FIBK - First Interstate BancSystem: 2024 Does Not Bode Well

2024-02-04 16:10:03 ET

Summary

• First Interstate BancSystem's high dividend yield of 7.10% raises concerns about its sustainability.
• The bank's loan portfolio is experiencing sluggish demand for credit, hindering loan growth.
• The bank is shifting focus to its investment portfolio and reinvesting in fixed-rate securities to gain from future Fed Funds Rate decline.

First Interstate BancSystem ( FIBK ) is a bank based in Billings, Montana. Analyzing it at first glance the thing that most catches your eye is its high dividend yield of 7.10%. Anyway, after the release of Q4 2023 I personally begin to have doubts about its sustainability. This quarterly did not go well as NIM continues to decline and demand for credit remains sluggish. At the same time, the upward pressure on the cost of deposits continues....

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