Ameris ((ABCB)) has held its Q4 earnings call. Read on for the main highlights of the call.
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Ameris Bancorp’s recent earnings call highlights a robust financial performance during the fourth quarter and throughout 2024, marked by significant growth in net income and deposits, alongside improvements in efficiency. Despite challenges such as provisions for credit losses and potential reversals in margin expansion, the company remains optimistic about its strategic positioning and growth prospects for 2025.
Strong Financial Performance in Q4 and Full Year 2024
Ameris Bancorp reported a net income of $94.4 million or $1.37 per diluted share for Q4, and $358.7 million or $5.19 per diluted share for the full year 2024. Adjusted net income was $95.1 million for Q4 and $346.6 million for the full year, representing a 26% increase in year-over-year adjusted earnings per share. This performance underscores the company’s ability to generate substantial earnings growth.
Growth in Deposits and Reduction in Broker Deposits
The company achieved a 5% growth in deposits for the year, coupled with a reduction in broker deposits by $340 million. Core deposits experienced a growth of over 3%, or $675 million, in Q4 alone. This reflects Ameris Bancorp’s successful strategy in strengthening its deposit base.
Improvement in Efficiency Ratio and Operating Leverage
Ameris Bancorp reported an improvement in the adjusted efficiency ratio by over 240 basis points in Q4, bringing it to under 52%. The total revenue increased by 9.8% annualized, while expenses decreased by 1.9%, resulting in positive operating leverage. This indicates effective cost management and revenue enhancement.
Margin Expansion and Asset Growth
Net interest income saw an increase of $7.7 million in Q4, with the margin expanding by 13 basis points to 3.64%. The company’s total assets grew from $25.2 billion last year to $26.3 billion, illustrating robust asset growth alongside improved profitability.
Increase in Tangible Book Value and Equity Ratio
The tangible book value per share increased by 14.7% over the year, while the tangible common equity ratio rose to 10.59% from 9.64%. These metrics highlight Ameris Bancorp’s strengthened capital position and shareholder value.
Provision for Credit Losses and Nonperforming Assets
A $12.8 million provision for credit losses was recorded in Q4, with nonperforming assets constituting 47 basis points of total assets. This reflects the company’s cautious approach to credit risk management amid economic uncertainties.
Potential Reversal of Margin Expansion
The company noted that 7 basis points of the Q4 margin expansion were due to temporary changes in the deposit mix, which are expected to reverse as public funds decline in early 2025.
Decline in Loan Balances Due to Seasonality
Loan balances saw a slight decline in Q4, attributed to seasonal factors in the mortgage warehouse and premium finance businesses. This seasonality is a typical trend observed in these business segments.
Forward-Looking Guidance
Ameris Bancorp provided strong financial guidance, emphasizing their strategic positioning for 2025. They forecast an adjusted return on assets of 1.43% for the fourth quarter, with a PPNR ROA exceeding 2%. The company aims to maintain top-tier profitability, enhance revenue, and leverage growth within their Southeastern footprint, setting a positive outlook for the upcoming year.
In conclusion, Ameris Bancorp’s earnings call reflects a strong financial performance throughout 2024, with notable achievements in net income growth, deposit expansion, and efficiency improvements. Despite some challenges, the company is well-positioned for future growth, with optimistic guidance for 2025.
