Home Bancorp(US:HBCP)2025-04-22 15:30Financial Data and Key Metrics Changes - The company reported first quarter net income of $11 million, or $1.37 per share, representing a 13% increase from the fourth quarter and a 20% increase year-over-year [2] - Net interest margin (NIM) expanded for the fourth consecutive quarter to 3.91%, with return on assets (ROA) increasing by 17 basis points to 1.29% [3][10] - Loans grew by $29.1 million in the first quarter, approximately 4% annualized, with expectations of continued growth [3][12] - Deposits increased at a 7% annualized rate, with noninterest-bearing deposits making up 27% of total deposits [4][15] Business Line Data and Key Metrics Changes - Net interest income remained stable at $31.7 million in the first quarter compared to $31.6 million in the fourth quarter, with expectations for growth due to loan growth and increasing asset yields [12] - Noninterest income increased by $400,000 to $4 million in the first quarter, driven by a gain on the sale of SBA loans [17] - Noninterest expense decreased by $776,000 to $21.6 million, primarily due to a decline in compensation and benefits [18] Market Data and Key Metrics Changes - The company has seen strong performance in its Houston market, which has been a significant success since its acquisition three years ago [4] - The loan portfolio is 59% fixed, providing yield protection from further rate cuts [17] Company Strategy and Development Direction - The company is focused on expanding its physical footprint and enhancing customer relationships, particularly in the Houston market [5][8] - Management emphasizes a strong credit culture and customer service as key components of their strategy to outperform peers [8][20] Management's Comments on Operating Environment and Future Outlook - Management remains confident in the company's outlook, expecting NIM and earnings to continue to expand even without rate cuts [9][20] - The company is monitoring economic conditions and potential impacts from tariffs but maintains a positive outlook on loan growth [3][8] Other Important Information - The company repurchased 297,000 shares at an average price of $43.82 per share and has a new 400,000 share repurchase plan approved by the board [19][20] - Tangible book value per share has grown at a 7.7% annualized rate since 2019, with dividends increased by 21% [20] Q&A Session Summary Question: Can you touch on the go forward margin expectation after the improvement in the first quarter? - Management expects a slowdown in deposit costs in the second quarter, with stable to slightly increasing NIM anticipated even with a 25 basis point rate cut [25][30] Question: Can you discuss the two loan relationships that moved to non-accrual in the quarter? - One loan is related to a condominium development in Mississippi facing sales challenges, while the other is a hotel undergoing renovations in Houston [36][39] Question: What about the office portfolio and any recent maturities? - The office portfolio has performed well, with most matured loans renewing without significant movement [44] Question: Will CD pricing change this quarter? - CD rates are expected to remain slightly elevated but will likely decrease incrementally over the next quarter [46] Question: Do you plan to see the loan to deposit ratio come down over time? - The loan to deposit ratio is expected to remain tight until there is a noticeable decrease in loan demand [50]