The following is a summary of the S&T Bancorp, Inc. (STBA) Q3 2024 Earnings Call Transcript:

Financial Performance:

• S&T Bancorp reported a Q3 2024 net income of $33 million, translating to $0.85 per share.

• Return on Tangible Common Equity (ROTCE) was 13.5% and Return on Assets (ROA) stood at 1.35%.

• Pre-Provision Net Revenue (PPNR) was controlled at 1.69%, influenced by $2 million in securities losses.

• Net Interest Income showed an improvement from the previous quarter, supporting a strong net interest margin of 3.82% despite a slight decline.

Business Progress:

• S&T Bancorp observed significant customer deposit growth of over $100 million in Q3, yielding an annualized growth of more than 5%.

• Efforts were focused on reducing wholesale and brokered deposits, which positively impacted the future net interest margin.

• Despite a decline in commercial loan balances due to high payoff levels, consumer loan segments saw growth, excluding construction.

• The loan pipeline has increased by over 50%, signaling potential growth in commercial and consumer lending in Q4.

Opportunities:

• The bank's strategic reduction in brokered deposits and a focus on enhancing customer deposit growth have fortified its liquidity and margin outlook, offering a competitive edge in the retail banking sector.

Risks:

• The elevated payoff levels in commercial loans, particularly driven by demand in the multifamily loans market, pose a risk to sustaining loan growth rates.

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