Wednesday, June 29 2022

Section 2.05. Costs associated with exit or disposal activities

On May 10, 2022, FB Financial Corporation (the “Company”) announced the restructuring of its mortgage segment, including the discontinuation of its nationwide Internet-based mortgage delivery channel, Real Genius, formerly known as ConsumerDirect (the “Direct-to- Consumer”), which is one of the two delivery channels of the Mortgages segment (the “Restructuring”). These efforts are being undertaken by the Company due to recent margin compression, reduced volumes due to excess capacity in the industry, refinancing fatigue and a shortage of housing in the housing markets. Company, which impacts the Direct-to-Consumer channel. We believe this realignment of our mortgage business will allow us to direct resources to our traditional consumer mortgage retail channel, which has historically produced more predictable and consistent results and should provide regulatory capital relief. resulting in mortgage service fees and produce a lock in lower interest rates. volume and, therefore, the income of mortgage banks in the future.

The Restructuring began on May 10, 2022. For the three months ended March 31, 2022 and 2021, the Direct-to-Consumer channel represented 43.4% and 50.2% of the Company’s total interest rate lock-in volume and 50.7% and 52.8% of the Company’s sales volume, respectively. Company. Following the exit of the Direct-to-Consumer channel, the Company expects to incur total pre-tax restructuring charges of approximately $11.0 million for $13.0 million through the remainder of 2022, with personnel costs representing approximately 80%, contract terminations representing approximately 10% and impairments of premises and equipment representing approximately 10% of total pre-tax expenses. The Company expects to stop operations in this channel before the fourth quarter of 2022.

All of the above costs and associated percentages are best estimates prepared under WE generally accepted accounting principles and are subject to change. The company plans to continue to offer and sell residential mortgages within its mortgage segment through its traditional consumer mortgage retail channel, retain mortgage servicing rights and continue to hold 1 to 4 family residential mortgages in its loan portfolio.

Caution Regarding Forward-Looking Statements

Certain statements contained in this report are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act. These forward-looking statements include, but are not limited to, statements relating to the expected completion date of the Restructuring, the timing and amounts of charges, and other statements of expectations regarding the mortgage market and the Restructuring. These statements, which are based on certain assumptions and estimates and describe the future plans, results, strategies and expectations of the Company, can generally be identified by the use of the words and expressions “may”, “will”, “should”, “could”, “should”, “goal”, “plan”, “potential”, “estimate”, “project”, “believe”, “intend”, “anticipate”, “expect”, “target” , “aim”, “predict”, “continue”, “seek”, “projection” and other variations of these words and similar phrases and expressions. These forward-looking statements are not historical facts and are based on current expectations, estimates and projections about the company’s industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond the control of the company. . The inclusion of these forward-looking statements should not be taken as a representation by the Company or any other person that such expectations, estimates and projections will be realized. Accordingly, the Company cautions investors that these forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict and beyond the control of the Company. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable as of the date of this report, actual results may differ materially from the results expressed or implied by the forward-looking statements. A number of factors could cause actual results to differ materially from those contemplated by the forward-looking statements in this report, including, without limitation, the successful winding down of the Direct-to-Consumer channel, including in anticipated delays, the occurrence of any unexpected additional costs or expenses, any cautionary statements included in this report, and the risks and other factors set forth in the company’s most recent annual report on Form 10-K under the headings “Disclaimer Caution Regarding Forward-Looking Statements” and “Risk Factors” and Periodic and Current Reports on Forms 10-Q and 8-K. Many of these factors are beyond the Company’s ability to control or predict. Should one or more events related to these or other risks or uncertainties materialize, or should the Company’s underlying assumptions prove incorrect, actual results may differ materially from the forward-looking statements. Accordingly, investors should not place undue reliance on these forward-looking statements. Any forward-looking statement speaks only as of the date of this report, and the Company undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law. New risks and uncertainties may emerge from time to time, and it is not possible for the Company to predict their occurrence or how they will affect the Company.

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