Photo by James Sanna | Bankers and Merchant Staff/File
Providence-based Citizens Bank said in its third-quarter earnings report Wednesday that the newly formed private bank had more than $5 billion in deposits.
The amount is up from $4 billion in the second quarter and $1.2 billion in the first quarter, and represents a 316% increase since March 31, as Citizens acquired several wealth executives from competing banks earlier in the year. Following the adoption.
“Our strategy is to create a transformed consumer bank, the best-positioned super regional commercial bank, and a premier bank owned private bank,” Chairman and CEO Bruce Van Thorne said in a conference call. It is based on the desire to do so.” “We expect to reach breakeven in August and September and be profitable in the fourth quarter with good momentum heading into 2025.”
Citizens recently opened two new private bank branches in the San Francisco Bay Area and also expanded its private banking team to help cover Southern California. About 34 percent of Citizens Private Bank’s deposits are interest-free, according to Citizens’ financial results.
“Expect us to opportunistically add talent to strengthen our banking and asset management capabilities.In particular, our private bank revenue increased 64% in the third quarter to $4,970. $1 million and break even by mid-quarter,” CFO John Woods told investors on Wednesday. “The private bank started contributing to earnings in the fourth quarter and is on track to significantly increase (earnings per share) next year.”
The Fed has signaled that it is in the early stages of a rate-cutting campaign, and with more rate cuts expected in the future, the public hopes it will lower the cost of deposits and make it much easier for banks. To lower deposit interest rates.
“I think the way to think about it is that the longer the downcycle lasts, the more it can continue to contribute to continued lower deposit costs, but broadly speaking, what we’ve said in the past is that “The downcycle beta will be similar to the upcycle (deposit) beta,” Van Thorne said.
National’s net interest income for the third quarter was $1.4 billion, down 2.9% from the second quarter. The bank’s net interest margin was 2.77%, down 10 basis points compared to the second quarter. Looking further back, net interest income decreased 10% year-over-year and net interest margin decreased 26 basis points.
