TowneBank (TOWN) Q2 2024 earnings summary

Executive summary

• Net income for Q2 2024 was $42.86M ($0.57 per share), up 2.73% year-over-year, with core earnings up 10.1% and total assets at $17.1B.

• Achieved 23.5% CAGR in earnings from FY2000–FY2023 and maintained #1 deposit market share in Hampton Roads.

• Diversified business model with 62% net interest income and 38% noninterest income YTD Q2 2024.

• Noninterest-bearing deposits increased sequentially for the first time since 2022.

• Recognized for strong workplace culture, community engagement, and financial strength.

Financial highlights

• Total revenue for Q2 2024 was $175.0M, down 3.6% year-over-year, with net interest income at $109.05M and noninterest income at $65.92M.

• Net interest margin (TE) was 2.89%, down from 3.01% year-over-year but up 14 bps sequentially.

• Loans totaled $11.5B (up 2.2% year-over-year), deposits $14.3B (up 3.7% year-over-year).

• Book value per share increased 4.8% year-over-year to $27.62; tangible book value per share up 6.9% to $20.65.

• Efficiency ratio improved to 68.98% from 70.41% in Q2 2023.

Outlook and guidance

• Management expects margin improvements in the second half of 2024 and into 2025, with annualized loan and deposit growth in the low to mid-single digits.

• Net interest income expected at $112–$118M for Q3 2024 and $455–$465M for FY2024.

• Noninterest income projected at $245–$250M and noninterest expense at $245–$255M for FY2024.

• Focus on controlled loan growth, liquidity, and expanding noninterest income sources.

• $495M in securities portfolio cash flows available for reinvestment over the next two years.