Q2 2024 Old National Bancorp Earnings Call Transcript
Key Points
- Earnings per share exceeded expectations due to better-than-expected revenue growth and lower expenses.
- Successful integration of CapStar Bank, expanding the franchise to southeastern markets.
- Strong deposit growth, with total deposits up $2.3 billion including CapStar.
- Solid credit performance with a low delinquency ratio and decreasing nonperforming loan ratio.
- Adjusted return on average tangible common equity was 17.2%, indicating strong profitability.
- Increased competition in deposit rates, leading to a 15 basis point increase in deposit costs.
- Criticized and classified loans increased by $75 million, primarily from CapStar and multifamily properties.
- Loan-to-deposit ratio ticked up modestly due to planned deposit runoff at CapStar.
- Noninterest-bearing deposit mix is expected to fall to 22% by year-end, indicating a shift in deposit composition.
- Prolonged higher interest rates have impacted some multifamily projects, leading to slower lease-up and tighter cash flow.
Welcome to the Old National Bancorp's second-quarter 2024 earnings conference call. This call is being recorded and has been made accessible to the public in accordance with the SEC's Regulation FD. Corresponding presentation slides can be found on the Investor Relations page at oldnational.com and will be archived there for 12 months.
Management would like to remind everyone that certain statements on today's call may be forward-looking in nature and are subject to certain risks, uncertainties, and other factors that could cause actual results or outcomes to differ from those disclosed.
The company refers you to its forward-looking statement legend in the earnings release and presentation slides. The company's risk factors are fully disclosed and discussed within its SEC filings.
In addition, certain slides contain non-GAAP measures, which management believes provides more appropriate comparisons. These non-GAAP measures are intended to assist investors' understanding of performance trends. Reconciliations for these numbers are contained with the appendix of the presentation.
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