Release Date: April 25, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: Can you provide the average yield on fintech loans over the last couple of quarters and your current asset sensitivity with a 25-basis point rate cut? A: For fintech loans, we get a 0% interest rate deposit and 5% on the loans, which translates into a fee. This is not very sensitive to rate changes. Our asset sensitivity has been reduced significantly, moving from 8% to close to 1% last quarter, but it can vary between 1% to 3% depending on deposit surges and utilization.
Q: What drove the more stable deposit cost in Q1, and should we expect it to catch up in Q2? A: The stable deposit cost was due to a mix issue, with one program having higher deposit payouts due to insurance payments. This will roll off over the next quarter. We also had a $500 million increase in deposits related to insurance settlements, which contributed to higher deposit costs.
Q: Has the disruption in the banking as a service space created opportunities for Bancorp to acquire new programs or portfolios? A: We are focusing on expanding relationships with large, high-growth partners and adding product capabilities. We believe we can sustain our current GDP levels for multiple years and are preparing for expanded relationships with more products.
Q: Can you reach your 2025 and 2026 year-end targets with just the four current credit sponsorship programs? A: Yes, even with just the four programs, we can meet the $1 billion target. We are already at $571 million at the end of the quarter, and growth is robust.
Q: Are you still confident about the closing of the OREO property sale in May despite the change in ownership of the buyer? A: Yes, the change in ownership has strengthened the buyer group. They continue to support the property, and we expect the deposit and close date to be held as planned.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.