ServisFirst Bancshares Reports Strong Deposit and Loan Growth in Q2

2024-07-17

In the recent earnings call transcript of ServisFirst Bancshares, key executives, including Thomas Broughton (CEO), Henry Abbott (Chief Credit Officer), Kirk Pressley (CFO), and Davis Mange (Director of Investor Relations), discussed various aspects of the company's performance and outlook.

The discussion during the second-quarter earnings call highlighted strong deposit and loan growth for ServisFirst Bancshares, despite experiencing a temporary decline in deposits in April due to tax payments. The company reported a robust deposit growth of 16% annualized for the quarter and achieved a 15% annualized growth in loans, amounting to approximately $450 million.

Factors contributing to the increase in loan demand included customers resuming borrowing activities after postponing projects the previous year due to rising interest rates. Additionally, customers were making capital expenditures using cash. During the quarter, ServisFirst Bancshares onboarded 14 new bankers and expanded its presence in markets such as Florida and the new Auburn-Opelika market.

The company's performance metrics, such as the NPA to total assets ratio and the ALLL to total loans ratio, were thoroughly discussed during the call. Furthermore, the implementation of Accounting Standards Update 2023-02 had an impact on noninterest expenses, resulting in changes to the amortization method for historical and new market tax credits.

Looking ahead to 2024, ServisFirst Bancshares expressed optimism about continued growth in yield on assets, effectively managing the increase in the cost of interest-bearing liabilities, and the potential for margin expansion. The company anticipates that loan growth will remain positive and foresees opportunities for repricing loans in the latter half of the year.

Overall, the earnings call provided valuable insights into ServisFirst Bancshares' strong performance, strategic initiatives, and future prospects within the banking industry. The company's emphasis on fostering customer relationships, expanding into new markets, and maintaining financial discipline positions it favorably for sustained success in the ever-evolving business landscape.