Evans Bank(US:EVBN)2019-04-25 02:40Financial Data and Key Metrics Changes - The company reported net income of $3.7 million for Q1 2019, a 12% increase compared to $3.3 million in Q1 2018, driven by higher net interest and fee income [5][14] - Net interest income increased by $1.1 million or 9% year-over-year, with a net interest margin of 3.79%, up from 3.77% in Q1 2018 [17][19] - Total deposits grew by $61 million or 5% in the quarter, reaching $1.3 billion, and were $141 million or 12% higher than the previous year [15] Business Line Data and Key Metrics Changes - Commercial loans grew by $29 million, reflecting an annualized growth rate of 10%, with significant contributions from commercial real estate and C&I loans [15][20] - Noninterest income for the quarter was $4.2 million, up over $400,000 from the previous year, with insurance revenue increasing to $2.4 million due to the acquisition of Richardson & Stout Agency [22][23] Market Data and Key Metrics Changes - The company experienced solid growth in its commercial deposit portfolio, including $25 million in savings deposits, while consumer savings deposits declined by $8 million [16] - The competitive environment for funding remains robust, with a focus on acquiring and defending core deposit relationships [19] Company Strategy and Development Direction - The company is focused on attracting experienced commercial loan personnel, which has led to a 10% annualized growth rate in commercial loans [6] - The strategy includes diversifying loan classes, with 65% of loan production in the quarter coming from C&I loans [10] Management's Comments on Operating Environment and Future Outlook - Management noted a strong commercial loan pipeline and little indication of inherent weakness in the local economy, despite mixed economic signals [9] - The company expects net interest margin to remain stable, with a moderate level of compression anticipated for the remainder of the year [11][19] Other Important Information - The company filed a $50 million shelf registration to replace an expiring registration, providing a tool for future capital needs [12] - Nonperforming loans increased slightly to 1.69%, with confidence in overall credit quality maintained [21] Q&A Session Summary Question: Was there anything in the margin this quarter that could be considered noncore? - Management confirmed that the margin was clean without noncore items [27] Question: Is the 3 to 5 basis points of compression over the remainder of the year? - Yes, it is over the remainder of the year [28] Question: Will there be any more pickup in the yield on loans? - Some increase in loan yields is expected, but compression is anticipated compared to the cost of funds [30] Question: How is the contribution from Richardson & Stout? - The contribution is around $480,000 to $500,000 for the quarter [32] Question: What is the tax rate for the remainder of the year? - The expected tax rate is typically between 23% to 24% [34]