Q4 2024 South Plains Financial Inc Earnings Call Transcript
Key Points
- South Plains Financial Inc (SPFI) delivered solid financial results despite a challenging environment, with a focus on optimizing profitability and maintaining strong credit quality.
- The company reported a diluted earnings per share of $2.92 for the full year 2024, outperforming the previous year when excluding a one-time gain.
- Loan portfolio growth of 1.4% for the full year was achieved, with strong new business production pipeline expected to drive further growth in 2025.
- The community-based deposit franchise remains a competitive advantage, with a stable deposit base and the ability to reprice deposits lower, contributing to a higher net interest margin.
- SPFI is well-capitalized, with a strong capital position allowing for potential growth opportunities and shareholder returns through dividends and stock repurchase programs.
- Diluted earnings per share decreased from $3.62 in 2023 to $2.92 in 2024, partly due to the absence of a one-time gain from the previous year.
- Loan payoffs and paydowns, particularly in the indirect auto portfolio, have been a significant headwind to loan growth.
- Non-interest-bearing deposits decreased, largely due to seasonal declines, impacting the overall deposit base.
- The company anticipates relatively flat loan growth in the first quarter of 2025 due to seasonal agricultural loan payoffs and continued elevated loan payoffs.
- M&A activity remains uncertain, with potential acquisitions being evaluated cautiously due to high seller expectations and the need for strong cultural fit and minimal shareholder dilution.
Good morning, ladies and gentlemen and welcome to the South Plains Financial Inc fourth quarter, 2024 earnings conference call. (Operator Instructions). As a reminder, this conference call is being recorded. I would now like to turn the call over to Steve Crockett, Chief Financial Officer and Treasurer of South Plains Financial. Please go ahead.
Thank you, operator and good morning, everyone. We appreciate you joining our earnings conference call with me here today are Curtis Griffith, our Chairman and CEO; Cory Newsom, our President and Brent Bates, the bank's Chief Credit Officer, the related earnings press release and earnings presentation are available on the news and events section of our website SPFI.bank.
Before we begin, I'd like to remind everyone that this call may contain forward-looking statements and are subject to a variety of risks, uncertainties and other factors that could cause actual results to differ materially from those anticipated future results.
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