Business First Bancshares (BFST) Q3 2024 earnings summary

Executive summary

• Net income available to common shareholders was $16.5 million ($0.65 per diluted share) for Q3 2024, up from $15.9 million in Q2 2024, with core net income at $17.2 million ($0.68 per share) and improved margins and capital ratios.

• Closed the Oakwood Bancshares acquisition on October 1, 2024, adding $863.6 million in assets and increasing Dallas and Houston market exposure to the mid-40% range of the loan book.

• Revenue diversification continued, with non-interest income from asset management, SBA loan services, swaps, and FIG group contributing positively.

• Leadership changes included the promotion of Jerry Vascocu to President of the bank.

• Quarterly preferred dividend of $18.75 per share and common dividend of $0.14 per share declared in October 2024.

Financial highlights

• Total assets reached $6.9 billion, loans $5.2 billion, and deposits $5.6 billion as of September 30, 2024.

• Net interest margin was 3.51% for Q3 2024, up from 3.45% in Q2 2024; core NIM was 3.46%.

• Efficiency ratio improved to 63.45% from 65.14% in Q2 2024; core efficiency ratio was 62.21%.

• Book value per common share increased to $24.59, and tangible book value per share rose to $20.60.

• Return on average assets was 0.97% (core: 1.01%), and return on average common equity was 10.76% (core: 11.23%).

Outlook and guidance

• Management expects continued measured growth, incremental NIM improvement, and further gains from non-spread-based business lines.

• Non-interest expense run rate projected at ~$50 million per quarter with Oakwood fully integrated; cost savings expected in late 2025 and into 2026.

• Deposit beta assumptions in an easing rate environment: 45%-55%.

• Forward-looking statements caution that actual results may differ due to various risk factors.

• Integration of Oakwood Bancshares is expected to provide strategic benefits, though risks remain around realizing full synergies.