Byline Bancorp, Inc. (BY): Boston Consulting Group Matrix [10-2024 Updated]

As we delve into the financial landscape of Byline Bancorp, Inc. (BY) in 2024, we will explore its positioning within the Boston Consulting Group Matrix. This analysis highlights the bank's Stars, Cash Cows, Dogs, and Question Marks, providing insights into its strengths, challenges, and growth opportunities. Discover how Byline Bancorp is navigating a competitive banking environment and where its potential lies in the coming year.

Background of Byline Bancorp, Inc. (BY)

Byline Bancorp, Inc. is a bank holding company headquartered in Chicago, Illinois. The company conducts its business primarily through its wholly-owned subsidiary, Byline Bank, which is a full-service commercial bank. Byline Bank provides a wide array of banking products and services aimed at small and medium-sized businesses, commercial real estate, financial sponsors, and consumers, particularly those living or working near its branches.

As of September 30, 2024, Byline Bancorp reported total assets of approximately $9.4 billion, with total deposits amounting to around $7.5 billion. The bank's loan and lease portfolio stood at $6.9 billion, reflecting a 2.9% increase from the previous year. Byline Bank is recognized as a leading originator of Small Business Administration (SBA) loans, being the most active 7(a) and 504 lender in Illinois for the fiscal year ended September 30, 2024.

Financially, Byline Bancorp has shown a solid performance, with a consolidated net income of $30.3 million for the three months ended September 30, 2024, translating to earnings of $0.70 per basic share and $0.69 per diluted share. This represents an increase from $28.2 million, or $0.66 per basic and $0.65 per diluted share, for the same period in 2023. The company has maintained a well-capitalized status, exceeding all applicable regulatory capital requirements as of September 30, 2024.

Byline Bancorp also engages in various non-interest income activities, including fees and service charges on deposits and loan servicing revenue, which contribute significantly to its overall financial performance. The company has a robust strategy focusing on organic growth through its commercial banking operations, as well as an emphasis on trust and wealth management services.

In addition to its commercial banking services, Byline Bancorp offers small ticket equipment leasing solutions through Byline Financial Group, which operates sales offices in Illinois, Michigan, New Jersey, and New York. The company also participates in U.S. government guaranteed lending programs, enhancing its offering to small business customers.

Byline Bancorp, Inc. (BY) - BCG Matrix: Stars

Strong growth in commercial and industrial loans

Byline Bancorp has reported a significant increase in its commercial and industrial loan portfolio, which totaled $2.6 billion as of September 30, 2024, reflecting an increase of $143 million, or 5.8%, from $2.4 billion at December 31, 2023.

Increasing total deposits reaching $7.5 billion, up 4.5% from the previous year

Total deposits at Byline Bancorp increased to $7.5 billion as of September 30, 2024, representing an increase of $320.9 million, or 4.5%, compared to $7.2 billion at December 31, 2023. This growth was primarily driven by increases in time deposits and money market accounts.

Well-capitalized status exceeding regulatory capital requirements

As of September 30, 2024, Byline Bancorp was classified as "well-capitalized," exceeding all applicable regulatory capital requirements. The company reported a total capital ratio of 14.41% and a Tier 1 capital ratio of 12.39%.

High return on average tangible common equity at 14.49%

Byline Bancorp achieved a return on average tangible common equity of 14.49% for the three months ended September 30, 2024, compared to 16.15% for the same period in 2023.

Solid non-interest income contributing 14.13% to total revenues

Non-interest income accounted for 14.13% of total revenues for Byline Bancorp in the third quarter of 2024, reflecting a solid contribution to the overall financial performance.

Byline Bancorp, Inc. (BY) - BCG Matrix: Cash Cows

Consistent Profitability

The adjusted return on average assets for Byline Bancorp, Inc. is 1.30% as of September 30, 2024.

Stable Net Interest Margin

The net interest margin remains stable at approximately 3.88%, providing a reliable income source for the company.

Robust Core Deposit Base

As of September 30, 2024, core deposits constitute 84.8% of total deposits.

Established Branch Network

Byline Bancorp has developed an established branch network in Chicago, enhancing customer access and service delivery.

Low Cost of Deposits

The average cost of deposits is recorded at 2.76%, which helps maintain a competitive advantage.

Byline Bancorp, Inc. (BY) - BCG Matrix: Dogs

Declining non-interest-bearing demand deposits, down 9.2% year-over-year.

As of September 30, 2024, non-interest-bearing deposits totaled $1.7 billion, a decrease of $176.0 million, or 9.2%, from $1.9 billion at December 31, 2023. This decline reflects a drop from 26.6% of total deposits to 23.1%.

Underperforming segments with net charge-offs impacting profitability.

The net charge-offs for the nine months ended September 30, 2024 were $1.5 million, with gross charge-offs amounting to $26.8 million during the same period.

Limited growth in residential real estate loans, stagnant at 7.2% of total loans.

Residential real estate loans represented 7.2% of total loans as of September 30, 2024, remaining stagnant compared to previous periods.

Increasing competition in the banking sector affecting market share.

Byline Bancorp faced intensified competition in the banking sector, which has pressured its market share and resulted in reduced profitability.

Non-performing loans at 1.02% of total loans, indicating potential risk.

As of September 30, 2024, non-performing loans were reported at 1.02% of total loans, up from 0.96% in the previous year, indicating a potential risk to the bank's financial stability.

Byline Bancorp, Inc. (BY) - BCG Matrix: Question Marks

Uncertain performance in construction and land development loans, only 6.0% of total loans.

As of September 30, 2024, Byline Bancorp reported that construction and land development loans accounted for only 6.0% of its total loans, which amounted to approximately $6.9 billion in total loans and leases outstanding.

Emerging opportunities in the SBA and USDA loans, with $419.5 million exposure.

Byline Bancorp has identified emerging opportunities in Small Business Administration (SBA) and United States Department of Agriculture (USDA) loans, with a total exposure of $419.5 million as of September 30, 2024.

Potential for growth in non-interest income streams not fully realized.

Non-interest income represented 14.13% of total revenues for the three months ended September 30, 2024, showing growth from 11.81% in the previous year, indicating that there is potential for further enhancement in this area.

Need for strategic focus on underperforming loan segments to enhance growth.

Byline Bancorp's total loans and leases included various segments that require strategic focus for performance improvement. For instance, as of September 30, 2024, the company reported $1.2 billion in commercial real estate loans, which had experienced $3.0 million in non-accrual status.

Market volatility impacting interest rate risk and future profitability.

Market volatility has introduced significant interest rate risks. Byline Bancorp reported an average cost of deposits of 2.76% for the three months ended September 30, 2024, compared to 2.13% in the previous year. This rise in costs poses challenges for profitability moving forward.

As of September 30, 2024, the total assets of Byline Bancorp were approximately $9.4 billion, with total stockholders' equity at $1.1 billion.

In summary, Byline Bancorp, Inc. (BY) showcases a diverse portfolio through the BCG Matrix, with Stars like commercial loans and total deposits reflecting strong growth, while Cash Cows demonstrate consistent profitability and a solid branch network. However, challenges persist in the Dogs category, where declining non-interest-bearing deposits and increasing competition pose risks. The Question Marks reveal potential for growth in SBA and USDA loans, but strategic focus is essential to capitalize on these opportunities and navigate market volatility effectively.

Article updated on 8 Nov 2024

Resources:

1. Byline Bancorp, Inc. (BY) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Byline Bancorp, Inc. (BY)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View Byline Bancorp, Inc. (BY)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.