Yahoo Finance Community Bank System Inc (CBU) (Q1 2024) Earnings Call Transcript Highlights: Record Revenues ...
GAAP Diluted EPS: $0.76 for Q1 2024, up from $0.11 in Q1 2023
Operating Diluted EPS: $0.82 for Q1 2024, compared to $0.92 in Q1 2023
Total Revenue: $177.3 million in Q1 2024, setting a new quarterly record
Net Interest Income: $107 million in Q1 2024, down from $111 million in Q1 2023
Loan Growth: Increase of $179 million, funded by deposit growth of $424 million
Provision for Credit Losses: $6.1 million in Q1 2024, up from $3.5 million in Q1 2023
Effective Tax Rate: 22.9% for Q1 2024, increased from 16.9% in Q1 2023
Branch Expansion: 14 new locations planned in the next five quarters
Share Repurchases: 750,000 shares at an average price of approximately $46 per share
Release Date: April 23, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q & A Highlights
Q: OpEx this quarter was much better than expected. What are your expectations for the OpEx run rate going forward? A: (Joseph Sutaris, EVP & CFO) We expect the OpEx run rate to be contained within our historic mid-single digits, around 3% to 6%. Last year's increased OpEx was due to investments in infrastructure, talent, and technology, but we anticipate these costs to moderate in 2024.
Q: Any updated thoughts on the pace of buybacks given strong loan growth? A: (Joseph Sutaris, EVP & CFO) The pace of buybacks will likely slow. We took advantage of favorable levels this quarter but generally aim to buy back shares to offset equity plan issuance and potentially a bit more.
Q: Could you discuss the current loan pipeline and economic activity? A: (Dimitar Karaivanov, CEO) Our loan pipeline is stronger than last year, particularly in commercial lending, which has shifted significantly from commercial real estate to C&I. The economic activity in our markets remains robust, offering numerous market share opportunities.
Q: What are the current add-on rates for new loans? A: (Dimitar Karaivanov, CEO) The add-on rate for new loans is in the mid-sevens, consistent with previous quarters.
Q: How do you see the margin evolving in a higher for longer rate environment? A: (Joseph Sutaris, EVP & CFO) We expect net interest income to increase and outpace 2023 results, despite potential continued pressure on funding costs. Loan growth and a shift in earning asset yields should help mitigate some of the impacts of higher rates.
Q: Can you provide an update on revenue growth in the insurance and employee benefits sectors? A: (Dimitar Karaivanov, CEO) We anticipate high single-digit growth in the insurance sector and strong performance in employee benefits, driven by new clients and favorable market conditions. The acquisition of Creative Plan Designs will also contribute positively in the latter half of the year.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
