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Stellar Bancorp, Inc. Reports Second Quarter 2024 Results

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Stellar Bancorp, Inc. (NYSE: STEL) reported net income of $29.8 million, or diluted earnings per share of $0.56, for the second quarter of 2024. This represents an increase from the first quarter's net income of $26.1 million, or $0.49 per share. The company's annualized return on average assets was 1.13%, with a return on average equity of 7.78%.

Key highlights include:

  • Total risk-based capital ratio increased to 15.34%
  • Tier 1 leverage ratio rose to 10.93%
  • Tax equivalent net interest margin was 4.24%
  • Net charge-offs were $715 thousand, or 0.02%, year-to-date

The company's focus remains on building capital, maintaining credit quality, and ensuring strong liquidity. Stellar's CEO, Robert R. Franklin, Jr., emphasized the bank's preparedness for potential interest rate changes and its strategic positioning in resilient markets.

Stellar Bancorp, Inc. (NYSE: STEL) ha riportato un utile netto di 29,8 milioni di dollari, ovvero un utile per azione diluito di 0,56 dollari, per il secondo trimestre del 2024. Questo rappresenta un aumento rispetto all'utile netto del primo trimestre di 26,1 milioni di dollari, o 0,49 dollari per azione. Il rendimento annualizzato medio sugli attivi è stato dell'1,13%, con un rendimento medio sul capitale del 7,78%.

Punti salienti includono:

  • Il rapporto di capitale totale basato sul rischio è aumentato al 15,34%
  • Il rapporto di leverage di Tier 1 è salito al 10,93%
  • Il margine d'interesse netto equivalente è stato del 4,24%
  • Le dismissioni nette sono state di 715 mila dollari, ovvero lo 0,02%, dall'inizio dell'anno

La priorità dell'azienda rimane quella di costruire capitale, mantenere la qualità del credito e garantire una solida liquidità. Il CEO di Stellar, Robert R. Franklin, Jr., ha sottolineato la preparazione della banca per possibili cambiamenti nei tassi d'interesse e il suo posizionamento strategico in mercati resilienti.

Stellar Bancorp, Inc. (NYSE: STEL) reportó un ingreso neto de 29,8 millones de dólares, o ganancias por acción diluidas de 0,56 dólares, para el segundo trimestre de 2024. Esto representa un aumento respecto al ingreso neto del primer trimestre de 26,1 millones de dólares, o 0,49 dólares por acción. El rendimiento anualizado sobre activos promedio fue del 1,13%, con un rendimiento sobre capital promedio del 7,78%.

Aspectos destacados incluyen:

  • El ratio de capital total basado en riesgo aumentó al 15,34%
  • El ratio de apalancamiento de Tier 1 subió al 10,93%
  • El margen neto de interés equivalente fue del 4,24%
  • Las cancelaciones netas fueron de 715 mil dólares, o el 0,02%, en lo que va del año

El enfoque de la empresa sigue siendo la construcción de capital, el mantenimiento de la calidad crediticia y la garantía de una sólida liquidez. El CEO de Stellar, Robert R. Franklin, Jr., enfatizó la preparación del banco para posibles cambios en las tasas de interés y su posicionamiento estratégico en mercados resilientes.

Stellar Bancorp, Inc. (NYSE: STEL)은 2024년 2분기에 2980만 달러의 순이익 또는 희석 주당순이익 0.56달러를 보고했습니다. 이는 1분기의 순이익 2610만 달러, 또는 주당 0.49달러에서 증가한 수치입니다. 이 회사의 자산 평균 대비 연환산 수익률은 1.13% 이었으며, 자본 평균 대비 수익률은 7.78%입니다.

주요 하이라이트는 다음과 같습니다:

  • 위험 기반 총 자본 비율이 15.34%로 증가했습니다.
  • Tier 1 레버리지 비율이 10.93%로 상승했습니다.
  • 세전 순이자 마진은 4.24%였습니다.
  • 연초 대비 순처분이 715천 달러, 즉 0.02%에 달했습니다.

회사는 자본 구축, 신용 품질 유지, 강력한 유동성 확보에 집중하고 있습니다. Stellar의 CEO인 Robert R. Franklin, Jr.는 잠재적인 금리 변동에 대비한 은행의 준비 태세와 회복력 있는 시장에서의 전략적 입지를 강조했습니다.

Stellar Bancorp, Inc. (NYSE: STEL) a rapporté un revenu net de 29,8 millions de dollars, soit un bénéfice par action dilué de 0,56 dollars, pour le deuxième trimestre de 2024. Cela représente une augmentation par rapport au revenu net du premier trimestre de 26,1 millions de dollars, ou 0,49 dollars par action. Le rendement annualisé sur les actifs moyens était de 1,13%, avec un rendement sur les fonds propres moyens de 7,78%.

Les points forts incluent :

  • Le ratio de capital total basé sur les risques a augmenté à 15,34%
  • Le ratio de levier Tier 1 a augmenté à 10,93%
  • La marge d'intérêt nette équivalente était de 4,24%
  • Les annulations nettes ont été de 715 mille dollars, soit 0,02%, depuis le début de l'année

L'entreprise reste concentrée sur la constitution de capital, le maintien de la qualité du crédit et la garantie d'une forte liquidité. Le PDG de Stellar, Robert R. Franklin, Jr., a souligné la préparation de la banque aux éventuels changements de taux d'intérêt et son positionnement stratégique sur des marchés résilients.

Stellar Bancorp, Inc. (NYSE: STEL) meldete einen Nettoertrag von 29,8 Millionen Dollar bzw. verwässerte Earnings per Share von 0,56 Dollar für das zweite Quartal 2024. Dies stellt einen Anstieg gegenüber dem Nettoertrag des ersten Quartals von 26,1 Millionen Dollar oder 0,49 Dollar pro Aktie dar. Die annualisierte Rendite auf das durchschnittliche Vermögen betrug 1,13%, mit einer Rendite auf das durchschnittliche Eigenkapital von 7,78%.

Wichtige Höhepunkte umfassen:

  • Die Gesamtkapitalquote basierend auf Risiko stieg auf 15,34%
  • Die Tier 1-Leverage-Quote stieg auf 10,93%
  • Die steuerlich angepasste Nettomarge betrug 4,24%
  • Die Nettoabschreibungen betrugen 715 Tausend Dollar oder 0,02% seit Jahresbeginn

Das Unternehmen konzentriert sich weiterhin auf den Auf- und Ausbau von Kapital, die Aufrechterhaltung der Kreditqualität und die Gewährleistung starker Liquidität. Der CEO von Stellar, Robert R. Franklin, Jr., betonte die Bereitschaft der Bank für potenzielle Zinsänderungen und ihre strategische Positionierung in widerstandsfähigen Märkten.

Positive
  • Net income increased to $29.8 million from $26.1 million in the previous quarter
  • Diluted earnings per share rose to $0.56 from $0.49
  • Total risk-based capital ratio improved to 15.34% from 14.62%
  • Tier 1 leverage ratio increased to 10.93% from 10.55%
  • Strong tax equivalent net interest margin of 4.24%
  • Low net charge-offs of 0.02% year-to-date
Negative
  • Net interest income decreased by $708 thousand to $101.4 million
  • Noninterest income decreased by $880 thousand to $5.4 million
  • Total loans decreased by $194.2 million to $7.71 billion
  • Total deposits decreased by $69.4 million to $8.73 billion
  • Efficiency ratio slightly increased to 66.63% from 66.18%

Insights

Stellar Bancorp's Q2 2024 results demonstrate resilience in a challenging economic environment. The bank reported $29.8 million in net income, translating to diluted EPS of $0.56, up from $26.1 million and $0.49 in Q1 2024, respectively. This 13.8% quarter-over-quarter increase in net income is noteworthy.

The bank's focus on capital, credit and liquidity appears to be paying off. The total risk-based capital ratio improved to 15.34% from 14.62% in Q1, while the Tier 1 leverage ratio increased to 10.93% from 10.55%. These improvements strengthen Stellar's position amidst economic uncertainties.

However, there are some areas of concern. Net interest income decreased slightly by $708,000 to $101.4 million and the net interest margin dipped 2 basis points to 4.24%. This suggests some pressure on the bank's core earnings. Additionally, noninterest income fell by 14% to $5.4 million, primarily due to decreased gains on asset sales.

The efficiency ratio slightly worsened to 66.63% from 66.18%, indicating a minor decline in operational efficiency. However, the bank's credit quality remains solid, with net charge-offs at a negligible $1,000 for Q2.

Overall, Stellar Bancorp's performance shows stability and growth in key areas, but also highlights challenges in maintaining net interest income and noninterest income in the current economic climate.

Stellar Bancorp's Q2 results offer interesting insights into the banking sector's current dynamics. The bank's strategy of reducing commercial real estate exposure and pursuing a more balanced lending approach through expansion of its commercial and industrial portfolio is noteworthy. This shift could be a response to perceived risks in the real estate market and an attempt to diversify revenue streams.

The bank's performance in some of the strongest markets in the country provides a unique perspective on regional economic resilience. Despite the Federal Reserve's tightening cycle, these markets have shown robustness, which bodes well for Stellar's future prospects.

However, the mention of a contentious presidential election as a factor to monitor is intriguing. Political uncertainty often leads to market volatility and Stellar's proactive approach in building a strong balance sheet could be a strategic move to weather potential economic turbulence.

The decrease in noninterest income, particularly from reduced gains on asset sales, might indicate a cooling in certain market segments. This trend, if continued, could pressure banks to find alternative revenue sources.

Lastly, the estimated 43.3% of uninsured deposits (net of collateralized deposits) is a metric worth watching. In the wake of recent banking sector stress, depositor confidence and the stability of funding sources remain important factors for all banks.

HOUSTON--(BUSINESS WIRE)-- Stellar Bancorp, Inc. (the “Company” or “Stellar”) (NYSE: STEL) today reported net income of $29.8 million, or diluted earnings per share of $0.56, for the second quarter of 2024 compared to net income of $26.1 million, or diluted earnings per share of $0.49, for the first quarter of 2024.

“We are pleased to announce our second quarter 2024 results,” said Robert R. Franklin, Jr., Stellar’s Chief Executive Officer. “Our disciplined focus on capital, credit and liquidity gives us strength and optionality as we move into the back half of the year. Although many anticipate lower interest rates in September, we are prepared if that does not come to pass,” said Mr. Franklin. “Stellar Bank is well-positioned for either outcome.”

“In addition to building capital, we have reduced our commercial real estate exposure and are pursuing a more balanced approach to our lending through new additions to our team to help us build our commercial and industrial portfolio. Our credit quality remains steady as the economy in our markets remains solid. We operate in some of, if not the best, markets in the country and they have shown resilience throughout this tightening cycle,” Mr. Franklin continued.

“Our focus on capital, credit and liquidity will not change. We will continue to monitor effects of higher interest rates and the contentious presidential election on our markets. We believe that building and maintaining a strong balance sheet, positions us to take advantage of opportunities that arise from this economic cycle. Our focus remains on building long-term shareholder value as we embark on the second half of 2024 and the future is bright,” concluded Mr. Franklin.

Second Quarter 2024 Financial Highlights

  • Solid Profitability: Second quarter 2024 net income of $29.8 million, or diluted earnings per share of $0.56, translated into an annualized return on average assets of 1.13%, an annualized return on average equity of 7.78% and an annualized return on average tangible equity of 12.82%(1).
  • Meaningful Regulatory Capital Build: Total risk-based capital ratio increased to 15.34% at June 30, 2024 from 14.62% at March 31, 2024 and Tier 1 leverage ratio increased to 10.93% at June 30, 2024 from 10.55% at March 31, 2024.
  • Strong Net Interest Margin: Tax equivalent net interest margin was 4.24% for the second quarter of 2024 compared to 4.26% for the first quarter of 2024. The tax equivalent net interest margin, excluding purchase accounting accretion (“PAA”), was 3.82%(1) for the second quarter of 2024 compared to 3.91%(1) for the first quarter of 2024.
  • Stable Credit Performance: Net charge-offs of $715 thousand, or 0.02%, for the year-to-date 2024.
________________________

(1)

Refer to page 10 of this earnings release for the calculation of this non-GAAP financial measure.

Second Quarter 2024 Results

Net interest income in the second quarter of 2024 decreased $708 thousand, or 0.7%, to $101.4 million from $102.1 million for the first quarter of 2024. The net interest margin on a tax equivalent basis decreased 2 basis points to 4.24% for the second quarter of 2024 from 4.26% for the first quarter of 2024. The decrease in the net interest margin from the prior quarter was primarily due to the impact of increased interest rates on our cost of funding only partially offset by increased income on interest earning assets. Net interest income for the second quarter of 2024 benefited from $10.1 million of income from purchase accounting adjustments compared to $8.6 million in the first quarter of 2024. Excluding purchase accounting adjustments, net interest income (tax equivalent) for the second quarter 2024 would have been $91.4 million(1) and the tax equivalent net interest margin would have been 3.82%(1).

Noninterest income for the second quarter of 2024 was $5.4 million, a decrease of $880 thousand, or 14.0%, compared to $6.3 million for the first quarter of 2024. Noninterest income decreased in the second quarter of 2024 compared to the first quarter of 2024 primarily due to a decrease in gains on sales of assets in the second quarter of 2024 compared to the first quarter of 2024.

Noninterest expense for the second quarter of 2024 decreased $194 thousand, or 0.3%, to $71.2 million compared to $71.4 million for the first quarter of 2024. The decrease in noninterest expense in the second quarter of 2024 compared to the first quarter of 2024 was primarily due to a $2.3 million decrease in salaries and employee benefits and a $1.0 million decrease in professional fees partially offset by other expenses.

The efficiency ratio was 66.63% for the second quarter of 2024 compared to 66.18% for the first quarter of 2024. Annualized returns on average assets, average equity and average tangible equity were 1.13%, 7.78% and 12.82%(1) for the second quarter of 2024, respectively, compared to 0.98%, 6.88% and 11.47%(1), respectively, for the first quarter of 2024.

Financial Condition

Total loans at June 30, 2024 decreased $194.2 million to $7.71 billion compared to $7.91 billion at March 31, 2024. At June 30, 2024, the remaining balance of the purchase accounting adjustments on loans was $87.4 million.

Total deposits at June 30, 2024 decreased $69.4 million to $8.73 billion compared to $8.79 billion at March 31, 2024, due to decreases in certificates and other time deposits, noninterest-bearing deposits and interest-bearing demand deposits, partially offset by increases in money market and savings deposits. Shifts in the deposit mix were primarily driven by the current interest rate environment and an intensely competitive market for deposits. Estimated uninsured deposits totaled $4.79 billion and estimated uninsured deposits net of collateralized deposits of $1.01 billion were $3.78 billion, or 43.3%, of total deposits at June 30, 2024.

Total assets at June 30, 2024 were $10.72 billion, a decrease of $5.6 million, compared to $10.73 billion at March 31, 2024.

Asset Quality

Nonperforming assets totaled $53.4 million, or 0.50% of total assets, at June 30, 2024, compared to $57.1 million, or 0.53% of total assets, at March 31, 2024. The allowance for credit losses on loans as a percentage of total loans was 1.23% at June 30, 2024 and 1.22% at March 31, 2024.

The second quarter of 2024 included a reversal of provision for credit losses expenses of $1.9 million compared to a $4.1 million provision for credit losses recorded during the first quarter of 2024. Net charge-offs for the second quarter of 2024 were $1 thousand, or 0.00% (annualized) of average loans, compared to net charge-offs of $714 thousand, or 0.04% (annualized) of average loans, for the first quarter of 2024.

GAAP Reconciliation of Non-GAAP Financial Measures

Stellar’s management uses certain non-GAAP financial measures to evaluate its performance. Please refer to the GAAP Reconciliation and Management’s Explanation of Non-GAAP Financial Measures on page 10 of this earnings release for a reconciliation of these non-GAAP financial measures.

Conference Call

Stellar’s management team will host a conference call and webcast on Friday, July 26, 2024 at 8:00 a.m. Central Time (9:00 a.m. Eastern Time) to discuss its results for the second quarter of 2024. Participants may register for the conference call at https://registrations.events/direct/Q4I635860 to receive the dial-in numbers and unique PIN to access the call. If you need assistance in obtaining a dial-in number, please contact IR@stellar.bank. A simultaneous audio-only webcast may be accessed at https://events.q4inc.com/attendee/232230638. If you are unable to participate during the live webcast, the webcast will be accessible via the Investor Relations section of the Company’s website at ir.stellar.bank.

About Stellar Bancorp, Inc.

Stellar Bancorp, Inc. is a bank holding company headquartered in Houston, Texas. Stellar’s principal banking subsidiary, Stellar Bank, provides a diversified range of commercial banking services primarily to small- to medium-sized businesses and individual customers across the Houston, Dallas, Beaumont and surrounding communities in Texas.

Forward-Looking Statements

Certain statements in this press release which are not historical in nature are intended to be, and are hereby identified as, “forward-looking statements” for purposes of the safe harbor provided by Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include, but are not limited to, statements about the benefits of the Company’s merger with Allegiance Bancshares, Inc. (the “Merger”), including future financial performance and operating results, the Company’s plans, business and growth strategies, objectives, expectations and intentions, and other statements that are not historical facts, including projections of macroeconomic and industry trends, which are inherently unreliable due to the multiple factors that impact economic trends, and any such variations may be material. Forward-looking statements may be identified by terminology such as “may,” “will,” “should,” “could,” “scheduled,” “plans,” “intends,” “projects,” “anticipates,” “expects,” “believes,” “estimates,” “potential,” “would,” or “continue” or negatives of such terms or other comparable terminology.

All forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and other factors that may cause the actual results, performance or achievements of Stellar to differ materially from any results expressed or implied by such forward-looking statements. Such factors include, among others: the risk that the cost savings and any revenue synergies from the Merger may not be fully realized or may take longer than anticipated to be realized; disruption to our business as a result of the Merger; the risk that the integration of operations will be materially delayed or will be more costly or difficult than we expected or that we are otherwise unable to successfully integrate our legacy businesses; the amount of the costs, fees, expenses and charges related to the Merger; reputational risk and the reaction of our customers, suppliers, employees or other business partners to the Merger; changes in the interest rate environment, the value of Stellar’s assets and obligations and the availability of capital and liquidity; general competitive, economic, political and market conditions; and other factors that may affect future results of Stellar including changes in asset quality and credit risk; the inability to sustain revenue and earnings growth; changes in interest rates and capital markets; inflation; customer borrowing, repayment, investment and deposit practices; the impact, extent and timing of technological changes; capital management activities; disruptions to the economy and the U.S. banking system caused by recent bank failures, risks associated with uninsured deposits and responsive measures by federal or state governments or banking regulators, including increases in the cost of our deposit insurance assessments and other actions of the Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation and Texas Department of Banking and legislative and regulatory actions and reforms.

Additional factors which could affect the Company’s future results can be found in the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, in each case filed with the SEC and available on the SEC’s website at https://www.sec.gov. We disclaim any obligation and do not intend to update or revise any forward-looking statements contained in this communication, which speak only as of the date hereof, whether as a result of new information, future events or otherwise, except as required by federal securities laws. As forward-looking statements involve significant risks and uncertainties, caution should be exercised against placing undue reliance on such statements.

 
 
 

Stellar Bancorp, Inc.

Financial Highlights

(Unaudited) 

 

 

2024

 

2023

 

June 30

 

March 31

 

December 31

 

September 30

 

June 30

 

(Dollars in thousands)

ASSETS

 

 

 

 

 

 

 

 

 

Cash and due from banks

$

110,341

 

 

$

74,663

 

 

$

121,004

 

 

$

94,970

 

 

$

105,913

 

Interest-bearing deposits at other financial institutions

 

379,909

 

 

 

325,079

 

 

 

278,233

 

 

 

207,302

 

 

 

198,176

 

Total cash and cash equivalents

 

490,250

 

 

 

399,742

 

 

 

399,237

 

 

 

302,272

 

 

 

304,089

 

 

 

 

 

 

 

 

 

 

 

Available for sale securities, at fair value

 

1,630,971

 

 

 

1,523,100

 

 

 

1,395,680

 

 

 

1,414,952

 

 

 

1,478,222

 

 

 

 

 

 

 

 

 

 

 

Loans held for investment

 

7,713,897

 

 

 

7,908,111

 

 

 

7,925,133

 

 

 

8,004,528

 

 

 

8,068,718

 

Less: allowance for credit losses on loans

 

(94,772

)

 

 

(96,285

)

 

 

(91,684

)

 

 

(93,575

)

 

 

(100,195

)

Loans, net

 

7,619,125

 

 

 

7,811,826

 

 

 

7,833,449

 

 

 

7,910,953

 

 

 

7,968,523

 

 

 

 

 

 

 

 

 

 

 

Accrued interest receivable

 

43,348

 

 

 

45,466

 

 

 

44,244

 

 

 

43,536

 

 

 

42,051

 

Premises and equipment, net

 

113,984

 

 

 

115,698

 

 

 

118,683

 

 

 

119,332

 

 

 

119,142

 

Federal Home Loan Bank stock

 

15,089

 

 

 

16,050

 

 

 

25,051

 

 

 

29,022

 

 

 

24,478

 

Bank-owned life insurance

 

106,262

 

 

 

105,671

 

 

 

105,084

 

 

 

104,699

 

 

 

104,148

 

Goodwill

 

497,318

 

 

 

497,318

 

 

 

497,318

 

 

 

497,318

 

 

 

497,260

 

Core deposit intangibles, net

 

104,315

 

 

 

110,513

 

 

 

116,712

 

 

 

122,944

 

 

 

129,805

 

Other assets

 

103,001

 

 

 

103,838

 

 

 

111,681

 

 

 

120,432

 

 

 

110,633

 

Total assets

$

10,723,663

 

 

$

10,729,222

 

 

$

10,647,139

 

 

$

10,665,460

 

 

$

10,778,351

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES:

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

Noninterest-bearing

$

3,308,441

 

 

$

3,323,149

 

 

$

3,546,815

 

 

$

3,656,288

 

 

$

3,713,536

 

Interest-bearing

 

 

 

 

 

 

 

 

 

Demand

 

1,564,405

 

 

 

1,576,261

 

 

 

1,659,999

 

 

 

1,397,492

 

 

 

1,437,509

 

Money market and savings

 

2,213,031

 

 

 

2,203,767

 

 

 

2,136,777

 

 

 

2,128,950

 

 

 

2,174,073

 

Certificates and other time

 

1,639,426

 

 

 

1,691,539

 

 

 

1,529,876

 

 

 

1,503,891

 

 

 

1,441,251

 

Total interest-bearing deposits

 

5,416,862

 

 

 

5,471,567

 

 

 

5,326,652

 

 

 

5,030,333

 

 

 

5,052,833

 

Total deposits

 

8,725,303

 

 

 

8,794,716

 

 

 

8,873,467

 

 

 

8,686,621

 

 

 

8,766,369

 

 

 

 

 

 

 

 

 

 

 

Accrued interest payable

 

12,327

 

 

 

12,227

 

 

 

11,288

 

 

 

7,612

 

 

 

4,555

 

Borrowed funds

 

240,000

 

 

 

215,000

 

 

 

50,000

 

 

 

323,981

 

 

 

369,963

 

Subordinated debt

 

109,964

 

 

 

109,864

 

 

 

109,765

 

 

 

109,665

 

 

 

109,566

 

Other liabilities

 

70,274

 

 

 

66,717

 

 

 

81,601

 

 

 

76,735

 

 

 

69,218

 

Total liabilities

 

9,157,868

 

 

 

9,198,524

 

 

 

9,126,121

 

 

 

9,204,614

 

 

 

9,319,671

 

 

 

 

 

 

 

 

 

 

 

SHAREHOLDERS’ EQUITY:

 

 

 

 

 

 

 

 

 

Common stock

 

536

 

 

 

536

 

 

 

533

 

 

 

533

 

 

 

533

 

Capital surplus

 

1,238,477

 

 

 

1,235,221

 

 

 

1,232,627

 

 

 

1,231,686

 

 

 

1,228,532

 

Retained earnings

 

447,948

 

 

 

425,130

 

 

 

405,945

 

 

 

385,600

 

 

 

361,619

 

Accumulated other comprehensive loss

 

(121,166

)

 

 

(130,189

)

 

 

(118,087

)

 

 

(156,973

)

 

 

(132,004

)

Total shareholders’ equity

 

1,565,795

 

 

 

1,530,698

 

 

 

1,521,018

 

 

 

1,460,846

 

 

 

1,458,680

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

$

10,723,663

$

10,729,222

 

$

10,647,139

$

10,665,460

$

10,778,351

 
 
 
 

Stellar Bancorp, Inc.

Financial Highlights

(Unaudited) 

 

 

Three Months Ended

 

Six Months Ended

 

2024

 

2023

 

2024

 

2023

 

June 30

 

March 31

 

December 31

 

September 30

 

June 30

 

June 30

 

June 30

 

(Dollars in thousands, except per share data)

INTEREST INCOME:

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans, including fees

$

135,885

 

 

$

134,685

 

$

139,114

 

$

138,948

 

$

133,931

 

 

$

270,570

 

$

259,660

Securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

11,923

 

 

 

9,293

 

 

9,622

 

 

9,493

 

 

9,726

 

 

 

21,216

 

 

19,379

Tax-exempt

 

816

 

 

 

818

 

 

418

 

 

437

 

 

436

 

 

 

1,634

 

 

1,698

Deposits in other financial institutions

 

3,555

 

 

 

3,627

 

 

3,021

 

 

2,391

 

 

2,865

 

 

 

7,182

 

 

6,636

Total interest income

 

152,179

 

 

 

148,423

 

 

152,175

 

 

151,269

 

 

146,958

 

 

 

300,602

 

 

287,373

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INTEREST EXPENSE:

 

 

 

 

 

 

 

 

 

 

 

 

 

Demand, money market and savings deposits

 

28,399

 

 

 

27,530

 

 

25,033

 

 

23,557

 

 

20,708

 

 

 

55,929

 

 

38,745

Certificates and other time deposits

 

18,758

 

 

 

15,084

 

 

15,075

 

 

13,282

 

 

9,622

 

 

 

33,842

 

 

12,929

Borrowed funds

 

1,700

 

 

 

1,774

 

 

4,154

 

 

5,801

 

 

6,535

 

 

 

3,474

 

 

7,852

Subordinated debt

 

1,912

 

 

 

1,917

 

 

1,983

 

 

1,908

 

 

1,812

 

 

 

3,829

 

 

3,739

Total interest expense

 

50,769

 

 

 

46,305

 

 

46,245

 

 

44,548

 

 

38,677

 

 

 

97,074

 

 

63,265

NET INTEREST INCOME

 

101,410

 

 

 

102,118

 

 

105,930

 

 

106,721

 

 

108,281

 

 

 

203,528

 

 

224,108

(Reversal of) provision for credit losses

 

(1,935

)

 

 

4,098

 

 

1,047

 

 

2,315

 

 

1,915

 

 

 

2,163

 

 

5,581

Net interest income after provision for credit losses

 

103,345

 

 

 

98,020

 

 

104,883

 

 

104,406

 

 

106,366

 

 

 

201,365

 

 

218,527

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NONINTEREST INCOME:

 

 

 

 

 

 

 

 

 

 

 

 

 

Service charges on deposit accounts

 

1,648

 

 

 

1,598

 

 

1,520

 

 

1,620

 

 

1,575

 

 

 

3,246

 

 

2,924

(Loss) gain on sale of assets

 

(64

)

 

 

513

 

 

198

 

 

 

 

(6

)

 

 

449

 

 

192

Bank-owned life insurance

 

591

 

 

 

587

 

 

573

 

 

551

 

 

532

 

 

 

1,178

 

 

1,054

Debit card and ATM income

 

543

 

 

 

527

 

 

542

 

 

935

 

 

1,821

 

 

 

1,070

 

 

3,519

Other

 

2,698

 

 

 

3,071

 

 

4,053

 

 

1,589

 

 

1,561

 

 

 

5,769

 

 

5,292

Total noninterest income

 

5,416

 

 

 

6,296

 

 

6,886

 

 

4,695

 

 

5,483

 

 

 

11,712

 

 

12,981

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NONINTEREST EXPENSE:

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

39,061

 

 

 

41,376

 

 

40,464

 

 

39,495

 

 

37,300

 

 

 

80,437

 

 

77,075

Net occupancy and equipment

 

4,503

 

 

 

4,390

 

 

4,572

 

 

4,455

 

 

3,817

 

 

 

8,893

 

 

7,905

Depreciation

 

1,948

 

 

 

1,964

 

 

1,955

 

 

1,952

 

 

1,841

 

 

 

3,912

 

 

3,677

Data processing and software amortization

 

5,501

 

 

 

4,894

 

 

5,000

 

 

4,798

 

 

4,674

 

 

 

10,395

 

 

9,728

Professional fees

 

1,620

 

 

 

2,662

 

 

3,867

 

 

997

 

 

1,564

 

 

 

4,282

 

 

3,091

Regulatory assessments and FDIC insurance

 

2,299

 

 

 

1,854

 

 

5,169

 

 

1,814

 

 

2,755

 

 

 

4,153

 

 

4,049

Amortization of intangibles

 

6,215

 

 

 

6,212

 

 

6,247

 

 

6,876

 

 

6,881

 

 

 

12,427

 

 

13,760

Communications

 

847

 

 

 

937

 

 

743

 

 

663

 

 

689

 

 

 

1,784

 

 

1,390

Advertising

 

891

 

 

 

765

 

 

1,004

 

 

877

 

 

907

 

 

 

1,656

 

 

1,746

Acquisition and merger-related expenses

 

 

 

 

 

 

3,072

 

 

3,421

 

 

2,897

 

 

 

 

 

9,062

Other

 

8,331

 

 

 

6,356

 

 

5,848

 

 

5,400

 

 

5,882

 

 

 

14,687

 

 

10,322

Total noninterest expense

 

71,216

 

 

 

71,410

 

 

77,941

 

 

70,748

 

 

69,207

 

 

 

142,626

 

 

141,805

INCOME BEFORE INCOME TAXES

 

37,545

 

 

 

32,906

 

 

33,828

 

 

38,353

 

 

42,642

 

 

 

70,451

 

 

89,703

Provision for income taxes

 

7,792

 

 

 

6,759

 

 

6,562

 

 

7,445

 

 

7,467

 

 

 

14,551

 

 

17,380

NET INCOME

$

29,753

 

 

$

26,147

 

$

27,266

 

$

30,908

 

$

35,175

 

 

$

55,900

 

$

72,323

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EARNINGS PER SHARE

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

$

0.56

 

 

$

0.49

 

$

0.51

 

$

0.58

 

$

0.66

 

 

$

1.05

 

$

1.36

Diluted

$

0.56

 

 

$

0.49

 

$

0.51

 

$

0.58

 

$

0.66

 

 

$

1.04

 

$

1.36

 
 
 

 

Three Months Ended

 

Six Months Ended

 

2024

 

2023

 

2024

 

2023

 

June 30

 

March 31

 

December 31

 

September 30

 

June 30

 

June 30

 

June 30

 

(Dollars and share amounts in thousands, except per share data)

Net income

$

29,753

 

 

$

26,147

 

 

$

27,266

 

 

$

30,908

 

 

$

35,175

 

 

$

55,900

 

 

$

72,323

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share, basic

$

0.56

 

 

$

0.49

 

 

$

0.51

 

 

$

0.58

 

 

$

0.66

 

 

$

1.05

 

 

$

1.36

 

Earnings per share, diluted

$

0.56

 

 

$

0.49

 

 

$

0.51

 

 

$

0.58

 

 

$

0.66

 

 

$

1.04

 

 

$

1.36

 

Dividends per share

$

0.13

 

 

$

0.13

 

 

$

0.13

 

 

$

0.13

 

 

$

0.13

 

 

$

0.26

 

 

$

0.26

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets(A)

 

1.13

%

 

 

0.98

%

 

 

1.02

%

 

 

1.14

%

 

 

1.31

%

 

 

1.06

%

 

 

1.35

%

Return on average equity(A)

 

7.78

%

 

 

6.88

%

 

 

7.33

%

 

 

8.34

%

 

 

9.67

%

 

 

7.33

%

 

 

10.14

%

Return on average tangible equity(A)(B)

 

12.82

%

 

 

11.47

%

 

 

12.61

%

 

 

14.47

%

 

 

17.05

%

 

 

12.15

%

 

 

18.14

%

Net interest margin (tax equivalent)(A)(C)

 

4.24

%

 

 

4.26

%

 

 

4.40

%

 

 

4.37

%

 

 

4.49

%

 

 

4.25

%

 

 

4.64

%

Net interest margin (tax equivalent) excluding PAA(A)(B)(C)

 

3.82

%

 

 

3.91

%

 

 

3.91

%

 

 

3.87

%

 

 

3.97

%

 

 

3.86

%

 

 

4.18

%

Efficiency ratio(D)

 

66.63

%

 

 

66.18

%

 

 

69.21

%

 

 

63.50

%

 

 

60.83

%

 

 

66.40

%

 

 

59.86

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital Ratios

 

 

 

 

 

 

 

 

 

 

 

 

 

Stellar Bancorp, Inc. (Consolidated)

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity to assets

 

14.60

%

 

 

14.27

%

 

 

14.29

%

 

 

13.70

%

 

 

13.53

%

 

 

14.60

%

 

 

13.53

%

Tangible equity to tangible assets(B)

 

9.53

%

 

 

9.12

%

 

 

9.04

%

 

 

8.37

%

 

 

8.19

%

 

 

9.53

%

 

 

8.19

%

Estimated Total capital ratio (to risk-weighted assets)

 

15.34

%

 

 

14.62

%

 

 

14.02

%

 

 

13.61

%

 

 

13.21

%

 

 

15.34

%

 

 

13.21

%

Estimated Common equity Tier 1 capital (to risk weighted assets)

 

12.98

%

 

 

12.29

%

 

 

11.77

%

 

 

11.30

%

 

 

10.83

%

 

 

12.98

%

 

 

10.83

%

Estimated Tier 1 capital (to risk-weighted assets)

 

13.10

%

 

 

12.41

%

 

 

11.89

%

 

 

11.41

%

 

 

10.94

%

 

 

13.10

%

 

 

10.94

%

Estimated Tier 1 leverage (to average tangible assets)

 

10.93

%

 

 

10.55

%

 

 

10.18

%

 

 

9.82

%

 

 

9.51

%

 

 

10.93

%

 

 

9.51

%

Stellar Bank

 

 

 

 

 

 

 

 

 

 

 

 

 

Estimated Total capital ratio (to risk-weighted assets)

 

14.65

%

 

 

14.13

%

 

 

13.65

%

 

 

13.32

%

 

 

12.98

%

 

 

14.65

%

 

 

12.98

%

Estimated Common equity Tier 1 capital (to risk-weighted assets)

 

13.12

%

 

 

12.61

%

 

 

12.20

%

 

 

11.80

%

 

 

11.38

%

 

 

13.12

%

 

 

11.38

%

Estimated Tier 1 capital (to risk-weighted assets)

 

13.12

%

 

 

12.61

%

 

 

12.20

%

 

 

11.80

%

 

 

11.38

%

 

 

13.12

%

 

 

11.38

%

Estimated Tier 1 leverage (to average tangible assets)

 

10.94

%

 

 

10.72

%

 

 

10.44

%

 

 

10.15

%

 

 

9.89

%

 

 

10.94

%

 

 

9.89

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Data

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares:

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

53,572

 

 

 

53,343

 

 

 

53,282

 

 

 

53,313

 

 

 

53,297

 

 

 

53,457

 

 

 

53,160

 

Diluted

 

53,608

 

 

 

53,406

 

 

 

53,350

 

 

 

53,380

 

 

 

53,375

 

 

 

53,506

 

 

 

53,261

 

Period end shares outstanding

 

53,564

 

 

 

53,551

 

 

 

53,291

 

 

 

53,322

 

 

 

53,303

 

 

 

53,564

 

 

 

53,303

 

Book value per share

$

29.23

 

 

$

28.58

 

 

$

28.54

 

 

$

27.40

 

 

$

27.37

 

 

$

29.23

 

 

$

27.37

 

Tangible book value per share(B)

$

18.00

 

 

$

17.23

 

 

$

17.02

 

 

$

15.76

 

 

$

15.60

 

 

$

18.00

 

 

$

15.60

 

Employees - full-time equivalents

 

1,045

 

 

 

1,007

 

 

 

998

 

 

 

1,008

 

 

 

1,004

 

 

 

1,045

 

 

 

1,004

 

(A)

Interim periods annualized.

(B)

Refer to the calculation of these non-GAAP financial measures and a reconciliation to their most directly comparable GAAP financial measures on page 10 of this Earnings Release.

(C)

Net interest margin represents net interest income divided by average interest-earning assets.

(D)

Represents total noninterest expense divided by the sum of net interest income plus noninterest income, excluding net gains and losses on the sale of loans, securities and assets. Additionally, taxes and provision for credit losses are not part of this calculation.

 
 
 
 

Stellar Bancorp, Inc.

Financial Highlights

(Unaudited) 

 

 

Three Months Ended

 

June 30, 2024

 

March 31, 2024

 

June 30, 2023

 

Average

Balance

 

Interest

Earned/

Interest

Paid

 

Average

Yield/Rate

 

Average

Balance

 

Interest

Earned/

Interest

Paid

 

Average

Yield/Rate

 

Average

Balance

 

Interest

Earned/

Interest

Paid

 

Average

Yield/Rate

 

(Dollars in thousands)

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-Earning Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans

$

7,808,320

 

 

$

135,885

 

7.00

%

 

$

7,938,824

 

 

$

134,685

 

6.82

%

 

$

7,980,856

 

 

$

133,931

 

6.73

%

Securities

 

1,549,638

 

 

 

12,739

 

3.31

%

 

 

1,441,814

 

 

 

10,111

 

2.82

%

 

 

1,502,949

 

 

 

10,162

 

2.71

%

Deposits in other financial institutions

 

258,916

 

 

 

3,555

 

5.52

%

 

 

264,906

 

 

 

3,627

 

5.51

%

 

 

209,722

 

 

 

2,865

 

5.48

%

Total interest-earning assets

 

9,616,874

 

 

$

152,179

 

6.36

%

 

 

9,645,544

 

 

$

148,423

 

6.19

%

 

 

9,693,527

 

 

$

146,958

 

6.08

%

Allowance for credit losses on loans

 

(96,306

)

 

 

 

 

 

 

(91,612

)

 

 

 

 

 

 

(96,414

)

 

 

 

 

Noninterest-earning assets

 

1,103,297

 

 

 

 

 

 

 

1,132,857

 

 

 

 

 

 

 

1,143,025

 

 

 

 

 

Total assets

$

10,623,865

 

 

 

 

 

 

$

10,686,789

 

 

 

 

 

 

$

10,740,138

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Shareholders' Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-Bearing Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing demand deposits

$

1,545,096

 

 

$

12,213

 

3.18

%

 

$

1,697,211

 

 

$

12,278

 

2.91

%

 

$

1,387,604

 

 

$

9,343

 

2.70

%

Money market and savings deposits

 

2,227,393

 

 

 

16,186

 

2.92

%

 

 

2,150,805

 

 

 

15,252

 

2.85

%

 

 

2,220,827

 

 

 

11,365

 

2.05

%

Certificates and other time deposits

 

1,694,536

 

 

 

18,758

 

4.45

%

 

 

1,444,048

 

 

 

15,084

 

4.20

%

 

 

1,225,834

 

 

 

9,622

 

3.15

%

Borrowed funds

 

112,187

 

 

 

1,700

 

6.09

%

 

 

134,400

 

 

 

1,774

 

5.31

%

 

 

479,896

 

 

 

6,535

 

5.46

%

Subordinated debt

 

109,910

 

 

 

1,912

 

7.00

%

 

 

109,808

 

 

 

1,917

 

7.02

%

 

 

109,499

 

 

 

1,812

 

6.64

%

Total interest-bearing liabilities

 

5,689,122

 

 

$

50,769

 

3.59

%

 

 

5,536,272

 

 

$

46,305

 

3.36

%

 

 

5,423,660

 

 

$

38,677

 

2.86

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-Bearing Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing demand deposits

 

3,308,633

 

 

 

 

 

 

 

3,525,758

 

 

 

 

 

 

 

3,779,594

 

 

 

 

 

Other liabilities

 

87,986

 

 

 

 

 

 

 

96,461

 

 

 

 

 

 

 

78,411

 

 

 

 

 

Total liabilities

 

9,085,741

 

 

 

 

 

 

 

9,158,491

 

 

 

 

 

 

 

9,281,665

 

 

 

 

 

Shareholders’ equity

 

1,538,124

 

 

 

 

 

 

 

1,528,298

 

 

 

 

 

 

 

1,458,473

 

 

 

 

 

Total liabilities and shareholders’ equity

$

10,623,865

 

 

 

 

 

 

$

10,686,789

 

 

 

 

 

 

$

10,740,138

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest rate spread

 

 

 

 

2.77

%

 

 

 

 

 

2.83

%

 

 

 

 

 

3.22

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income and margin

 

 

$

101,410

 

4.24

%

 

 

 

$

102,118

 

4.26

%

 

 

 

$

108,281

 

4.48

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income and net interest margin (tax equivalent)

 

 

$

101,482

 

4.24

%

 

 

 

$

102,207

 

4.26

%

 

 

 

$

108,509

 

4.49

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of funds

 

 

 

 

2.27

%

 

 

 

 

 

2.06

%

 

 

 

 

 

1.69

%

Cost of deposits

 

 

 

 

2.16

%

 

 

 

 

 

1.94

%

 

 

 

 

 

1.41

%

 
 
 
 

Stellar Bancorp, Inc.

Financial Highlights

(Unaudited) 

 

 

Six Months Ended June 30,

 

2024

 

2023

 

Average

Balance

 

Interest

Earned/

Interest Paid

 

Average

Yield/Rate

 

Average

Balance

 

Interest

Earned/

Interest Paid

 

Average

Yield/Rate

 

(Dollars in thousands)

Assets

 

 

 

 

 

 

 

 

 

 

 

Interest-Earning Assets:

 

 

 

 

 

 

 

 

 

 

 

Loans

$

7,873,572

 

 

$

270,570

 

6.91

%

 

$

7,914,303

 

 

$

259,660

 

6.62

%

Securities

 

1,495,726

 

 

 

22,850

 

3.07

%

 

 

1,553,200

 

 

 

21,077

 

2.74

%

Deposits in other financial institutions

 

261,911

 

 

 

7,182

 

5.52

%

 

 

286,823

 

 

 

6,636

 

4.67

%

Total interest-earning assets

 

9,631,209

 

 

$

300,602

 

6.28

%

 

 

9,754,326

 

 

$

287,373

 

5.94

%

Allowance for credit losses on loans

 

(93,959

)

 

 

 

 

 

 

(94,881

)

 

 

 

 

Noninterest-earning assets

 

1,118,077

 

 

 

 

 

 

 

1,151,497

 

 

 

 

 

Total assets

$

10,655,327

 

 

 

 

 

 

$

10,810,942

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Shareholders' Equity

 

 

 

 

 

 

 

 

 

 

 

Interest-Bearing Liabilities:

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing demand deposits

$

1,621,154

 

 

$

24,491

 

3.04

%

 

$

1,518,213

 

 

$

17,725

 

2.35

%

Money market and savings deposits

 

2,189,099

 

 

 

31,438

 

2.89

%

 

 

2,355,112

 

 

 

21,020

 

1.80

%

Certificates and other time deposits

 

1,569,292

 

 

 

33,842

 

4.34

%

 

 

1,044,721

 

 

 

12,929

 

2.50

%

Borrowed funds

 

123,293

 

 

 

3,474

 

5.67

%

 

 

293,578

 

 

 

7,852

 

5.39

%

Subordinated debt

 

109,859

 

 

 

3,829

 

7.01

%

 

 

109,458

 

 

 

3,739

 

6.89

%

Total interest-bearing liabilities

 

5,612,697

 

 

$

97,074

 

3.48

%

 

 

5,321,082

 

 

$

63,265

 

2.40

%

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-Bearing Liabilities:

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing demand deposits

 

3,417,196

 

 

 

 

 

 

 

3,971,862

 

 

 

 

 

Other liabilities

 

92,223

 

 

 

 

 

 

 

79,609

 

 

 

 

 

Total liabilities

 

9,122,116

 

 

 

 

 

 

 

9,372,553

 

 

 

 

 

Shareholders’ equity

 

1,533,211

 

 

 

 

 

 

 

1,438,389

 

 

 

 

 

Total liabilities and shareholders' equity

$

10,655,327

 

 

 

 

 

 

$

10,810,942

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest rate spread

 

 

 

 

2.80

%

 

 

 

 

 

3.54

%

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income and margin

 

 

$

203,528

 

4.25

%

 

 

 

$

224,108

 

4.63

%

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income and net interest margin (tax equivalent)

 

 

$

203,688

 

4.25

%

 

 

 

$

224,628

 

4.64

%

 

 

 

 

 

 

 

 

 

 

 

 

Cost of funds

 

 

 

 

2.16

%

 

 

 

 

 

1.37

%

Cost of deposits

 

 

 

 

2.05

%

 

 

 

 

 

1.17

%

 
 
 
 

Stellar Bancorp, Inc.

Financial Highlights

(Unaudited) 

 

 

Three Months Ended

 

2024

 

2023

 

June 30

 

March 31

 

December 31

 

September 30

 

June 30

 

(Dollars in thousands)

Period-end Loan Portfolio:

 

 

 

 

 

 

 

 

 

Commercial and industrial

$

1,392,435

 

 

$

1,451,462

 

 

$

1,409,002

 

 

$

1,474,600

 

 

$

1,512,476

 

Paycheck Protection Program (PPP)

 

3,629

 

 

 

4,293

 

 

 

5,100

 

 

 

5,968

 

 

 

8,027

 

Real estate:

 

 

 

 

 

 

 

 

 

Commercial real estate (including multi-family residential)

 

4,029,671

 

 

 

4,049,885

 

 

 

4,071,807

 

 

 

4,076,606

 

 

 

4,038,487

 

Commercial real estate construction and land development

 

922,805

 

 

 

1,039,443

 

 

 

1,060,406

 

 

 

1,078,265

 

 

 

1,136,124

 

1-4 family residential (including home equity)

 

1,098,681

 

 

 

1,049,316

 

 

 

1,047,174

 

 

 

1,024,945

 

 

 

1,009,439

 

Residential construction

 

200,134

 

 

 

252,573

 

 

 

267,357

 

 

 

289,553

 

 

 

311,208

 

Consumer and other

 

66,542

 

 

 

61,139

 

 

 

64,287

 

 

 

54,591

 

 

 

52,957

 

Total loans held for investment

$

7,713,897

 

 

$

7,908,111

 

 

$

7,925,133

 

 

$

8,004,528

 

 

$

8,068,718

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

Noninterest-bearing

$

3,308,441

 

 

$

3,323,149

 

 

$

3,546,815

 

 

$

3,656,288

 

 

$

3,713,536

 

Interest-bearing

 

 

 

 

 

 

 

 

 

Demand

 

1,564,405

 

 

 

1,576,261

 

 

 

1,659,999

 

 

 

1,397,492

 

 

 

1,437,509

 

Money market and savings

 

2,213,031

 

 

 

2,203,767

 

 

 

2,136,777

 

 

 

2,128,950

 

 

 

2,174,073

 

Certificates and other time

 

1,639,426

 

 

 

1,691,539

 

 

 

1,529,876

 

 

 

1,503,891

 

 

 

1,441,251

 

Total interest-bearing deposits

 

5,416,862

 

 

 

5,471,567

 

 

 

5,326,652

 

 

 

5,030,333

 

 

 

5,052,833

 

Total deposits

$

8,725,303

 

 

$

8,794,716

 

 

$

8,873,467

 

 

$

8,686,621

 

 

$

8,766,369

 

 

 

 

 

 

 

 

 

 

 

Asset Quality:

 

 

 

 

 

 

 

 

 

Nonaccrual loans

$

50,906

 

 

$

57,129

 

 

$

39,191

 

 

$

38,291

 

 

$

43,349

 

Accruing loans 90 or more days past due

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total nonperforming loans

 

50,906

 

 

 

57,129

 

 

 

39,191

 

 

 

38,291

 

 

 

43,349

 

Other real estate

 

2,548

 

 

 

 

 

 

 

 

 

 

 

 

 

Total nonperforming assets

$

53,454

 

 

$

57,129

 

 

$

39,191

 

 

$

38,291

 

 

$

43,349

 

 

 

 

 

 

 

 

 

 

 

Net (recoveries) charge-offs

$

(1

)

 

$

714

 

 

$

2,577

 

 

$

8,116

 

 

$

236

 

 

 

 

 

 

 

 

 

 

 

Nonaccrual loans:

 

 

 

 

 

 

 

 

 

Commercial and industrial

$

18,451

 

 

$

15,465

 

 

$

5,048

 

 

$

14,991

 

 

$

22,968

 

Real estate:

 

 

 

 

 

 

 

 

 

Commercial real estate (including multi-family residential)

 

18,094

 

 

 

21,268

 

 

 

16,699

 

 

 

13,563

 

 

 

8,221

 

Commercial real estate construction and land development

 

1,641

 

 

 

8,406

 

 

 

5,043

 

 

 

170

 

 

 

388

 

1-4 family residential (including home equity)

 

12,454

 

 

 

10,368

 

 

 

8,874

 

 

 

8,442

 

 

 

10,880

 

Residential construction

 

155

 

 

 

1,410

 

 

 

3,288

 

 

 

635

 

 

 

665

 

Consumer and other

 

111

 

 

 

212

 

 

 

239

 

 

 

490

 

 

 

227

 

Total nonaccrual loans

$

50,906

 

 

$

57,129

 

 

$

39,191

 

 

$

38,291

 

 

$

43,349

 

 

 

 

 

 

 

 

 

 

 

Asset Quality Ratios:

 

 

 

 

 

 

 

 

 

Nonperforming assets to total assets

 

0.50

%

 

 

0.53

%

 

 

0.37

%

 

 

0.36

%

 

 

0.40

%

Nonperforming loans to total loans

 

0.66

%

 

 

0.72

%

 

 

0.49

%

 

 

0.48

%

 

 

0.54

%

Allowance for credit losses on loans to nonperforming loans

 

186.17

%

 

 

168.54

%

 

 

233.94

%

 

 

244.38

%

 

 

231.14

%

Allowance for credit losses on loans to total loans

 

1.23

%

 

 

1.22

%

 

 

1.16

%

 

 

1.17

%

 

 

1.24

%

Net charge-offs to average loans (annualized)

 

0.00

%

 

 

0.04

%

 

 

0.13

%

 

 

0.40

%

 

 

0.01

%

 
 
 
 

Stellar Bancorp, Inc.
GAAP Reconciliation and Management’s Explanation of Non-GAAP Financial Measures
(Unaudited)
 

 

Stellar’s management uses certain non-GAAP (generally accepted accounting principles) financial measures to evaluate its performance. Stellar believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance and that management and investors benefit from referring to these non-GAAP financial measures in assessing Stellar’s performance and when planning, forecasting, analyzing and comparing past, present and future periods. Specifically, Stellar reviews pre-tax, pre-provision income, pre-tax pre-provision ROAA, tangible book value per share, return on average tangible equity, tangible equity to tangible assets and net interest margin (tax equivalent) excluding PAA for internal planning and forecasting purposes. Stellar has included in this earnings release information relating to these non-GAAP financial measures for the applicable periods presented. These non-GAAP measures should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the manner in which Stellar calculates the non-GAAP financial measures may differ from that of other companies reporting measures with similar names. 

 

 

Three Months Ended

 

Six Months Ended

 

2024

 

2023

 

2024

 

2023

 

June 30

 

March 31

 

December 31

 

September 30

 

June 30

 

June 30

 

June 30

 

(Dollars and share amounts in thousands, except per share data)

Net income

$

29,753

 

 

$

26,147

 

 

$

27,266

 

 

$

30,908

 

 

$

35,175

 

 

$

55,900

 

 

$

72,323

 

Add: Provision for credit losses

 

(1,935

)

 

 

4,098

 

 

 

1,047

 

 

 

2,315

 

 

 

1,915

 

 

 

2,163

 

 

 

5,581

 

Add: Provision for income taxes

 

7,792

 

 

 

6,759

 

 

 

6,562

 

 

 

7,445

 

 

 

7,467

 

 

 

14,551

 

 

 

17,380

 

Pre-tax, pre-provision income

$

35,610

 

 

$

37,004

 

 

$

34,875

 

 

$

40,668

 

 

$

44,557

 

 

$

72,614

 

 

$

95,284

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total average assets

$

10,623,865

 

 

$

10,686,789

 

 

$

10,626,373

 

 

$

10,741,295

 

 

$

10,740,138

 

 

$

10,655,327

 

 

$

10,810,942

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pre-tax, pre-provision return on average assets(B)

 

1.35

%

 

 

1.39

%

 

 

1.30

%

 

 

1.50

%

 

 

1.66

%

 

 

1.37

%

 

 

1.78

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total shareholders’ equity

$

1,565,795

 

 

$

1,530,698

 

 

$

1,521,018

 

 

$

1,460,846

 

 

$

1,458,680

 

 

$

1,565,795

 

 

$

1,458,680

 

Less: Goodwill and core deposit intangibles, net

 

601,633

 

 

 

607,831

 

 

 

614,030

 

 

 

620,262

 

 

 

627,065

 

 

 

601,633

 

 

 

627,065

 

Tangible shareholders’ equity

$

964,162

 

 

$

922,867

 

 

$

906,988

 

 

$

840,584

 

 

$

831,615

 

 

$

964,162

 

 

$

831,615

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares outstanding at end of period

 

53,564

 

 

 

53,551

 

 

 

53,291

 

 

 

53,322

 

 

 

53,303

 

 

 

53,564

 

 

 

53,303

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tangible book value per share

$

18.00

 

 

$

17.23

 

 

$

17.02

 

 

$

15.76

 

 

$

15.60

 

 

$

18.00

 

 

$

15.60

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average shareholders’ equity

$

1,538,124

 

 

$

1,528,298

 

 

$

1,475,377

 

 

$

1,471,009

 

 

$

1,458,473

 

 

$

1,533,211

 

 

$

1,438,389

 

Less: Average goodwill and core deposit intangibles, net

 

604,722

 

 

 

611,149

 

 

 

617,236

 

 

 

623,864

 

 

 

630,854

 

 

 

607,935

 

 

 

634,462

 

Average tangible shareholders’ equity

$

933,402

 

 

$

917,149

 

 

$

858,141

 

 

$

847,145

 

 

$

827,619

 

 

$

925,276

 

 

$

803,927

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average tangible equity(B)

 

12.82

%

 

 

11.47

%

 

 

12.61

%

 

 

14.47

%

 

 

17.05

%

 

 

12.15

%

 

 

18.14

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets

$

10,723,663

 

 

$

10,729,222

 

 

$

10,647,139

 

 

$

10,665,460

 

 

$

10,778,351

 

 

$

10,723,663

 

 

$

10,778,351

 

Less: Goodwill and core deposit intangibles, net

 

601,633

 

 

 

607,831

 

 

 

614,030

 

 

 

620,262

 

 

 

627,065

 

 

 

601,633

 

 

 

627,065

 

Tangible assets

$

10,122,030

 

 

$

10,121,391

 

 

$

10,033,109

 

 

$

10,045,198

 

 

$

10,151,286

 

 

$

10,122,030

 

 

$

10,151,286

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tangible equity to tangible assets

 

9.53

%

 

 

9.12

%

 

 

9.04

%

 

 

8.37

%

 

 

8.19

%

 

 

9.53

%

 

 

8.19

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income (tax equivalent)

$

101,482

 

 

$

102,207

 

 

$

106,121

 

 

$

106,919

 

 

$

108,509

 

 

$

203,688

 

 

$

224,628

 

Less: Purchase accounting accretion

 

10,098

 

 

 

8,551

 

 

 

11,726

 

 

 

12,400

 

 

 

12,572

 

 

 

18,649

 

 

 

22,676

 

Adjusted net interest income (tax equivalent)

$

91,384

 

 

$

93,656

 

 

$

94,395

 

 

$

94,519

 

 

$

95,937

 

 

$

185,039

 

 

$

201,952

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average earning assets

$

9,616,874

 

 

$

9,645,544

 

 

$

9,576,927

 

 

$

9,697,553

 

 

$

9,693,527

 

 

$

9,631,209

 

 

$

9,754,326

 

Net interest margin (tax equivalent) excluding PAA

 

3.82

%

 

 

3.91

%

 

 

3.91

%

 

 

3.87

%

 

 

3.97

%

 

 

3.86

%

 

 

4.18

%

(A)

Represents total noninterest expense, excluding acquisition and merger-related expenses, core deposit intangibles amortization and write-downs on assets moved to held for sale, divided by the sum of net interest income, excluding purchase accounting adjustments plus noninterest income, excluding gains and losses on the sale of assets. Additionally, taxes and provision for credit losses are not part of this calculation.

(B)

Interim periods annualized.

 
 

 

Investor Relations

IR@stellar.bank

Source: Stellar Bancorp, Inc.

FAQ

What was Stellar Bancorp's (STEL) net income for Q2 2024?

Stellar Bancorp (STEL) reported a net income of $29.8 million for the second quarter of 2024.

How did Stellar Bancorp's (STEL) earnings per share change in Q2 2024?

Stellar Bancorp's (STEL) diluted earnings per share increased to $0.56 in Q2 2024, up from $0.49 in Q1 2024.

What was Stellar Bancorp's (STEL) net interest margin in the second quarter of 2024?

Stellar Bancorp's (STEL) tax equivalent net interest margin was 4.24% for the second quarter of 2024.

How did Stellar Bancorp's (STEL) total loans change in Q2 2024?

Stellar Bancorp's (STEL) total loans decreased by $194.2 million to $7.71 billion in Q2 2024 compared to Q1 2024.

What was Stellar Bancorp's (STEL) return on average assets for Q2 2024?

Stellar Bancorp's (STEL) annualized return on average assets was 1.13% for the second quarter of 2024.

Stellar Bancorp, Inc.

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