WesBanco (WSBC) Q2 2024 & Acquisition earnings summary

Executive summary

• Announced a definitive agreement to merge with Premier Financial Corp., creating a $27B asset regional bank with significant scale and market share improvements.

• Achieved strong year-over-year loan and deposit growth for eight consecutive quarters, with total loans up 10.1% and deposits up 4.4% year-over-year in Q2 2024.

• Net income for Q2 2024 was $26.4M ($0.44/share), down from $42.3M ($0.71/share) in Q2 2023; adjusted net income excluding restructuring/merger costs was $29.4M ($0.49/share).

• Maintained strong credit quality metrics, favorable to peer averages, and recognized for workplace excellence.

• Transformation into a stronger regional institution, focusing on diversified growth, operational efficiency, and financial center optimization.

Financial highlights

• Q2 2024 GAAP net income was $26.4M ($0.44/share); adjusted net income was $29.4M ($0.49/share), down from $42.4M ($0.71/share) year-over-year.

• Loan portfolio grew 10.1% year-over-year to $12.3B; commercial loan pipeline up 30% to $950M.

• Deposits at $13.4B, up 4.4% year-over-year; non-interest income at $31.4M, down 1.5% year-over-year.

• Net interest margin for Q2 2024 was 2.95%, up 3 bps sequentially but down 23 bps year-over-year.

• Non-interest expense increased 6.2% year-over-year, mainly due to higher equipment/software and operating costs; salaries and benefits declined YoY.

Outlook and guidance

• The Premier Financial Corp. acquisition is expected to deliver 40%+ EPS accretion in 2025, with ROAA improving to 1.3% and ROATCE to 18.6%.

• Pro forma net interest margin projected to rise to 3.46%, with efficiency ratio improving to 51%.

• Management expects continued integration costs and transaction-related expenses from the Premier Financial merger.

• Q3 NIM expected to remain in low- to mid-2.90% range; Q4 to rise to mid- to upper-2.90s.

• Provision for credit losses expected to be lower in Q3; effective tax rate to remain at 18%.