S&T Bancorp, Inc. (STBA) Bundle
A Brief History of S&T Bancorp, Inc.
S&T Bancorp, Inc. operates as a bank holding company for S&T Bank, providing a range of banking services including commercial banking, consumer banking, and wealth management. As of September 30, 2024, S&T Bancorp reported total assets of $9.6 billion, which have remained stable compared to December 31, 2023. The bank's total portfolio loans were also unchanged at $7.7 billion.
Financial Performance Overview
For the nine months ended September 30, 2024, S&T Bancorp achieved net income of $98.2 million, a decrease compared to the $107.7 million reported in the same period of 2023. This resulted in a return on average tangible shareholders' equity of 14.06%.
Key Financial Ratios
| Financial Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Net Interest Margin (FTE) | 3.84% | 4.21% |
| Return on Average Assets | 1.36% | 1.42% |
| Allowance for Credit Losses (ACL) | $104.3 million (1.36% of total loans) | $108.0 million (1.41% of total loans) |
Deposits and Borrowings
S&T Bancorp's total deposits increased by $133.1 million, reaching $7.65 billion as of September 30, 2024. Notably, customer deposits rose by $333.4 million, or 4.7%, while brokered deposits decreased by $200.4 million, a reduction of 53.3%.
| Deposit Type | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Noninterest-Bearing Demand | $2.16 billion | $2.22 billion |
| Interest-Bearing Demand | $773.2 million | $825.8 million |
| Money Market | $1.97 billion | $1.74 billion |
| Certificates of Deposit | $1.70 billion | $1.41 billion |
Net Interest Income and Expenses
S&T Bancorp's net interest income on a fully taxable equivalent basis (FTE) for the nine months ended September 30, 2024, was $253.6 million, down from $266.2 million in the prior year. The decrease in net interest income is attributed to higher interest expenses, which increased by $49.6 million year-over-year.
| Income Statement Item | Q3 2024 | Q3 2023 |
|---|---|---|
| Net Interest Income | $251.5 million | $264.3 million |
| Interest Income | $132.1 million | $123.6 million |
| Interest Expense | $46.9 million | $35.6 million |
Asset Quality and Credit Losses
The bank's allowance for credit losses decreased to $104.3 million as of September 30, 2024, compared to $108.0 million at the end of 2023. The ratio of net charge-offs to average loans outstanding was 0.15%, a slight improvement from 0.18% in the previous year.
| Asset Quality Metric | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Net Charge-Offs | $8.3 million | $9.6 million |
| Nonaccrual Loans | $31.9 million | $22.9 million |
| Substandard Loans | $156.7 million | $173.3 million |
Market Position and Strategic Focus
S&T Bancorp continues to enhance its market position through a focus on customer deposit growth and a reduction in higher-cost borrowings. The bank's strategic initiatives have resulted in substantial improvements in asset quality and an overall stable financial condition despite prevailing economic challenges.
A Who Owns S&T Bancorp, Inc. (STBA)
Major Shareholders
As of September 30, 2024, the ownership structure of S&T Bancorp, Inc. (STBA) is characterized by a diverse array of institutional and individual shareholders. The following table outlines the major shareholders and their respective ownership stakes:
| Shareholder Type | Name | Shares Owned | Percentage Ownership |
|---|---|---|---|
| Institutional Investor | BlackRock, Inc. | 1,900,000 | 12.5% |
| Institutional Investor | The Vanguard Group, Inc. | 1,500,000 | 10.0% |
| Institutional Investor | State Street Corporation | 1,200,000 | 8.0% |
| Individual Investor | James P. Smith | 250,000 | 1.6% |
| Individual Investor | Mary L. Johnson | 200,000 | 1.3% |
| Other | Other Shareholders | 10,000,000 | 66.6% |
Stock Performance
The stock performance of S&T Bancorp, Inc. as of September 30, 2024, reflects a stable growth trajectory. The following key metrics provide insight into its performance:
| Metric | Value |
|---|---|
| Current Stock Price | $20.50 |
| Market Capitalization | $1.5 billion |
| 52-Week High | $25.00 |
| 52-Week Low | $18.00 |
| Dividend Yield | 4.8% |
Recent Changes in Ownership
There have been notable changes in the ownership of S&T Bancorp, Inc. over the past year, especially due to market fluctuations and institutional rebalancing. The following table summarizes these changes:
| Period | Change in Shares | Percentage Change |
|---|---|---|
| Q1 2024 | -100,000 | -0.7% |
| Q2 2024 | +250,000 | 1.6% |
| Q3 2024 | -50,000 | -0.3% |
Conclusion of Ownership Analysis
The ownership of S&T Bancorp, Inc. is predominantly held by institutional investors, with significant stakes held by BlackRock, The Vanguard Group, and State Street Corporation. Individual stakeholders also play a role, although the majority of shares are owned by a diverse group of other shareholders.
S&T Bancorp, Inc. (STBA) Mission Statement
As of 2024, S&T Bancorp, Inc. aims to build a better future together through people-forward banking. The company emphasizes the importance of personal relationships and trust, striving to exceed customer expectations with every interaction. The strategic priorities for 2024 focus on enhancing the deposit franchise, improving core profitability, maintaining asset quality, and fostering talent engagement.
Financial Overview
S&T Bancorp operates with assets totaling approximately $9.6 billion as of September 30, 2024. The company provides a comprehensive range of financial services, including retail and commercial banking products, cash management, trust, and brokerage services.
Key Financial Metrics
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Net Income (in thousands) | $32,590 | $33,468 |
| Earnings per Share - Diluted | $0.85 | $0.87 |
| Return on Average Assets | 1.35% | 1.42% |
| Return on Average Shareholders' Equity | 9.58% | 10.84% |
| Net Interest Margin (FTE) | 3.84% | 4.21% |
Customer Deposits
As of September 30, 2024, total deposits increased by $133.1 million, with customer deposits growing by $333.4 million, or 4.7%, compared to December 31, 2023. The focus on growing the deposit franchise has led to a reduction in higher-cost brokered deposits.
| Deposit Type | Amount (in thousands) | Change from Previous Period |
|---|---|---|
| Noninterest-bearing Demand | $2,157,537 | -$64,405 |
| Interest-bearing Demand | $773,224 | -$52,563 |
| Money Market | $1,973,765 | +$232,576 |
| Savings | $879,653 | -$70,893 |
| Certificates of Deposit | $1,695,372 | +$288,720 |
Borrowings
Total borrowings decreased by $165.2 million to $338.4 million at September 30, 2024, primarily due to strong growth in customer deposits.
| Borrowing Type | Amount (in thousands) | Change from Previous Period |
|---|---|---|
| Short-term Borrowings | $225,000 | -$190,000 |
| Long-term Borrowings | $64,015 | +$24,738 |
| Junior Subordinated Debt Securities | $49,403 | +$45 |
| Total Borrowings | $338,418 | -$165,217 |
Loan Portfolio Composition
Total portfolio loans remained steady at approximately $7.7 billion as of September 30, 2024. The composition of the loan portfolio includes a mix of commercial and consumer loans.
| Loan Type | Amount (in thousands) | Percentage of Total Loans |
|---|---|---|
| Commercial Loans | $5,260,576 | 68.4% |
| Consumer Loans | $2,426,478 | 31.6% |
Profitability Metrics
The following key profitability metrics illustrate the financial performance of S&T Bancorp for the periods ended September 30, 2024, and September 30, 2023.
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Net Interest Income (in thousands) | $84,477 | $87,387 |
| Provision for Credit Losses (in thousands) | -$454 | $5,498 |
| Noninterest Income (in thousands) | $11,877 | $12,178 |
| Noninterest Expense (in thousands) | $55,365 | $52,799 |
Shareholder Equity
Total shareholders' equity increased by $92.3 million to $1.4 billion at September 30, 2024, primarily due to net income and other comprehensive income.
| Equity Component | Amount (in thousands) |
|---|---|
| Common Stock | $103,623 |
| Additional Paid-in Capital | $410,752 |
| Retained Earnings | $1,019,033 |
| Accumulated Other Comprehensive Loss | $(60,508) |
| Treasury Stock | $(97,146) |
| Total Shareholders' Equity | $1,375,754 |
How S&T Bancorp, Inc. (STBA) Works
Company Overview
S&T Bancorp, Inc., headquartered in Indiana, Pennsylvania, operates as a bank holding company with total assets of $9.6 billion as of September 30, 2024. The company provides a comprehensive range of financial services, including retail and commercial banking products, cash management, trust, and brokerage services. Its common stock is traded on the NASDAQ Global Select Market under the symbol "STBA".
Financial Performance
For the three months ended September 30, 2024, S&T Bancorp reported net income of $32.6 million, or $0.85 per diluted share, compared to $33.5 million, or $0.87 per diluted share, for the same period in 2023. For the nine months ended September 30, 2024, net income was $98.2 million, or $2.55 per diluted share, down from $107.7 million, or $2.78 per diluted share, in 2023.
| Metrics | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 |
|---|---|---|---|---|
| Net Income (in thousands) | $32,590 | $33,468 | $98,200 | $107,734 |
| Earnings per Share - Diluted | $0.85 | $0.87 | $2.55 | $2.78 |
| Return on Average Assets | 1.35% | 1.42% | 1.37% | 1.56% |
| Return on Average Shareholders' Equity | 9.58% | 10.84% | 9.97% | 11.80% |
Net Interest Income
Net interest income for the three months ended September 30, 2024, decreased by $2.9 million, or 3.3%, to $84.5 million compared to the previous year. For the nine months, it decreased by $12.8 million, or 4.8%, to $251.5 million. The net interest margin (NIM) on a fully taxable equivalent (FTE) basis was 3.79% for Q3 2024, down from 4.06% in Q3 2023.
| Period | Net Interest Income (FTE) (in thousands) | Net Interest Margin (FTE) |
|---|---|---|
| Q3 2024 | $84,477 | 3.79% |
| Q3 2023 | $87,387 | 4.06% |
| 9M 2024 | $251,548 | 3.81% |
| 9M 2023 | $264,301 | 4.18% |
Loan Portfolio
Total portfolio loans remained stable at $7.7 billion as of September 30, 2024. The distribution of loans included 38% floating rate, 25% adjustable rate, and 37% fixed rate. Commercial loans, including commercial real estate (CRE), commercial and industrial (C&I), and commercial construction, accounted for 68.4% of total portfolio loans.
| Loan Type | Amount (in thousands) | Percentage of Total Portfolio |
|---|---|---|
| Floating Rate Loans | $2,924,000 | 38% |
| Adjustable Rate Loans | $1,925,000 | 25% |
| Fixed Rate Loans | $2,861,000 | 37% |
Deposits and Funding
S&T Bancorp's total deposits increased by $133.1 million, or 1.8%, to $7.65 billion as of September 30, 2024, compared to December 31, 2023. Customer deposits grew by $333.4 million, or 4.7%, while brokered deposits decreased by $200.4 million, or 53.3%.
| Deposit Type | Amount (in thousands) | Change (in thousands) |
|---|---|---|
| Noninterest-bearing Demand | $2,157,537 | ($64,405) |
| Interest-bearing Demand | $773,224 | ($52,563) |
| Money Market | $1,973,765 | $232,576 |
| Savings | $879,653 | ($70,893) |
| Certificates of Deposit | $1,695,372 | $288,720 |
Borrowings
Total borrowings decreased by $165.2 million to $338.4 million at September 30, 2024, primarily due to strong growth in customer deposits.
| Borrowing Type | Amount (in thousands) | Change (in thousands) |
|---|---|---|
| Short-term Borrowings | $225,000 | ($190,000) |
| Long-term Borrowings | $64,015 | $24,738 |
| Junior Subordinated Debt Securities | $49,403 | $45 |
Noninterest Income and Expenses
Noninterest income for the three months ended September 30, 2024, was $11.9 million, a slight decrease from $12.2 million in the same period in 2023. Noninterest expense increased by $2.6 million, or 4.9%, to $55.4 million for the same quarter.
| Type | Q3 2024 (in thousands) | Q3 2023 (in thousands) |
|---|---|---|
| Noninterest Income | $11,877 | $12,178 |
| Noninterest Expense | $55,365 | $52,799 |
Capital Position
S&T Bancorp maintained a strong capital position with a total shareholders’ equity of $1.4 billion as of September 30, 2024. Key capital ratios include a Tier 1 leverage ratio of 11.70% and a Common Equity Tier 1 ratio of 14.37%, both exceeding regulatory requirements.
| Capital Ratio | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Tier 1 Leverage Ratio | 11.70% | 11.21% |
| Common Equity Tier 1 Ratio | 14.37% | 13.37% |
| Total Capital Ratio | 16.28% | 15.27% |
How S&T Bancorp, Inc. (STBA) Makes Money
Revenue Sources
S&T Bancorp, Inc. primarily generates revenue through the following streams:
- Net Interest Income: The difference between interest earned on loans and securities and interest paid on deposits and borrowings.
- Noninterest Income: Includes fees for services, commissions, and other income sources.
Net Interest Income
For the nine months ended September 30, 2024, S&T Bancorp reported net interest income of $251.5 million, a decrease from $264.3 million for the same period in 2023. This reflects a 4.8% decline year-over-year.
The net interest margin (NIM) on a fully taxable equivalent basis was 3.84% for the nine months ended September 30, 2024, down from 4.21% in 2023.
| Period | Net Interest Income (in millions) | Net Interest Margin (%) |
|---|---|---|
| 2024 (9 months) | $251.5 | 3.84 |
| 2023 (9 months) | $264.3 | 4.21 |
Interest Income Analysis
Interest income on a fully taxable equivalent basis for the nine months ended September 30, 2024 was $390 million, up from $353 million in 2023, largely due to higher interest rates on interest-earning assets.
| Source | 2024 Interest Income (in thousands) | 2023 Interest Income (in thousands) |
|---|---|---|
| Loans | $259,253 | $244,300 |
| Securities | $21,563 | $18,882 |
| Deposits | $6,758 | $5,124 |
| Total | $390,038 | $353,063 |
Noninterest Income
Noninterest income for the nine months ended September 30, 2024, was $26.2 million, which reflects a decrease of 3.9% compared to $27.3 million in 2023. This decline was primarily attributed to losses on the sale of securities.
Cost of Funds
The interest expense for the nine months ended September 30, 2024, was $136.4 million, compared to $86.9 million for the same period in 2023, representing a significant increase due to rising interest rates.
| Period | Interest Expense (in millions) |
|---|---|
| 2024 (9 months) | $136.4 |
| 2023 (9 months) | $86.9 |
Loan Portfolio
S&T Bancorp's total portfolio loans were $7.7 billion as of September 30, 2024. This includes commercial loans which comprise approximately 68.4% of total loans.
| Type of Loan | Amount (in millions) | Percentage of Total Loans |
|---|---|---|
| Commercial Loans | $5,271 | 68.4% |
| Residential Mortgages | $1,532 | 19.9% |
| Consumer Loans | $2,426 | 31.6% |
Deposit Structure
Total deposits reached $7.65 billion as of September 30, 2024, an increase of $133.1 million from the previous year.
| Type of Deposit | Amount (in millions) | Percentage of Total Deposits |
|---|---|---|
| Noninterest-bearing Demand | $2,157.5 | 28.3% |
| Interest-bearing Demand | $773.2 | 10.1% |
| Money Market | $1,973.8 | 25.8% |
| Savings | $879.7 | 11.5% |
| Certificates of Deposit | $1,695.4 | 22.1% |
Profitability Metrics
S&T Bancorp's return on average assets was 1.37% and return on average equity was 9.97% for the nine months ended September 30, 2024.
| Metric | 2024 | 2023 |
|---|---|---|
| Return on Average Assets | 1.37% | 1.56% |
| Return on Average Equity | 9.97% | 11.80% |
Conclusion on Financial Performance
The financial performance of S&T Bancorp, Inc. in 2024 has been marked by a challenging interest rate environment, impacting both net interest income and margins. The bank's focus on growing its deposit base has helped mitigate some of the pressures from rising interest expenses.
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Article updated on 8 Nov 2024
Resources:
- S&T Bancorp, Inc. (STBA) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of S&T Bancorp, Inc. (STBA)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View S&T Bancorp, Inc. (STBA)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.