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Mar 31, 2020
Amerant Q1 2020 Earnings Report
Amerant's financial performance for Q1 2020 was reported, demonstrating resilience amidst the COVID-19 pandemic.
Key Takeaways
Amerant Bancorp Inc. reported a net income of $3.4 million for Q1 2020, a significant decrease compared to both Q4 2019 and Q1 2019. However, operating income showed a slight increase from the previous quarter and remained flat year-over-year. The company increased its allowance for loan losses due to the estimated deterioration of its loan portfolio caused by COVID-19.
Net income was $3.4 million, down 74.9% from Q4 2019 and 74.1% from Q1 2019, primarily due to increased provision for loan losses.
Operating income was $16.7 million, up 12.5% from Q4 2019 and flat compared to Q1 2019.
Net interest income (NII) was $49.2 million, down 4.0% from Q4 2019 and 11.2% from Q1 2019, with a net interest margin (NIM) of 2.65%.
Noninterest income was $21.9 million, up 37.2% from Q4 2019 and 66.5% from Q1 2019, driven by net gains on the sale of securities.
Amerant
Amerant
Amerant Revenue by Geographic Location
Revenue by Geographic Location
Domestic Revenue
CapyFin.comVenezuela Revenue
CapyFin.comOthers Revenue
CapyFin.com Forward Guidance
Amerant anticipates continued pressure on NII and NIM due to the depressed interest rate environment caused by the COVID-19 pandemic and the ongoing runoff of low-cost international deposits. The company is proactively managing deposits, exploring higher-yield investments, and seeking lower-cost funding options.
Positive Outlook
- Proactively repricing deposits to manage costs.
- Leveraging opportunities for higher-yield investments.
- Seeking lower-cost wholesale funding.
- Working diligently to meet the banking needs of domestic and international clients.
- Modified maturities on $420.0 million fixed-rate FHLB advances, resulting in $2.4 million of cost savings for the remainder of 2020.
Challenges Ahead
- Interest-earning assets are expected to price lower.
- Continued runoff of low-cost international deposits.
- NII and NIM are expected to remain pressured.
- Economic disruption caused by COVID-19 is expected to impact the Company's credit quality.
- Uncertain duration and magnitude of the slowdown in U.S. and global economic activity.