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IB

INTERNATIONAL BANCSHARES CORP (IBOC)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 delivered strong sequential and year-over-year growth: net income rose to $115.1M and diluted EPS to $1.85, up from $99.8M and $1.60 in Q3 and $106.4M and $1.71 in Q4 2023, respectively .
  • Management attributes 2024 performance to higher interest income from larger investment and loan portfolios in an elevated rate environment, partially offset by higher deposit costs; they emphasized continued cost control and balance sheet discipline into 2025 .
  • Balance sheet growth remained solid: year-end 2024 total assets $15.7B, net loans $8.7B, deposits $12.1B (all up vs. Dec-31-2023) .
  • Capital return strengthened post-quarter with a 6% dividend increase to “.70 cents per share,” signaling confidence in earnings durability and capital strength .

What Went Well and What Went Wrong

  • What Went Well

    • EPS and net income accelerated: Q4 diluted EPS of $1.85 and net income of $115.1M beat both Q3 levels ($1.60, $99.8M) and Q4 2023 ($1.71, $106.4M) on higher interest income from larger earning asset bases in a still-elevated rate backdrop .
    • Loan and deposit growth: Year-end loans reached ~$8.7B and deposits ~$12.1B, up from ~$7.9B and ~$11.8B at YE 2023; assets were ~$15.7B vs. ~$15.1B at YE 2023 .
    • Management confidence: “We are extremely pleased and proud to continue our industry-leading financial results…we will continue to deliver industry-leading financial results,” said CEO Dennis Nixon, highlighting focus on balance sheet/liquidity management and cost controls .

  • What Went Wrong

    • Funding cost pressure: Net interest income has been “negatively impacted by an increase in interest expense, primarily driven by increases in rates paid on deposits,” underscoring persistent deposit pricing headwinds .
    • Expense pressures earlier in 2024: Q3 commentary cited higher non-interest expenses driven by inflation and increased salary/compensation to attract and retain staff, a headwind discussed earlier in the year .
    • Full-year EPS modestly down y/y: 2024 diluted EPS of $6.57 and net income of $409.2M decreased ~0.8% and ~0.6% vs. 2023 despite a strong Q4 finish, reflecting the impact of higher deposit costs and earlier-year items .

Financial Results

Quarterly earnings performance

MetricQ2 2024Q3 2024Q4 2024
Net Income ($USD Millions)$97.0 $99.8 $115.1
Diluted EPS ($USD)$1.56 $1.60 $1.85

Q4 year-over-year comparison

MetricQ4 2023Q4 2024
Net Income ($USD Millions)$106.4 $115.1
Diluted EPS ($USD)$1.71 $1.85

Balance sheet KPIs (end of period)

MetricQ2 2024Q3 2024Q4 2024
Total Assets ($USD Billions)$15.5 $15.9 $15.7
Total Net Loans ($USD Billions)$8.1 $8.4 $8.7
Deposits ($USD Billions)$12.0 $12.1 $12.1

Notes:

  • Management did not disclose quarterly revenue or margin metrics in the press releases/8-K; narrative indicates higher interest income offset by higher deposit costs .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Revenue2025Not providedNot providedMaintained: Not provided
Margins (NIM/Net income margin)2025Not providedNot providedMaintained: Not provided
OpEx2025Not providedNot providedMaintained: Not provided
OI&E2025Not providedNot providedMaintained: Not provided
Tax rate2025Not providedNot providedMaintained: Not provided
Dividend per SharePayable Feb 28, 2025Not disclosed in PR“.70 cents” per share; +6% vs prior dividendRaised 6%

Earnings Call Themes & Trends

Note: A Q4 2024 earnings call transcript was not available in the document set; themes below reflect management commentary from Q2–Q4 press releases/8-Ks.

TopicPrevious Mentions (Q2 2024)Previous Mentions (Q3 2024)Current Period (Q4 2024)Trend
Rate environment impactElevated rates boosted interest income; deposit costs rising Same: higher interest income; higher deposit costs Same: higher interest income on larger portfolios; deposit rates elevated Stable narrative
Deposit pricing competition“Increase in rates paid on deposits” weighing on NII “Increase in rates paid on deposits” continues Ongoing deposit cost pressure mentioned again Persistent headwind
Non-interest expense/inflationProvision/charge-down noted in H1 context Non-interest expense pressure from inflation and salaries Not highlighted in Q4 PRMixed/moderating in PR
Balance sheet growthAssets $15.5B; Loans $8.1B; Deposits $12.0B Assets $15.9B; Loans $8.4B; Deposits $12.1B Assets $15.7B; Loans $8.7B; Deposits $12.1B Loans up q/q; assets slightly down q/q
Technology initiativesNot highlightedNot highlightedAnnounced digital transformation partnership (Nov 5) in commercial lending operations, including AI-driven analytics Increasing focus
Capital returnNot highlightedNot highlightedDividend increased 6% post-quarter Positive

Management Commentary

  • Strategic focus: “As we move into 2025, we will remain focused and vigilant on delivering superior customer service, continued execution of our long-standing practices of balance sheet, asset, liability and liquidity management, strong cost controls and evaluating processes for efficiencies across our organization” .
  • Results posture: “We are extremely pleased and proud to continue our industry-leading financial results in 2024…we will continue to deliver industry-leading financial results” .
  • Operating backdrop: 2024 was “positively impacted by an increase in interest income” from larger investment and loan portfolios in an elevated rate environment, while “net interest income has been negatively impacted by an increase in interest expense” on deposits .

Q&A Highlights

  • Q4 2024 earnings call transcript was not available in the document set; therefore, Q&A highlights and any guidance clarifications from the call cannot be provided based on primary sources reviewed [ListDocuments showed no transcript for this period].

Estimates Context

  • S&P Global (Capital IQ) consensus estimates for Q4 2024 EPS and revenue could not be retrieved in this session due to an SPGI daily rate limit; therefore, we cannot provide vs-consensus comparisons for this quarter using S&P Global data at this time [GetEstimates error].
  • Given the absence of retrievable consensus, focus remains on company-reported results and qualitative drivers .

Key Takeaways for Investors

  • Strong finish to 2024: Q4 EPS of $1.85 and net income of $115.1M show clear sequential and y/y momentum despite funding cost pressures .
  • Earnings drivers intact: Higher interest income on larger loan and investment portfolios remains the core tailwind; deposit cost inflation continues as the main offset .
  • Balance sheet growth resilient: Loans rose to ~$8.7B with deposits steady at ~$12.1B at year-end, supporting ongoing earnings capacity .
  • Capital return positive: A 6% dividend increase to “.70 cents per share” suggests confidence in earnings durability and capital strength .
  • Operating discipline: Management emphasizes balance sheet/liquidity management and cost controls going into 2025, seeking to sustain “industry-leading” results .
  • Technology modernization: The Finanta partnership points to accelerated digital transformation in commercial lending and AI-enabled analytics—potentially supportive of long-term efficiency and risk management .
  • Watch list for 2025: Deposit pricing competition and non-interest expense trends; absent consensus visibility this quarter, monitor external estimate revisions as data becomes available .

Additional primary sources reviewed:

  • Q3 2024 press release and 8-K confirming quarterly trajectory and expense commentary .
  • Q2 2024 press release and 8-K confirming earlier 2024 earnings dynamics and balance sheet trends .
  • Q4 2024 8-K Item 2.02 and Exhibit 99 press release as the primary source for quarterly results .