Metropolitan Bank Holding Corp. (NYSE:MCB) Q4 2023 Earnings Call Transcript January 19, 2024 9:00 AM ET
Company Participants
Mark DeFazio - President & CEO
Dan Dougherty - EVP & CFO
Conference Call Participants
Mark Fitzgibbon - Piper Sandler
Nick Cucharale - Hovde Group
Chris O'Connell - KBW
Alex Lau - JP Morgan
Operator
Good day and welcome to the Metropolitan Commercial Bank Fourth Quarter and Full Year 2023 Earnings Call. Hosting the call today from Metropolitan Commercial Bank are Mark DeFazio, President and Chief Executive Officer, and Dan Dougherty, Executive Vice President and Chief Financial Officer. Today's call is being recorded. At this time, all participants have been placed in a listen-only mode and the floor will be open for your questions following the prepared remarks. [Operator Instructions]
During today's presentation, references will be made to the company's earnings release and investor presentation, copies of which are available at mcbankny.com. Today's presentation may include forward-looking statements that are subject to risks and uncertainties that may cause actual results to differ materially. Please refer to the company's notices regarding forward-looking statements and non-GAAP measures that appear in the earnings release.
It is now my pleasure to turn the floor over to Mark DeFazio, President and Chief Executive Officer. You may begin.
Mark DeFazio
Thank you, Todd. Good morning, and thank you all for joining our fourth quarter earnings call. MCB's ability to manage through severe banking sector stress in 2023 while simultaneously exiting less material lines of business demonstrates the impressive strength and stability of MCB's franchise. We have been able to responsibly grow the balance sheet while maintaining our credit standards and with a continued sharp focus on liquidity, interest rate risk management. Importantly, the economy continues to display impressive resilience and calls for a steep recession have become less apparent over time. That said, 2023 was a challenging year for the banking industry, the effects of the most aggressive Fed tightening cycle in decades and an inverted yield curve created significant headwinds. Thankfully, experts predict that we have seen the end of the tightening cycle and many are convinced that an easing cycle is on the horizon. MCB being modestly liability sensitive will benefit from the monetary policy easing.
Turning to recent results, I am pleased with MCB's performance in the fourth quarter and for year-end 2023. NIM inflected in the fourth quarter where we saw modest expansion ending what turned out to be only two quarters of compression. We expect NIM expansion to continue in 2024, supported by continued loan growth, originated at consistent spreads, and funded with core deposits from our growing roster of deposit verticals. Asset quality remains strong, with no identifiable broad negative trends in any loan product, geography, or sector. Looking forward, we are excited to formally announce that we have begun our core banking modernization initiative. We expect that this project will result in improved capabilities and efficiencies for both customer facing and internal processes.