First Republic Bank (NYSE: FRC) stock rose over 6.3% on 15th October, 2019 (As of 12:37 pm GMT-4; Source: Google finance) driven by better than expected results for the third quarter of FY 19. FRC’s credit quality remained strong as the nonperforming assets were only 12 basis points of total assets at September 30, 2019. The Bank had net charge-offs for the quarter of $4.3 million, while adding $16.7 million to its allowance for loan losses due to continued loan growth. The Bank’s Common Equity Tier 1 ratio was 9.91% at September 30, 2019, compared to 10.47% a year ago. As previously announced, the Bank will redeem its $190 million of 5.50% Non-cumulative Perpetual Series D Preferred Stock on October 18, 2019.
Further, the bank’s total investment securities at the end of September, 2019 were up 7.7% to $17.4 billion compared to the prior quarter and up 6.8% compared to a year ago. High-quality liquid assets, including eligible cash, totaled $13.6 billion at the end of September 2019, and formed 12.7% of average total assets. Total wealth management assets of the bank were $140.2 billion at September 30, 2019, which has increased by 1.9% for the third quarter and up 7.1% compared to a year ago. The increases in wealth management assets were on the back of net new assets from existing and new clients, and market appreciation.
FRC in the third quarter of FY 19 has reported the adjusted earnings per share of $1.31, beating the analysts’ estimates for the adjusted earnings per share of $1.21, according to the analysts surveyed by Zacks Investment Research. The company had reported the adjusted revenue growth of 8.9 percent to $837.2 million in the third quarter of FY 19, beating the analysts’ estimates for revenue of $830.6 billion.
FRC has declared a cash dividend for the third quarter of $0.19 per share of common shares, which is payable by the company on November 14, 2019 to shareholders of record as of October 31, 2019.
Moreover, during the third quarter, net interest income was $695.0 million was up 9.5% compared to the third quarter a year ago. The increase in net interest income resulted mainly from growth in average earning assets. FRC’s net interest margin was 2.80% for the third quarter, compared to 2.85% for the prior quarter. The decline was mainly on the back of a more rapid decrease in the average yield on loans, compared to the offsetting decrease in total funding costs.