The following is a summary of the United Community Banks, Inc. (UCBI) Q1 2024 Earnings Call Transcript:
Financial Performance:
United Community Banks reported operating earnings per share at $0.52, a decrease compared to the previous quarter due to increased employment costs.
A slight increase was seen in the bank's operating return on assets from 92 to 93 basis points.
The bank's net interest margin showed minor improvement with a rise of 1 basis point on a GAAP basis and 2 basis points on a core basis.
Loan growth was reported at a lower-than-expected 1.2%, but there was solid core deposit growth outside of the high-rate public funds portfolio.
The company reported $12.9 million in net charge-offs, with a steady quarter-to-quarter allowance for credit losses.
Business Progress:
The bank is refining its loan and deposit pricing strategies to adjust to the high-for-longer rate environment.
United Community Bank reported a strong liquidity position with a loan-to-deposit ratio of 79% and practically no wholesale borrowings.
The bank's loan portfolio is less reliant on commercial real estate compared to its peers.
United bank was recognized by J.D. Power for its retail banking satisfaction in the Southeast for 2023.
There's anticipation of single-digit loan growth exceeding Q1's figures, unless the Fed intervenes.
Multiple efficiency projects are underway for improved results through technology implementation and process optimization.
There is a potential slowdown in loan yield in Q3 and Q4 if growth doesn't pick up. Pricing strategies are shifting with a larger focus on Commercial and Industrial loans over Commercial Real Estate lending.
More details: United Community Banks IR
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