On July 22, 2024, Trustco Bank Corp N Y (TRST, Financial) released its 8-K filing for the second quarter of 2024. Trustco Bank Corp N Y is a savings and loan holding company that offers a range of personal and business banking services, including savings accounts, retirement accounts, money market accounts, mortgages, building loans, and auto loans. The company operates primarily in New York, Florida, Massachusetts, New Jersey, and Vermont.
Performance Overview
Trustco Bank Corp N Y reported a net income of $12.6 million or $0.66 diluted earnings per share (EPS) for Q2 2024, compared to $16.4 million or $0.86 diluted EPS for the same period in 2023. For the first six months of 2024, net income was $24.7 million or $1.30 diluted EPS, down from $34.1 million or $1.79 diluted EPS in the first half of 2023. Despite the year-over-year decline, the quarterly EPS of $0.66 exceeded the analyst estimate of $0.53.
Key Financial Metrics
Net interest income for Q2 2024 was $37.8 million, a 3.3% increase from the previous quarter, driven by loan growth and higher interest rates. The net interest margin improved to 2.53%, up from 2.44% in Q1 2024. Average loans grew by $182.2 million or 3.8% year-over-year, with residential loans and home equity lines of credit increasing by 2.1% and 20.1%, respectively. Average commercial loans also saw a 12.7% increase.
| Metric | Q2 2024 | Q1 2024 | Q2 2023 |
|---|---|---|---|
| Net Interest Income | $37.8 million | $36.6 million | $44.1 million |
| Net Income | $12.6 million | $12.1 million | $16.4 million |
| EPS (Diluted) | $0.66 | $0.64 | $0.86 |
| Net Interest Margin | 2.53% | 2.44% | 2.98% |
Challenges and Achievements
Trustco Bank Corp N Y faced challenges with a decline in net income and EPS compared to the previous year. However, the company achieved significant milestones, including a 3.7% increase in net interest margin and a 3.8% growth in average loans. The strategic decision to retain Visa Class C shares resulted in a $1.4 million gain, showcasing the company's effective asset management.
Chairman, President, and CEO, Robert J. McCormick stated, "Our success this quarter arises directly from our commitment to the core principles of Trustco Bank: competitive pricing and exceptional customer service. This clear mission focus enabled us to reach yet another milestone in our loan portfolio, as our residential, home equity, and commercial offerings all grew significantly over this time last year, reaching an all-time high for total loans."
Financial Position
Trustco Bank Corp N Y's asset quality remains strong, with a provision for credit losses of $500 thousand in Q2 2024. The allowance for credit losses on loans was $49.8 million, representing 0.99% of total loans. Non-performing loans (NPLs) were $19.2 million, or 0.38% of total loans, indicating stable credit quality. The company's equity to asset ratio improved to 10.73%, and the book value per share increased to $34.46.
Conclusion
Trustco Bank Corp N Y's Q2 2024 earnings report highlights the company's resilience and strategic growth in a challenging economic environment. The increase in net interest margin and loan growth, coupled with effective asset management, positions the company well for future performance. Investors and stakeholders will be keen to see how Trustco Bank Corp N Y navigates the remainder of the year.
Explore the complete 8-K earnings release (here) from Trustco Bank Corp N Y for further details.
