Eagle Bancorp, Inc. (NASDAQ: EGBN) stock rose over 3.3% on April 19th, 2018 (as of 1:20 PM GMT-4 ; Source: Google finance). Major drivers of the better performance during the first quarter of 2018 is a rising profitability, a slightly expanded net interest margin, ongoing credit quality with low levels of charge-offs in problem loans and growth in both loans and deposits. Superior operating leverage is also leading to a favorable efficiency ratio.
Eagle Bancorp, Inc. (NASDAQ: EGBN) Revenue for the first quarter of 2018 was boosted by a better net interest income, which rose 13% rise against pcp. Better loan portfolio, higher average loan yields and balance sheet management in accordance with our disciplined ALCO process led to a better net interest income. Total revenue rose 11% against the same quarter of 2017. They delivered a solid NIM of 4.17% for the first quarter of 2018.
The group’s disciplined loan pricing and ALCO strategies, led to a better margin rise to over 4.14% in the first quarter a year ago and was improved from the 4.13% in the fourth quarter of 2017. Better loan level in their loan mix of earning assets, on the back of rates, adjustments in their predominantly variable and adjustable rate loan portfolio drove the margins. The average yield on the loan portfolio was 5.3% for the first quarter of 2018, led to a rise of over 5.13% in the first quarter of 2017 and is up from 5.21% in the fourth quarter of 2017.
On the other hand, the revenue from the sale of SBA and FHA loans does not produce a smooth trend line and varies widely from quarter-to-quarter. But the group sees a better performance from both of these business lines which would make a major revenue contributions during the rest of 2018. Efficiency ratio improved to 38.38% from 40.06% in pcp.
They reported a return on average assets of 1.91% during the first quarter, which rose from 1.62% in the first quarter of 2017. The return on average common equity reached15.99% for the first quarter against 12.74% a year ago.