WINTRUST FINL(US:WTFCP)2023-11-08 22:11Financial Performance - Wintrust recorded net income of $164.2 million for Q3 2023, a 15% increase from $143.0 million in Q3 2022[185]. - Net income for Q3 2023 totaled $164.2 million, an increase of $21.2 million, or 15%, compared to Q3 2022[205]. - Comprehensive income for Q3 2023 was a loss of $4.4 million, significantly improved from a loss of $72.7 million in Q3 2022[185]. - Return on average common equity rose to 13.35% for Q3 2023, compared to 12.31% in Q3 2022, indicating improved profitability[191]. - The wealth management segment's net income for Q3 2023 was $8.5 million, down from $11.1 million in Q3 2022, with year-to-date net income totaling $23.6 million compared to $28.1 million in the same period last year[244]. Income and Expenses - Net interest income for Q3 2023 was $462.4 million, a 15% increase compared to $401.4 million in Q3 2022, driven by a $3.3 billion increase in average loans[187]. - Non-interest income rose to $112.5 million in Q3 2023, up from $101.5 million in Q3 2022, attributed to increased fees from covered call options and operating lease income[188]. - Non-interest expense totaled $330.1 million in Q3 2023, an 11% increase from $296.5 million in Q3 2022, primarily due to higher salaries and employee benefits[189]. - The efficiency ratio (GAAP) for Q3 2023 was 57.18%, compared to 58.59% in Q3 2022, indicating improved operational efficiency[206]. Asset and Loan Growth - The loan portfolio increased to $41.4 billion as of September 30, 2023, up from $39.2 billion at December 31, 2022, reflecting organic growth in various portfolios[186]. - Total assets increased by 6% to $55.6 billion as of September 30, 2023, compared to $52.4 billion at the end of 2022[191]. - Total earning assets for Q3 2023 were $51.01 billion, compared to $49.36 billion in Q2 2023 and $47.75 billion in Q3 2022[212]. - Total average loans reached $39.97 billion, accounting for 80% of total average earning assets, compared to $36.05 billion and 77% in the previous year[254]. Credit Losses and Non-Performing Loans - The allowance for credit losses was determined to be 380.69% of nonaccrual loans as of September 30, 2023, down from 414.09% as of June 30, 2023[269]. - As of September 30, 2023, total non-performing loans amounted to $133.1 million, an increase from $108.7 million as of June 30, 2023, representing a 22.4% increase[269]. - The total allowance for credit losses for commercial and commercial real estate loans increased to $367.2 million as of September 30, 2023, compared to $286.0 million in 2022[261]. - The community banking segment recorded a provision for credit losses of $16.7 million for Q3 2023, compared to $3.6 million in Q3 2022, reflecting a significant increase due to macroeconomic deterioration and loan growth[241]. Deposits and Funding - Total deposits grew to $44.99 billion as of September 30, 2023, a 5% increase from $42.8 billion at the end of 2022[191]. - Brokered deposits as of September 30, 2023, were $3.69 billion, representing 8.2% of total deposits[281]. - The company had approximately $15.3 billion of uninsured deposits as of September 30, 2023, representing about 28% of total deposits[283]. - Total funding as of September 30, 2023, was $48.7 billion, an increase from $46.3 billion at September 30, 2022[245]. Capital and Regulatory Environment - The Tier 1 capital ratio as of September 30, 2023, was 10.2%, up from 9.9% a year earlier, indicating a strengthening of the company's capital position[288]. - The company emphasizes the importance of its ability to raise additional capital on acceptable terms when needed[299]. - Regulatory changes may impact the Company's ability to market products and operate its mortgage business profitably[299]. - The Company is subject to increased costs of compliance and heightened regulatory capital requirements[299]. Market and Economic Conditions - Key macroeconomic variables, such as the Baa corporate credit spread, significantly impact the estimate of allowance for credit losses[202]. - The severity and duration of the COVID-19 pandemic continue to pose risks to the Company's financial results and operations[299]. - Disruptions in capital markets may lower fair values for the Company's investment portfolio[299].