On Friday, Ameris (NYSE:ABCB) discussed first-quarter financial results during its earnings call. The full transcript is provided below.
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The full earnings call is available at https://event.choruscall.com/mediaframe/webcast.html?webcastid=wlhfkm1n
Summary
Ameris reported a strong financial performance with a return on assets (ROA) of 1.62% and a return on tangible common equity of nearly 15%.
The company achieved a 10% increase in quarterly revenue compared to the first quarter of 2025, while expenses only rose by 4%, maintaining an efficiency ratio just under 50%.
Ameris repurchased 1.4% of its shares during the quarter, demonstrating active capital management.
Loan production saw a significant increase with a 45% rise over the previous year, while deposits grew by 5% annualized.
The company anticipates mid-single-digit loan and deposit growth for the rest of the year, with some expected slight margin compression.
Non-interest income increased due to better mortgage fees and equipment finance fees, while non-interest expenses rose due to higher compensation costs.
Management expressed confidence in their competitive positioning and focus on growing core deposits and organic growth.
Full Transcript
OPERATOR
Good day and welcome to the Ameris Bancorp first quarter conference call. All participants will be in a listen only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today’s presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on the touchtone phone. To withdraw your question, please press Star then two. Please note this event is being recorded. I would now like to turn the conference over to Nicole Stokes, Chief Financial Officer. Please go ahead.
Nicole Stokes (Chief Financial Officer)
Thank you. And thank you to all who have joined our call today. During the call we will be referencing the press release and the financial highlights that are available on the investor Relations section of our website at amerisbank.com I’m joined today by Palmer Proctor, our CEO, and Doug Strange, our Chief Credit Officer. Palmer will begin with some opening comments and then I will discuss the details of our financial results before we open up for Q and A. But before we begin, I’ll remind you that our comments may include forward looking statements. These statements are subject to risks and uncertainties. The actual results could vary materially. We list some of the factors that might cause results to differ in our press release and in our SEC filings which are available on our website. We do not assume any obligation to update any forward looking statements as a result of new information, early developments or otherwise, except as required by law. Also during the call we will discuss certain non GAAP financial measures in reference to our performance. You can see our reconciliation of these measures and GAAP financial measures in the appendix to our presentation. And with that, I’ll turn it over to Palmer for his comments.
Palmer Proctor (Chief Executive Officer)
Thank you, Nicole. Good morning everyone. We appreciate you taking the time to join our first quarter call. I’m proud of our performance to start the year primarily due to three factors. First, we operated at a high level of core profitability with an ROA above 160ppnr, ROA at 2.30, and a return on tangible common equity of almost 15%. Second, we experienced good growth in loans, deposits earning assets and revenue. And third, we actively managed our capital by repurchasing 1.4% of the company in the quarter at about a 7.5% discount to yesterday’s closing price. In addition to those 3 positives, I want to revisit something I said on our first quarter call last year. I said we were focused on enhancing revenue generation and positive operating leverage, and once again we executed on our plan. Compared to the first quarter of 2022, our quarterly revenue is up 10% with expenses up only 4%. That’s about a 21% growth efficiency on our growth due to our focus on efficient, organic profitable growth. More specifically, on an annualized basis, we grew loans and deposits by 5 to 6% along with earning assets at nearly 10%. Revenue increased 9.5% driven by an uptick in fee income which represented a strong 22% of total revenue for the quarter. Our continued focus on expense discipline across the company results in an efficiency ratio of just under 50%. Despite some seasonal revenue and expense headwinds in the first quarter, our net interest margin expanded 3 basis points to 388 in the quarter and remains well above peer level. Loan production was 2.2 billion in the first quarter of a 45% increase over first quarter last year. Our loan pipeline remained robust at 2.8 billion. On the deposit front, we continue to focus on core granular deposits and relationship banking with total deposits up 5% annualized in the quarter. Our non interest bearing deposits grew 323 million in the quarter, recapturing some of the seasonal decline of last quarter. Our non interest bearing deposits returned to 30% of total deposits and we have minimal reliance on brokered funds. We increased our capital return in the quarter by repurchasing 75 million or 1.4% of shares outstanding, which is the highest level of buybacks we have had in any one quarter. Capital levels remain robust with CET1 finishing at roughly 13% and our TCE ratio slightly above 11%. These capital levels position us well for any type of environment. Credit quality was stable, our 1.62% reserve was unchanged and both net charge offs and nonperforming assets excluding government guaranteed mortgages improved modestly in the quarter. CRE and construction concentrations were relatively stable at 265 and 46% respectively. Overall, we remain well positioned for future growth and this growth should be positively impacted by the continued disruption in our southeastern footprint. I’ll stop there and turn it over to Nicole to discuss our financial results in more detail.
Nicole Stokes (Chief Financial Officer)
Great. Thank you Palmer. So we reported net income of 110.5 million or $1.63 per diluted share in the first quarter. Our return on assets was 1.62%, our PPNR ROA was 2.3% and our return on tangible common equity was 14.75%. For the quarter our tangible book value increased to 44.79 and that’s about 12.5% than a year ago. As Palmer said, capital levels remain robust and we were notably active in our share buybacks during the quarter, repurchasing 74.9 million of common stock or 950,400 shares at an average price of $78.76. Combined with our full year 2025 share buybacks, we’ve repurchased just over 3% of the company over the last five quarters. Our remaining share repurchase authorization was 84.3 million. At the end of the first quarter, our net interest margin expanded 3 basis points to a strong 388. The expansion came from 6 basis point positive impact on the funding side, more than offset the three basis point decline from the lower asset yields. Our margin level is well above peer and is at 100% core without any purchase accounting accretion from M and A. Our asset liability sensitive is effectively neutral and has really served us well through this macroeconomic environment. That said, we do anticipate we could have some slight margin compression over the next few quarters and that’s really due to pressure on the deposit costs as we fund our balance sheet growth. We believe the margin could decline a few basis points per quarter, probably 5 to 10 total basis points lower over the next few quarters but but we will continue to focus on growth in net interest income both through earning asset growth and margin management. Non interest income increased 8.1 million this quarter, mostly from better mortgage fees as well as an increase in our equipment finance fees. Total non interest expense increased about 14 million in the quarter, partially driven by seasonally higher compensation costs, specifically higher payroll taxes, 401 matching expenses and incentive accruals. Comparing cyclical first quarters, our efficiency ratio this year was 49.97, an improvement from 52.83 first quarter of last year. This improvement was driven by the positive operating leverage as year over year quarterly revenue growth was 28.5 million and our expense growth was only 6 million for that same period. Going forward, I anticipate the efficiency ratio to be slightly above 50% for the rest of the year. During the quarter we recorded $16.6 million of provision expense. Annualized net charge offs this quarter decreased to 21 basis points. We continue to anticipate net charge offs in the 20 to 25 basis point range. For 2026, our reserve remains strong at 1.62% of loans, the same as last quarter and overall asset quality trends remain strong with nonperforming assets excluding government guaranteed mortgages and net charge offs down in the quarter and both classifies and criticize remain well below peer. Looking at our balance sheet, we ended the quarter at 28.1 billion of total assets compared to $27.5 billion at year end. Earning assets grew 607.8 million or 9.7% annualized. As we grew, both the loan book and the bond portfolio loans grew 314.5 million or about 5.9% annualized. And as Palmer mentioned, our loan production and our pipelines rem strong. The real big win for the quarter was our core deposit growth. Deposits grew 261 million or 4.7% annualized. And that was really strong growth in both our consumer and commercial customers of 547 million. As expected, we had the seasonal outflows of about 430 million of public funds and our non interest bearing to total deposit ratio improved back up to 29.8% from 28.7 at year end. We project our loan and deposit growth to be in the mid single digit range for the rest of the year. And as I previously mentioned, we expect longer term deposit growth will be the governor on loan growth. With that, I’m going to wrap it up and turn the call back over to Bailey for any questions from the group.
OPERATOR
We will now begin the question and answer session. To ask a question, you may press star then one on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw the question, please press star then two. At this time we will pause momentarily to assemble our roster. Our first question comes from Will Jones with kbw. Please go ahead.
Will Jones (Equity Analyst)
Yeah. Hey, thanks. Good morning guys. Good morning. Good morning, Will. Hey. So Nicole, I just wanted to start just with the margin. You know, you guys have just perpetually continued to outperform your guidance and kind of outperform your expectations there. Although you know, the forward outlook, the messaging has really been the same that you kind of see, you know, a couple basis point headwind just as, it becomes more competitive to fund some of your growth. Although it feels like that messaging hasn’t particularly changed much either. So maybe just a backward looking question. What has kind of differed from your expectations with that dynamic and maybe more forward looking, where are you seeing new loan yields today? Coming on just relative to new deposits?
Nicole Stokes (Chief Financial Officer)
Yep, great question. So I’ll start with kind of the look back and you know, we’ve said all of our guidance when we talk about our Asset Liability Management (ALM) modeling and where our margin guidance is going, we’ve said all along that that had to do with some of our guidance we added was deposit pressure and also the funding and the mix of the deposits as we fund the growth. So where is the growth coming from? So certainly in the first quarter something that really helped the margin was the deposit growth, you know, of the non interest bearing. So $323 million of non interest bearing growth …
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