Mission Bancorp Q3 2024 earnings reach $7.8m amid impressive 33% deposit growth

Mission Bancorp, the parent company of Mission Bank, announced its financial results for the third quarter of 2024. The company reported a net income of $7.8 million, or $2.93 per diluted share. Although this marks a slight decline from $8.0 million reported in Q3 2023, it demonstrates a sequential improvement from the $7.3 million recorded in Q2 2024. The strong performance is highlighted by a substantial annualized deposit growth rate of 33%, a notable achievement given the challenging economic environment and rising interest rates.

Impressive Deposit and Loan Growth

The company’s total deposits surged by $202.1 million year-over-year, reaching $1.61 billion as of September 30, 2024. Sequentially, deposits also saw an increase of $123.1 million from Q2 2024. Loan growth was equally notable, with gross loans rising to $1.24 billion, a 7.3% year-over-year increase, driven by growth in commercial real estate and agricultural production segments.

Expert Commentary on Q3 Performance

AJ Antongiovanni, CEO of Mission Bancorp, commented that despite industry trends of shrinking deposits, Mission Bancorp has shown resilience and countered the norm through strong client relationships and strategic growth initiatives. He noted that the bank’s SBA division has had a record year, contributing significantly to the company’s non-interest income and overall performance.

Net Interest Margin and Cost Pressures

Net interest income for the third quarter was $18.2 million, reflecting a modest increase from the previous quarter. However, the net interest margin (NIM) decreased to 4.31% compared to 4.67% in Q3 2023 due to the rising costs of interest-bearing deposits, which outpaced the yield growth on assets. The rising short-term rates and competitive deposit market have put pressure on margins, a trend observed across regional banks.

Outlook and Share Price Insights

Mission Bancorp’s stock is currently trading around $87.00 on the OTC market as of October 18, 2024, reflecting a steady performance with a 52-week price range of $74.29 to $89.99. The market has responded positively to the bank’s consistent performance and growth strategies, with the stock demonstrating lower volatility compared to the market average. The company’s price-to-earnings (P/E) ratio stands at 7.42, suggesting it remains attractively valued compared to industry peers.