In This Article:
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Net Income: Approximately $112 million, up 36% from $82.7 million a year ago.
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Earnings Per Share: $1.93, representing a year-over-year growth of 40%.
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Net Interest Margin: 5.17% for the quarter, up from 4.36% a year ago.
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Return on Average Common Equity: 19.1% for the three months ended September 30, 2024.
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Deposit Growth: Increased by approximately $614 million linked quarter.
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Ending Loan Balances: Up 0.3% linked quarter and 13.7% year over year to $19.3 billion.
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Average Loan Yields: 9.01%, up 116 basis points from a year ago.
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Noninterest Expenses: Approximately $147 million for the quarter, up by $6.9 million from the previous quarter.
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Provision for Credit Losses: $14 million for the quarter, compared to $7 million a year ago.
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Allowance for Credit Losses: 1.35% of total loans held for investment.
Release Date: October 30, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Axos Financial Inc (NYSE:AX) reported double-digit year-over-year growth in earnings per share and book value per share for the 10th consecutive quarter.
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The company achieved a 19.1% return on average common equity for the three months ended September 30, 2024.
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Net interest margin increased to 5.17% for the quarter, benefiting from the payoff of three loans purchased from the FDIC.
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Axos Financial Inc (NYSE:AX) increased deposits by $614 million in the first quarter of fiscal year 2025, with demand, money market, and savings accounts representing 96% of total deposits.
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The company continues to see strong demand in its fund finance, ABL, and select C&I lending businesses, with several new lending and deposit teams contributing to growth.
Negative Points
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There was an uptick in nonperforming assets, particularly in the single-family jumbo mortgage and commercial real estate loan portfolios.
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The company faced elevated levels of prepayments in multifamily, single-family jumbo mortgage, and commercial real estate lending groups, impacting loan growth.
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Axos Financial Inc (NYSE:AX) experienced increased competition and pricing pressure in certain lending verticals, which may require concessions on pricing.
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Noninterest expenses rose to approximately $147 million for the three months ended September 30, 2024, driven by higher salaries and benefits expenses.
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The company allocated a specific loan provision of approximately $10 million for a potential loss related to a restructuring transaction in a shared national credit loan.
Q & A Highlights
Q: Can you discuss the competitive dynamics you're seeing for new loan deals, particularly in the C&I verticals? A: Gregory Garrabrants, President and CEO: We've observed a trend of banks tightening spreads, which has led to some pricing pressure in certain verticals. Despite this, demand remains strong, and we've added teams across various geographies and national verticals. We need to be thoughtful about pricing concessions to maintain loan growth, but competition is definitely increasing.