Good morning and welcome to the First Interstate Bancsystem Inc. fourth quarter 2013 earnings conference call. All participants will be in listen-only mode. (Operator instructions) After today’s presentation there will be an opportunity to ask questions. (Operator instructions) Please note that this event is being recorded. Now, I would like to turn the conference over to Ms. Marcy Mutch, Investor Relations Officer. Ms. Mutch, please go ahead.

Thanks, Keith [ph]. Good morning. Thank you for joining us for our fourth quarter earnings conference call. As we begin, I’d like to direct all listeners to the cautionary note regarding forward-looking statements and factors that could affect future results in our most recently filed Forms 10-Q and 10-K. Relevant factors that could cause actual results to differ materially from any forward-looking statements are listed in the earnings release and in our SEC filings. The company does not instantly correct or update any of the forward-looking statements made today. Joining us from management this morning are Ed Garding, our Chief Executive Officer; and Kevin Riley, our Chief Financial Officer, along with other members of our management team. At this time, I’d like to turn the call over to Ed Garding. Ed?

Thanks, Marcy, and thanks again to all of you for joining us. Yesterday, we reported the highest annual level of earnings in the history of our company at just over $86 million or $1.96 per share. Our quarterly earnings were $20.8 million or $0.47 per share. We have many reasons to be pleased with our 2013 performance. Our return on average assets for the year is 1.16; it’s great to have that ratio above 1% again. Our return-on-equity was just over 11%. Going forward, we continue to seek ways to deploy our capital in order to maintain higher levels of return, so in addition to reporting another solid quarter, we announced a 14% increase in our dividend to $0.16 per share. We’re beginning to see some loan growth, however, as typical, loan growth slowed in the fourth quarter in addition to our normal seasonal slowing. We had that below zero weather for a big part of the fourth quarter and that slowed things further. The only good part about that was that in Montana we’re fairly used to the below zero weather but this year we were able to share that with all the rest of you. Back to loan growth anyway, total loans grew approximately 3% in 2013. Our construction portfolio continued to increase each quarter this year, which is indicative of improvement in our economies and allows us to be optimistic going forward. Our indirect portfolio grew 9% in 2013. This portfolio performs very well and has a net charge off rate of only 19 basis points, well below the national average. All credit quality metrics have improved over the year while we communicated early in 2013 that we hoped to reduce non-performing assets by 30% this year, we missed this goal but did have a significant reduction from last year of 21%. Non-performing assets are now at 1.40% of total assets, a 37 basis point reduction over 2012. At this point I’d like to have Kevin Riley go over the financial statements with you, then I’ll come back and touch on our economy and some other 2013 highlights. So, Kevin, I’ll turn the call over to you.

Thanks, Ed, and good morning everyone. I’d like to start off with the balance sheet. Earnings assets were up for both last quarter and from the fourth quarter of 2012. On a linked quarterly basis, our loan portfolio was up $24 million, which excluded loans held for sale. A $41 million growth we saw in our real-estate lending area which was offset by a decrease in ag and consumer loans. The decline in ag loans was expected and these lines typically paid down during this time of year as cattle are sold and crops are harvested. The invested portfolio continues to make of about 31% of our average earning assets. Our emphasis there is to continue to keep our duration short and it currently stands at 3.7 years, as we position ourselves to take advantage of opportunities when rates start to rise. Our non-earning assets are moving in the right direction which is down from last quarter and from the fourth quarter of 2012. Most of this change can be attributed to the decline in our other real-estate owned which decreased to 16% decrease from the third quarter and a 52% decrease from a year ago. On the liability side, our average deposits this year have fluctuated a little from quarter to quarter. We started a year with the first two quarters posting declines, but then in the third and fourth quarter, we saw posted increases. All in all, we saw a 1.7% decline in deposits for the year. The shipped out [ph] time deposits and the savings [ph] and [indiscernible] accounts continue throughout the year as customers were hesitant to tie their money in certificates of deposit in this low-rate environment. Our capital levels remain strong where our leverage ratio at just over 10% and our total risk-based capital…

Thanks, Kevin. I’d like to just touch on our economies for a minute. Unemployment continues to decrease, and is 5% or below in each of the states in which we do business. As you all know, that is at or near full employment levels. A lot of that can be attributed to the jobs that have been created over the Bakken oil field. We’re seeing housing starts back to the pre-recession levels in some of our largest market areas. And with the 5% growth we saw in construction real estate portfolio in 2013, we’re optimistic the commercial and residential construction growth will continue. Tourism has been strong particularly this winter. Snowfall in December has helped our ski resort areas particularly in Montana, kicked off the season, and they’re having a good year. Back to the bank, wealth management continues to grow, and assets under management have increased 17% each of the last two years. We still see potential for growth in this area, both within our current customer base, and through attracting new customers. One of the reasons we’re so optimistic about the growth potential is because we’re seeing quite a bit of wealth created in some of our markets because of the Bakken energy play. We continue to expand our credit card business. New cards issued, and card volume both went up 8% this year. We entered into an exclusive agreement with MasterCard which has resulted in a better product for our customers and a higher percentage of interchange fee revenue for the bank. We’ve also introduced a new rewards program that is more market focused that allows our customers to spend their rewards – their rewards points, I should say, within their own communities. Our goal here is to encourage our customers to use their cards more often…

(Operator Instructions) And the first question comes from Jeff Rulis of D.A. Davidson Jeff Rulis – D.A. Davidson: Thanks, good morning. Ed, just to kind of follow up on your discussion on the loan growth, it sounds like it’s a bit more optimistic. I guess, to characterize that, would it be safe to say that you think that ‘14 growth could outstrip the 3% this last year?

Yes. And by the way, good morning, Jeff. That’s a real short answer but we’ve been talking about that very subject. And yes, we think we can have growth that will exceed the 2013 growth. Jeff Rulis – D.A. Davidson: And if that were to – if growth was more modest that you expect, I guess, would this year be a little more of year that you’ll look on the acquisition front, to augment some of that if the growth strategy isn’t really coming together as it – I mean that may not be the reason that you’re looking for acquisitions, but maybe you can give us an update on kind of what you’re seeing out on the acquisition front and your appetite?

I think we’ll see more opportunities to take a look this year than we saw last year. And kind of similar to what I said about our lenders, now that we’ve got most of the problems behind us, we and senior management will have more time to look at the acquisition trail also. So that’s certainly isn’t a strategy for loan growth, but it’s something that we’re all thinking about. Jeff Rulis – D.A. Davidson: Okay. And then one last one on the – I know that you mentioned the focus is going to be on the purchase side on mortgages, but just trying to get a feel for the mortgage loan sale gains going forward. Is this a bottom, or is that – expect that to kind of continue to trickle lower?

I’m not sure I understand the question. Are you talking about the... Jeff Rulis – D.A. Davidson: The gain – sale, line item – what’s the expectation on gain on sale for the mortgage side? I know that you said you want to grow the purchase side, but what’s the gain on sale look in the coming year?

I can tell you, for the first quarter, it’s going to be less than it has been in the four quarters of 2013. Jeff Rulis – D.A. Davidson: And the outlook for the year?

And then yes, and then typically it picks up. The middle two quarters are the most active. But we’re kind of – we’re following along the lines of the Mortgage Bankers Association in regards to volume dropping off this year. However, we don’t think our volume will drop as much as they are predicting nationally partly because of the economy is pretty strong here. Again, the influence from the Bakken interestingly is even though we’re 350 miles away in Billings, the influence here in Billings, our biggest market, it’s just been huge. And so partly because of that and partly because we just think we can gain some market share. Jeff Rulis – D.A. Davidson: Sure, okay. Thanks, Ed.

Thank you. And the next question comes from Matthew Keating with Barclays. Matthew Keating – Barclays: Yes. Thank you. Good morning. Ed, I was hoping you could help me – I know you talked about how job growth and the footprint has remained strong and with encouraging signs of residential and commercial construction. So maybe if you – if you take those kind of trends, normally you would expect a fairly vibrant loan demand environment. So maybe could you explain some of the factors that have been keeping loan demand somewhat more depressed that you might expect given the levels of economic activity in your footprint?

Good morning, Matthew. I got to think about this for a minute. My first thought is that there’s two sides to that loan growth equation. There’s new loans and there’s payments. And so, we’re continuing to make new loans but that stream of payments is coming in very strong. And that’s a good news story from the stand point of our customers are doing well in repaying us rapidly. Of course the bad news is it’s hard to maintain growth when that’s happening. So that’s one piece of it. And the other piece though is that we are seeing quite a few requests that simply don’t meet our standards. And we’re not interested in going back to the issue of spending a great deal of time cleaning up problems. So, the ones that don’t meet our standards just have to borrow elsewhere. Matthew Keating – Barclays: Understood, that’s helpful. My next question would be for Kevin. Kevin, you mentioned the bully purchase that you made, what kind of like the income benefit should we expect from that I guess $60 million purchase you did in the quarter as we look out?

Approximately $2.5 million. Matthew Keating – Barclays: Annualized? Okay. Okay. That’s helpful. And then I think you guys mentioned that MTA [ph] should return to more normalized level is your expectation. Are you willing like last year to put a target on the decline or what kind of magnitude of decline or normalized level that you have in mind with that comment?

I’m going to ask Bob Cerkovnik, our Chief Credit Officer to address that. Go ahead Bob.

Matt, I guess the thing that we would want to be a high performing bank; we want to be at 1%, less than 1% of total assets of our non-performing assets. Matthew Keating – Barclays: Toward by the end of ‘14 is kind of expectations or that would be a target that you’d like to achieve but who knows how things transpire.

That’s very much the target we want to achieve. Matthew Keating – Barclays: Understood. And my follow up question, I’m just curious, I know back in July you gave us a metric. You may not have it readily available. But I think you said that you had about 15,000 mobile banking customers. Any update on kind of where that metric trended as we kind of close the year of ‘13?

19,000, so it continues to grow. And to put that into perspective, our original goal was to have 14,000 signed up by October. And so, now three or four months after that we’re up to 19,000. So it’s been more robust than we had hoped. Matthew Keating – Barclays: Very good. Thanks for the color.

You’re welcome Matt.

Thank you. Your next question comes from Brad Milsaps for Sandler O’Neill. Brad Milsaps – Sandler O’Neill: Hey, good morning.

Good morning Brad. Brad Milsaps – Sandler O’Neill: Kevin, just a question on – I know you talked the last couple quarters about trying to make the balance sheet more asset sensitive. I know it’s the average liquidity was up again, this quarter on some deposit growth form the last couple quarters. Just curious what your plans are there? Do you expect some of that to reverse out or do you anticipant maybe going into this portfolio [ph] a little bit more? Just trying to get a sense of what you’re plans for the additional liquidity would be.

Good morning, Brad. To be honest with you we’re trying to keep – to be more – we are a little bit as you know liability sensitive, so we’re trying to stay more asset sensitive. So at this point we don’t plan on parking that out in the investment portfolio to make that matter worst at all. So I think the liquidity will stay there for a while because we don’t have any plan – yes, have any plans currently right now to put that in the investment portfolio. Brad Milsaps – Sandler O’Neill: Okay, great. And then just to follow up on the asset quality. I think I heard you say maybe about 25 basis points of charge offs is what you got to looking for – to ‘14. And you mentioned a lower level of positioning, is it safe to say, we wouldn’t see the negative provisions that we see in the last couple quarters in 2014?

We’re not anticipating that but again, it’s all driven by you know, Brad, the accounting aspects. And, Bob does a great job in knocking down asset quality levels to the way he just spoke a few minutes ago. I’m not going to rule that out. Brad Milsaps – Sandler O’Neill: Okay. Okay, great, very helpful. Thank you.

Thank you. And the next question comes from Tim Coffey with FIG Partners. Tim Coffey – FIG Partners: Hey, good morning everybody.

Good morning, Tim. Tim Coffey – FIG Partners: I just want to clear, the net target of expectation is it – did you say 45 BITs [ph]?

25.

25, yes. Tim Coffey – FIG Partners: 25, okay, okay, that’s what I thought. Alright, given kind of what we’re seeing in terms of any expectations for long growth in the asset growth [ph], how do you plan on targeting or improving efficiencies in the next year or two?

We have a long-term initiative for operating efficiency or we’re calling it process improvement. And I can tell you that that it’s not about cost cutting as much as people like to see a cost cutting measure. We think we’d rather concentrate on process improvement so to speak. The idea being we’d like to do more business with more customers with the same number of FTEs. And we think process improvement is the way to do that. So some of that includes lean six sigma training which we’ve been doing for over a year, and we’ve actually created a Process Improvement Department, we’ve got four people staffing that department right now, and that’s fairly new but that is all they’re going to do across the company for the foreseeable future. Tim Coffey – FIG Partners: Okay. Okay. Yes, I know you’ve talked about that in previous quarters. And then what were the non-interest expense line item, other expenses that may book [ph] this quarter?

Kevin, would you answer that one?

Yes. We had some – that time of year, some of the travel in [ph] our team and it’s a little higher than we anticipated. Some marketing expenses a little higher than anticipated with some initiatives being. So there were just some kind of seasonal expenses that a little higher than we anticipated in that other expense category. Again, nothing that we anticipate that will continue at that rate going forward on a quarterly basis. Tim Coffey – FIG Partners: Okay. Okay. And in terms of efficiency ratio going forward, is it fair to expect that the efficiency ratio stays at 65% or lower?

Hopefully lower than that Tim. Tim Coffey – FIG Partners: Okay. All right, well, those are all my questions. Thank you.

Thank you, Tim.

Thank you. (Operator instructions) And the next question comes from Jackie Chimera with KBW. Jackie Chimera – KBW: Hi, good morning everyone.

Good morning, Jackie. Jackie Chimera – KBW: Just thinking about mortgage gain on sale [ph] and then the portfolio of those loans rather than sale of them. I know right now you’re looking at the 15 years as to what you’re putting in the portfolio book. Is there a point where you might be more interested in portfolio – in putting more longer term loans into the portfolio?

The short answer is no. And we’re actually putting fewer of the fifteens [ph] in the portfolio than we were a year ago. Obviously the interest rate risk weighs heavily. And so, we don’t want to load up anymore with long-term fix rate. Jackie Chimera – KBW: Is that a function of just not wanting that long-term fix rate in the portfolio or is it more just where we are in the rate cycle, so once rate increased you can book to increase those mortgages more?

It’s more a function of the first that we just don’t want long-term fix rate in the portfolio. It’s not so much about where rates are today. Jackie Chimera – KBW: Okay. Do you have an ideal mix of where you’d like to see the single family loans from an exposure stand point?

Yes, I do. And Marcy, keeps telling that I’m not supposed to reveal that, is that true Marcy? Jackie Chimera – KBW: Well, I don’t want to get in trouble with Marcy, so onto my next one. All right, you – just talking back on some of the data mining people that you’ve hired, do you see yourself developing new products as you learn more about your customers?

Yes. Jackie Chimera – KBW: Anything that – just to get more color on that.

Not to the extent that we’re – I’m sorry, I want to expand on that a little bit. New products, yes, but mostly they’ll be tied to what I would call traditional banking products. Meaning, we are not looking to get into new product lines. We’re more looking into knowing what we do well and figure out how to do it even better, keep tweaking until it’s better, better, better for our customers. Jackie Chimera – KBW: Okay. Do you see that more of an NII benefit or more of a Phi benefit [ph] as we go along?

I’d say both. Jackie Chimera – KBW: Okay, fair enough. And then just one quick last one, the 25 basis points that you’re looking towards burn that [ph] charge off next year, did those include expected recoveries in there as well?

Yes.

Yes. Jackie Chimera – KBW: And how does the recovery will look now, is it still pretty substantial, we could see continuation of that going forward to the next year or two?

Yes, pretty substantial would be a good way to put it. Jackie Chimera – KBW: Okay. That was all I had. Thank you very much.

Thank you, Jackie.

Thank you. And as there are no more questions at the present time, I would like to turn the call back over to management for any closing remarks.

Thank you. I’ll just wrap up by saying, again, we’re pleased with our year. And we’ve entered 2014 with renewed focus and energy going forward. I’d like to thank all the people across our company who helped us accomplish everything we did this year. I’d also like to thank you shareholders and let you know that we’re continuing to work hard to deliver a high return to you. Thanks and good bye.

Thank you. The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect. Have a nice day.