Renasant (US:RNST)2024-01-24 18:01Financial Data and Key Metrics Changes - The fourth quarter earnings were $28.1 million or $0.50 per diluted share, with an adjusted EPS of $0.76, reflecting a $0.20 increase from the previous quarter [45] - Total footings increased just under $180 million for the quarter, with loan growth of $183 million representing an annualized growth rate of 6% [50] - Adjusted net interest margin was 3.29%, down 6 basis points from Q3, while adjusted loan yields increased 10 basis points [54] Business Line Data and Key Metrics Changes - Income from the mortgage division, excluding the MSR gain, declined by $1.5 million from the third quarter, with interest rate lock volume down by $152 million [48] - Non-interest income for the fourth quarter included a $2.3 million payment related to a loan recovery agreement, contributing to overall income [48] Market Data and Key Metrics Changes - Core deposit growth was $215 million on a linked quarter basis, with a focus on managing funding costs through competitive pressures [46] - The average deposit account is $28,000, indicating a diverse and granular deposit base [51] Company Strategy and Development Direction - The company aims to continue shifting reliance away from non-core funding sources while focusing on core deposit growth [50] - Management emphasized the importance of expense control and maintaining strong asset quality as key strategies moving into 2024 [41][42] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2024, highlighting the potential for modest margin expansion if interest rates remain stable [8][61] - There is an expectation of some volatility in asset quality in 2024 due to loan repricing and economic cycles [12] Other Important Information - The company recorded a credit loss provision of $2.5 million, with net charge-offs at $1.79 million, representing an annualized rate of 6 basis points [52] - The effective tax rate for Q4 was lower due to an impairment charge, with a forecasted effective tax rate for 2024 expected to be in the range of 21% to 22% [35] Q&A Session Summary Question: Inquiry about margin outlook - Management indicated that assuming no interest rate cuts, the margin is likely close to bottom and could show moderate upside in 2024 [61] Question: Follow-up on fixed-rate pricing opportunities - Approximately $700 million in fixed-rate loans will reprice in 2024, with an expected yield increase to the upper 7% to 8% range [4][7] Question: Credit quality and reserve release potential - Management does not anticipate a reserve release in the near future, preferring to use provisions for loan growth opportunities [12][14]