WINTRUST FINL(US:WTFCP)2024-05-09 20:42Financial Performance - Wintrust recorded net income of $187.3 million for Q1 2024, a 4% increase from $180.2 million in Q1 2023[166]. - Net income for Q1 2024 totaled $187.3 million, an increase of $7.1 million, or 4%, compared to Q1 2023[185]. - Net income per diluted common share for Q1 2024 was $2.89, compared to $2.80 for Q1 2023[185]. - The increase in net income was primarily due to increased net interest income, higher mortgage banking revenue, and a $20.0 million gain from the sale of the RBA division[186]. - Return on average common equity fell to 14.42% in Q1 2024, down from 15.67% in Q1 2023[172]. - The effective tax rate decreased to 25.07% in Q1 2024 from 26.01% in Q1 2023, with income tax expense recorded at $62.7 million[211]. - The company recorded net excess tax benefits of $4.4 million in Q1 2024, compared to $2.8 million in Q1 2023, related to share-based compensation[213]. Loan and Deposit Growth - The loan portfolio increased to $43.2 billion at March 31, 2024, up from $39.6 billion a year earlier, reflecting organic growth in various segments[167]. - Total deposits increased by 9% to $46.4 billion at March 31, 2024, from $42.7 billion in the same period last year[172]. - Premium finance receivables originated in Q1 2024 reached $4.6 billion, compared to $3.8 billion in Q1 2023, indicating strong growth in the portfolio[224]. - Residential real estate loans averaged $2.7 billion in Q1 2024, an increase of $394.7 million, or 17%, from Q1 2023[223]. - As of March 31, 2024, total loans net of unearned income amounted to $43,230.7 million, with fixed rate loans at $17,370.5 million and variable rate loans at $25,860.2 million[227]. - Total average deposits for Q1 2024 were $44.6 billion, an increase of $2.6 billion, or 6%, from Q1 2023[246]. Income and Expenses - Net interest income for Q1 2024 was $464.2 million, a slight increase of 1% compared to $458.0 million in Q1 2023[168]. - Non-interest income rose to $140.6 million in Q1 2024, up from $107.8 million in Q1 2023, driven by a $20.0 million gain from the sale of the Retirement Benefits Advisors division[169]. - Non-interest expense increased by 11% to $333.1 million in Q1 2024, primarily due to higher salaries and employee benefits[170]. - Total non-interest expense for Q1 2024 was $333.15 million, an 11% increase from $299.17 million in Q1 2023[206]. - Salaries and employee benefits rose to $195.17 million in Q1 2024, a 10% increase from $176.78 million in Q1 2023, largely due to higher commissions and incentive compensation[207]. Asset Growth - Total assets grew by 9% to $57.6 billion at March 31, 2024, compared to $52.9 billion a year earlier[172]. - Total assets increased to $55.60 billion in Q1 2024 from $55.02 billion in Q4 2023 and $52.08 billion in Q1 2023[193]. - Average earning assets for Q1 2024 totaled $52.27 billion, compared to $51.51 billion in Q4 2023 and $48.81 billion in Q1 2023[193]. - The total equity increased to $5.44 billion in Q1 2024 from $5.07 billion in Q4 2023 and $4.90 billion in Q1 2023[193]. Credit Losses and Allowances - The allowance for credit losses is critical, representing management's estimate of expected credit losses over the life of financial assets[180]. - The allowance for credit losses at the end of the period was $427.175 million, up from $375.798 million in the previous year[242]. - The provision for credit losses for the three months ended March 31, 2024, was $21.691 million, compared to $23.070 million for the same period in 2023[242]. - The community banking segment recorded a provision for credit losses of $20.4 million in Q1 2024, down from $21.1 million in Q1 2023[215]. - The total charge-offs for the three months ended March 31, 2024, were $23.841 million, compared to $7.351 million for the same period in 2023[242]. Market and Economic Conditions - The company anticipates future financial performance to be influenced by economic conditions, housing prices, and job market trends, which may adversely affect liquidity and loan portfolio performance[263]. - The company expects potential increases in its allowance for credit losses due to defaults and losses on its loan portfolio[263]. - The company acknowledges the impact of competitive pressures in the financial services sector, which may affect pricing and market share[263]. - The company is monitoring the commercial real estate market conditions in the Chicago metropolitan area and southern Wisconsin[263]. Strategic Initiatives - The Company announced the acquisition of Macatawa Bank Corporation, which had approximately $2.7 billion in assets and $2.4 billion in deposits as of December 31, 2023[259]. - The company is focused on growth strategies, including plans to form additional de novo banks or branch offices[263]. - The company is preparing for the transition from LIBOR to an alternative benchmark rate for current and future transactions[265]. - The company recognizes the importance of attracting and retaining experienced senior management in the banking and financial services industries[265]. Risk Management - The company faces risks related to cybersecurity, including potential breaches and the impact of human error or cyberattacks[265]. - The company is evaluating the impact of heightened capital requirements and increased FDIC insurance premiums on its financial position[265].