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The lackluster earnings season for regional banks continued. Executives at Fifth Third and BB&T shared concerns about margin shrinkage and other forces beyond their control, and they provided contrasts in expense control and management of interest rate uncertainty.
October 16 -
Regional banks are doing their best to hold down expenses, compete for quality loans and generate more fee income, but until the Federal Reserve raises interest rates, their quarterly profits will remain sluggish, bankers and analysts say.
October 15 -
Alternative lenders filling gaps left by banks continue to gain market share. TCP Capital's Raj Vig discusses the pressures in middle market lending, where looser terms are attracting regulators' attention.
October 10
Associated Banc-Corp in Green Bay, Wis., produced strong loan growth and other results in the third quarter that analysts said outshone some of its peers.
The $26 billion-asset company reported net income after preferred dividends of $49 million, up 10% from a year earlier. Revenue rose nearly 7%, to $252 million, over the same period.
Associated reported net interest income of $173 million, which was slightly higher than in the second quarter and 7.6% better than a year earlier. Noninterest income was $75 million, just above the second quarter and 5.6% above the third quarter of 2013.
Loans rose 10% year over year, to $17.2 billion. Commercial increased more than 11% from a year earlier, to $10.7 billion. That growth occurred despite what executives described as a slowdown at the end of the third quarter amid stiff competition.
"Competition has picked up even more as all banks seem to be seeking asset growth," Chief Executive Philip Flynn said in Associateds earnings call. "We continue to see aggressive pricing and structures. We have been selective."
Sandler ONeill analyst Scott Siefers described Associated's outlook as "cautious
given frothiness in the market." Its quarterly performance was solid compared with other regional banks reporting over the past two days.
Flynn said at the end of the conference call that Associated is now seeing the benefits of larger loan portfolio.
Residential mortgages grew 6% from the previous quarter, with $231 million originated. Even greater growth, though smaller in number at $115 million, was mortgage warehousing, which increased 42% from the previous quarter.
