Sierra Bancorp reports Q1 EPS 64c, consensus 56c

Reports net interest income was $28.7M for the first quarter of 2024, an increase of $0.8 M, or 3%, as compared to the fourth quarter of 2023 and an increase of $0.6 million, or 2%, as compared to the first quarter of 2023. This increase in interest income was due primarily to a $2.3M decrease in interest expense due to the reduction in borrowed funds facilitated by a balance sheet restructuring, partially offset by a related decline in interest income on investments of $1.5 million, or 3%, due to the sale of low yielding investments. For the first quarter of 2024 as compared to the same quarter in 2023, the $3.5M increase in interest income is due primarily to a $56.8 M increase in average loan balances, as well as a 39 basis point increase in yield. However, this was partially offset by a $3.0 million increase in interest expense due to the movement of deposits from lower cost transaction accounts to higher cost time deposits including wholesale brokered deposits. Deposit costs increased 82 basis points in the first quarter of 2024 as compared to the same quarter in 2023, while there was a 35 basis points decrease in the cost of borrowed funds. “Our first quarter results demonstrate our strength and commitment to banking fundamentals coupled with strategic repositioning, especially in this challenging rate environment that continues to affect the banking industry,” stated Kevin McPhaill, CEO and President. “Following the completion of our balance sheet restructuring last quarter, our return on assets and net interest margin both showed strong improvement this quarter. In addition, both our capital and liquidity positions strengthened. We also grew outstanding loans by 3.2% during the quarter while maintaining strong total and low-cost deposits. This is a direct result of the efforts of our banking team! Our bankers continue to understand the importance of relationship-based community banking and we are grateful for our loyal customers and communities. We are excited for the opportunities ahead in 2024 and beyond!” McPhaill concluded.