Amalgamated Financial (AMAL) Q3 Earnings call transcript Oct 24, 2024

Amalgamated Financial, a leading financial institution, recently held its third quarter 2024 earnings call, revealing a strong financial performance and strategic initiatives aimed at sustainable growth and profitability. The call, led by Chief Financial Officer Jason Darby and President and CEO Priscilla Sims Brown, highlighted the company's focus on deposit and loan growth, profitability, and strategic investments in sustainability.

Deposit and Loan Growth

Amalgamated Financial reported a remarkable deposit growth of $311 million in the third quarter, outperforming industry averages. This growth was led by strength across customer segments, including political, social and philanthropy, and sustainable deposits. The sustainable deposit segment, in particular, holds significant potential, with anticipated investments required to achieve net zero emissions by 2050. The company's political deposit balances also grew by 13%, reaching $2 billion, underscoring the bank's ability to capitalize on political deposit inflows.

Sustainable Lending and Strategic Investments

Priscilla Sims Brown emphasized the bank's commitment to sustainability, with a focus on sustainable lending and impact investing. The bank aims to be a leading player in the transition to a clean economy, leveraging its expertise and strategic investments in the sustainable lending team. The recent addition of industry experts to the sustainable lending team is a testament to the bank's commitment to financing renewable energy projects and supporting America's transition to a clean energy economy.

Financial Metrics and Performance

The call also revealed strong financial metrics, with net income of $27.9 million or $0.90 per diluted share and core net income of $28 million or $0.91 per diluted share. The bank's focus on neutralizing its balance sheet size and maintaining a minimum Tier 1 leverage ratio has contributed to its financial stability and growth. The bank's tangible book value per share increased by 8.2% to $22.29, reflecting a strong earnings performance.

Future Outlook and Challenges

Looking ahead, Amalgamated Financial is optimistic about its future prospects, with a focus on strategic investments, particularly in the sustainable lending segment. However, the bank also faces challenges, including the uncertainty surrounding political deposit outflows and potential changes in regulations. The bank's confidence in navigating these challenges is evident in its strategic planning, which includes a focus on maintaining a flexible balance sheet and a strong capital base.

Conclusion

In conclusion, Amalgamated Financial's third quarter 2024 earnings call underscored the bank's financial strength and strategic focus on sustainable growth and profitability. With a robust deposit base and a commitment to sustainable lending, the bank is well-positioned to capitalize on opportunities in the evolving financial landscape. As the company looks to the future, investors and stakeholders will continue to monitor its performance in navigating the challenges and capitalizing on the opportunities in the sustainable lending sector.