Glacier Bancorp, Inc. (NASDAQ:GBCI) Q4 2019 Earnings Conference Call - Final Transcript

Jan 24, 2020 • 11:00 am ET


Glacier Bancorp, Inc. (NASDAQ:GBCI) Q4 2019 Earnings Conference Call - Final Transcript


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Ladies and gentlemen, thank you for standing by and welcome to the Glacier Bancorp, Fourth Quarter 2019 Earnings Conference Call. [Operator Instructions]. I will now hand the conference over to your speaker today, Randy Chesler, Glacier Bancorp, President and CEO.

Randall M. Chesler

All right, thank you, Carmen. So good morning and thank you for joining us today. With me here in Kalispell this morning is Ron Copher, our Chief Financial Officer; Don Chery, our Chief Administrative Officer; Angela Dose, our Chief Accounting Officer; Barry Johnston, our Chief Credit Officer, Tom Dolan, our Deputy Chief Credit Administrator; and Byron Pollan, our Treasurer.

Let me first thank you all for joining us today and we hope you're all enjoying these winter months. Yesterday, we released our fourth quarter and full year 2019 results. Our divisions, I think they did a great job holding our margin with prudent pricing and fair, but full loan pricing. They also do a great job building deposits in a competitive environment. We grew core deposits $401 million, or 4% in 2019, and we also continue to grow our non-interest deposits, which were up $305 million or 10% over the year, not including any of the current year acquisitions.

Non-interest deposits now represent 34% of core deposits, up from 32% at the end of 2018. And most notably, these -- the divisions, continue to do an excellent job with credit. Nonperforming assets were down almost $20 million for the year, or 34%. We ended the year with non-performing assets as a percentage of assets at 27 basis points at the lowest level for us in over a decade.

We are a little light on loan growth for the quarter and the year, up 4% in 2019 organically versus our expectations at the beginning of 2019 for 7% loan growth. This shortfall can be primarily attributed to consumer excess liquidity that is used to be -- used to pay off debt, sub-market [Phonetic] cooling and occasional money center bank competition on larger loans often with pricing that doesn't compensate for adequate return and risk in our view.

We are optimistic for growth in 2020, as we believe the Glacier markets are strong and that, that excess liquidity will find its way into more business investment. And as a result we expect to see a loan growth rate in 2020 of about 5% to 6%. The Glacier team once again delivered impressive results in 2019. Our 16 divisions now serving eight states across the west and our senior staff did a terrific job. And Forbes agrees with us, having just published their ranking of top banks in the U.S. and putting Glacier in the top ten.

Net income for the quarter was $57.4 million, an increase of $7.8 million or 16% over the prior year fourth quarter, including current period acquisition-related expenses of $4.4 million. Without the acquisition-related expenses and a benefit of $1.3 million reduction in regulatory assessments applied by the FDIC, the net income would have been $59.7 million, an increase