Original Source: FD (FAIR DISCLOSURE) WIRE
. Ed Bilek, Compass Bancshares, Inc., Director, IR . Paul Jones, Compass Bancshares, Inc., Chairman & CEO . Garry Hegel, Compass Bancshares, Inc., CFO
CBSS reported 2Q05 total revenues up $29m vs. 2Q04. The Co. reported 2Q05 earnings of $102.5m and EPS of $0.81. The Co. expects its 2005 EPS guidance to be in a range with a mean estimate of $3.21. Q&A Focus: Deposits, Reserves, and M&A.
A. Key Data From Call 1. 2Q05 total revenue = up $29m vs. 2Q04. 2. 2Q05 net income = $102.5m. 3. 2Q05 EPS = $0.81. 4. 2Q05 nonperforming assets = $64m. 5. 2005 EPS guidance = A range with $3.21 as a mean estimate.
S1. 2Q05 Results (P.J.) 1. General Observations: 1. CBSS delivered an outstanding qtr. highlighted by balanced topline revenue growth, focused deposit generation, solid loan production, and continued improvement in credit quality. 2. The Co. is particularly encouraged by its ability to deliver strong growth to its shareholders in what continues to be a difficult operating environment. 2. 2Q05 Highlights: 1. Earnings for 2Q05 were a record $102.5m, up 12% vs. 2Q04. 2. On a per share basis, earnings were $0.81 for 2Q05, an 11% increase vs. $0.73 earned in 2Q04. 3. At $0.81 per share, EPS surpassed the Street mean estimate for 2Q05 of $0.79 by some $0.02 per share. 4. Total revenue increased 8% vs. 2Q04. 5. Similar to 1Q05, revenue growth was balanced as net interest
income increased 6% and noninterest income was up 11% vs.
2Q05. 6. Key driver of CBSS' profitability and an area that it continuously focuses on for all of its business units is its ability to generate deposits, particularly low cost deposits.
7. Avg. total deposits increased 11% vs. 2Q04. 8. Avg. noninterest-bearing deposit growth continued to be robust, increasing 15% vs. 2Q04.
1. Noninterest-bearing deposits now represent more than 32% of
total deposits. 9. CBSS' ability to continue to grow deposits is both the function of the sales culture that it has instilled at CBSS and the high growth market it has chosen to do business.
3. Low-cost Deposit Accounts: 1. Over the past five years, CBSS has generated significant growth in new personal checking accounts including a record 348,000 new account openings in 2004. 2. The number of accounts added in 2004 is more than double the
number the Co. opened just four years ago in 2000. 3. CBSS is seeing similar results with its small business customers.
4. These are new accounts, and in 2004, CBSS added 75,000 new
small business checking accounts, a 17% increase vs. 2003 and
nearly triple the number of accounts the Co. added four years
ago. 5. CBSS is off to another good start in both categories this year. 1. Opened 195,000 new personal checking accounts and 39,000 new small business checking accounts during 1H05. 4. Asset Side of the Balance Sheet: 1. CBSS continues to experience focused earning asset growth, which was up 6%. 2. Growth earning asset was driven by high-quality loan growth. 3. Total loans increased 13% vs. 2Q04 and 18% linked-qtr. annualized.
1. On a managed loan basis, loans increased 10% vs. 2Q04 and
15% bank qtr. 4. On a period-end basis, the balance of CBSS' investment securities portfolio was down 10% vs. 2Q04 and 5% vs. 1Q05 levels. 1. Investment securities now represent 26% of total earning assets vs. 31% in 2Q04. 5. Excluding $1.3b of loans, CBSS originated and securitized …