On July 24, 2024, Amerant Bancorp Inc (AMTB, Financial) released its 8-K filing for the second quarter of 2024. Amerant Bancorp Inc is a bank holding company that provides deposit, credit, investment, wealth management, and fiduciary services to individuals and businesses in the United States and select international markets.
Performance Overview
Amerant Bancorp Inc (AMTB, Financial) reported net income attributable to the company of $5.0 million, or $0.15 per diluted share, for Q2 2024. This represents a significant decline from the $10.6 million, or $0.31 per diluted share, reported in Q1 2024. The reported earnings per share (EPS) fell short of the analyst estimate of $0.37.
Key Financial Metrics
| Metric | Q2 2024 | Q1 2024 |
|---|---|---|
| Total Assets | $9.7 billion | $9.8 billion |
| Total Gross Loans | $7.32 billion | $7.01 billion |
| Total Deposits | $7.82 billion | $7.88 billion |
| Net Interest Income | $79.4 million | $78.0 million |
| Provision for Credit Losses | $19.2 million | $12.4 million |
| Non-Interest Income | $19.4 million | $14.5 million |
| Non-Interest Expense | $73.3 million | $66.6 million |
Financial Achievements and Challenges
Amerant Bancorp Inc (AMTB, Financial) achieved strong loan growth in Q2 2024, with total gross loans increasing by $316.5 million, or 4.5%, compared to Q1 2024. The average yield on loans also saw a slight increase to 7.08% from 7.05% in the previous quarter. However, the company faced challenges with higher provisions for credit losses, which rose by $6.8 million, or 54.8%, primarily due to a downgraded legacy commercial credit.
"The Company had strong loan growth in the second quarter, as well as significantly higher pre-provision net revenue, excluding the impact of previously disclosed deal charges from the sale of our Houston franchise," stated Jerry Plush, Chairman and CEO. "However, the provision for credit losses was higher than the first quarter, primarily related to a legacy commercial credit that, while paying as agreed, was downgraded based on the receipt of updated financial information. We are actively working toward reaching a positive resolution on this credit, as we remain focused on executing on our strategic plan."
Income Statement Highlights
Net interest income (NII) for Q2 2024 was $79.4 million, up 1.8% from $78.0 million in Q1 2024. The net interest margin (NIM) improved to 3.56% from 3.51% in the previous quarter. Non-interest income increased significantly by 33.8% to $19.4 million, driven by higher fee income and other non-interest income sources.
Balance Sheet and Cash Flow
Total assets decreased slightly by 1.0% to $9.7 billion, while total deposits fell by 0.8% to $7.82 billion. The loan-to-deposit ratio increased to 93.69% from 88.93% in Q1 2024, indicating a higher utilization of deposits for lending activities. Cash and cash equivalents saw a substantial decline of 52.8% to $310.3 million.
Asset Quality and Capital Ratios
Total non-performing assets rose sharply by 139.9% to $121.1 million, primarily due to downgrades of certain loans based on updated financial information. The allowance for credit losses decreased slightly to $94.4 million. The company's capital ratios remained robust, with a total capital ratio of 12.00% and a Tier 1 capital ratio of 10.44%.
Dividend Declaration
The Board of Directors declared a quarterly cash dividend of $0.09 per common share, payable on August 30, 2024, to shareholders of record on August 15, 2024.
For more detailed information, please refer to the 8-K filing.
Explore the complete 8-K earnings release (here) from Amerant Bancorp Inc for further details.
