Citizens Financial Group, Inc. (NYSE:CFG) Q2 2019 Earnings Conference Call - Final Transcript
Jul 19, 2019 • 09:00 am ET
Good morning, everyone, and welcome to the Citizens Financial Group Second Quarter 2019 Earnings Conference Call. My name is John, and I'll be your operator today. [Operator Instructions] Following the presentation, we will conduct a brief question-and-answer session. As a reminder, this event is being recorded.
Now, I'll turn the call over to Ellen Taylor, Head of Investor Relations. Ellen, you may begin.
Thank you so much, John. Good morning to all. We're really pleased to have you join us. We got a lot of great material to cover in our presentation, which you can find at investor.citizensbank.com. First, this morning, our Chairman and CEO, Bruce Van Saun; and CFO, John Woods, will walk through our results and our outlook, and then we'll be happy to take questions. Brad Conner, Head of Consumer Banking; and Don McCree, Head of Commercial Banking, are here also to help us with that effort.
I need to remind you that our comments today will include forward-looking statements, which are subject to risks and uncertainties and you should review the factors that may cause our results to differ materially from expectations on Page 2 of the presentation in our 2018 Form 10-K. We also utilize non-GAAP financial measures and provide information and a reconciliation of those measures to GAAP in our earnings materials.
And with that, Bruce, you got the floor.
Bruce Van Saun
Okay. Thanks, Ellen. Good morning, everyone, and thanks for joining our call. We're pleased to announce another strong quarter today. We navigated reasonably well through a dramatic change in the rate environment. Our fee businesses have really come on strong as we've integrated well our recent acquisitions, and we're able to do more for our customers. And our expense discipline continues to be excellent. We continue to find efficiencies that lead to simpler processes and better customer experiences while also creating the wherewithal for funding new growth initiatives.
We are also very focused on being good stewards of our shareholder capital both in terms of loan growth and capital returns to shareholders. Our year-over-year loan growth was 4% with a lot going on inside that number. We are allocating capital to growth portfolios that offer good risk-adjusted returns and attractive cross-sell, while extracting capital through loan sales and run off as part of balance sheet optimization.
We are passing on commercial deals in the market where we don't like the risk, the terms of the pricing. Our deposit growth has been faster than loan growth at 7%, which has the benefit of bringing our loan to deposit ratio down to 94%. Citizens Access has been key to this as they reached $5.4 billion in deposits by quarter end. This lower LDR gives us increased flexibility on funding strategies, which will be highly beneficial in the current uncertain rate environment. We recently announced a 20% increase in our buyback capacity to $1.275 billion, and today we announced a $0.04 dividend increase to $0.36 per share with dividend now up 30% from the year ago quarter. I'm