Amerant Bancorp's Q4 2024: Unpacking Contradictions in Loan Growth, Margin Stability, and Charge-Off Projections

Balance Sheet and Loan Growth:
- Amerant Bancorp reported total assets of $9.9 billion at the end of Q4, a decrease from $10.35 billion at the end of Q3.
- Loan growth was strong at $255 million excluding the Houston sale transaction, with a loan pipeline indicating closing of approximately $100 million in loans in the first quarter.
- The reduction in assets was primarily due to the Houston franchise sale and early repayments of Federal Home Loan Bank advances.

Net Interest Income and Margin Improvement:
- Net interest income increased to $87.6 million in Q4, up $6.6 million from the previous quarter.
- The net interest margin improved to 3.75%, up from 3.49% in Q3.
- This was driven by lower average rates on interest-bearing liabilities, lower balances in FHLB advances, and higher rates on securities available for sale.

Credit Quality and Loss Provisions:
- Special mention loans decreased by $71 million, and nonperforming loans were reduced by $4.2 million post-quarter through a note sale at par value.
- The provision for credit losses decreased to $9.9 million, down from $19 million in Q3.
- The improvement in credit quality is attributed to ongoing efforts to resolve classified assets and the prepayment of the indirect consumer portfolio.

Deposit Growth and Structure:
- Total deposits decreased by $256.9 million to $7.85 billion, primarily due to the Houston franchise sale.
- Excluding the transaction, organic deposit growth was strong at $317 million.
- The ratio of noninterest-bearing deposits to total deposits increased to 19.2% from 18.3% in Q3.