial Bancorp]

Hey, David.

[Daniel Tamayo, Vice President at Raymond James Financial]

Maybe we start just on the margin, but specifically on the funding side. So the second quarter, you really had you showed a good ability to continue to lower deposit costs even non maturity deposit costs came down pretty meaningfully. So just curious kind of how you see that continuing to play out here as we go forward and where maybe we you would see a bottom in terms of funding costs, absent any kind of rate cuts?

[Jamie Anderson, CFO & COO at First Financial Bancorp]

Think Denny, it's Jamie. I think we're pretty close to that at this point. And when we look out over the next really the next quarter, we see deposit costs just coming down slightly now, like two or three basis points. Then so in our outlook included in our outlook is a rate cut in September and a rate cut in December. So as we get into the fourth quarter, we see deposit costs maybe coming down a little bit more than that.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

But I think we're kind of close with rates stabilizing here, I think we were maybe a quarter behind some of our competition in terms of lowering deposit costs and really kind of wringing out those last few basis points. So I think you're seeing that 12 or 13 basis point drop in our deposit costs, maybe a little bit more than the peer group, and that's that lag that I was referring to. So when we look out here in the third quarter, included in that margin outlook in that four to four zero five range is about a two to three point drop in the deposit costs.

[Daniel Tamayo, Vice President at Raymond James Financial]

Okay.

[Daniel Tamayo, Vice President at Raymond James Financial]

So given that and then the fact that your asset yields are already pretty strong, loan yields up towards pushing towards seven, is it fair to say you think that the four to four zero five will be a peak for you guys and then maybe bounce around that level? Again, you know, kind of before we consider what happens with rate cuts?

[Jamie Anderson, CFO & COO at First Financial Bancorp]

That's right. Yeah. When we again, when we look out and and kind of start bleeding in the rate cuts into our into our model, And we've said this kind of all along that the slow, of methodical 25 basis point rate cuts, can manage through those. Obviously, like you mentioned, we're asset sensitive, so it's going to impact the margin negatively. But those kind of quarterly 25 basis point rate cuts impact the margin by about five or six basis points each.

[Daniel Tamayo, Vice President at Raymond James Financial]

Okay.

[Daniel Tamayo, Vice President at Raymond James Financial]

All right. Helpful. And then just a cleanup question on the deposit outflows, the seasonal deposit outflows that you referenced that the guidance excludes. What would you expect those to be in the third quarter?

[Jamie Anderson, CFO & COO at First Financial Bancorp]

Yes. They're on average, they're about $100,000,000 So we get a little we get a pop in the second quarter. And these relate to Indiana property taxes public at funds. So those come in in May and November. And primary and May is kind of the big a bigger pop as some people pay the full year.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

So we will we see that 100 to 150 basis point or $150,000,000 jump in public funds in the second quarter. Those those flow out. Those come in kinda mid early May, start to flow out. So on average, we see that it's roughly a $100,100,000,000 dollars and those flow out towards the end of the quarter. So quarter to quarter, it's around $100,000,000

[Operator]

Your next question comes from the line of Terry McEvoy from Stephens Inc.

[Terry Mcevoy, Managing Director at Stephens Inc]

Archie, in the prepared remarks, you talked about the ongoing efficiency initiative producing results and you can see that in the overall efficiency ratio. Can you just dig a little bit deeper and talk about kind of where across the company or within the bank you're really focused on cutting costs and driving that operating leverage?

[Archie Brown, President & CEO at First Financial Bancorp]

Yes, Terry. We've been at this more than a year now. And we really are going through the whole bank to to do the work. So literally looking at every every function, every department. We we like to say we're kinda going knee to knee with our associates and understanding, you know, the task and looking for ways to improve the processes that they're they're using.

[Archie Brown, President & CEO at First Financial Bancorp]

Some cases, it's technology. Some cases, it's just some process redesign. So I would say we're probably 80% of the way through the company at this point in terms of the reviews that we've done and and the work that we've done. And then there's probably 20% to go over the next several quarters. There's some technology in a couple of these areas we're implementing in the back half of this year.

[Archie Brown, President & CEO at First Financial Bancorp]

And then we'll probably do some final work as we get into early twenty twenty six. And then from there, I think we view the recently announced acquisition will also provide some additional help in terms of efficiency as we go deeper into 2026.

[Terry Mcevoy, Managing Director at Stephens Inc]

Thanks. And then as a follow-up, can you just talk about the impact the payoffs are having on loan growth? I'm trying to get a sense of more normalized loan growth. I know it's mid low to mid single digits over the near term, but that that includes, you know, payoffs, which are subsiding. So kind of ex payoffs, what's that underlying growth?

[Archie Brown, President & CEO at First Financial Bancorp]

Terry, if you just set up if you had a a norm to think about for us, way we think about this is, 6%, 7% loan growth over the longer term is kind of how we think and how we've been planning. We have seen, as we've talked about, some higher level of payoffs, specifically in our commercial real estate group. What we're seeing for Q3 is scheduled maturities are lower, a little bit higher level of production coming for the quarter. Commercial real estate in Q3 will probably it probably won't grow. We're not we're not forecasting that particular part of the of the book to grow in q three, maybe slightly down, but it'll be a lot better than what we've seen in the last couple of quarters.

[Archie Brown, President & CEO at First Financial Bancorp]

And what that will allow is the other areas that are have really good production. Their growth will be more reflected and show through the overall company. So that's why we're taking it up a little bit in Q3. But longer term, six to 7% is how I think about it.

[Terry Mcevoy, Managing Director at Stephens Inc]

Great. Thanks for taking my questions.

[Archie Brown, President & CEO at First Financial Bancorp]

Yes. Thanks.

[Operator]

Your next question comes from the line of David Conrad from KBW. Your line is open.

[David Konrad, Managing Director at Keefe, Bruyette & Woods (KBW)]

Yes. Hey, good morning. Real quick question on asset quality. It's been really solid, admittedly, it's off of really low levels. But we did see a little bit of a growth there in C and I in terms of the nonaccruals. So any color on that growth rate there would be great.

[Archie Brown, President & CEO at First Financial Bancorp]

David, Bill will cover that a little bit here.

[William Harrod, Chief Credit Officer at First Financial Bancorp]

Yes, absolutely. So our quarter over quarter increase in the NPAs was driven by downgrades of two commercial borrowers, one of which was significantly impacted by the tariffs. But recently, they have shown some improvement as the dust is settling and their impacts. The other relationship is a contract manufacturer, which is currently going through a sale process. We've taken the bulk of our expected charge off this quarter with the remainder in reserve for as dust settles before the end of the year.

[William Harrod, Chief Credit Officer at First Financial Bancorp]

And we expect a resolution by the end of the year.

[David Konrad, Managing Director at Keefe, Bruyette & Woods (KBW)]

Great. Okay. And then, Jamie, appreciate the asset sensitivity color. And I know Westfield is not a big asset change for you, but just wondered if if your assets seems to be would change a little bit next year as you integrate that that balance sheet.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

Yeah. It's a first of all, welcome to the call. I'm here. I'll view on here. So yeah.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

Yeah. It it Hope you're alright. Yeah. Yeah. Doing a great Yeah.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

You're doing a great job. Yeah. Thank you. Yeah. Yeah.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

No. It I would say, you know, of course, the size of this acquisition, you know, is is relatively small. But, so they're they're slightly they're slightly liability sensitive. So, and, you know and, obviously, then you gotta kinda wash through here for a while some of the purchase accounting noise that takes place in the first couple of years. But overall, they're going to help our asset sensitivity and bring us a little bit more closer to neutral.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

But again, obviously, the size of their earning asset base is roughly around 10% of our earning assets. So it's on the margin, but it does help for sure.

[David Konrad, Managing Director at Keefe, Bruyette & Woods (KBW)]

Great. Perfect. Thank you.

[Archie Brown, President & CEO at First Financial Bancorp]

Yes. Thanks.

[Operator]

Your next question comes from the line of Karl Shepherd from RBC Capital Markets. Your line is open.

[Karl Shepard, AVP at RBC Capital Markets]

Hey, good morning, guys.

[Archie Brown, President & CEO at First Financial Bancorp]

Good morning, Carl.

[Karl Shepard, AVP at RBC Capital Markets]

Just to start on loan growth real quick, I appreciate the comments on CRE trends. Are you guys signaling a consistent pace of growth in the other businesses? Or do you think that there's, I guess, opportunity for acceleration there in the second half as well?

[Jamie Anderson, CFO & COO at First Financial Bancorp]

Yeah. This is Jamie, Carl. Yeah. So what what we're really seeing is really just that headwind on the CRE side in terms of the payoffs and prepayments, some level of maturities, but but the but in really, in in the other business lines, we're seeing consistent growth. Now those those those business lines would have varying levels of growth.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

So, like, when you look at, you know, consumer, C and I, you know, consistently on the C and I we had a good quarter on the in the second quarter on the C and I side. But C and I, consumer are going to be if we're talking 5% to 7% loan growth, we're getting kind of maybe the lower end from those types of businesses. And then our specialty lines will grow maybe in that 10% to 12% range. And when you blend it all together, it's in that, call it, 7%. So obviously, the specialty lines make up around 20% of the loan book.

[Archie Brown, President & CEO at First Financial Bancorp]

And currently, what you'll see typically in the back half of the year, Summit, their volume really strengthened, So especially as we get into they'll ramp up more in the back half compared to the first half.

[Karl Shepard, AVP at RBC Capital Markets]

Perfect. I love Slide 12. And then one quick one on the margin. Methodical cuts you guys can manage through. Is it can you just remind us a little bit of leading impact to asset yields, though, and then for deposits, maybe catch up a half quarter later?

[Karl Shepard, AVP at RBC Capital Markets]

Is that is that fair? So just thinking about the timing of cuts and how that

[Jamie Anderson, CFO & COO at First Financial Bancorp]

Yeah. One quarter or the other one? Yep. Yep. That's a good question.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

And so, you know, when we're looking out and we have, like, the September cut, you know, obviously, it doesn't have a whole lot of impact for the third quarter. But, as rates start to move down in anticipation of that cut, you know, we will see our loan yields start to move down, you know, maybe starting thirty, forty five days in advance of that. And then and then you're right. I mean, we try to get in front of the deposit cost as much as we can, But, you know, that's more it's obviously not contractual like the loan side is, and it's more, you know, market competition type base. So, yeah, typically, that will have a a quarter lag on the deposit side.

[Jamie Anderson, CFO & COO at First Financial Bancorp]

And that's kind of what you saw here in the second quarter with us. And we tend to, you know, given the fact that our margin is so high, we we tend tend to to lag the deposit side just to make sure we're retaining balances more and, Eric, kind of on the side of liquidity and not bring them down and and and maybe have to readjust and and bring them back up. So, yes, so you'll see that lag on the deposit side typically with us.

[Karl Shepard, AVP at RBC Capital Markets]

Okay. Makes a ton of sense. Thanks so much.

[Archie Brown, President & CEO at First Financial Bancorp]

Yes.

[Operator]

And we have reached the end of our question and answer session. I will now turn the call back over to Archie Brown for some final closing remarks.

[Archie Brown, President & CEO at First Financial Bancorp]

Thank you, Rob. Want thank everybody for joining us on today's call and tracking with us on our really great second quarter. We look forward to talking to you again next quarter. Have a great day and weekend. Bye now.

[Operator]

This concludes today's conference call. Thank you for your participation. You may now disconnect.

Participants

Analysts

• Scott Crawley, Controller at First Financial Bancorp
• Archie Brown, President & CEO at First Financial Bancorp
• Jamie Anderson, CFO & COO at First Financial Bancorp
• Daniel Tamayo, Vice President at Raymond James Financial
• Terry Mcevoy, Managing Director at Stephens Inc
• David Konrad, Managing Director at Keefe, Bruyette & Woods (KBW)
• William Harrod, Chief Credit Officer at First Financial Bancorp
• Karl Shepard, AVP at RBC Capital Markets