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Jun 30, 2020
Customers Bancorp Q2 2020 Earnings Report
Reported strong results driven by PPP loan originations and solid performance in core businesses.
Key Takeaways
Customers Bancorp reported a strong second quarter in 2020, with GAAP net income of $19.1 million, or $0.61 per diluted share, up 237% over Q2 2019. The bank originated $5.2 billion in PPP loans, ranking #6 in the nation, and total assets grew by $5.9 billion to $17.9 billion, up 49% in Q2 2020.
GAAP earnings of $19.1 million, or $0.61 per diluted share, up 51% over Q2 2019.
Adjusted pre-tax pre-provision net income for Q2 2020 was $50.8 million, an increase of 94% over Q2 2019.
Total revenues up 49% over Q2 2019.
Originated $5.2 billion in PPP Loans Ranking #6 in Nation With Approximately 100,000 loans to Small Businesses and Non-Profits.
Customers Bancorp
Customers Bancorp
Forward Guidance
Customers Bancorp is well positioned to execute on its 2020 and 2026 LT strategies.
Positive Outlook
- Net interest margin, excluding PPP loans, expected to remain on average between 2.9% and 3.0% for 2020
- Core operating expenses expected to remain flat over next few quarters
- Tax rate expected to be 22% to 23% for 2020
- Excluding PPP loans, balance sheet at year-end 2020 expected to be about the same or moderately higher than at December 31, 2019
- PPP loans expected to add about $100 million (pre-tax) to equity capital
Challenges Ahead
- Rapid recent changes in economic activity introduce uncertainty to near-term profitability
- Provision will be higher
- Most customer activity will slow
- There will be disruptions
- Absent a further deterioration in economic forecasts, management does not expect a material build up in CECL reserves in future quarters