• Net Income: $99.2 million or $0.44 per diluted share.
• Adjusted Net Income: $95.2 million or $1.38 per diluted share.
• Return on Assets (ROA): Adjusted ROA of 1.43%.
• Return on Tangible Common Equity: 15% for the quarter.
• Tangible Book Value Growth: Increased by $1.72 per share, annualized growth rate of 19.1%.
• Net Interest Income: Increased by $2.1 million over the last quarter.
• Net Interest Margin: 3.51% for the quarter.
• Provision for Credit Losses: $6.1 million.
• Non-Performing Assets: Improved from 0.74% to 0.44% of total assets.
• Charge-Off Rate: Improved to 0.15% from 0.18% last quarter.
• Adjusted Efficiency Ratio: Improved to 54.25%.
• Total Assets: $26.4 billion at the end of the quarter.
• Total Earning Assets: $24.3 billion.
• Loan Production: $509 million for the quarter.
• Deposit Growth: Increased by $1.17 billion or 7.6% annualized.
• Non-Interest Bearing Deposits: Represent 30% of total deposits.
• Brokered CDs: Represent 7% of total deposits.

• Warning! GuruFocus has detected 5 Warning Sign with ABCB.

Release Date: October 25, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Ameris Bancorp (NYSE:ABCB) reported a strong third quarter financial performance with a 19% annualized growth rate in tangible book value per share.
• The company maintained a healthy capital position with a TCE ratio of 10.2% and a common equity Tier 1 ratio over 12%, providing flexibility for future growth opportunities.
• Net interest income increased by $2.1 million, with a strong margin of 3.51%, supported by a granular core deposit base.
• The company executed a successful MSR sale, resulting in a pretax gain of over $5 million and a significant reduction in non-performing loans.
• Ameris Bancorp (NYSE:ABCB) demonstrated effective expense control, reducing its efficiency ratio to 54% from 55% in the previous quarter.

Negative Points

• Adjusted non-interest income decreased by $6.7 million, primarily due to reduced mortgage division production and a lower gain on sale margin.
• The company experienced a slight margin compression of three basis points, attributed to changes in funding mix.
• Loan growth was relatively flat quarter-over-quarter, with some fluctuations due to seasonal factors in warehouse lines.
• The mortgage gain on sale margins declined in the quarter, impacting overall non-interest income.
• Despite strong capital levels, the company remains cautious about deploying excess capital for growth opportunities, awaiting more economic clarity.

Q & A Highlights

Q: Can you provide an update on the margin outlook and how you plan to manage it going forward? A: Nicole Stokes, CFO, stated that the margin guidance remains around 350 basis points, with slight fluctuations expected. The focus is on growing net interest income (NII) through asset growth, as the bank is nearly asset-sensitive neutral. The margin expansion will primarily come from growth in earning assets.

Q: How are you managing deposit betas, and what impact do you expect from rate changes? A: Nicole Stokes explained that the bank has a low percentage of indexed deposits, with most behaving like indexed deposits. The strategy is to adjust deposit rates aggressively in line with market changes, and they expect to maintain strong deposit betas on the downside as well.

Q: With strong capital levels, are there plans for more aggressive capital deployment? A: CEO Palmer Proctor mentioned that while the bank is in a strong capital position, they remain prudent and disciplined. They are in a capital-building mode and will consider opportunities post-election, maintaining optionality for future growth.

Q: What is the outlook for loan growth, and how do you plan to manage potential paydowns? A: Palmer Proctor expressed confidence in achieving mid-single-digit loan growth, supported by diversified business lines and strong market positions. The bank is well-positioned to capitalize on growth opportunities, with investments in new hires and growth markets.

Q: How is the mortgage segment performing, and what are the expectations for gain on sale margins? A: Palmer Proctor indicated that the mortgage gain on sale margins are expected to bounce back in the next quarter. The bank is prepared to capitalize on any increase in mortgage activity, with no capacity constraints anticipated.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.