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Mar 31, 2020
TriCo Q1 2020 Earnings Report
Reported net income of $16.1 million and diluted earnings per share of $0.53 for the quarter ended March 31, 2020.
Key Takeaways
TriCo Bancshares reported a decrease in net income to $16.121 million for the quarter ended March 31, 2020, compared to $22.890 million in the previous quarter and $22.726 million in the same quarter last year. Diluted earnings per share also decreased to $0.53, compared to $0.75 in the previous quarter and $0.74 in the first quarter of 2019. The company's return on average assets was 1.00%, and the return on average equity was 7.14%.
Net income for the quarter ended March 31, 2020, was $16.121 million, a decrease from both the previous and prior-year quarters.
Diluted earnings per share (EPS) for Q1 2020 were $0.53, down from $0.75 in Q4 2019 and $0.74 in Q1 2019.
Total loans reached a record high of $4.38 billion as of March 31, 2020, an increase of 8.5% over the same quarter of the prior year.
The company adopted CECL on January 1, 2020, resulting in an increase to the allowance for loan losses of $18.9 million and a decrease, net of taxes, to retained earnings of $13.0 million.
TriCo
TriCo
Forward Guidance
The company expects further economic damage from COVID-19 and anticipates challenges ahead, but believes its financial strength and experienced leadership will enable it to navigate the uncertain environment successfully.
Positive Outlook
- Continued service to customers through digital and e-banking solutions.
- Augmented business hours and adjusted locations to maximize social distancing.
- Processed SBA PPP loan approval requests for nearly 1,200 borrowers and $293.0 million (estimated 27,000 jobs).
- Actively engaged borrowers in discussions to identify short-term cash flow needs.
- Implemented cost savings initiatives to support bank earnings.
Challenges Ahead
- The economic damage of COVID-19 continues, with expected further damage as shutdowns persist.
- PPP program offers only limited help, and not all businesses will receive funding.
- Uncertainty regarding the duration and severity of the crisis.
- Potential credit deterioration due to the pandemic, specifically portfolio-wide qualitative indicators such as the outlook for changes in California Unemployment and Gross Domestic Product (GDP).
- Declines in several market interest rates, including many rates that serve as reference indices for variable rate loans declined markedly from previous levels.