Great Western Bancorp. Inc. (NYSE:GWB) Q2 2018 Earnings Conference Call - Preliminary Transcript
Apr 26, 2018 • 08:30 am ET
Good day and welcome to the Great Western Bancorp Second Quarter Fiscal Year 2018 Earnings Announcement and Call. All participants will be in listen-only mode. (Operator Instructions) After today's presentation, there will be an opportunity to ask questions. (Operator Instructions) Please note this event is being recorded.
I would now like to turn the conference over to Ann Nachtigal, Director of Corporate Communications. Please go ahead.
Thank you, Kelly, and good morning everyone. Joining us this morning on Great Western Bancorp's second quarter fiscal year 2018 conference call are, Ken Karels, Chairman, President and Chief Executive Officer; Peter Chapman, Chief Financial Officer; Steve Ulenberg, Chief Risk Officer; Michael Gough, Chief Credit Officer; and Doug Bass, Regional President.
Before we get started, I'd like to remind you that today's presentation may contain forward-looking statements that are subject to certain risks and uncertainties that could cause the Company's actual future results to materially differ from those discussed. Please refer to the forward-looking statement disclosures contained in the presentation we have made available on our Web-site as well as our periodic SEC filings for a full discussion of the Company's risk factors.
Additionally, today we will be discussing certain non-GAAP financial measures on this conference call. References to non-GAAP measures are only provided to assist you in understanding Great Western's results and performance trends and should not be relied upon as a financial measure of actual results. Reconciliations for such non-GAAP measures are appropriately referenced and included within the presentation.
With that said, let me turn it over now to Great Western Bancorp's Chairman, President and Chief Executive Officer, Ken Karels. Ken.
Kenneth James Karels
Thank you, Ann, and good morning everyone. Thank you for taking the time to join us this morning to discuss our financial results. We are very pleased with the earnings and growth in our business this quarter. A few of the underlying highlights are; net income was $40.5 million or $0.69 per share. This is an increase of 15% from last year. Loan growth remained strong, with loans increasing $173 million or 7.7% on an annualized basis. Our efficiency ratio remained strong at 48.6%, or 47.8% if you exclude an accounting gross up that Pete Chapman will expand upon in a moment. And finally, we increased our quarterly dividend to $0.25 per share. This increase of 25% reflects Great Western Bank's ability to generate excess capital due to our strong returns.
Now for more insight on our first quarter financial results, I'd like to turn the call over to our Chief Financial Officer, Peter Chapman. Pete.
Thank you, Ken, and good morning everybody. As Ken mentioned, within our income statement for the quarter there is a gross up of noninterest income and noninterest expense by $2.3 million that largely offsets. This is due to a contract termination cost and offsetting (inaudible) from a vendor change. This has no real impact upon net income but does gross up our efficiency ratio by approximately 1% for the quarter.
Now moving to revenue, net interest