Horizon Bancorp, Inc. (HBNC) Earnings Call Transcript & Summary

Hello. And welcome to the 2020 Annual Meeting of Shareholders of Horizon Bancorp, Inc. Please note that today's meeting is being recorded. [Operator Instructions] It is now my pleasure to turn today's meeting over to Mr. Craig Dwight, Chairman of Horizon Bancorp, Inc. Mr. Dwight, the floor is yours.

Thank you, Diwana, and good morning. And welcome to Horizon Bancorp, Inc.'s 147th Annual Shareholder Meeting. The holding company was incorporated in 1983 and its primary subsidiary, Horizon Bank in Indiana State-Chartered Bank, has continuously operated as a bank since 1873. Absolutely amazing. In our annual meeting materials is a brief slide presentation that includes Horizon Bancorp's safe harbor and forward-looking statement. Please take a moment to review the forward-looking statement. Officers for today's meeting: Chairman, myself, Craig Dwight; election Judge, Angelina Rizzo; Secretary, Todd Etzler; proxies, Jim Neff, Mark Secor, Kathie DeRuiter and Todd Etzler. Shareholders who have not voted their shares may do so now by clicking on the link on the left side of the meeting's web page and following the instructions. The polls will close after the introductions and review of the matters being voted upon at today's meeting. I declare a quorum to be present, online or by proxy, there being 38,813,000 shares accounted for out of total eligible shares of 44,795,000 for shareholders of record as of March 6, 2020. The percent of shares represented is 86.7%, the meeting shall proceed. The minutes of the 2019 Annual Shareholders Meeting are available for download on the meeting website and stand as approved. It is my pleasure to identify the 4 directors up for election and whose terms will expire in the year 2023: James Dworkin, Chancellor Emeritus of Purdue University North Central; Dan Hopp, retired Senior Vice President, Corporate Affairs and General Counsel, Whirlpool Corporation. Dan is also Horizon Bancorp's Lead Director. Michele Magnuson, former President and Chief Financial Officer and Director of LaPorte Bancorp; Steven Reed, partner with the accounting firm of BGBC Partners, LLP. And now to introduce the other directors and executive officers in virtual attendance at today's annual meeting. We have Larry Burnell, Vice Chairman of the White Lodging Services Corporation, a national hotel management development company; Peter Pairitz, a business developer who focuses on consulting with small business owners regarding all aspects of ownership and finance; Julie Scheck Freigang, Vice President and Chief Information Officer of Franklin Electric Company; and Susan Aaron, Chair of Vision Financial Services, Inc. and accounts receivable management business. Executive officers in attendance are President, Jim Neff; Executive Vice President, Senior Operations Officer Kathie DeRuiter; Executive Vice President and Chief Commercial Banking Officer, Dennis Kuhn; Corporate Secretary and General Counsel, Todd Etzler; Executive Vice President and Chief Financial Officer, Mark Secor. In attendance from our independent auditing firm, BKD, LLP, is Michael Ososki, CPA and partner with BKD. Now for a summary of the matters submitted for shareholders' vote at this year's annual meeting. There are 3 matters being voted upon today, which include election of directors, advisory vote to approve the executive compensation, and the ratification of the appointment of BKD, LLP as independent auditors. In addition, we may entertain a proposal to adjourn, if necessary. [Operator Instructions] I'll pause for a brief moment to see we receive any questions on the matters being voted upon today.

Mr. Chairman, we have received no shareholder questions on the matters to be voted on today.

Thank you, Mark. Having received no questions on the matters to be voted upon today, the voting is now closed. Again, the voting is now closed. While we wait for the votes to be tabulated, we'll provide you a brief update on Horizon's response to the COVID-19 national emergency. For this update, it's my pleasure to introduce you our President, Jim Neff. Jim?

Thank you, Craig. And good morning, everyone. Horizon's response to the health emergency has truly been remarkable, and I'm proud of our entire team. We mobilized our management team in early February to review our existing pandemic plan and conducted a trial run. Our focus and first priority was the safety and health of our employees and customers. This early trial run of our plan helped to prepare all of us for what was to come. On March 12, we implemented a ban on nonessential travel for all employees. And on March 24, we limited access to our offices and branch lobbies to by appointment only. All of this happened very quickly, and our employees and customer responses were supportive and overwhelming. This is evidenced by the high employee attendance rates, quick deployment of social distancing and 42% of our employees adjusting, working remotely from home or through other branch locations. We expanded our call center locations from 3 to 4 to minimize risk of illness and to handle the expected increased call volume. In addition, we increased the number of our interactive teller machines to offer expanded hours of service to more customers. Our employees have been looking long hours, nights, weekends, reaching out to customers, helping them with payment extensions and loan modifications, and we have processed over 22,000 stimulus checks for over $41 million. Our commercial lending team has processed and received approval on more than 1,750 payment protection plan loans in round one and are currently working through requests for round 2. The mortgage team is taking a record number of refinance applications as interest rates have hit record lows. This has been a true team effort with branch staff and others pitching in to help our lending and operations team handle this record volume and meet our customer needs. During these challenging times, we have also supported our local communities by donating over $270,000 to COVID-19-related, not-for-profits efforts to help local families in need. In addition, our employees have volunteered their time and efforts. We have heard countless stories of employees going above and beyond, helping customers and families within their local communities. As we move forward and the country starts to slowly reopen, Horizon is planning and preparing to reopen our lobbies in a safe manner to protect our customers and employees. We are in the process of installing plexiglass shields at teller lines and customer-facing desks, implementing sanitizing procedures, scheduling routine deep cleanings of public spaces, and providing PPE, such as gloves and masks. I want to give a big thank you to the entire Horizon team, our customers and shareholders as we work through this together. Now I'll turn the meeting back over to Craig.

Jim, thank you for the update, and we truly are blessed to have such a talented and hard-working team of employees. Will the election judge, please provide me with the voting results? Thank you, Angelina. The first matter presented to shareholders for a vote is the election of 4 directors. All directors received the plurality of the votes cast, and therefore, all directors nominated have been elected. Congratulations to the elected directors. The second matter voted upon today is the advisory vote to approve executive compensation. Since more shares voted in favor of the advisory vote to approve executive compensation for 1 year than voted against it, the advisory vote to approve executive compensation passed. The third and final matter presented to shareholders for a vote is the ratification of Horizon's independent auditors. Since more shares voted in favor of this proposal than against it, the ratification of auditors has been approved. I'm pleased to announce that all matters presented to shareholders for their approval today have been approved. As a matter of record, Horizon Bancorp will publish the detailed voting results tomorrow. As is our custom, the meeting is now open to shareholder questions. [Operator Instructions]

Mr. Chairman, we have received no questions at this time.

Thank you, Mark. We'll ask the shareholders again if they have questions, please submit them now. While we wait to see if we receive any questions, I'd like to inform the shareholders that Horizon conducted its first-ever earnings conference call on April 30. And the presentation for the conference call was published on April 29 and can be found on our website, www.horizonbank.com under the tabs About Us, Investor Relations Presentations. Mark, did we receive any questions?

Mr. Chairman, we still have not received any questions at this time.

Thank you, Mark. Seeing no questions in the queue. Horizon's 2020 Annual Meeting is now adjourned. From all of us at Horizon Bank, we appreciate your support, and we look forward to return to normal operations. As always, we do enjoy meeting and speaking with our shareholders, so if you have any questions or comments that you would like to share about the company, please feel free to call myself or Mark Secor, our Chief Financial Officer. Thank you for participating in Horizon Bancorp's Virtual Annual Meeting, and we wish you and your families good health. I'll now turn it back over to Diwana. Diwana?

This concludes the meeting. You may now disconnect.