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| Statement |
|---|
| This is approximately [indiscernible] earnings growth over 2023 guidance, we expect The Bancorp to continue to meaningfully outperform our peers and deliver superior growth and continued improvements in ROE and ROA |
| We've had a kind of an amazing event, the way we positioned our balance sheet and we've taken advantage of it |
| So we think it's going to be a really great year |
| Obviously, I think we've talked about this in prior quarters, you guys are well positioned and have a strong balance sheet |
| We've got great visibility |
| As I stated in our last earnings call, we expect to have above-trend GDD growth in 2024 of more than 15% and increasing participation in providing credit sponsorship solutions to our business partners |
| In addition to the rate sensitivity of the majority of our lending lines of business management has structured the balance sheet to benefit from a higher interest rate environment |
| As a result of its variable rate loans and securities, Bancorp continues to benefit from the cumulative impact of Federal Reserve rate increases |
| We believe our stock continues to be significantly undervalued when considering our long-term equity returns and EPS growth prospects |
| Have already achieved example of bank performance with robust growth with little need for new capital, The Bancorp can produce future performance that is truly extraordinary in the financial services industry |
| The Bancorp continues to produce record core profitability and exempt our financial performance and a challenging interest rate and macro environment for most financial institutions |
| As a result of our investments in growth and efficiency, our ROE is driving a continued increase in our regulatory capital ratios with the [indiscernible] balance sheet limit of $10 billion, The Bancorp is fast approaching the maximum equity capital needed to support our business growth into the future |
| So we're very excited about 2024 and 2025 |
| The NIM expanded to 5.07% from 4.83% quarter-over-quarter and 3.69% year-over-year |
| And so we have great visibility 18 months in advance |
| GDV increased 17% year-over-year and total fees from all of our FinTech activities increased 12% |
| And we're seeing our pipelines grow in our SBA and our real estate business |
| That is a good relationship [indiscernible] |
| And with us returning so much capital, it will obviously impact our ROA and ROE in a positive way |
| So we think we'll be able to do that |
| We've got a lot of flexibility |
| So that is helping to maintain our pipeline |
| And they're exciting organizations with great volume and they're early in their life cycle, so they haven't broken through those tiers like we've had for a very long relationships like [indiscernible] or PayPal |
| That factor was the primary driver in increases in return on assets and equity for Q3 2023 which were respectively 2.7% and 26% compared to 1.7% and 18% in Q3 2022 |
| As a result, in Q3 2023 the yield on interest-earning assets has increased to 7.4% from 4.8% in Q3 2022 or an increase of 2.6% |
| Those factors were reflected in the 5.1% NIM in Q3 2023 which represented another increase over prior periods |
| The Bancorp earned $0.92 a share with revenue growth of 31% and expense growth of 6% |
| But if you're taking a mature program, you've got a really good idea of the economics |
| So we'll have low in a conservative view without the bond purchases and without the impact of buybacks again, we think we can maintain a mid to lower single-digit expense growth with a low teens revenue growth |
| Our base is dramatically higher than it was even a few years ago |
| Statement |
|---|
| There's been substantial regulatory pressure on the banking as a service industry |
| If that went on for a few more months, it could hurt our leasing business |
| But once again, we're not underwriting where there was problems in the market |
| And then just on -- obviously, the interest rate picture is a little bit uncertain here |
| And that's lessening |
| And that's why you've seen maybe a little bit less than trend growth in some of the roll-off on the SBLOC portfolio, where we would have matched other companies' price cuts |
| So our total footings didn't grow a lot even though our new footings did |
| We can't really predict that, obviously |
| So it's definitely slow |
| The big economic arrow in our quiver, though is the fact that we still haven't bought any bonds and that's not in the guidance |
| The increase also reflected higher stock compensation expense as a result of a focus on stock ownership and lower expense deferrals as a result of lower loan production |
| We're at such a high profitability level that if you can get a 10% between revenue and expense growth, it has obviously a dramatic impact |
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