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Sep 30, 2023
Esquire Financial Q3 2023 Earnings Report
Esquire Financial's Q3 2023 earnings were marked by strong commercial loan growth and a robust net interest margin.
Key Takeaways
Esquire Financial Holdings, Inc. reported a net income increase of 28% to $9.8 million, or $1.17 per diluted share, for the third quarter of 2023. The company's performance was driven by commercial loan growth and a strong net interest margin of 6.19%.
Core commercial relationship banking clients represent approximately 85% of the $1.3 billion deposit base.
There were no nonperforming loans at quarter end, with a 1.38% allowance for credit losses to loans ratio.
Overall liquidity position totaled $782.4 million, or 61% of total deposits.
Net income increased 28% to $9.8 million, or $1.17 per diluted share.
Esquire Financial
Esquire Financial
Forward Guidance
The company anticipates continued increases in their cost-of-funds due to the current short-term interest rate environment, which may negatively impact their net interest margin in the future.
Challenges Ahead
- Anticipate continued increases in our cost-of-funds in response to the current interest rate environment, which may negatively impact our net interest margin in the future.
- We anticipate continued increases in our cost-of-funds due to the current short-term interest rate environment.
- These increases may negatively impact our net interest margin in future quarters.
- The increase in the allowance as a percentage of loans was general reserve driven considering loan growth and qualitative factors associated with the current uncertain economic environment including, but not limited to, its potential impact on the New York metro commercial real estate market.
- Our deposit cost-of-funds, excluding demand deposits, increased 88 basis points in the current quarter when compared to 2022 due to increases in short-term interest rates as well as management pro-actively increasing rates on escrow accounts in the various states where we operate (interest on lawyer trust accounts or IOLTA).