Synovus' 2024 Success: A Tale of Control and Growth

In 2024, Synovus Financial Corp. (SNV) demonstrated a remarkable financial performance, driven by its strategic focus on core commercial lending and deposit growth. The company's success can be attributed to its ability to maintain strict control over operating expenses, improve loan losses, and implement effective relationship-building strategies.

Synovus' core commercial lending and deposit growth strategies significantly contributed to its 2024 financial performance. The company saw strong growth in core commercial lending, which helped drive revenue and earnings. Period-end loans declined by $795.5 million (2%) in 2024, but this was primarily due to line utilization declining, payoffs increasing, and non-relationship credits being rationalized. The decline in loans was offset by growth in other areas, such as deposits and fee-producing businesses. In the fourth quarter of 2024, net interest income increased by $14.3 million (3%) compared to the prior quarter, primarily due to lower funding costs. Net interest margin was 3.28%, up from the prior quarter, supported by lower funding costs and loan hedge maturities.

Synovus' deposit growth strategy also contributed to its financial performance in 2024. Period-end deposits increased by $356.2 million (1%) primarily driven by growth in time deposits, money market, interest-bearing demand deposits, and public funds, partially offset by a decline in non-interest-bearing deposits. Brokered deposits declined by $1.17 billion (19%) in 2024, but this was likely a strategic move to focus on core deposits, which are generally more stable and less expensive. Total deposits ended the fourth quarter of 2024 at $51.10 billion, an increase of $901.6 million (2%) sequentially, as a result of the focus on deposit production, public funds seasonality, and middle market deposit growth. Total deposit costs declined 26 basis points from the third quarter 2024 to 2.46%.



In 2024, Synovus maintained strict control over operating expenses and saw improvements in loan losses, which significantly contributed to its strong financial position. Non-interest expense in 2024 was $1.25 billion, down 7% from the previous year. Adjusted non-interest expense declined 3% year over year to $1.23 billion, primarily due to a $51 million FDIC special assessment incurred in the fourth quarter of 2023. This strict control over operating expenses helped Synovus improve its efficiency and profitability.

Net charge-offs were 0.31% of average loans in 2024, compared to 0.35% in 2023, indicating an improvement in credit quality. The provision for credit losses declined to $136.7 million in 2024, down from $189.1 million in the prior year. The allowance for credit losses ended the year at 1.27%, compared to 1.24% at the end of 2023, demonstrating a healthy balance between provisions and expected losses. The year-end Common Equity Tier 1 (CET1) ratio increased by 62 basis points year over year to 10.84%, reflecting the company's improved capital position.



Synovus' strong financial position, along with its accelerated growth orientation, positioned the company well for continued success in 2025 and beyond. The company's successful implementation of relationship-building strategies and growth across core commercial lending, deposits, and key fee-producing businesses contributed to its overall financial strength in 2024.

In conclusion, Synovus Financial Corp.'s 2024 financial performance was a testament to its strategic focus on core commercial lending and deposit growth, as well as its ability to maintain strict control over operating expenses and improve loan losses. The company's strong financial position and growth orientation set the stage for continued success in the years to come.