TrustBank NY(TRST) - 2025 Q1 - Earnings Call Transcript

Financial Data and Key Metrics Changes - The company reported a net income of $14.3 million for Q1 2025, an increase of 17.7% compared to the same quarter last year [13] - Return on average assets and return on average equity were 0.93% and 8.49%, respectively, both up 27% year-over-year [8] - Consolidated equity to assets ratio was 10.85%, up 3% year-over-year, and shareholders' equity increased by 6% year-over-year [9][14] - Net interest income for Q1 2025 was$ 40.4 million, a 10.4% increase from the prior year [18] Business Line Data and Key Metrics Changes - Total loans increased by $104.7 million or 2.1% year-over-year, reaching an all-time high of$ 5.1 billion [15] - Home equity lines of credit grew by $61 million or 17.3%, while residential real estate loans increased by$ 26.2 million [16][24] - Commercial loans rose by $20.7 million or 7.5% compared to the same period in 2024 [16][24] Market Data and Key Metrics Changes - Total deposits reached$ 5.5 billion, up $142 million compared to the prior year [17] - The yield on interest-earning assets increased to 4.13%, while the cost of interest-bearing liabilities decreased to 1.92% [18] Company Strategy and Development Direction - The company is focusing on relationship banking and solid financial practices to navigate a complex economic environment [18] - A stock repurchase program of up to 1 million shares was announced, representing approximately 5% of current outstanding shares, aimed at enhancing shareholder value [15] Management's Comments on Operating Environment and Future Outlook - Management noted a strong local economy, particularly in the Capital District and Central Florida, which supports their lending activities [35][36] - The expectation for residential home prices is stable, with no significant increases anticipated [38] - The bank is preparing for potential interest rate reductions in 2025, which may provide opportunities to manage deposit costs effectively [19] Other Important Information - Non-performing loans remained flat at 0.37%, indicating strong asset quality [9][28] - Wealth Management division had approximately$ 1.1 billion in assets under management, with non-interest income increasing by 16.7% [20] Q&A Session Summary Question: Is the strong local economy specific to the Capital region or all markets? - Management indicated stability in strong markets, particularly in the Capital District and Central Florida, which are less affected by economic fluctuations [35][36] Question: What are the trends in residential home prices? - Management stated that home prices are stable, with no significant increases expected [38] Question: What changed regarding the share repurchase plan compared to last year? - Management noted that the 5% repurchase plan reflects a more favorable tone towards share repurchases this year, with an intent to fully execute [40] Question: What target capital ratio is being contemplated? - Management did not specify a target capital ratio but indicated room for additional repurchases while maintaining a strong capital position [42]