Cullen/Frost 3Q13 Earnings Call Notes

This post is part of a series of posts called “Company Notes.” These posts contain quotes and exhibits from earnings calls, conference presentations, analyst days and SEC filings.

“During the third quarter, Cullen/Frost also announced a merger agreement with WNB Bancshares. When this merger is completed, it will bring Frost into Midland and Odessa for the first time. The Permian Basin is a significant driver of the state’s strong oil and gas business, and we are delighted to be expanding into this dynamic region to give us additional opportunities for growth.”

“Second quarter 2013 average total loans were $9.3 billion, up 7.1% from the $8.6 billion for the third quarter of last year. Through the first 3 quarters of 2013, we recorded our highest ever level of new loan requests. Year-to-date, new loan commitments are the highest since 2008. Our loan pipeline is higher than last year but down from the previous quarter due to an across-the-board slowdown in requests.”

“American families and businesses need confidence that our elected officials will address the fiscal mess responsibly and put us on a course to end the runaway deficit spending and exploding national debt. The government shutdown is the latest symptom of a larger ongoing problem.”

“we expect loan growth — still expect loan growth, but we’ve lost some momentum.”

“we’re in a time that in 45 years I’ve never seen before, and I’ve talked about this in previous calls, to where commitments, people are preparing to borrow money, but they are not yet ready. And what we saw across this nation and, certainly, our experience, when you get into this kindergarten fight in Washington, because they’re all involved in the fight — and me instead of we in making this country better, you see a great pause because there’s a lack of confidence and the uncertainty.”

“So as we moved through this year and continued to build uncertainty and it was already at a high level, I’m optimistic that the commitments are growing. You can lead a horse to water and there’s plenty of water in the trough. We’ve got tons of liquidity, but I can’t make them drink. I can’t make them advance on the line, but we are growing our relationships.”

“There’s a new term that I’m sure you’ve heard. They call them surge deposits. And people wonder what their surge deposits are, how much they’ll go down. One thing about us is we’re not blind to that, and that’s one of the reasons that our liquidity is being maintained so high. Because I believe the — really and truly, the only liquidity you have going into a crisis is the liquidity you brought into the crisis. And so we’re careful with that. That’s one of the reasons we are maintaining such a high liquidity. And we could see it drop some, as I’ve said, because it’s been lower for longer than it was back when Greenspan cut rates.”

“Again, I will tell you, look at the commitment growth. It’s significant. And companies are sitting on the sideline wanting to buy a company, wanting to expand, but they’re scared to do it when you’ve got such a dysfunctional state of affairs in Washington.”

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