Third Coast Bancshares, Inc. (NASDAQ:TCBX) Q4 2023 Earnings Call Transcript

Matt Olney: Okay. And you disclosed kind of what the newer loan yields are at in the fourth quarter. Any color on incremental funding of those new loans more recently?

John McWhorter: Yes. Most accounts that we’re bringing over, being that they’re existing accounts at other banks, were paying generally in 4.50% to 5% range.

Matt Olney: Okay. And then thinking about loan growth and kind of capital, I think I heard your loan growth expectations for the year. Help me think about in this scenario of kind of a softer landing borrowers feeling better about from their point of view. At what level could you grow loans in ’24, before it would start to pressure capital? And then I guess, what’s the internal tolerance as far as pressuring capital? Would that be acceptable? Or do you have to really slow things down in that scenario?

Bart Caraway: Yes. We’re definitely mindful of the capital side of it and that we’re going to grow the bank for the best allocation of capital, basically. So there is 0 chance that we’d be interested in raising capital ord supplementing. What we’re going to do is basically grow loans as prudently as possible to fill out the operating leverage. But we think the earnings is really going to provide the ability to hit to 300 million to 400 million in loans pretty easily. So I don’t see that, that capital is going to be an issue for this year or next, because I think we’re going to be able to fully sustain our own growth going forward.

John McWhorter: Yes. And if you think about last year, if we made $33 million in net income last year and grew loans about 550 [ph]. We used capital doing that. But this year, we’re expecting to earn more and grow less. So I think it’s very likely that we’ll be capital accretive this year.

Matt Olney: All right, guys. That’s all for me. Thanks.

Operator: There are no further questions in the queue. I’d like to hand the call back to Mr. Caraway for closing remarks.

Bart Caraway: Thank you, Doug. I appreciate very much. Well done, and thank you all for joining us on the call and for your support of Third Coast Bancshares. We look forward to speaking with you next quarter.

Operator: Ladies and gentlemen, this does conclude today’s teleconference. Thank you for your participation. You may disconnect your lines at this time, and have a wonderful day.