How did BHB's Q4 2023 earnings surprise investors?

Bar Harbor Bankshares (BHB) delivered a lackluster earnings report for the fourth quarter of 2023, missing investor expectations and reflecting challenges in net interest margin and loan growth.

1. **Earnings Performance**: BHB reported a net income of $9.95 million for Q4 2023, which was below the anticipated figure. This shortfall may have disappointed investors expecting higher profitability.

|code|Ticker|Name|Date|Total Revenue|Net Income|Diluted EPS|market_code|
|---|---|---|---|---|---|---|---|
|BHB|BHB.A|Bar Harbor|2023 Q1|4.009E7|1.3012E7|0.86|170|
|BHB|BHB.A|Bar Harbor|2023 Q2|3.777E7|1.0791E7|0.71|170|
|BHB|BHB.A|Bar Harbor|2023 Q3|3.7793E7|1.1104E7|0.73|170|
|BHB|BHB.A|Bar Harbor|2023 Q4|3.7489E7|9945000||170|

2. **Revenue Outcome**: The total revenue for the quarter was $37.49 million, slightly below the typical range for BHB. This could be attributed to lower average net interest margins and loan growth, as indicated by Ceri Breeze's analysis.
3. **Earnings Outlook**: Ceri Breeze, an analyst, had anticipated earnings of $0.71 per share for the last quarter of 2023 and $2.94 for 2024. The actual diluted EPS for Q4 2023 was not provided, but the bank's overall performance fell short of these expectations.
4. **Loan Growth and Interest Margins**: BHB's loan portfolio growth has been sluggish, which, along with a lower average net interest margin, is likely to have impacted revenue and earnings. The unemployment rate in the region has been low, and personal income growth has been robust, which typically favors loan growth. However, the residential mortgage market remains constrained, which may limit the bank's growth in this segment.

In summary, BHB's Q4 2023 earnings fell below investor expectations due to a combination of factors including lower net interest margins, slower loan growth, and constrained residential mortgage market.