S&T Bancorp(STBA)2024-10-31 21:09Financial Performance - For the three months ended September 30, 2024, total interest and dividend income was $131.474 million, compared to $122.959 million for the same period in 2023, representing a year-over-year increase of 10.3%[106] - Net interest income for the three months ended September 30, 2024, was $84.477 million, down from $87.387 million in the same period of 2023, reflecting a decrease of 2.1%[106] - Net income for the three months ended September 30, 2024, was $32.6 million, a decrease of 2.6% from $33.5 million in the same period in 2023[111] - Earnings per share (diluted) for the three months ended September 30, 2024, was $0.85, down from $0.87 in the same period in 2023[111] - Noninterest income decreased by $0.3 million, or 2.47%, for the three months ended September 30, 2024, compared to the same period in 2023[112] - Noninterest expense increased by $2.6 million, or 4.86%, for the three months ended September 30, 2024, compared to the same period in 2023[112] Asset and Liability Management - As of September 30, 2024, S&T Bancorp, Inc. has total assets of $9.6 billion[110] - Total assets increased to $9,573,413,000, while total liabilities and shareholders' equity also rose to $9,573,413,000[118] - Total loans increased to $7.67 billion for the three months ended September 30, 2024, compared to $7.41 billion in the same period in 2023[115] - Total deposits increased by $133.1 million to $7.65 billion at September 30, 2024, compared to December 31, 2023, representing a growth of 1.8%[142] - Customer deposits grew by $333.4 million, or 4.7%, compared to December 31, 2023, driven by a focus on expanding the deposit franchise[143] - Total borrowings decreased by $165.2 million to $338.4 million at September 30, 2024, primarily due to strong growth in customer deposits[144] Credit Quality - The provision for credit losses decreased to a negative $0.5 million for the three months ended September 30, 2024, compared to $5.5 million for the same period in 2023[112] - Net loan charge-offs were $2.1 million for the three months ended September 30, 2024, compared to $3.7 million for the same period in 2023[123] - Nonaccrual loans increased to $31.9 million at September 30, 2024, compared to $22.9 million at December 31, 2023, primarily due to a $16.3 million commercial real estate relationship[140] - The allowance for credit losses (ACL) decreased to $104.3 million, or 1.36% of total portfolio loans, down from $108.0 million or 1.41% at December 31, 2023[139] Strategic Focus - The company aims to focus on deposit franchise, core profitability, asset quality, and talent engagement as strategic priorities for 2024 and beyond[110] - The bank's asset-sensitive balance sheet implies that in a rising interest rate environment, net interest income and operating income are expected to increase[158] Regulatory Capital - The leverage ratio improved to 11.70% at September 30, 2024, compared to 11.21% at December 31, 2023, exceeding the well-capitalized regulatory guideline of 5.00%[151] - The risk-based Common Equity Tier 1 ratio increased to 14.37% at September 30, 2024, compared to 13.37% at December 31, 2023, also above the well-capitalized regulatory guideline of 6.50%[151] Interest Rate Sensitivity - The rate shock analysis indicated a 2.0% increase in pretax net interest income over 1-12 months with a 400 basis point increase in interest rates as of September 30, 2024[156] - The economic value of equity (EVE) showed a decline of 32.3% with a 400 basis point increase in interest rates over the 1-12 month period[156] - The percentage change in pretax net interest income in the rates down scenarios showed a decline due to changes in the bond portfolio mix and upcoming maturities[158] Market Risk Management - The bank's market risk stress tests include sensitivity analyses and simulations to identify the impact of interest rate changes on earnings and capital[158] - The company performs a market risk stress test at least annually, which includes sensitivity analyses and simulations[158]