Stellar Bancorp Inc (NYSE:STEL)
$ 26.78 -0.6 (-2.19%) Market Cap: 1.43 Bil Enterprise Value: 1.29 Bil PE Ratio: 12.51 PB Ratio: 0.92 GF Score: 66/100
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Q2 2024 Stellar Bancorp Inc Earnings Call Transcript

Jul 26, 2024 / 01:00PM GMT
Release Date Price: $27.93 (+1.49%)

Key Points

Positve
  • Stellar Bancorp Inc (STEL) reported a strong net income of $29.8 million for Q2 2024, up from $26.1 million in Q1 2024.
  • The company has successfully de-risked its balance sheet, bringing its commercial real estate portfolio within regulatory guidance.
  • Stellar Bancorp Inc (STEL) has maintained a solid net interest margin of 4.24% despite the challenging interest rate environment.
  • The company has seen stabilization in its non-interest-bearing deposits, which is a positive indicator for future funding costs.
  • Stellar Bancorp Inc (STEL) has been successful in attracting high-quality senior C&I talent, enhancing its operational capabilities.
Negative
  • Net interest income for the quarter decreased slightly to $101.4 million from $102.1 million in Q1 2024.
  • Non-interest income declined to $5.4 million from $6.3 million in the previous quarter, partly due to the absence of gains on asset sales.
  • The company experienced elevated payoffs in its loan portfolio, which contributed to a decline in loan balances.
  • Stellar Bancorp Inc (STEL) had to recognize an additional FDIC special assessment charge of $420,000 in Q2 2024.
  • The company's cost of deposits increased to 2.16%, reflecting the broader industry trend and impacting net interest margin.
Operator

Thank you for standing by. At this time, I'd like to welcome everyone to the Stellar Bancorp, Inc. Q2 2024 earnings call. (Operator Instructions) I'd now like to turn the call over to Courtney Theriot, Chief Accounting Officer. Please go ahead.

Courtney Theriot
Stellar Bancorp Inc - Executive Vice President-Chief Accounting Officer & Controller at Stellar Bank

Thank you, operator, and thank you, all, that have joined our call today. Good morning. Our team would like to welcome you to our earnings call for the second quarter of 2024. This morning's earnings call will be led by our CEO, Bob Franklin; and CFO, Paul Egge. Also in attendance today are Steve Retzloff, Executive Chairman of the company; Ray Vitulli, President of the company and CEO of the bank; and Joe West, Senior Executive Vice President and Chief Credit Officer of the bank.

Before we begin, I need to remind everyone that some of the remarks made today constitute forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995 as amended. We intend all such

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