Wintrust Financial Corporation (NASDAQ:WTFC) Q1 2018 Earnings Conference Call - Preliminary Transcript

Apr 17, 2018 • 02:00 pm ET


Wintrust Financial Corporation (NASDAQ:WTFC) Q1 2018 Earnings Conference Call - Preliminary Transcript


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Welcome to the Wintrust Financial Corporation's First Quarter 2018 Earnings Conference Call. At this time, all participants are in a listen-only mode. (Operator Instructions) Following the review of the results by Edward Wehmer, Chief Executive Officer and President; and David Dykstra, Senior Executive Vice President and Chief Operating Officer, there will be a formal question-and-answer session.

During the course of today's call, Wintrust's management may make statements that constitute projections, expectations, beliefs or similar forward-looking statements. Actual results could differ materially from the results anticipated or projected in any such forward-looking statements.

The Company's forward-looking assumptions that could cause actual results to differ materially from the information discussed during the call are detailed in the first quarter 2018 earnings press release and in the Company's most recent Form 10-K and any subsequent filings on filed with the SEC. As a reminder, this conference call is being recorded.

I would now like to turn the conference over to Mr. Edward Wehmer. You may begin.

Edward Wehmer

Thank you. And welcome everybody to our first quarter earnings call. With me as always are Dave Dykstra; and Kate Boege, our Legal Counsel; and Dave Stoehr, our Chief Financial Officer. We have same format as always. I will give some general comments regarding our results. Turn over to Dave Dykstra for more detailed analysis of other income, other expenses and taxes, back to me for some summary comments and thoughts about the future then on the questions.

We're pleased to report on the earnings front that we recorded record earnings for the ninth consecutive quarter in a row. David Long, if you're out there, you should know Nick Papagiorgio will be very proud of us. Net income totaled $82 million, up 19% over fourth quarter of '17 and 40% over the first quarter of 2017. Earnings per share were $1.40 compared to $1 in the first quarter of '17 and $1.17, 40% up over the last year almost 20% up over the fourth quarter.

Just to note, pretax income was $108 million, which is almost 13% over the fourth quarter and 23% over the first quarter of last year. So given out taxes, we had good operating results. Our return on assets was 120 compared to 1% at the end of the fourth quarter last. Return on equity was 11.3 and return on tangible equity is 14%. And as it is readily appearing, our operating trends remain consistently positive.

The net interest margin front, the net interest income front, the net interest margin increased 9 basis points over the fourth quarter of '17 and 18 basis points over the first quarter of '17 to 3.54%. Net interest income grew $6 million over the fourth quarter of 2017 despite two days, two less days, quarter versus quarter. Both increases were driven by the higher rate environment and a large earning asset base.

The average earning asset base grew $586 million in the quarter. Earning asset yields increased 13 basis points versus the fourth quarter while interest expense increased