First Financial Bancorp (FFBC, Financial) announced its financial results for Q3 2023 on October 24, 2023. The company reported net income of $63.1 million, or $0.66 per diluted common share, compared to net income of $65.7 million, or $0.69 per diluted common share, for the second quarter of 2023. For the nine months ended September 30, 2023, First Financial had earnings per diluted share of $2.09 compared to $1.57 for the same period in 2022.
Financial Highlights
The company's return on average assets for the third quarter of 2023 was 1.48%, while return on average tangible common equity was 23.60%. These compare to return on average assets of 1.55% and return on average tangible common equity of 25.27% in the second quarter of 2023.
First Financial Bancorp (FFBC, Financial) reported a net interest margin of 4.28%, or 4.33% on a fully tax-equivalent basis. The company saw a 15 bp decrease to 4.33% from 4.48% in the second quarter due to increasing deposit costs. However, higher asset yields significantly offset a 37 bp increase in the cost of deposits.
Loan Growth and Dividend Approval
The company reported moderate loan growth during the quarter, with loan balances increasing by $96.6 million compared to the first quarter, marking a growth of 3.6% on an annualized basis. The company's board of directors also approved a quarterly dividend of $0.23 per common share.
CEO Commentary
Archie Brown, President and CEO, commented on the quarter,
“Overall, I am pleased with our third quarter performance. Strong net interest income and robust fee income led to a 13% increase in net income from the third quarter of 2022. Adjusted return on assets was 1.49% and adjusted return on average tangible common equity was 23.8%. As expected, higher deposit costs led to a slight reduction in earnings on a linked quarter basis. Even so, our net interest margin was 4.33% for the quarter, which was at the high end of our expectations.”
Mr. Brown also noted that the company's fee income continued to exceed expectations this quarter, with strong performance from wealth management, equipment leasing, Bannockburn, and mortgage banking.
Looking Forward
Despite the challenges posed by the current economic environment, First Financial Bancorp (FFBC, Financial) remains confident in its performance and believes it is well-positioned to continue delivering strong results.
