2023-04-28 13:15:20 ET
Customers Bancorp ( NYSE: CUBI ) stock spiked 16.6% in Friday afternoon trading as investors praised the regional lender's first-quarter results and full-year outlook.
The Pennsylvania-based bank's EPS of $1.55 sailed past the average analyst estimate of $1.18 and jumped from $0.77 in the previous quarter, as it acquired several new relationships from failed banks.
One of the main highlights from the earnings report featured an "impressive" increase in its non-interest bearing deposits, soaring 85% to $1.6B from year-end balances, said Chairman and CEO Jay Sidhu. Since last month's failures of Silicon Valley Bank and two other regional banks, deposit levels have been a primary focus among bank investors as widespread customer withdrawals prompted a slew of regional lenders to sell their underwater fixed-income investments at a loss.
Still, total deposits of $17.7B at the end of Q1 fell from $18.2B at the end of 2022. For the full year, “deposits are expected to remain relatively flat, with a focus on improving our funding profile and reducing high-cost deposits” in the wake of higher interest rates, CUBI said.
Core loans are also expected to "essentially flat to down," it added, contending that net interest margin -- a key profitability metric among banks -- "has troughed with expansion opportunities throughout the remainder of 2023."
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Customers Bancorp stock soars as Q1 earnings, year outlook cheered