Yahoo Finance Ameris Bancorp (ABCB) Q1 2024 Earnings Call Transcript Highlights: Robust Growth and Strategic ...
Net Income: $74.3 million, or $1.8 per diluted share; adjusted net income of $75.6 million, or $1.10 per diluted share excluding FDIC special assessment.
Deposits Growth: 5.6% annualized increase, with over $46 million in noninterest bearing deposits.
Loan Growth: 6.5% annualized increase.
Net Interest Margin: Maintained at 3.51%.
Tangible Book Value: Increased by over 10.5% annualized to $34.52 per share.
TCE Ratio: 9.71%, exceeding the target of 9%.
Provision for Credit Losses: $21 million, coverage ratio at 1.55 of loans and 325% of portfolio NPAs.
Interest Income: Decreased by $2.8 million from the previous quarter.
Noninterest Income: Increased by $9.6 million, primarily in the mortgage division.
Total Assets: Ended the quarter at $25.7 billion, up from $25.2 billion at year-end.
Adjusted Efficiency Ratio: 54.56%, expected to remain below 55% for the year.
Stock Repurchase: $2.1 million of common stock purchased, with $94.7 million remaining available through end of October.
Release Date: April 26, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q & A Highlights
Q: Can you walk us through how you're viewing the margin over the next few quarters? And is it safe to say for Ameris to reach an inflection here, we might start to see that grow or is it too early for that? A: Nicole Stokes, CFO, noted cautious optimism about the margin, highlighting a decreasing beta and stable deposit mix. She mentioned that while it's premature to declare a definitive trend, the signs are encouraging with a slowed beta and stabilized deposit mix.
Q: Any comments on the outlook on mortgage and the open pipeline, and what is a good expectation for revenue growth this year, even if we don't get cuts? A: Palmer Proctor, CEO, expressed positivity about the mortgage outlook, though he cautioned that market rates heavily influence volume. He anticipates maintaining gain on sale margins between 2% and 2.5%, depending on market conditions.
Q: On the mortgage side, as production ramps up, is there going to be some expense growth related to that? And is the first quarter the expense run rate a good jumping off point for the rest of the year? A: Nicole Stokes explained that while mortgage expenses were well-controlled, increased production would naturally lead to higher related expenses. She also clarified that the first quarter included specific cyclical costs, suggesting a slight reduction in expenses in subsequent quarters.
Q: With about $10 billion of loans repricing within the year, what is the expected pickup in yield potential? A: Nicole Stokes detailed that a significant portion of the loan book is repricing soon, which could positively impact yields, especially as some fixed-rate loans behave like variable-rate loans due to their short duration.
Q: How are you managing the balance sheet given the uncertainty on rates, and what strategies are in place? A: Nicole Stokes highlighted the bank's strategic positioning with short-duration brokered and retail CDs, and a smaller-than-usual bond portfolio, which provides flexibility to adjust to rate changes effectively.
Q: Can you discuss the net interest margin possibly bottoming sooner and what that means going forward for PPNR ROA? A: Nicole Stokes expressed satisfaction with the current margin levels and anticipated minimal future compression. She underscored the strategic positioning of the bank's assets and liabilities to maintain a strong margin even late in the cycle.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
