Financial Institutions reports Q4 EPS 61c, consensus 71c

Net interest income was $39.9 M for the fourth quarter of 2023, a decrease of $1.8M from the third quarter of 2023 and a decrease of $3.3 M from the fourth quarter of 2022 due primarily to higher funding costs.”Amid unprecedented pressures on the banking industry throughout 2023, our Company responded by defending and growing deposits, strengthening liquidity and capital while deepening relationships with our customers and welcoming new ones to our diversified financial services company,” said President and Chief Executive Officer Martin K. Birmingham. “We also took meaningful steps to position our Company for future success and growth. The strategic realignment announced in December 2023 strengthens our leadership team and streamlines our organizational structure in key areas while also supporting our continued focus on expense management. “Loans grew 10.2% in 2023, driven by strong commercial loan growth in the first half of the year. Credit quality remains sound and we bolstered our reserves in the fourth quarter, increasing our allowance for credit losses on loans to total loans by two basis points to 1.14%. Credit-disciplined loan growth has been and continues to be a key focus. Our relationship-based approach gives us confidence in our ability to work with borrowers dealing with the challenges of higher rates.” Chief Financial Officer and Treasurer W. Jack Plants II added, “During the fourth quarter, we took proactive measures to enhance our earnings generation potential amid the challenging operating environment that has created continued funding cost pressures for our industry. We repositioned a segment of our investment securities portfolio supporting near-term and future earnings generation in what we believe is a prudent use of capital. Heading into 2024, we have over $1.3B in available liquidity and approximately $1.1 billion in cash flow anticipated over the next twelve months which we expect to deploy into higher yielding earning assets.”