Cullen/Frost Bankers, Inc. (CFR) Q3 2024 Earnings Conference Call October 31, 2024 2:00 PM ET

Company Participants

A.B. Mendez - SVP, Director of IR
Phil Green - Chairman and CEO
Jerry Salinas - Group EVP, CFO
Dan Geddes - Incoming CFO

Conference Call Participants

Peter Winter - D.A. Davidson
Dave Rochester - Compass Point
Ebrahim Poonawala - Bank of America
Catherine Mealor - KBW
Ben Gerlinger - Citi
Manan Gosalia - Morgan Stanley
Jon Arfstrom - RBC Capital Markets

Operator

Greetings. Welcome to Cullen/Frost Bankers, Inc. Third Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen only mode. A question-and-answer session will follow the formal presentation [Operator Instructions]. As a reminder, this conference is being recorded.

It is now my pleasure to introduce A.B. Mendez, Senior Vice President and Director of Investor Relations. Thank you. You may begin.

A.B. Mendez

Thanks, Jerry. This afternoon's conference call will be led by Phil Green, Chairman and CEO; Jerry Salinas, Group Executive Vice President and CFO; and Dan Geddes, our incoming CFO. Before I turn the call over to Phil, Jerry and Dan, I need to take a moment to address the safe harbor provisions. Some of the remarks made today will constitute forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995 as amended. We intend such statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 as amended. Please see the last page of text in this morning's earnings release for additional information about the risk factors associated with these forward-looking statements. If needed, a copy of the release is available on our Web site or by calling the Investor Relations department at (210) 220-5234. At this time, I'll turn the call over to Phil.

Phil Green

Thanks, A.B. Good afternoon, everyone. Thanks for joining us. Today, I'll review third quarter results for Cullen/Frost, and I'm accompanied on the call by Jerry Salinas and Dan Geddes, who have been working together in anticipation of Jerry's upcoming retirement as CFO, and they'll provide additional commentary. In the third quarter, Cullen/Frost earned $144.8 million or $2.24 a share compared with earnings of a $154 million or $2.38 a share reported in the same quarter last year. Our return on average assets and average common equity in the third quarter were 1.16%, 15.48%, respectively, and that compares with a 1.25% and 18.93% for the same period last year. Average deposits in the third quarter were $40.7 billion, down just 20 basis points from $40.8 billion in the third quarter of last year. Average loans grew by 11.8% to $20.1 billion in the third quarter compared with $18 billion in the third quarter of last year. We continue to see solid results resulting from the hard work of our Frost bankers and the extension of our organic growth strategy. As was the case in previous quarters, Cullen/Frost didn't utilize any FHLB advances, broker deposits or reciprocal deposit arrangements to build insured deposit percentages or to fund liquidity. So again, as you look at our balance sheet, what you see is what you get.