Yahoo Finance Amerant Bancorp Inc (AMTB) Q1 2024 Earnings Call Transcript Highlights: Strategic Adjustments ...
Total Loans: Decreased by $258.5 million, reflecting the sale of a $401 million multi-family loan portfolio in Houston, offset by organic loan growth of $142.5 million.
Deposit Growth: Organic deposit growth of $331.8 million, offsetting a reduction in institutional and brokered deposits.
Net Interest Margin: Decreased to 3.51% in Q1 from 3.72% in the previous quarter.
Provision for Credit Losses: $12.4 million, slightly down from $12.5 million in the previous quarter.
Noninterest Income: Decreased to $14.5 million from $19.6 million in the previous quarter.
Noninterest Expense: Decreased to $66.6 million from $109.7 million in the previous quarter.
Total Assets: Reached a record $9.82 billion, slightly up from $9.72 billion in the previous period.
Total Deposits: Slightly decreased by $16.6 million to $7.88 billion.
Total Gross Loans: Decreased by $258.5 million to $7 billion.
Total Securities: Increased by $81.6 million to $1.6 billion.
Cash and Cash Equivalents: Increased by $337.8 million to $659.7 million.
Capital Ratios: Total capital ratio at 12.5%, CET1 at 10.11%, and Tier one capital ratio at 10.8%.
Dividend: A dividend of $0.09 per share was approved, payable on May 30, 2024.
Release Date: April 25, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q & A Highlights
Q: Can you provide more details on the special mention loans and what drove the downgrade? A: (Laura Rossi, SVP, Head of Investor Relations & Sustainability) - The increase in special mention loans is partly due to lack of timely financial data and metrics like trailing 12-month leverage showing some deterioration. However, there's a positive trend in EBITDA, and currently, there's no immediate concern of further downgrades.
Q: How will the capital from the Houston sale be deployed, and what is the target CET1 level? A: (Jerry Plush, Chairman & CEO) - The target CET1 level is around 10%. The capital will be used for a mix of buybacks, supporting growth, and potentially adjusting dividends based on earnings consistency. The focus is on maintaining flexibility to support ongoing growth and shareholder returns.
Q: What impact do you expect from the Houston exit on the bank's margin and expenses? A: (Laura Rossi, SVP, Head of Investor Relations & Sustainability) - Post-Houston exit, an improvement in net interest margin is expected due to better yields on new loan production outweighing the higher cost of funds. Expense savings from the exit are anticipated to be around $4.9 to $5 million annually.
Q: Can you update on the efforts and focus on growing international deposits? A: (Jerry Plush, Chairman & CEO) - The bank continues to focus on international deposit gathering, leveraging commercial accounts with international exposure. More detailed plans on expanding this area will be shared by the end of the second quarter.
Q: What is the expected loan growth rate for the year, considering the sale of the Houston portfolio? A: (Laura Rossi, SVP, Head of Investor Relations & Sustainability) - Excluding the effect of the $400 million Houston portfolio sale, the expected loan growth rate is around 17% year-over-year.
Q: How will the charge-offs from the consumer book impact future quarters? A: (Laura Rossi, SVP, Head of Investor Relations & Sustainability) - The $8.6 million in charge-offs related to indirect consumer loans this quarter is part of an expected trend, as these loans have reached their peak losses. Future quarters are expected to see reduced charge-offs from this segment.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
