Amerant Bancorp (US:AMTB)2022-04-21 18:53Financial Data and Key Metrics Changes - Net income attributable to the company was $16 million, down 75% quarter-over-quarter, primarily due to a one-time gain on the sale of the headquarters building recorded in the fourth quarter of 2021 [7] - Core PPNR was $17.9 million, down by 5.5% compared to the previous quarter [10] - Total gross loans were $5.72 billion, up from $5.57 billion last quarter, despite $253 million in loan prepayments and the sale of $57.3 million from the former New York City loan production office [8] - Total deposits were $5.69 billion, up $16.8 million compared to last quarter, with core deposits increasing by $150.4 million [8][13] Business Line Data and Key Metrics Changes - Amerant Mortgage closed 157 loans for a total of $93.6 million in the first quarter, with a current pipeline showing over $94 million in process [16] - The loan portfolio saw total loan growth of $5.7 billion, up 3% compared to the last quarter, with consumer loans increasing by $62 million or 15% quarter-over-quarter [18] - Non-interest income in the first quarter was $14 million, down 82% from the previous quarter, primarily due to the absence of a $62 million gain from the sale of the headquarters [27] Market Data and Key Metrics Changes - Domestic deposits accounted for 56% of total deposits, totaling $3.2 billion, up $43 million or 1.4% compared to the previous quarter [13] - Foreign deposits, which account for 44% of total deposits, totaled $2.5 billion, slightly up by $18 million over the quarter [13] Company Strategy and Development Direction - The company is focused on transforming its operations to better position itself for success, with a commitment to executing its strategic priorities throughout 2022 [6] - A new head of retail banking has been hired to drive a sales-focused culture in branches, and the company is expanding its loan production office in Tampa [12][34] - The company aims to maintain a loan-to-deposit ratio in the 95% to 100% range, focusing on generating non-interest bearing deposit relationships [62] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about loan growth expectations, projecting higher growth rates in the double-digit range moving forward [38] - The company is aware of the challenges posed by rising interest rates but believes it has absorbed most of the shock from recent rate increases [42] - Management emphasized the importance of maintaining a focus on growth while continuing to transform the organization [35] Other Important Information - The company initiated a new $50 million share repurchase program, with $32.7 million used under this authorization as of quarter-end [9] - The efficiency ratio was 87.3% in the first quarter, up from 41.4% in the previous quarter, primarily due to the absence of the gain from the headquarters sale [30] Q&A Session Summary Question: Loan growth expectations - Management indicated expectations for higher loan growth rates, projecting double-digit growth moving forward [38] Question: Capital and share repurchase rationale - Management discussed the impact of interest rate shocks on capital and emphasized a selective approach to share repurchases while maintaining liquidity [42][43] Question: Transformation progress - Management described the company as being in the middle innings of its transformation, with many goals close to being achieved [44][46] Question: Mortgage business breakeven timeline - Management expressed commitment to the mortgage division and anticipated closer proximity to breakeven in the second quarter [51][52] Question: Deposit pricing changes - Management noted specific adjustments to large relationships tied to fed funds but indicated no widespread increases in deposit rates [67]