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Cullen/Frost Bankers, Inc. CFR reported fourth-quarter 2024 earnings per share (EPS) of $2.36, up 8.3% from the prior-year quarter. The bottom line surpassed the Zacks Consensus Estimate by 8.8%.
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Results were primarily aided by a rise in non-interest income and net interest income (NII), alongside higher loan and deposit balances in the quarter. However, increased credit loss expenses were significant drags.
The company reported net income available to its common shareholders of $153.2 million, up from $100.9 million in the prior-year quarter.
In 2024, earnings of $8.87 per share topped the consensus estimate by 1.3%. However, the metric fell from $9.10 in 2023. Net income was $575.9 million in 2024, down 2.6% from the prior year.
CFR’s Revenues Increase, Expenses Down
The company’s total revenues were $556.4 million in the fourth quarter, up 6.3% year over year. Also, the top line surpassed the Zacks Consensus Estimate by 2.3%.
For 2024, revenues were $2.15 billion, which topped the Zacks Consensus Estimate by 0.9%. Also, the top line rose 3.4% year over year.
The fourth-quarter NII on a taxable-equivalent basis increased 2% to $433.7 million year over year. Nonetheless, the net interest margin (NIM) expanded 12 basis points (bps) year over year to 3.56%. Our estimates for NII and NIM were $426.9 million and 3.57%, respectively.
Non-interest income improved 8% to $122.8 million year over year. The rise was attributed to increases in all components, except for other non-interest income. Our estimate for non-interest income was $111.6 million.
Non-interest expenses of $336.2 million declined 8% year over year. Excluding the special surcharge expenses associated with FDIC insurance in the fourth quarter of 2023, non-interest expenses for the fourth quarter of 2024 increased 7.2% to $336.2 million. Our estimate for non-interest expenses was $338.6 million.
As of Dec. 31, 2024, total loans were $20.8 billion, up 3.5% sequentially. Total deposits amounted to $42.7 billion, up 2.4% from the previous quarter. Our estimates for total loans and total deposits were $21.3 billion and $40.1 billion, respectively.
Cullen/Frost’s Credit Quality: Mixed Bag
As of Dec. 31, 2024, the company recorded credit loss expenses of $16.2 million compared with $16 million in the prior-year quarter. Nonetheless, the allowance for credit losses on loans, as a percentage of total loans, was 1.30%, down 1 bps.
Net charge-offs, annualized as a percentage of average loans, increased 4 bps year over year to 0.27%.