The following is a summary of the Cullen/Frost Bankers, Inc. (CFR) Q1 2024 Earnings Call Transcript:

Financial Performance:

• Cullen/Frost reported Q1 earnings of $134 million or $2.06 per share, a decrease compared to earnings of $176 million or $2.70 per share in the same quarter last year.

• Q1 results were impacted by an additional FDIC insurance surcharge accrual of $7.7 million.

• The company experienced a return on average assets and average common equity in Q1 of 1.09% and 15.22%, respectively, and a net interest margin percentage of 3.48%, up 7 basis points from the previous quarter.

• The bank recorded average deposits in the first quarter of $40.7 billion, down 4.8% from last year, while average loans grew 10.4% to $19.1 billion compared to the previous year.

• The bank anticipates full-year average loan growth in the high single digits and a slightly upward trend in the net interest margin percentage each quarter for the remainder of the year.

Business Progress:

• Cullen/Frost reports success in its organic growth strategy, achieving positive results from expansions in the Houston and Dallas markets, exceeding deposit and loan goals.

• The bank added 6,600 net new checking accounts and saw an increase in average loan balances in Q1.

• The new marketing campaign and brand refresh were introduced with the aim of emphasizing customer service excellence.

• The company's credit quality is deemed to be in good health, with net charge-offs and new non-performing loans at acceptable levels.

• The bank grew by $145 million in new loan balances and $100 million in deposits from new relationships in the first quarter; a quarter of the loan growth is attributed to new customers.

• The company anticipates company-specific challenges on the C&I side, but they are confident these issues will be resolved, part of the normal risk in the banking business.

More details: Cullen/Frost Bankers IR

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