HomeStreet(HMST) - 2024 Q4 - Annual Results

Financial Performance - HomeStreet reported a net loss of $123.3 million in Q4 2024, compared to a net loss of $7.3 million in Q3 2024, resulting in a net loss per fully diluted share of $6.54[1]. - For the full year 2024, the net loss was $144.3 million, with a net loss per fully diluted share of $7.65, compared to a net loss of $27.5 million and $1.46 per share in 2023[2]. - The company reported a net loss of $123,327,000 for Q4 2024, compared to a net loss of $3,419,000 in Q4 2023, marking a substantial increase in losses[12]. - The company reported a net loss of $144,344 thousand for the year 2024, compared to a net loss of $27,508 thousand in 2023, representing a significant increase in losses[17]. - Core net loss for the quarter ended December 31, 2024, was $(123,327), compared to $(7,282) in the previous quarter[60]. - The core net loss for Q4 2024 was $5.1 million, a slight improvement from $6.0 million in Q3 2024, primarily due to increased net interest income and reduced noninterest expenses[21]. Asset and Liability Management - Total assets as of December 31, 2024, were $8,123,698,000, down from $9,392,450,000 as of December 31, 2023, reflecting a decrease of 13.5%[13]. - Total liabilities decreased to $7,726,701 thousand in 2024 from $8,854,063 thousand in 2023, a reduction of about 12.7%[16]. - Total deposits decreased by $33 million, with uninsured deposits at $581 million, representing 9% of total deposits[3]. - Deposits fell to $6,413,021 thousand in 2024, down from $6,763,378 thousand in 2023, a decrease of approximately 5.2%[16]. - Total assets decreased by $1.3 billion in 2024, largely due to the $990 million sale of multifamily loans and a $221 million decrease in investment securities[34]. - Total liabilities decreased by $1.1 billion in 2024, driven by a $745 million decrease in borrowings and a $350 million decrease in deposits[34]. Income and Expenses - Net interest income for Q4 2024 was $29,616,000, a decrease from $34,989,000 in Q4 2023, representing a decline of 15.4% year-over-year[12]. - Noninterest income for Q4 2024 was a loss of $78,124,000, compared to a gain of $10,956,000 in Q4 2023, indicating a significant downturn[12]. - The company experienced a total noninterest income loss of $44,385 thousand for the year ended December 31, 2024, compared to a gain of $41,921 thousand in 2023[17]. - Interest expense increased to $282,486 thousand in 2024, up from $232,990 thousand in 2023, reflecting a rise of about 21.2%[17]. - Noninterest expenses were reduced by $45.7 million in 2024, primarily due to a $39.9 million goodwill impairment charge in 2023[33]. Credit Quality and Allowances - The allowance for credit losses to LHFI was 0.63%, with nonperforming assets to total assets at 0.71%[3]. - The allowance for credit losses (ACL) was $38,743,000 as of December 31, 2024, slightly down from $40,500,000 as of December 31, 2023[13]. - The provision for credit losses was zero in 2024, compared to a provision of $441 thousand in 2023, indicating a change in credit loss expectations[17]. - The ratio of nonperforming assets to total assets rose to 0.71% as of December 31, 2024, up from 0.45% as of December 31, 2023, indicating a deterioration in asset quality[13]. Equity and Book Value - The tangible book value per share decreased to $20.67 as of December 31, 2024, from previous levels due to cumulative losses and market conditions[6]. - The company’s total shareholders' equity decreased to $396,997,000 as of December 31, 2024, from $538,387,000 as of December 31, 2023, a decline of 26.2%[13]. - The book value per share was $21.05 as of December 31, 2024, down from $28.62 as of December 31, 2023, representing a decrease of 26.5%[13]. Future Outlook - HomeStreet anticipates continuous growth in earnings for the foreseeable future, supported by effective noninterest expense management and expected reductions in short-term interest rates[1]. - The company anticipates potential challenges due to changes in the interest rate environment and economic conditions, which may affect future performance[63]. - The company has highlighted the importance of managing operating costs and credit quality to mitigate risks associated with economic fluctuations[64]. - The company plans to continue focusing on market expansion and new product development to enhance future performance[58].