Carter Bankshares reports Q4 EPS 36c, consensus 23c

Net interest margin, on a fully taxable equivalent basis, decreased one basis point to 2.58% for the fourth quarter of 2024, compared to 2.59% for the prior quarter and increased nine basis points from the year ago quarter. The Company remained well capitalized at December 31, 2024. The Company’s Tier 1 Capital ratio was 10.88% at December 31, 2024 as compared to 10.83% at September 30, 2024. The Company’s leverage ratio was 9.56% at December 31, 2024 as compared to 9.53% at September 30, 2024. The Company’s Total Risk-Based Capital ratio was 12.13% at December 31, 2024 as compared to 12.09% at September 30, 2024. “The Bank produced a strong fourth quarter on multiple fronts. We launched a brand refresh, celebrated our 50th anniversary, and announced the acquisition of two branches in Winston-Salem and Mooresville, North Carolina from another financial institution. This branch transaction strengthens our presence in North Carolina and further expands our footprint between Greensboro and Charlotte. We believe this as a crucial step toward optimizing our operations in Winston-Salem because it gives us an immediate presence in the market, and we are gaining further market share in Mooresville. We believe that the transaction will improve our profitability and deliver positive returns to our shareholders,” stated Litz Van Dyke, CEO. “We continue to feel positive about the fundamentals of the Company and the structure of our balance sheet. Capital and liquidity levels continue to be strong, and loan production was solid in the fourth quarter, although much of this production was construction lending which has a lag time before it is fully funded and earning interest. Our loan production pipeline also remains strong. Deposit growth is occurring in most categories, with the majority of growth coming from increases in interest checking and CD accounts. Our cost of funds declined in the fourth quarter as a result of the recent Federal Reserve rate cuts in the third and fourth quarters of 2024. Our balance sheet is slightly liability sensitive and is well positioned so that further declines in interest rates should continue to positively benefit our net interest margin. We also expect that our net interest margin will return to a more normalized level once the large nonperforming lending relationship is fully resolved. Although our large nonperforming credit relationship continues to have a negative impact on our financial and credit metrics, aside from this impact, our fundamentals, financial performance, and asset quality metrics all remain solid. We are committed to resolving this lending relationship in a manner that best protects the Company, the Bank, and shareholders. We believe we are well positioned for a strong 2025.” Operating Highlights