Fulton Financial Corp. in Lancaster, Pa., plans to continue to focus on organic growth this year but would consider an acquisition if the right deal came along, its top executive said Wednesday.
The $14.9 billion-asset multibank holding company opened 12 branches last year and is planning another dozen this year, R. Scott Smith Jr., Fulton's chairman, president, and chief executive, said in a conference call with analysts.
Fulton has been an active acquirer in recent years but did not announce any deals last year.
"While acquisitions have been a big part of our success, we believe we can achieve required earnings per share growth by better leveraging organic growth opportunities across our five-state footprint," Mr. Smith said.
Richard D. Weiss, an analyst at Janney Montgomery Scott LLC, asked if Fulton might step up its branching if it continued to pass on acquisitions, but Mr. Smith said it would stick to its stated plan.
The conference call came a day after Fulton reported that its fourth-quarter earnings jumped 13.9% from a year earlier but only 3.6% from the third quarter, to $46.6 million. Full-year earnings rose 11.7%, to $185.5 million.
Analysts peppered Fulton executives with questions about its growth prospects in the year ahead and its net interest margin, which shrank 17 basis points from the third quarter and 24 basis points from a year earlier, to 3.68%. The company attributed some of the compression to the repricing of certificates of deposit and an overall shift in its deposit mix toward CDs.
Charles J. Nugent, Fulton's chief financial officer, said it hopes an upcoming marketing effort will help attract more core deposits, though the industry overall is struggling with the same issue.
"We're still opening the same amount of accounts, but the average balances are dropping," he said. "How far they're going to drop, I don't know."
Nonperforming assets were 0.39% of total assets, virtually unchanged from a year ago, but up from 0.31% in the previous quarter. The provision for loan losses increased $288,000, or 36.9%, from a year earlier.
