TriCo Bancshares (TCBK): Boston Consulting Group Matrix [10-2024 Updated]
- ✓ Fully Editable: Tailor To Your Needs In Excel Or Sheets
- ✓ Professional Design: Trusted, Industry-Standard Templates
- ✓ Pre-Built For Quick And Efficient Use
- ✓ No Expertise Is Needed; Easy To Follow
TriCo Bancshares (TCBK) Bundle
In the dynamic landscape of banking, understanding how a company like TriCo Bancshares (TCBK) fits into the Boston Consulting Group Matrix is crucial for investors and analysts alike. As of 2024, TCBK exhibits a mix of Stars, Cash Cows, Dogs, and Question Marks that highlight its performance across various segments. From a robust increase in asset management income to challenges in loan origination and deposits, the insights below will unravel the intricacies of TCBK's business strategy and market positioning.
Background of TriCo Bancshares (TCBK)
TriCo Bancshares, trading under the ticker symbol TCBK, is a financial holding company based in Northern California. Founded in 1978, the company operates through its primary subsidiary, Tri Counties Bank, which provides a wide range of banking services to commercial and retail customers. As of September 30, 2024, TriCo Bancshares reported total assets of approximately $9.8 billion and total loans outstanding of about $6.7 billion.
The bank offers various financial products, including personal and business loans, checking and savings accounts, credit and debit cards, and wealth management services. It primarily serves communities in California, focusing on regions such as the San Francisco Bay Area, Sacramento Valley, and the North Valley.
As of September 30, 2024, the bank reported a net interest income of $248.2 million for the nine months ended, a decrease of 8.4% compared to the prior year. This decline was attributed to increased interest expenses, which rose significantly due to rising rates and a shift in deposit mix towards higher-yielding products.
TriCo Bancshares has maintained a strong capital position, with a tangible common equity per share of approximately $28.09 as of the end of the third quarter in 2024. The company actively manages its credit risk and reported a non-performing assets ratio of 0.45% of total assets, reflecting a slight increase from the previous year.
The company's efficiency ratio stood at 60.02% for the third quarter of 2024, indicating ongoing challenges in managing operational costs amidst fluctuating economic conditions. Additionally, TriCo Bancshares has been proactive in its liquidity management, boasting primary liquidity sources that account for 51% of total deposits as of September 30, 2024.
In terms of market performance, TriCo Bancshares has shown resilience, with diluted earnings per share reported at $0.88 for the third quarter of 2024. The bank continues to adapt to the evolving financial landscape while focusing on sustainable growth and customer service excellence.
TriCo Bancshares (TCBK) - BCG Matrix: Stars
Strong performance in asset management and commission income
For the three months ended September 30, 2024, TriCo Bancshares reported a non-interest income of $16.5 million, reflecting a growth of 3.2% compared to the previous quarter. Increased activity and volumes in asset management significantly contributed to this performance.
Significant gain on sale of loans, up 43.7% year-over-year
TriCo Bancshares experienced a substantial gain on sale of loans amounting to $549,000 for the quarter ended September 30, 2024, which marks a remarkable increase of 43.7% compared to the same quarter in the previous year.
Noninterest income growth of 3.2% driven by increased service charges
The company’s non-interest income for the nine months ended September 30, 2024, totaled $48.1 million, which is an increase of 6.1% from $45.4 million in the same period of 2023. This growth was primarily driven by an increase in service charges on deposit accounts which rose by 12.6% year-over-year.
Consistent return on average equity at 9.52% for Q3 2024
For the third quarter of 2024, TriCo Bancshares reported a return on average equity of 9.52%, demonstrating stable performance despite market fluctuations.
Robust growth in cash value of life insurance, increasing by 14.9%
As of September 30, 2024, the cash value of life insurance increased by 14.9%, amounting to $786,000, compared to $684,000 from the previous year.
| Metric | Q3 2024 | Q3 2023 | Year-over-Year Change |
|---|---|---|---|
| Non-interest Income | $16.5 million | $15.9 million | 3.2% |
| Gain on Sale of Loans | $549,000 | $382,000 | 43.7% |
| Return on Average Equity | 9.52% | 10.91% | -1.39% |
| Cash Value of Life Insurance | $786,000 | $684,000 | 14.9% |
| Service Charges on Deposit Accounts | $4.98 million | $4.85 million | 2.6% |
TriCo Bancshares (TCBK) - BCG Matrix: Cash Cows
Stable Net Interest Margin
The net interest margin for TriCo Bancshares (TCBK) stands at 3.71% as of September 30, 2024, showing a slight decrease from the previous year.
Dividends Per Share
TriCo Bancshares has maintained a consistent dividend payout, with dividends per share recorded at $0.33, reflecting solid profitability.
Cost Management
The company has effectively managed its costs, evidenced by a 2.0% growth in noninterest expenses, demonstrating efficient operational management.
Strong Capital Ratios
TriCo Bancshares boasts a robust Tier 1 capital ratio of 13.8%, indicating a strong capital position relative to its risk-weighted assets.
Performance in Mortgage Banking Services
The performance in mortgage banking services has remained consistent, with only minor fluctuations observed in the recent quarters.
| Financial Metric | Value |
|---|---|
| Net Interest Margin | 3.71% |
| Dividends Per Share | $0.33 |
| Noninterest Expense Growth | 2.0% |
| Tier 1 Capital Ratio | 13.8% |
| Average Loan Yield | 5.83% |
| Loan to Deposit Ratio | 83.2% |
TriCo Bancshares (TCBK) - BCG Matrix: Dogs
Decline in Loans Outstanding
Total loans outstanding decreased by $58.6 million or 3.5% annualized during the quarter ended September 30, 2024, resulting in a total balance of $6.7 billion.
Non-Performing Assets
Non-performing assets increased to 0.45% of total assets as of September 30, 2024, compared to 0.36% as of June 30, 2024, and 0.33% at September 30, 2023.
Decrease in Interest-Bearing Demand Deposits
The average balance of noninterest-bearing deposits decreased by $423.0 million from the three-month average for the period ended September 30, 2023. The ratio of average total noninterest-bearing deposits to total average deposits was 31.7% for the quarter ended September 30, 2024.
Drop in Lease Brokerage Income
Lease brokerage income fell by 59.7%, from $154,000 in the previous quarter to $62,000 in the third quarter of 2024.
Overall Decrease in Total Deposits
Total deposits decreased by $13.1 million or 0.7% annualized during the quarter ended September 30, 2024, resulting in total deposits of $8.037 billion.
| Financial Metric | Value as of September 30, 2024 |
|---|---|
| Total Loans Outstanding | $6.683 billion |
| Non-Performing Assets (% of Total Assets) | 0.45% |
| Average Noninterest-Bearing Deposits Decrease | $423.0 million |
| Lease Brokerage Income | $62,000 |
| Total Deposits | $8.037 billion |
TriCo Bancshares (TCBK) - BCG Matrix: Question Marks
Increased provision for credit losses of $220, indicating potential future risks.
The provision for credit losses for TriCo Bancshares was reported at $220,000 for the quarter ended September 30, 2024, a significant decrease from $4.155 million in the same quarter of the previous year, indicating potential future risks in credit quality.
Loan origination volume remains lower due to economic uncertainties.
Loan origination volume totaled approximately $351.5 million during the quarter, while payoffs/repayments reached $418.8 million. This reflects a contraction in loan activity, attributed to economic uncertainties and disciplined pricing strategies.
Investment securities purchases reflect a strategic pivot but pose risks if not managed well.
Investment securities increased by $30.4 million or 5.8% on an annualized basis during the quarter, with purchases totaling $69.4 million. However, the total investments decreased by $216.7 million year-over-year.
Declining average balance of noninterest-bearing deposits may affect funding strategies.
The average balance of noninterest-bearing deposits decreased by $423 million from the previous year, resulting in a ratio of 31.7% of total deposits.
Potential impact from rising interest rates on loan demand and profitability.
The average yield on loans increased to 5.83% for the quarter ending September 30, 2024, reflecting an increase of 32 basis points year-over-year. However, the cost of interest-bearing deposits rose significantly, leading to concerns about profitability.
| Financial Metric | September 30, 2024 | September 30, 2023 | Change |
|---|---|---|---|
| Provision for Credit Losses | $220,000 | $4,155,000 | Decrease of $3,935,000 |
| Loan Originations | $351,500,000 | Not specified | Lower due to economic uncertainties |
| Investment Securities Purchases | $69,400,000 | Not specified | Strategic pivot |
| Average Balance of Noninterest-Bearing Deposits | $423,000,000 decrease | Not specified | Indicates funding strategy challenges |
| Average Loan Yield | 5.83% | 5.51% | Increase of 32 basis points |
In summary, TriCo Bancshares (TCBK) presents a mixed yet promising outlook as evaluated through the BCG Matrix. The Stars segment showcases strong performance in asset management and a remarkable 43.7% increase in loan sales, while Cash Cows maintain stability with a net interest margin of 3.71% and consistent dividends. However, challenges in the Dogs category, such as a 3.5% decline in loans and a significant drop in lease brokerage income, highlight areas for concern. Meanwhile, the Question Marks reveal potential risks, particularly with increased provisions for credit losses and uncertainties in loan origination. As TCBK navigates these dynamics, strategic management will be crucial to capitalize on strengths and address weaknesses effectively.
Article updated on 8 Nov 2024
Resources:
- TriCo Bancshares (TCBK) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of TriCo Bancshares (TCBK)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View TriCo Bancshares (TCBK)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.