On Friday, Amerant Bancorp (NYSE:AMTB) discussed first-quarter financial results during its earnings call. The full transcript is provided below.
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Summary
Amerant Bancorp focused on credit quality, improving loan portfolio, and cost-saving initiatives, achieving approximately $30 million in cost savings for 2026.
The company reported a Q1 net income in line with guidance and strong international deposit growth, particularly from Venezuela, contributing $188 million in total deposit growth.
Amerant Bancorp’s strategic initiatives include optimizing risk management, exiting non-core loans, and emphasizing sustainable growth with disciplined expense management.
The company’s net interest margin faced pressure due to lower loan yields and a shift in asset mix, with expectations to stabilize around 3.4% by year-end.
Management highlighted enhancements in credit evaluation processes and proactive portfolio management, aiming for long-term sustainable financial results.
Full Transcript
OPERATOR
Greetings and welcome to the Amerant Bancorp First Quarter 2026 Earnings Conference Call and webcast. At this time, all participants are in listen only mode. A question and answer session will follow the formal presentation. You may be placed into question queue at any time by pressing Star1 on your telephone keypad. As a reminder, this conference is being recorded. If anyone should require operator assistance, please press Star zero. It’s now my pleasure to turn the call over to Laura Rossi, Executive Vice President, Head of Investor Relations. Laura, please go ahead.
Laura Rossi (Executive Vice President, Head of Investor Relations)
Thank you operators. Good morning everyone and thank you for joining us to review Amerant Bancorp’s first quarter 2026 results. On today’s call are Carlos Yafigliola, our interim CEO, and Cherima Calderon, our CFO. Additionally, we’re pleased to welcome as a guest speaker this quarter Leanne Craig, Chief Credit Officer who will share further insight into our credit risk management initiatives as we begin. Please note that discussions on today’s call contain forward looking statements within the meaning of the securities Exchange Act. In addition, references will also be made to non GAAP financial measures. Please refer to the Company’s earnings release for a statement regarding forward looking statements as well as for information and reconciliation of non GAAP financial measures to GAAP measures. I will now turn it over to our interim CEO, Carlos Yafigliola.
Carlos Yafigliola (Interim CEO)
Thank you Laura Good morning everyone and thank you for joining us today to discuss Amerant Bancorp first quarter 2026 results. As we begin, I want to acknowledge where we are in the execution of our strategic plan. I’m proud of the continued progress we have made on the three priorities we outlined last stabilizing the business, optimizing our credit portfolio, and growing sustainably. I also want to thank the Ameren team for the hard work and dedication throughout the quarter. Our people are the key enablers of this plan and that continues to guide our execution. So let’s begin with our primary focus, which has been credit quality and improving our loan portfolio. As a reminder, in Q4 last year we completed a comprehensive reassessment of our portfolio in terms of risk identification and classification and subsequently exited a segment of loans from classified categories. This process continued into the first quarter where we demonstrated proactive credit management and further refined declassifications of certain loans based on current macroeconomic data and new information received. We identified both necessary downgrades as well as merited upgrades. Additionally, we exited and transferred to held-for-sale another group of loans that we no longer consider core to our business. The new process and people we have put in place have significantly improved our credit evaluation capabilities and the team is executing well. The composition of our loan portfolio now reflects a healthier mix with a risk profile that is more consistent with our long term goals. Leanne will share additional details shortly going forward as we prioritize business development and we will pursue growth within credit parameters that allow for sustainable financial results. To this end, we have enhanced risk based limits to adjust concentration risk and prevent single borrower overexposure. We have also refined our market approach by moving away from out of market collateral projects except selectively for existing clients in core markets where we have deeper borrower insight. We have also fundamentally shifted underwriting, prioritizing borrowers with proven stable operating history over projection based lending and tightening our policy exception framework by lowering allowable exception thresholds to better align with our risk appetite. Lastly, we have continued to invest in experienced, talented and we’re taking a more intentional approach to growth focusing on what we believe are the right fundamentals to drive stability, consistency and sustainable top line performance. Our top priority is continuing to improve our efficiency which the team executed well against. This quarter Our net income for Q1 was in line with our guidance and we have significantly reduced non interest expenses quarter over quarter supported by better than expected cost savings. To put this in perspective, our expense management efforts represents approximately 30 million in cost savings for 2026. Additionally, we saw strong growth in favorable low cost international deposits as a result of the reactivation of the Venezuelan economy and our deep knowledge and experience in the market as well as the extensive work that for many years we have done to preserve and expand our relationships in the country. In line with this, I would like to take a moment to provide some additional context on our international deposit growth. Last quarter we highlighted Venezuela as an area of opportunity and this quarter we delivered recording $188 million of total deposit growth in Q1 from which 95 million came from Venezuela and 66 million of this growth was in March alone. These deposits are quite attractive due to their stability, overall cost of funds and beta in rates up cycle such as the one we recently experienced, allowing for improved profitability as we continue to grow our international presence. Furthermore, these customers are well aligned with our relationship first approach as they can be cross sold via our wealth management offering. Moving forward, Venezuela represents a key opportunity to continue generating net interest income from a source of funds and to capture increased market share. We believe Amerent is uniquely positioned to take advantage of this opportunity and support both individual entities as the country reopens. In summary, we believe we executed well against our strategic plan, we took a focused, deliberate action to further optimize our credit portfolio while reinforcing risk management. We implemented cost savings initiatives that have reduced our expenses and improved our efficiency. We generated long growth that is aligned with our risk appetite despite exits of certain criticized loans and significant loan repayments, which provides a clear line of sight to sustained credit performance. And we executed well on our international strategy, particularly in Venezuela, which we view as a meaningful opportunity to further scale our international deposit franchise and drive incremental earnings. With that, I will turn it over to Sherry to review our quarterly financial results in more detail.
Charima Calderon (CFO)
Thank you, Carlos and good morning everyone. I want to begin by saying that going forward we will be discussing results without breaking down core versus non core metrics in our financials. We would like to be more selective with adjustments with the goal of providing a clearer and more straightforward view of our quarterly performance. All comparisons made to last quarter’s results are to our GAAP reported figures. Let’s turn to slide 4 where you will see our balance sheet highlights. Note that in the next three slides I will focus on those items that are most relevant to the quarter and will not be covered in subsequent slides. Total assets were $9.9 billion as of the end of the first quarter, an increase from $9.8 billion as of the end of the fourth quarter. The increase was primarily driven by higher deposit balances. Additionally, we reallocated our assets to fund net loan growth, including selected residential loan purchases, and deployed available cash into higher yielding assets. Cash and cash equivalents were 188.7 million, down by 281.5 million, compared to 470.2 million in the fourth quarter due to the purchases of investment securities at attractive yields as well as to fund loan growth. Total Investment securities were $2.4 billion, up by $346.3 million compared to $2.1 billion in the previous quarter. Total gross loans were $6.8 billion, up by $56.5 million compared to $6.7 billion in the fourth quarter. While we experienced increases in certain portfolios, overall loan balances were only slightly higher than in the fourth quarter due to a high level of prepayments and some loans that we exited in line with our focus on credit quality. This was anticipated and guided to in our call last quarter. On the deposit side, total deposits were $7.9 billion, up by 152.2 million compared to 7.8 billion in the fourth quarter, primarily driven, as Carlos mentioned, by strong growth and international deposits. Our assets under management increased $148.6 million to $3.4 billion driven by higher market valuations. As we’ve shared previously, we continue to see this business as an area of opportunity for us to grow fee income going forward. Increasingly, in light of the opportunity in Venezuela, let’s turn to slide 5 looking at the income statement, Diluted income per share for the first quarter was $0.44 compared to $0.07 in the fourth quarter. Net interest income was 80.3 million, down 9.9 million from 90.2 million in the fourth quarter. This was primarily driven by lower average balances and yields on interest earning assets, largely attributable to the anticipated cuts of 50 basis points in market rates impacting the portfolio for the entire quarter. The decrease in net interest income was also driven by the asset mix reallocation that translated into a contraction of our financial margin to 3.55% from 3.78% in the fourth quarter. Provision for credit losses was $7.8 million compared to $3.5 million in the fourth quarter. Non interest income was $17.4 million, down $4.6 million from $22 million, primarily driven by the absence of the gain that we had in the fourth quarter from the sale and leaseback of two banking centers as well as lower securities gains this quarter compared to the fourth quarter. Non interest income this quarter includes securities gains of $516,000. Non interest expense was $66.9 million down by $39.9 million or 37.3% from $106.8 million in the fourth quarter. The significant reduction in …
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