Yahoo Finance Associated Banc-Corp (ASB) Q1 2024 Earnings Call Transcript Highlights: Key Financial Metrics ...
Earnings Per Share (EPS): $0.52 on a diluted GAAP basis for Q1.
Net Interest Income: Increased by $4 million from the previous quarter to $258 million.
Loan Growth: Period-end loans grew by $278 million in Q1.
Core Customer Deposit Growth: Increased by 2% in Q1, adding $557 million.
Noninterest Income: $65 million for the quarter, up $3 million year-over-year.
Noninterest Expense: $198 million in Q1, including an $8 million FDIC special assessment cost.
Total Loan Growth Forecast: Expected to be between 4% and 6% for 2024.
Total Core Customer Deposit Growth Forecast: Projected to be between 3% and 5% for 2024.
Net Interest Income Growth Forecast: Anticipated to be between 2% and 4% for 2024.
Noninterest Expense Growth Forecast: Expected to increase by 2% to 3% for 2024, excluding FDIC special assessment expenses.
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: Could you discuss the margin guidance and the impact of the potential delay in rate cuts on it? A: Andrew Harmening, President and CEO, explained that the margin guidance remains within the previously stated range. He noted that while higher rates could increase funding costs, the bank's slight asset sensitivity could offset this. Derek Meyer, CFO, added that deposit behavior is key, and while they are cautious, they are optimistic about deposit performance and expect margins to widen by year-end.
Q: Can you provide insights into the growth in non-interest bearing deposits this quarter? A: Derek Meyer, CFO, noted that the growth in non-interest bearing deposits was as expected and should reach around $6 billion by year-end. He emphasized the focus on growing interest-bearing deposits to optimize funding and manage margin pressures.
Q: What drove the savings and money market growth, and is this trend sustainable? A: Andrew Harmening, President and CEO, attributed the growth to an increase in consumer deposits, particularly from the mass affluent segment and private wealth management. He expects the growth trend to continue, supported by strong foundational products and services.
Q: Could you discuss the trajectory of expenses for the rest of the year? A: Derek Meyer, CFO, indicated that expenses would slightly increase due to marketing and technology investments and the addition of revenue-producing staff. He reassured that the increase would be gradual and aligned with the bank's growth strategy.
Q: How is customer demand and investment appetite, considering the broader industry trend of weak loan demand? A: Andrew Harmening, President and CEO, noted that despite macroeconomic awareness, the bank's focus on quality relationships and strategic hiring has led to steady growth. He remains optimistic about the bank's ability to attract quality loans and maintain strong growth momentum.
Q: What is the bank's exposure to the trucking and transportation industry, and how is it managing emerging risks in this sector? A: Patrick Ahern, Chief Credit Officer, stated that the exposure is relatively small at about $700 million in commitments. He mentioned that recent reviews have shown no significant emerging risks, and the bank feels confident about the stability of its portfolio in this sector.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
