WINTRUST FINL(US:WTFCP)2024-10-21 21:31Financial Performance - Net income for the first nine months of 2024 was $509.7 million, or $7.67 per diluted common share, compared to $499.1 million, or $7.71 per diluted common share for the same period in 2023[1]. - Net income for Q3 2024 was $170.0 million, a 12% increase from $152.4 million in Q2 2024[49]. - Net income for the three months ended September 30, 2024, was $170,001 thousand, compared to $164,198 thousand for the same period last year, showing a growth of 3.4%[52]. - Net income applicable to common shares was $163.010 million in Q3 2024, up from $145.397 million in Q2 2024, representing a growth of 12.1%[57]. - Basic net income per common share for Q3 2024 was $2.51, an increase from $2.35 in Q2 2024, reflecting a rise of 6.8%[57]. Loan and Deposit Growth - Total loans increased by approximately $2.4 billion in Q3 2024, including $1.3 billion from the Macatawa acquisition; excluding Macatawa, total loans increased by $1.1 billion or 10% annualized[4]. - Total deposits rose by approximately $3.4 billion in Q3 2024, with $2.3 billion from Macatawa; excluding Macatawa, total deposits increased by $1.1 billion or 9% annualized[4]. - Total loans reached $47,067,447 thousand as of September 30, 2024, up from $41,446,032 thousand a year earlier, indicating a 13.6% increase[52]. - Total deposits increased to $51,404,966 thousand as of September 30, 2024, compared to $44,992,686 thousand a year earlier, marking a growth of 14.3%[52]. - Non-interest-bearing deposits remained at 21% of total deposits at the end of Q3 2024, increasing by $708 million compared to Q2 2024[5]. Interest Income and Margin - Net interest income increased to $502.6 million in Q3 2024, up from $470.6 million in Q2 2024, primarily due to average earning asset growth and the addition of Macatawa[6]. - Total interest income for Q3 2024 reached $908.604 million, an increase from $849.979 million in Q2 2024, representing a growth of 6.5%[57]. - The net interest margin for the three months ended September 30, 2024, was 3.49%, slightly down from 3.60% a year ago[52]. - The company anticipates net interest margin to remain in the 3.50% range in Q4 2024 and into 2025, supported by stable net interest margin and continued balance sheet growth[3]. Non-Interest Income and Expenses - Other income decreased by $5.1 million in Q3 2024 compared to Q2 2024, primarily due to a gain recognized in Q2 2024 from a loan sale transaction[33]. - Non-interest expenses totaled $360.7 million in Q3 2024, an increase of $20.3 million from $340.4 million in Q2 2024, with the Macatawa acquisition contributing approximately $10.1 million to this increase[35]. - Total Non-Interest Income for Q3 2024 was $113,147,000, a decrease of $8,000,000 (7%) compared to Q2 2024, but an increase of $669,000 (1%) compared to Q3 2023[90]. - Total Non-Interest Income for the nine months ended September 30, 2024, was $374,874,000, an increase of $41,597,000 (12%) compared to the same period in 2023[90]. Credit Quality and Allowance for Losses - Net charge-offs totaled $26.7 million in Q3 2024, a decrease from $30.0 million in Q2 2024, with net charge-offs as a percentage of average total loans at 23 basis points[25]. - Non-performing loans totaled $179.7 million, or 0.38% of total loans, at the end of Q3 2024, compared to $174.3 million, or 0.39% of total loans, at the end of Q2 2024[27]. - The allowance for credit losses was $436.2 million as of September 30, 2024, relatively unchanged from $437.6 million as of June 30, 2024[23]. - The allowance for loan losses as a percentage of loans at period end was 0.77% as of September 30, 2024, down from 0.81% in the previous quarter[81]. Acquisitions and Market Expansion - The acquisition of Macatawa is expected to enhance Wintrust's presence in the west Michigan market, leveraging a compatible management team and reputable brand[3]. - The company completed the acquisition of Macatawa on August 1, 2024, issuing approximately 4.7 million shares and recording goodwill of approximately $144.6 million[45]. - The company plans to continue its growth strategy, including potential acquisitions and expansion of its banking operations[101]. Operational Efficiency and Ratios - The efficiency ratio, which measures the cost to produce one dollar of revenue, is calculated using non-GAAP measures, excluding securities gains or losses[96]. - The efficiency ratio (GAAP) for Q3 2024 was 58.88%, up from 57.10% in Q2 2024, indicating a decrease in operational efficiency[97]. - Return on average common equity (annualized) was 11.63% for the three months ended September 30, 2024, slightly up from 11.61% in June 2024[98]. Risks and Regulatory Environment - The Company faces potential risks from economic conditions affecting liquidity and loan portfolio performance, including U.S. government debt defaults or rating downgrades[103]. - The Company must navigate regulatory changes that could impact its operations and compliance costs[106]. - Changes in interest rates and market volatility could materially affect the Company's net interest income and profitability[103].