NBT Bancorp (US:NBTB)2024-01-24 18:19Financial Data and Key Metrics Changes - The fourth quarter earnings per share were $0.64, with operating earnings per share at $0.72, excluding acquisition expenses and impairment charges [80] - Return on tangible equity was 15.78% for the full year, and the year-end tangible equity ratio grew 11% to 7.93% [76] - Tangible book value per share increased to $21.72, up $1.33 from the third quarter and $1.07 from the fourth quarter of 2022 [8] Business Line Data and Key Metrics Changes - Total loans increased by $1.5 billion from the fourth quarter of 2022, including $1.18 billion from the Salisbury acquisition [95] - Revenues from retirement plan administration decreased by $1.6 million from the third quarter, reflecting seasonal trends [12] - Non-interest income was $38 million, up 11% year-over-year but down 6% from the linked third quarter [84] Market Data and Key Metrics Changes - Total deposits reached $11 billion, up $1.5 billion in 2023, including $1.3 billion from the Salisbury acquisition [9] - Municipal deposits declined by $225 million from the seasonally high third quarter [96] - The cost of total deposits increased by 251 basis points compared to the linked third quarter [10] Company Strategy and Development Direction - The successful integration of the Salisbury acquisition positions the company for growth in adjacent markets and future strategic growth [91] - The company aims for mid-single-digit loan growth in 2024, with expectations of a stronger performance in business banking [18] - The company is focused on maintaining strong liquidity and capital levels while managing funding costs effectively [83] Management's Comments on Operating Environment and Future Outlook - Management noted that market volatility and uncertainty have pressured funding costs, impacting net interest margins [14] - The company expects modest additional funding pressures to persist in 2024, but remains optimistic about organic growth [83] - Management highlighted a resilient consumer and business environment, with continued investment in small businesses [91] Other Important Information - The company declared a $0.32 dividend, representing a 6.7% increase over the previous quarter, marking 11 consecutive years of annual dividend increases [6] - The company recorded a loan loss provision expense of $5.1 million in the fourth quarter, higher than the previous quarter [39] Q&A Session Summary Question: What are the expectations for funding costs in the first half of the year? - Management indicated that total deposit costs ended the quarter at approximately $155 million, with stability expected in funding costs moving forward [16] Question: How does the company view the loan pipeline and growth outlook? - Management expressed confidence in mid-single-digit growth for 2024, despite a slight decrease in year-over-year pipelines entering the first quarter [18] Question: What is the outlook for charge-offs as the Springstone portfolio winds down? - Management anticipates that charge-offs will decrease as the portfolio reduces, maintaining a range of $2.5 million to $3 million per quarter [122]