Synovus Financial Corp. (SYU1.DU) Earnings Call Transcript & Summary

Welcome to the 2020 Annual Meeting for Synovus Financial Corp. Our host for today's call is Kessel Stelling, Chairman of the Board and Chief Executive Officer. [Operator Instructions] I will now turn the call over to your host, Mr. Stelling. You may begin.

Well, good morning and welcome to all of you. I'd like to call the 2020 Annual Shareholders Meeting to order. I'm Kessel Stelling, Chairman of the Board of Directors and Chief Executive Officer, and I'd like to welcome all of our shareholders to our first online-only virtual shareholders meeting. On our call today, we have a number of special guests, including members of the Synovus Board of Directors, our executive management group and bank leadership group and representatives of KPMG, our independent auditor. At this time, I'd like to introduce our Corporate Secretary, Mary Maurice Young. Mary Maurice will be reporting on the business items of the meeting.

Good morning. Before we begin the business of the meeting, I would like to review a few housekeeping items. On our virtual meeting portal, you should see the agenda for the meeting and an explanation of our rules of conduct and meeting procedures, including procedures for shareholder questions. As you can see from the rules of conduct, questions or concerns related to the proposals being voted on today will be addressed after all the proposals are introduced. Only validated shareholders may ask questions. Out of consideration for others, please limit yourself to one question. If you have general questions that do not pertain to the business of the meeting today, we're happy to answer those at a later time with you. Please see the rules of conduct for the contact information of our investor relations group. The Board has appointed Belinda Massafra to act as inspector of elections for the meeting. Ms. Massafra is present today and has taken the oath of office, which will be filed with the minutes of this meeting. We have a list of the company's shareholders of record as of February 20, 2020, the record date for this meeting, available for inspection during the meeting. The minutes of the 2019 Annual Meeting of Shareholders are also available for your inspection during the meeting. Both the shareholder list and these minutes may be found via a link on the web portal. The notice of the meeting and the notice of internet availability of proxy materials were mailed by Broadridge, the company's tabulation agent, beginning on March 11, 2020, to all shareholders of record as of February 20. The notice of the change to a virtual shareholders meeting was made available to shareholders on April 8, 2020. As such, the meeting is being held pursuant to proper notice. An affidavit from Broadridge as to the mailing of the notice to all record shareholders of the company will be filed with the minutes today. The affidavit is available for inspection by any shareholder. Proxies representing over 91% of the votes entitled to be cast by the holders of the outstanding shares of Synovus common stock are present at the meeting. As such, the inspector of elections has confirmed that a quorum is represented, and the meeting is duly constituted and should proceed. I now declare the polls open. We have 6 proposals to vote on this morning: first, to elect as directors the 11 nominees named in the proxy statement; second, to approve amendments to the company's articles of incorporation and bylaws to eliminate our 10-1 voting provision; third, to approve amendments to the company's articles of incorporation and bylaws to eliminate super majority voting requirements; fourth, to hold an advisory vote on the compensation of Synovus' named executive officers as determined by the Compensation Committee of the Board of Directors; fifth, to hold an advisory vote on the frequency of the advisory vote on executive compensation; and finally, to ratify the appointment of KPMG as the company's independent auditor for the year 2020. The Board unanimously recommends that shareholders vote for each of the foregoing proposals and for a vote of every year in the case of the advisory vote on the frequency of the executive comp advisory vote. Under our bylaws, the deadline for submitting a nominee for director or any other shareholder proposal has passed, and no other nominations for director or shareholder proposals were submitted. Therefore, these 6 items of business are the only matters we will consider at this meeting. We will now address any questions specifically related to the foregoing proposals. If you have a question related to a proposal, please submit your question now. Are there any questions related to these proposals? Seeing no questions, we will now proceed with the voting. Shareholders who have already voted do not need to vote at this time, unless they want to change their vote. If you have not already voted and would like to vote now, please do so by clicking on the voting button on the web portal and follow the instructions there. The polls are now closed to voting. At this point, the preliminary vote has been verified and tabulated, and I will report the preliminary results of the 6 matters voted upon at this meeting. Each of the 11 nominees for director has received votes cast for election ranging from over 98% to over 99%. Since each of the 11 nominees has received more votes cast for than against, each of the nominees is hereby elected to serve until the next Annual Shareholders Meeting and until his or her successor is elected and qualified. The amendment to Synovus' articles and bylaws to eliminate the 10-1 voting provision has been approved by over 82% of the votes entitled to be cast. This proposal requires the affirmative vote of 2/3 of the votes entitled to be cast, and as such, it is hereby approved. The amendment to Synovus' articles of incorporation and bylaws to eliminate super majority voting requirements has been approved by over 82% of the votes entitled to be cast. This proposal requires the affirmative vote of 2/3 of the votes entitled to be cast, and as such, it is hereby approved. The advisory vote on the compensation of Synovus' named executive officers as determined by the compensation committee has been approved by approximately 99% of the votes cast. This proposal requires the affirmative vote of a majority of the votes cast, and as such, it is hereby approved. The advisory vote on the frequency of the advisory vote on executive compensation has been approved for every year by over 98% of the votes cast. This proposal, likewise, requires the affirmative vote of a majority of the votes cast, and as such, it is hereby approved. The appointment of KPMG as Synovus' independent auditor for 2020 has been ratified by the shareholders by over 98% of the votes cast. Since this proposal requires the affirmative vote of a majority of the votes cast, the proposal to ratify KPMG as Synovus' independent auditor for 2020 has been approved. These preliminary voting results are subject to final tabulation and to verification by the inspector of elections. The inspector of elections will make and certify to a final vote -- a final report of the vote. The vote will become part of the record of this meeting. We will report the voting results in a current report on Form 8-K no later than April 28, 2020. This concludes the formal business of our meeting, and today's shareholder meeting is now adjourned. But before I turn the meeting back over to Kessel, I would like to remind you that Kessel may be making forward-looking statements about the future of Synovus. These forward-looking statements are based on management's current expectations and assumptions and are subject to risk, uncertainties and changes in circumstances. Actual results may differ materially. Please refer to our website for more information.

Well, thank you, Mary Maurice. I would normally now move on to a review of our 2019 and first quarter performance, but given that our earnings release is scheduled for this Friday, April 24, I'm unable to do that. But I thought it'd be appropriate to share just a few observations about our response to this coronavirus and how we'll continue to serve and lead. Our focus has been and continues to be the health and well-being of our team members, our customers and our communities and has guided every decision we have made thus far. To that end, we've transitioned most of our 5,000-plus team members to a work-from-home environment while implementing multiple safety and sanitation measures in locations that remain staffed to serve and support our customers. We've converted our branch lobbies to appointment-only, and we've encouraged customers to use, as often as possible, our alternative online and mobile ATM and drive-through banking channels. On April 3, we launched a new loan system to process requests for the much-needed financial relief to small businesses through the Small Business Administration Paycheck Protection Program, known as PPP. We're very hopeful that Congress will extend the much-needed funding for this program this week. And our dedicated team has been working overtime to process and fund the backlog of applications we received before funding expired last week. We'll provide additional details on the Paycheck Protection Program as well as our operating and financial results for the first 3 months of the year with the publication of our first quarter earnings report on Friday morning, as previously referenced. If you'd like to join via the web, please go to our website for further instructions on how to join that call. For a relationship-based culture like Synovus, this 6-feet apart social distancing approach to business has been somewhat difficult for our team to embrace. But as you can imagine, our team has rallied. And during this time, we've grown deeper in our understanding of and appreciation for authentic connection, relationships and community, the kind not dependent solely on proximity but also on long-standing commitment and trust. I'm confident that this will continue to see us through. 2020 has begun with new sources of global uncertainty and the certainty of more and faster change. Fears from the global pandemic, recession, a divisive presidential campaign and geopolitical conflict are among the many factors that influence financial markets and our operating environment in ways we cannot control or predict. But rest assured, despite the uncertainties, our team remains very focused on what we can control and confident in the things that have sustained us for more than 130 years, a culture grounded in people and a legacy of service. In closing, I want to, again, thank our team for their incredible response to this crisis, both to our customers and to each other. And to our shareholders, thank you for your investment and your continued trust and confidence in our company. Operator, this concludes our meeting. I want to thank all again for their participation. Please stay safe and healthy, and have a good day.

This now concludes the meeting. Thank you for joining, and have a pleasant day.