Carter Bankshares reports Q4 EPS (8c), consensus 17c

The Company remains well capitalized. The Company’s Tier 1 Capital ratio was 11.08% at December 31, 2023 as compared to 11.20% at September 30, 2023. The Company’s leverage ratio was 9.48% at December 31, 2023 as compared to 9.70% at September 30, 2023. The Company’s Total Risk-Based Capital ratio was 12.34% at December 31, 2023 as compared to 12.46% at September 30, 2023. The Bank also remained well capitalized as of December 31, 2023. The Bank’s Tier 1 Capital ratio was 10.99% at December 31, 2023 compared to 11.08% at September 30, 2023. The Bank’s leverage ratio was 9.41% at December 31, 2023 compared to 9.59% at September 30, 2023. The Bank’s Total Risk-Based Capital ratio was 12.25% at December 31, 2023 compared to 12.34% at September 30, 2023. “We continue to be disappointed that our largest lending relationship remains in nonaccrual status and continues to have a negative impact on our financial results. The fourth quarter was also impacted by several expenses and increased legal and other expenses related to our efforts dealing with the large nonaccrual loan. However, aside from this issue, our financial performance for the quarter was solid,” stated Litz Van Dyke, Chief Executive Officer. “the fourth quarter was also impacted by a loss of $1.5 million on the sale of $30 million of available-for-sale securities. The sale was executed to take advantage of market opportunities and reposition the securities portfolio. The realized loss is expected to be earned back in less than one year, as proceeds are reinvested in higher earning assets.” “Additionally, we continue to feel positive about the structure of our balance sheet. Loan growth remains solid across the footprint. The bond portfolio is of very high credit quality, with a shorter average life and duration than peers. Deposits are showing modest growth, and capital and liquidity levels remain strong. As with many of our peers, we have seen pressure on funding costs during 2023. We believe this trend is beginning to stabilize as the Federal Reserve has kept interest rates steady. We do expect the net interest margin will return to a more normalized level once the large NPL is resolved.” “In terms of loans, we experienced another strong quarter with annualized growth of 11.0%. Lending pipelines have moderated some, but we are still expecting respectable loan growth in the near term. We continue to invest in strong markets within the footprint, and opened a new flagship/full-service branch in Charlottesville, VA and a commercial production office in Raleigh, NC during the fourth quarter. Other than the large NPL relationship, our asset quality remains strong across all credit metrics. We remain confident in the condition and positioning of our Company. We are well prepared to navigate through any challenges that may emerge in our industry. We remain focused on resolving our large NPL and are committed to pursuing all remedies to resolve this matter in a manner that best protects the Company and its shareholders.”