The Private Bank
recorded EPS of $0.51, beating estimates by $0.03, with 21% in EPS YoY.
The stock reacted positively and increased by 3.94% on the day. Net revenue
grew 10% YoY, mostly driven by sustained growth in earning assets and
non-interest income but partially offset by increasing expenses. Operating
profit for the quarter was $70.4 MM, up 11% YoY and up 4% from the prior
quarter. President and CEO, Larry D. Richman, announced the reason for
Private Bancorp’s impressive net income of 40.5 million was due in part to
“building quality client relationships”.
Net-interest income grew
to 116.8MM (up 10% YoY), a result of higher average loan balances, especially
in the commercial real estate area. The amount of total loans increased
to 11.5 billion, specifically from growth seen within the commercial real
estate and industrial area of lending. Private Bancorp’s net interest
margin improved 5 bps to 3.23%.
Non-interest income for
the quarter was 30.7MM, driven by growth in treasury management income, syndication
fees, and deposit service charges. These increases were partially offset by
growing employee salaries and compensation benefits, marketing, insurance, and
loan and collection expenses. Total non-interest expenses for the quarter
totaled $77.8MM.
Improving credit quality
is positively reflected in the earnings report with net charge-offs decreasing
to $88,000 for the quarter, down from $2.3MM in 2Q14. Non-performing assets
decreased 39% YoY. Overall, it was a strong quarter for Private Bancorp
demonstrated through continued growth in their top line in addition to a
strengthening balance sheet. However, concern over weak global economic growth
and persistent low interest rates may continue to restrict the company’s future
financial performance.
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