PrivateBancorp, Inc. (NASDAQ:PVTB) Q4 2015 Earnings Conference Call - Final Transcript

Jan 21, 2016 • 11:00 am ET

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PrivateBancorp, Inc. (NASDAQ:PVTB) Q4 2015 Earnings Conference Call - Final Transcript

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Presentation
Operator
operator

Good morning and welcome to PrivateBancorp Inc.'s Fourth Quarter and Full-Year 2015 earnings call. At this time, I would like to inform you that this conference call is being recorded and that all participants are in a listen-only mode. At the request of the Company, we will open the conference up for questions and answers after the presentation. Please note that the Company will be taking questions from individuals and companies that have been invited to attend the live portion of the conference call.

I will now turn the call over to Jeanette O'Loughlin, Head of Investor Relations.

Executive
Jeanette O'Loughlin

Good morning and welcome to PrivateBancorp's fourth quarter and full-year 2015 earnings conference call. Participating on the call today are Larry Richman, PrivateBancorp President and CEO and Kevin Killips, our CFO. Kevin Van Solkema, our Chief Credit Risk Officer will also be available for questions. PrivateBancorp's fourth quarter 2015 earnings press release was distributed this morning over the newswires. The release and the financial supplement with additional financial tables are available on our website at investor.theprivatebank.com. Before we begin, I'd like to read our Safe Harbor statement. (Forward-Looking Cautionary Statements)

Now I will turn this call over to Larry Richman, President and CEO of PrivateBancorp.

Executive
Larry Richman

Thank you, Jeanette, and happy New Year, everyone. Let me start by saying that 2015 was another strong year of profitable client growth. Our business development and relationship management expertise drove year-over-year gains in revenue, operating profit, net income, loans, and deposits. I am pleased with our results and the value we continue to create for our shareholders. With this in mind, this morning, I will discuss our fourth quarter and 2015 results, what our performance says about the business we are building, and how we're positioned for 2016. Kevin Killips will discuss key results in greater detail and then Kevin, Kevin and I will take your questions.

Net income was $52.1 million, up from third quarter 2015 and fourth quarter 2014. Q4 benefited from solid loan growth in average loans, which were up nearly $400 million and an increase in loan fees due to early loan repayments. New loans to new clients were nearly $500 million, which was higher than any other quarter last year. About 75% of that growth was in our commercial and industrial portfolio. We had solid loan growth from existing clients, both C&I and commercial real estate. There was a good and diversified mix of new clients and existing clients in a variety of industries, both in Chicago and in our regional markets.

At the same time, weighted more towards the end of the quarter, we saw a higher level of pay downs, as clients repaid or reduced lines of credit. Additionally, payoffs were significantly higher than past quarters due to the sale of businesses and refinancing in the long-term market. Net loan growth was over $180 million. We had good cross-sell business in the fourth quarter. Fee income was higher, largely on a strong quarter from syndications and capital markets, which also