Q2 2024 Webster Financial Corp Earnings Call Transcript
Key Points
- Webster Financial Corp (WBS) announced a private credit joint venture with Marathon Asset Management, enhancing balance sheet flexibility and adding new sources of fee income and deposit opportunities.
- The company hired Neil Holland as the new Chief Financial Officer, bringing extensive experience from First Republic and MUFG.
- Bill Haas joined the Board of Directors, adding significant regulatory and risk management expertise from his 38-year career at the OCC.
- Core deposits grew by $700 million, and loans increased by $500 million, with growth expected to continue in the second half of the year.
- Investments in technology at HSA Bank are yielding positive results, with significant client wins and a new investment offering expected to add $400 million in deposits.
- Net interest income (NII) performance has not met earlier expectations due to slower private equity activity and competition from private credit markets.
- The office portfolio saw several loans move to non-accrual status, increasing overall non-performing loans (NPLs) for the quarter.
- The company experienced a $49 million pretax charge due to the repositioning of its securities portfolio.
- Commercial classified loans increased, particularly in the healthcare and office sectors, reflecting ongoing challenges in these areas.
- The efficiency ratio increased slightly, and adjusted non-interest income was down $5 million, driven by lower BOLI income and reduced deposit and customer hedging activity.
Good morning. Welcome to the Webster Financial Corporation 2Q 2024 earnings. Please note, this event is being recorded.
I would now like to introduce Webster's Director of Investor Relations, Emlen Harmon, to introduce the call. Mr. Harmon, please go ahead.
Good morning. Before we begin our remarks, I want to remind you that the comments made by management may include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and are subject to the Safe Harbor rules. Please review the forward-looking disclaimer and Safe Harbor language in today's press release and presentation for more information about risks and uncertainties, which may affect us.
The presentation accompanying management's remarks can be found on the company's Investor Relations site at investors.websterbank.com. (Event Instructions)
I will now turn the call over to Webster Financial CEO, John Ciulla.
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