Cullen/Frost moves quickly on hires as part of Houston expansion
Cullen/Frost Bankers says its expansion plan in the Houston area is off to a solid start.
The San Antonio bank began its expansion effort late in the fourth quarter, opening the first of 25 new branches planned over the next two years in the Houston market.
The $31.3 billion-asset bank has filled about 90 of 130 jobs it has posted so far, a bank spokesman said Thursday. With those hires it is roughly a third of the way to the 260 workers it needs to staff all the new branches.
“It’s very early," Chairman and CEO Phil Green cautioned in discussing the bank's progress in Houston during a conference call on fourth-quarter results. "These are long-term strategies. We’re not planting corn, we’re planting trees. The important thing is, are we hiring the right people? Did we pick the right markets? I think everything we know about these markets we feel really good about it."
Cullen/Frost benefited from strong loan growth, savings from tax reform and a lower provision for loan losses in the fourth quarter.
Net income rose 19% from a year earlier to $117.2 million, and earnings per share of $1.82 came in 7 cents higher than the mean estimate of analysts surveyed by FactSet Research Systems.
Net interest income increased 11.3% to $249.2 million as the company shifted its mix to higher-yielding assets, mostly loans, and benefited from higher interest rates and tax savings. Its net interest margin widened 2 basis points to 3.72%.
Average loans rose 8.3% to $13.9 billion. Average deposits increased 1.5% to $26.3 billion.
Noninterest income declined 3% to $87.1 million, mainly due to a new accounting standard that changed the way the bank reported interchange and debit card transaction fee income, the bank said.
Expenses increased 1.7% to $199.7 million.
Cullen/Frost recorded a provision for loan losses of $3.8 million, compared with $8.1 million in the year-ago period. Net charge-offs totaled $9.2 million, compared with $7 million a year earlier.