In This Article:
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Net Loss: $66.1 million for Q4 2024, or $4.02 per diluted share.
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Net Loss for 2024: $26 million, or $1.66 per diluted share.
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Pre-tax Loss from Securities Repositioning: $100.2 million.
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After-tax Impact of Securities Loss: Approximately $75 million.
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Equity Offering Proceeds: $108.5 million from $115 million issued capital.
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Net Interest Margin (NIM): 2.91% for Q4 2024; full year NIM of 2.86%.
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Commercial Loan Growth: 3.8% during Q4 2024; 4.5% for the full year 2024.
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Deposits: $5.1 billion at year-end 2024, down $202 million from September 30, 2024.
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Provision for Credit Losses: $6.5 million in Q4 2024.
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Allowance for Credit Losses on Loans: Increased to 1.07% as of September 30, 2024.
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Return on Average Assets Target for 2025: At least 110 basis points.
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Return on Average Equity Target for 2025: At least 11.25%.
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Efficiency Ratio Target for 2025: Below 60%.
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Net Interest Margin Target for 2025: Between 345 and 355 basis points.
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Non-interest Income Projection for 2025: $9 to $10 million per quarter.
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Non-interest Expense Projection for 2025: Approximately $35 million per quarter.
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Effective Tax Rate for 2025: Expected between 17% and 19%.
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Net Charge Offs Projection for 2025: Between 25 to 35 basis points of average loans.
Release Date: January 31, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Financial Institutions Inc (NASDAQ:FISI) successfully completed an equity offering that was more than four times oversubscribed, raising $115 million in new capital.
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The company restructured its investment securities portfolio, selling $653.5 million of low-yielding securities and reinvesting in higher-yielding agency-wrapped securities, which is expected to enhance future earnings.
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Commercial loan growth was strong, with a 3.8% increase during the quarter and 4.5% for the full year 2024.
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Regulatory and tangible capital ratios improved significantly, with the common equity tier 1 ratio increasing by 60 basis points from the previous quarter.
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The company is targeting a return on average assets of at least 110 basis points and a return on average equity of at least 11.25% for 2025, indicating a focus on profitability.
Negative Points
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Financial Institutions Inc (NASDAQ:FISI) recorded a $100.2 million pre-tax loss due to the securities repositioning, resulting in a net loss available to common shareholders for the fourth quarter.
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The allowance for credit losses on loans increased by six basis points to 1.07%, reflecting higher loan growth and increased net charge-offs.
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Non-interest expenses are expected to rise by 5% in 2025, partly due to ongoing initiatives and a $1.3 million pension plan settlement accounting charge.
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The company anticipates continued outflows from its bass-related deposits, which could impact overall deposit growth.
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FDIC assessment expenses are expected to remain elevated through 2025 due to an increase in the assessment rate following the fourth-quarter securities loss.