Synovus Financial (US:SNV)2026-01-22 14:32Financial Data and Key Metrics Changes - Pinnacle reported Q4 Adjusted EPS of $2.24, stable quarter-over-quarter and up 18% year-over-year [10] - Net interest income increased 3% from Q3 and 12% year-over-year [10] - Period-end loans grew 3% from the prior quarter and 10% year-over-year [10] - Core deposit growth was 3% quarter-over-quarter and 10% year-over-year [10] - Adjusted non-interest revenue declined 6% from Q3 but increased 25% year-over-year [10] - Synovus reported Q4 adjusted diluted EPS of $1.45, stable quarter-over-quarter and up 16% year-over-year [11] Business Line Data and Key Metrics Changes - Legacy Pinnacle's adjusted diluted EPS grew by 22% in 2025, while Legacy Synovus grew by 28% [7] - Pinnacle's adjusted non-interest revenue growth was driven by higher service charges, wealth management revenue, and income from BHG, which contributed $31 million in fee revenue [11] - Synovus's adjusted non-interest revenue grew 6% from the prior quarter and 16% year-over-year to $144 million [12] Market Data and Key Metrics Changes - The merger between Pinnacle and Synovus was completed on January 1st, 2025, demonstrating effective integration [8] - Both organizations have successfully completed key milestones over the past two quarters, reinforcing a solid foundation for continued growth [8] Company Strategy and Development Direction - Pinnacle aims to produce strong, above-peer revenue, earnings per share, and tangible book value growth [5] - The company plans to hire 250 total revenue producers in 2026, with expectations of loan growth to reach $91 billion-$93 billion, up 9%-11% from year-end 2025 [17] - The focus is on delivering exceptional client service and industry-leading loyalty, as verified by external sources [5] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving loan growth targets despite a competitive backdrop, citing a positive client sentiment and a constructive environment [44] - The company anticipates net charge-offs to be in the range of 20-25 basis points for the year, consistent with 2025 performance [20] - Management is optimistic about the revenue synergies from the merger, expecting to exceed the $100 million-$130 million target over the next three years [74] Other Important Information - The CET1 ratio ended the quarter at 10.88% for Pinnacle and 11.28% for Synovus, with expectations of approximately 10% at the end of Q1 2026 [15][14] - A $400 million common share repurchase program has been authorized to manage capital in multiple growth scenarios [21] Q&A Session Summary Question: What can the combined bank not do today that it will be able to do a year from now post-conversion? - Management indicated that the transition to the nCino platform will introduce new capabilities and products, enhancing revenue synergies [33] Question: When do you think you would actually initiate buybacks? - Management stated that they would reassess buybacks later in the year, with no purchases expected in Q1 or Q2 due to capital accretion considerations [38] Question: Can you walk us through your confidence in achieving the loan growth target? - Management highlighted that Q4 already showed 10% loan growth and emphasized the importance of existing team members and recent hires in driving future growth [44] Question: What is the outlook for fee income guidance for the capital markets business? - Management expressed optimism about capital markets as a significant area of opportunity, expecting strong growth in capital markets fees in 2026 [52] Question: How do you plan to handle higher loan growth before deposit growth? - Management confirmed that they would use higher-cost sources to fund growth if necessary, but this is already factored into their guidance [66]