Ameris Bancorp(US:ABCB)2022-01-28 20:55Financial Data and Key Metrics Changes - For 2021, the company reported a record net income of $368.7 million or $5.29 per diluted share, a 22% increase over 2020 [6][19] - The fourth quarter net income was $81.5 million or $1.17 per diluted share, with a return on average assets (ROA) of 1.40% and a return on tangible equity (ROTCE) of 16.88% [7][17] - The tangible book value increased by over 10% in 2021, ending at $26.26 [20] Business Line Data and Key Metrics Changes - Loan growth for the fourth quarter was over $383 million, representing over 10% annualized growth, with full-year loan growth at $1.4 billion or 10.5% excluding PPP runoff [7][40] - Noninterest income increased by $5.2 million for the quarter, with a significant recovery in servicing rights [31] - Retail mortgage originations as a percentage of pre-provision pre-tax income declined to 13%, down from 50% last year [32] Market Data and Key Metrics Changes - Total deposits approached $20 billion, with noninterest-bearing deposits accounting for over 39% of total deposits [8][41] - The company experienced a deposit growth of $832 million in the fourth quarter, with significant contributions from both noninterest-bearing and interest-bearing deposits [41] Company Strategy and Development Direction - The acquisition of Balboa Capital Corporation is expected to enhance the company's technology and revenue generation, targeting $70 million in revenue from Balboa [13][67] - The company aims to maintain a sub 55% efficiency ratio while focusing on organic growth and leveraging technology across its operations [36][66] - The company is positioned for loan growth in the upper single digits for 2022, with a strong loan pipeline and asset-sensitive balance sheet [8][14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's performance in 2022, citing strong fundamentals and a robust loan pipeline [15][42] - The company anticipates net interest income (NII) to increase by 6% to 7% in a rising rate environment, with every 25 basis points of rate movement expected to increase NII by about $9.5 million to $10 million [28][74] - Management acknowledged competitive pressures on pricing but indicated a disciplined approach to maintaining margins [59][60] Other Important Information - The company repurchased 1.3 million shares during the fourth quarter, with approximately $78 million remaining on the share repurchase program [10] - The allowance for loan losses was $167.6 million at year-end, reflecting net recoveries for the second consecutive quarter [30] Q&A Session Summary Question: Outlook for mortgage volume and gain on sale - Management remains encouraged by the mortgage contribution, expecting normalization in seasonality and strong performance in subsequent quarters [45] Question: Plans for growing the bond book - The company has about $3 billion in excess liquidity and aims to increase its bond portfolio to around 7.5% of total assets [46] Question: Impact of NSF fees and overdraft - NSF fees accounted for about $16 million in 2021, with a budgeted decline of 25% anticipated [48] Question: Increase in problem loans - The increase was attributed to purchased credit deteriorated loans from Balboa and loans under CARES Act provisions [50] Question: Acquisition interest going forward - The company remains focused on integrating Balboa but is open to future acquisition opportunities [51] Question: Revenue expectations from Balboa - The anticipated revenue from Balboa includes both net interest income and fee income, with expectations of significant contributions [54]