Good afternoon, and welcome to the SMBC Quarterly 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 this event is being recorded. I would now like to turn the conference over to Mr. Matt Funke, Chief Financial Officer. Please go ahead, sir.

Thank you. Good afternoon everyone. This is Matt Funke, CFO, with Southern Missouri Bancorp. The purpose of this call today is to review the information and data presented in our quarterly earnings release dated Monday, October 23, 2017, and to take your questions. We may make certain forward-looking statements during today's call, and we refer you to our cautionary statement regarding forward-looking statements contained in the press release. Thanks everyone for joining us. I'll begin by reviewing the preliminary results highlighted in the quarterly earnings release. The September quarter is the first quarter of our 2018 fiscal year. We were pleased to earn $0.56 diluted in the September quarter that is an increase of $0.06 from the $0.50 diluted in the September quarter a year ago and is up $0.07 from the $0.49 diluted that we earned in the linked June quarter. The June quarter did include an elevated level of one-time expenses. We have a smaller amount of M&A costs included in this current quarter's results. Asset growth in the September quarter was primarily attributable to loan growth. Total assets were up $56 million and that included loan growth of $52 million. This is a seasonally strong quarter for us in terms of loan growth compared to the September 30 of 2016 a year ago our gross loans were up almost $248 million and if you take out the $152 million we picked up from our Capaha acquisition in June we would be up just to touch below 8% year-over-year. That is down slightly from where we stood on a 12-month basis last quarter as the September quarter of last year was really quite strong for us in terms of loan growth. Deposits were up $16 million for the September quarter, which as opposed to my preceding comments on…

Thank you, Matt. Start off with our net loan growth for the first quarter was totaled of $52 million, or 3.7%. September quarter is typically one of our strongest of the fiscal year and we perceive that again for this year. We usually will begin to see ag pay downs starting in the December quarter, but at this time we really feel pretty good about our 8% to 10% annual growth target for the fiscal year. When we look at the composition of our growth this year, included in growth was a little over 8.7 million in loan participations that we did repurchase for loans that we acquired in the Capaha transaction. So that did boost our level of loan growth during the tail end of the first quarter of our fiscal year. Changes in our loan portfolio over the year did include growth in commercial real estate of 32 million, our ag balances between ag real estate and ag operating lines were up $10 million and our C&I portfolio was up $8 million. Loan growth was nearly equally divided over all three of our regions in the east, west and south. Overall, we're pleased with our lending activity in the first quarter and look forward to the upcoming December quarter. And giving an update on our agricultural portfolio, ag real estate balances grew a modest $3 million while our operating lines were up $7 million, which was slightly below the $10 million that we had estimated at our last earnings call. And part of the reason that we didn't hit the $10 million was we had several ag relationships that were – we experienced certainly payoffs on related to the Capaha acquisition. We're currently projecting about $15 million in the ag pay downs this quarter for operating lines as…

I think that concludes Greg comments and we will take questions at this time if you remind our callers how they can queue.

We will now begin the question-and-answer session. [Operator Instructions] The first question comes from Andrew Liesch with Sandler O’Neill. Please go ahead.

Good afternoon guys.

Good afternoon, Andrew. How are you?

Good, thanks. Question on the margin really on the loan yields. If I strip out the accretion from the deals, it looks like core loan yields increased a little bit this quarter. Can you confirm that? And then also what's the main driver behind that?

That is what we're seeing as well and we just attributed to better pricing since we've seen the uptick in rates really since December.

Gotcha. And then it also looks like you're seeing some deposit pricing pressure as well. So going forward like what's your – what are your thoughts on the core margin, hold steady, maybe a little bit of expansion here?

We feel happy with the expansion we've seen. I wouldn't get too aggressive with it going forward, but we’re hopeful that deposit betas will hold in line and keep the pricing loans just slightly better than what we have to increase our deposit.

Okay, gotcha. And then on the operating expense front, taking out the deal costs right around $10.5 million, certainly that can fluctuate depending on the – on some of the commitment line and provision there. But is this $10.5 million a good level to build off of or are there any of – is there any reason to think that it might be a little bit above that?

Then you're trying to think if there's anything that we ought to warn you of there, we – no it was a good quarter just some things not fell our way within the number. I wouldn’t want to be too aggressive with any kind of outlook, but we do feel good about savings to ring out with Capaha sale. And we’ll do our best to hold everything else steady.

Great. Those are my questions. Thanks so much.

Thanks, Andrew.

[Operator Instructions] This concludes our question-and-answer session. I would like to turn the conference back over to Matt Funke for any closing remarks.

Well, thank you and thank you everyone for joining us. We appreciate your interest and we’ll talk to you again in three months.

The conference is now concluded. Thank you for attending today’s presentation. You may now disconnect.