Ameris Bancorp (ABCB) Q2 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call summary indicates strong financial performance with increased loan production, deposit growth, and robust credit reserves. The Q&A session provided additional insights, highlighting organic growth, increased dividends, and stock buybacks, which are positive indicators. The management's cautious optimism about future growth, despite competition, and the potential for reduced deposit costs if Fed rates cut further support a positive sentiment. Given the market cap, these factors are likely to result in a positive stock price movement of 2% to 8% over the next two weeks.
Key Financial Performance
Net Income $109.8 million or $1.60 per diluted share in Q2 2025, a 21% increase year-over-year. The increase was driven by improved profitability metrics such as ROA and return on tangible common equity.
Efficiency Ratio Improved to 51.63% in Q2 2025 from 52.83% in the previous quarter. This improvement was due to revenue growth of 20.9% annualized, which outpaced expense growth.
Return on Assets (ROA) 1.65% in Q2 2025, reflecting robust profitability.
Return on Tangible Common Equity 15.8% in Q2 2025, indicating strong profitability.
Tangible Book Value Per Share Increased to $41.32 per share in Q2 2025, a 15.5% annualized growth or $1.54 per share increase. This growth was supported by strong capital levels.
Tangible Common Equity Ratio Increased to 11.09% at the end of Q2 2025, reflecting strengthened capital levels.
Stock Repurchase $12.8 million of common stock repurchased in Q2 2025, approximately 212,000 shares.
Net Interest Margin (NIM) Expanded by 4 basis points to 3.77% in Q2 2025. The expansion was driven by a 3 basis point positive impact from loans and a 1 basis point increase from higher bond yields.
Noninterest Income Increased by $4.9 million in Q2 2025, primarily due to better mortgage performance. Mortgage production grew 36% to approximately $1.3 billion, and mortgage gain on sale climbed 5 basis points to 2.22%.
Noninterest Expense Increased by $4.2 million in Q2 2025, mainly due to higher salaries and employee benefits related to stronger mortgage production and annual merit increases.
Provision for Credit Losses $2.8 million in Q2 2025. Reserve remained strong at 162% of loans or 408% of portfolio NPLs.
Loan Growth Increased by $335 million or 6.5% annualized in Q2 2025, driven mostly by C&I loans, particularly mortgage warehouse and premium finance.
Total Loan Production $1.9 billion in Q2 2025, up from $1.5 billion in the previous quarter.
Deposits Increased by $20 million in Q2 2025. Noninterest-bearing deposits grew by over 3% annualized, increasing their percentage to 31% of total deposits from 30.8% last quarter.
You have reached the limit. Sign up to access full content
Get started
Operating Highlights
Southeastern market growth: Bankers are positioned to take advantage of growth opportunities and disruptions in the southeastern markets, with production increasing 29% from the first quarter.
Revenue growth: Achieved 20.9% annualized revenue growth, outpacing expense growth, leading to an improved efficiency ratio of 51.63%.
Loan growth: Loans grew by 6.5% annualized, driven by C&I loans, particularly mortgage warehouse and premium finance.
Deposit growth: Deposits increased by $20 million, with noninterest-bearing deposits growing over 3% annualized.
Mortgage production: Mortgage production grew 36% in the quarter to approximately $1.3 billion, with a gain on sale climbing to 2.22%.
Stock repurchase: Repurchased $12.8 million in common stock during the quarter, with $72 million remaining for future purchases.
Capital strengthening: Common equity Tier 1 increased to 13%, and tangible common equity ratio rose to 11.09%.
You have reached the limit. Sign up to access full content
Get started
Risk or Challenges
Deposit Growth Pressure: The company anticipates pressure on deposits as loan growth picks up in the second half of the year, which could impact the net interest margin and funding costs.
Loan Growth Dependency on Deposits: Long-term loan growth is expected to be governed by deposit growth, indicating a potential challenge if deposit growth does not keep pace.
Higher Noninterest Expenses: Noninterest expenses increased due to higher salaries, employee benefits, and annual merit increases, which could pressure profitability if not offset by revenue growth.
Seasonal Decline in Municipal Deposits: The company experienced a seasonal decline in cyclical municipal deposits, which could impact liquidity and deposit stability.
Regulatory and Economic Uncertainties: Forward-looking statements are subject to risks and uncertainties, including regulatory and economic factors that could materially impact results.
You have reached the limit. Sign up to access full content
Get started
Guidance & Outlook
Loan Growth: Loan growth is expected to continue in the mid-single-digit range, with a focus on C&I loans, particularly mortgage warehouse and premium finance.
Deposit Growth: Deposit growth is anticipated to align with loan growth in the mid-single-digit range, with a long-term expectation that deposit growth will govern loan growth.
Net Interest Margin (NIM): The net interest margin is expected to normalize above the 3.60% to 3.65% range over the next few quarters, with some pressure on deposits as loan growth picks up.
Mortgage Production: Mortgage production is expected to remain strong, with continued growth in production and gain on sale margins.
Capital and Liquidity: Capital levels are strong, with a focus on maintaining a healthy allowance and asset quality to support future growth opportunities.
Market Opportunities: The company plans to leverage growth opportunities and banking disruptions in the Southeast markets, supported by experienced local bankers.
You have reached the limit. Sign up to access full content
Get started
Shareholder Return Plan
Stock Repurchase: We were active in repurchasing stock, buying back $12.8 million in the quarter.
Remaining Stock Repurchase Authorization: We've got about $72 million remaining through the end of October available to purchase.
You have reached the limit. Sign up to access full content
Get started
Key Q&A
Q:What are the current loan growth trends and expectations for the mortgage warehouse lending?
A:The mortgage warehouse lending showed seasonality with a strong quarter. Loan growth trends reflect a resurgence of activity better than the first quarter, with hopes for continued growth into 2026. However, there is caution due to increased competition. The third quarter is expected to be similar to the second quarter unless unforeseen events occur.
Q:What are the future growth opportunities and capital deployment preferences?
A:The focus is on organic growth, with 64 new revenue generators hired year-to-date. Stock buybacks are considered due to the current trading value, and dividends have been increased. M&A is not a priority unless a very special opportunity arises, as the company is focused on organic growth in key Southeastern markets.
Q:How does Ameris differentiate itself in hiring new talent?
A:Ameris focuses on market share and commitment to key growth markets, providing stability and a clear business model. The company emphasizes accountability and compensates well for performance. It has a 50-year history and avoids distractions, which appeals to potential hires.
Q:What are the expectations for the bond portfolio and its impact on the balance sheet?
A:The bond portfolio could grow by $200 million to $400 million, reaching 9%-10% of earning assets. $71 million in bonds maturing at 3.50% will be replaced with bonds yielding 4.75%-5%. The company values the optionality of growing both the loan book and bond portfolio.
Q:What is the outlook for the net interest margin (NIM) and deposit costs?
A:The NIM is expected to normalize at 3.60%-3.65% over the long term, with some pressure on deposit costs due to competition. If the Fed cuts rates, deposit costs could decrease, potentially providing a slight margin bump. The company remains focused on growing net interest income and earning assets.
Q:What is driving the increase in origination activity and the competitive landscape?
A:The increase in origination activity is due to bankers being more productive and gaining market share, as well as increased customer activity. Competition is growing, with some structural changes beyond pricing. The company focuses on deposits and treasury management to drive growth.
Q:What is the outlook for the mortgage segment?
A:The third quarter is expected to be consistent with the second quarter, with production potentially down 5%-10%. Gain on sale margins are expected to hold in the 2.15%-2.25% range. The company is prepared to handle a potential refinance wave without adding staff.
Q:What are the trends in the Equipment Finance segment?
A:Equipment Finance loans are about 7.2% of total loans, with charge-offs now within the target range after retooling the credit box in 2023. The segment is performing as expected.
Q:What is the outlook for noninterest expenses?
A:Noninterest expenses for the third quarter are expected to be consistent with the second quarter, in the range of $156 million to $158 million. This includes merit increases and production-related expenses.
Q:What are the trends in deposits and their impact on the margin?
A:Deposits are growing steadily, with a focus on noninterest-bearing deposits, which make up 31% of the total. The company is willing to pay up for deposit growth if needed. Seasonal municipal funds will boost deposits in the fourth quarter. Growth in noninterest-bearing deposits could positively impact the margin.
Q:What is the reserve position and its implications?
A:The reserve is robust at 1.62%, among the top of its peer group. It provides flexibility for growth and serves as a defensive position in a credit cycle. The reserve for the office sector is at 3.8%.
Q:What is the impact of securities yield changes on the portfolio?
A:The securities yield increased due to the addition of $200 million in securities at a 4.88% yield, replacing $260 million maturing at 2.77%.
Q:Review of Unclear Management Responses
A:Management avoided providing a direct answer or lacked clarity on the specific timeline for achieving the long-term NIM range of 3.60%-3.65%, as well as the exact impact of potential Fed rate cuts on the margin.
You have reached the limit. Sign up to access full content
Get started
Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
Antonio Navas
Associates Inc
Bruyette Woods
CEO Stokes
CFO Summerson
CFO comment
CI Deposits
Capital ratio
Chairman CEO
Co Research
Conference Instructions
Corporate Executive
Davidson Co
Deposits pace
Division Conference
Division Gunther
Division Manuel
Division Marinac
Division Pipkin
Division Stephen
ET Ameris
Executive VP
Gunther Stephens
Inc Research
Janney Montgomery
Keefe Bruyette
Palmer Proctor
Research Division
advantage
asset quality
disruption
generation
noninterest deposit
ABCB Transcript
Ameris Bancorp (ABCB) Q4 2025 Earnings Call Transcript
Positive1-30
The earnings call reveals strong loan production, strategic market positioning, and a new $200 million share repurchase plan, indicating positive growth prospects. Despite some margin compression and higher initial expenses, the overall financial health and optimistic guidance outweigh these concerns. The company's strategic focus on Southeastern markets and capital management further supports a positive outlook, suggesting a stock price increase of 2% to 8% over the next two weeks.
Ameris Bancorp (ABCB) Q3 2025 Earnings Call Transcript
Positive10-28
The earnings call presents strong financial performance with increased income and improved efficiency ratios. Loan and deposit growth are robust, and noninterest income is rising. Share repurchases and a stable outlook for expenses further bolster confidence. Despite some competitive pressures and potential margin compression, the overall sentiment is positive, with opportunities for accelerated loan growth and strong market positioning. The market cap suggests moderate stock price sensitivity, aligning with a positive outlook.
Ameris Bancorp (ABCB) Q2 2025 Earnings Call Transcript
Positive7-29
The earnings call summary indicates strong financial performance with increased loan production, deposit growth, and robust credit reserves. The Q&A session provided additional insights, highlighting organic growth, increased dividends, and stock buybacks, which are positive indicators. The management's cautious optimism about future growth, despite competition, and the potential for reduced deposit costs if Fed rates cut further support a positive sentiment. Given the market cap, these factors are likely to result in a positive stock price movement of 2% to 8% over the next two weeks.
Earnings call transcript: Ameris Bancorp beats Q1 2025 forecasts, stock rises
Unknown4-29
The earnings call presents a mixed picture. Strong financial metrics, such as net income growth and improved efficiency ratio, are offset by concerns over market volatility and cautious credit risk management. The Q&A section reveals uncertainties in economic forecasts and management's vague responses, which may cause investor unease. Despite a solid shareholder return plan with stock repurchases, the lack of clear guidance on growth strategy and potential expense increases tempers optimism. Given the company's mid-cap status, the stock is likely to experience a neutral reaction, fluctuating within a small range.
ABCB Slides
ABCB Report
Frequently Asked Questions
Where does this earnings call transcript come from?
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
How soon is the transcript available after the earnings call ends?
Full verbatim transcripts are typically published within 4–12 hours after the call ends. Same-day availability is guaranteed for all S&P 500 and most mid-cap companies.
Is the transcript edited or altered in any way?
No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.
Why do some answers appear as “Unclear” or “Inaudible”?
When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.
Who creates the AI Summary and Key Q&A highlights shown above the transcript?
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
