Suntrust 3Q14 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. Full transcripts can be found at Seeking Alpha

credit quality performance continues to be strong

“Our credit quality performance continues to be strong, and in the quarter we were able to further improve the overall asset quality of the balance sheet through targeted non-performing asset reductions. As a result, NPLs declined 15% sequentially and net charge-offs ticked up slightly to 39 basis points.’

NIM dropped as loan yields compressed

“The drivers of our loan yield compression are mix shift as wholesale is growing at a faster rate than the rest of the portfolio, and continued competition in our markets and businesses. While loan yields in the wholesale segment are typically lower, C&I business often brings with it additional non-interest income and deposit revenue. Our intent is to meet the full suite of our clients’ needs and maintain a disciplined focus on entire relationship returns.”

Expect further declines in NPAs though moderating

“Over the near term, we expect further though moderating declines in non-performing loans primarily driven by the residential portfolio. We also expect our loan loss provision expense to be fairly stable over the next few quarters, in line with our results for the past five quarters as continued strong asset quality may offset positive loan growth.”

Credit quality is determined by the economy though

“However, as you all are well aware, the ultimate level of reserves and provision expense will be determined by future economic conditions and our rigorous quarterly review processing/”

S&P upgraded credit quality

“Lastly, I’d like to highlight the credit rating upgrade we received from Standard & Poor’s this week, which acknowledged the actions we have taken as an organization to substantially improve our asset quality position, increase our capital ratios, and enhance our profitability profile over the last several years.”

Bought the naming rights to the Braves new stadium

“I’d like to give a brief mention of our announcement last month regarding the naming of the new ballpark for the Atlanta Braves, which is set to open in 2017. ”

We’re watching energy very closely

“The good news is that energy has been a good part of our growth but it’s not sort of the only part of our growth. This quarter actually was quite good on the energy side, but it’s one that we’re going to watch and be careful about and the pundits are sort of all over the place on how much additional capital will be there, but our portfolio is good so I feel positive about that where we are. Might it have slower growth in the next several quarters relative to last few quarters possibly, but that’s not sort of the only driver for us.”

Mortgage refi volume up significantly as interest rates have fallen

“The last two days have been really good. Our locked volume and app volume was up 80% in two days, so very significant. I don’t know if that’s going to continue. I think we’ll have to sort of see things settle out a little bit”

One quarter isn’t telling of overall trends

“One quarter really isn’t – any one quarter no matter whether it’s good or bad, really isn’t telling about sort of overall trends.’