WINTRUST FINANCIAL CORP Q1 FY2025 earnings call

• The quarter was clean with net income of $189 million and record net interest income of $526 million despite two fewer business days. - Loans grew by over $650 million and deposits by over $1.1 billion. - Net interest margin was 3.56%, 5 basis points higher than the fourth quarter. - Charge-offs were 11 basis points, provision was $24 million, non-performing loans were stable. - Non-interest income was $116.6 million, non-interest expense was $366.1 million, well controlled. - Announced dividend increase to $2 per share annualized. - Received multiple recognitions including 14 Coalition Greenwich Awards, J.D. Power Award for best customer service in Illinois for the fourth consecutive year, and top employer recognition in material markets.

For the first quarter, Wintrust grew loans by over $650 million and deposits by over $1.1 billion. Loan growth was 6% on an annualized basis, and deposit growth was approximately 8% on an annualized basis. Net interest income was a record $526 million, with a net interest margin of 3.56%, which was 5 basis points higher than the fourth quarter. The Life Premium Finance segment grew by $218 million, the mortgage warehouse team by $126 million, and portfolio residential real estate loans by $72 million. Non-interest income totaled $116.6 million, and non-interest expense was $366.1 million, well controlled. Tangible book value per common share ended the quarter at $78.83 per share.

• Loan growth expected to be strong in the second quarter, mid to high single digits. - Non-interest expenses expected to increase slightly in the second quarter due to full effect of annual merit increases, higher marketing expenses, etc. - Tangible book value per common share is expected to continue growing.

• Uncertain economic environment, potential impact of tariffs, tax law changes, and funding cuts. - Credit spread and financial market valuation uncertainties. - Competition in certain loan segments like leasing and fully funded commercial real estate (CRE).

Q: Jon Arfstrom asks about borrower uncertainty and impact on growth outlook.

A: Timothy Crane and Richard Murphy discuss borrowers pausing but no major impact on growth outlook, mentioning local economy and P&C business strength.

Q: Nathan Race asks about non-maturity deposit cost leverage.

A: David Dykstra talks about competitive market in Chicago, slight rate decline, and need to balance with loan growth.

Q: Jared Shaw asks about M&A and growth through acquisition.

A: Timothy Crane discusses ongoing M&A conversations, disciplined approach, and confidence in financial resources for attractive acquisitions.

Q: Chris McGratty asks about deposit growth source.

A: Timothy Crane and David Dykstra talk about deposit mix matching loan growth, stable non-interest-bearing deposits, and adding new clients.