Alerus Financial Corp (ALRS) Reports Q3 2023 Net Income of $9.2 Million
Alerus Financial Corp (NASDAQ:ALRS) reported a net income of $9.2 million for Q3 2023, slightly up from Q2 2023's $9.1 million.
The company's net interest income for Q3 2023 was $20.4 million, a decrease from Q2 2023's $22.2 million.
Noninterest income for Q3 2023 increased by 10.2% from Q2 2023, reaching $28.4 million.
Total assets increased by 2.4% from December 31, 2022, reaching $3.9 billion as of September 30, 2023.
On October 25, 2023, Alerus Financial Corp (NASDAQ:ALRS) announced its third-quarter earnings for 2023. The company reported a net income of $9.2 million, or $0.45 per diluted common share, a slight increase from the second quarter's net income of $9.1 million, or $0.45 per diluted common share. However, this represents a decrease from the third quarter of 2022, where the company reported a net income of $9.6 million, or $0.47 per diluted common share.
Company Performance and Strategic Initiatives
President and CEO Katie Lorenson commented on the company's performance, stating,
Alerus fundamental execution of key strategic initiatives continued during the third quarter with strong deposit retention and acquisition while maintaining noninterest-bearing deposits at 25% and a loan to deposit ratio of 90% without the utilization of brokered deposits."
Lorenson also highlighted the company's focus on building a valuable commercial wealth bank and its strategic exit from the ESOP trustee business to invest in key service lines.
Financial Highlights
The company's net interest income for the third quarter of 2023 was $20.4 million, a decrease of 8.3% from the second quarter of 2023. This decrease was primarily due to an increase in interest expense, driven by an increase in rates paid on interest-bearing deposits and an increase in the average short-term borrowings balance.
Noninterest income for the third quarter of 2023 was $28.4 million, a 10.2% increase from the second quarter of 2023. This increase was largely driven by the divestiture of the ESOP trustee business, which resulted in a $2.8 million gain.
Asset and Loan Portfolio
As of September 30, 2023, total assets were $3.9 billion, an increase of 2.4% from December 31, 2022. Total loans were $2.6 billion, an increase of 6.6% from December 31, 2022. The increase in loans was primarily driven by a $143.3 million increase in commercial real estate loans and a $38.2 million increase in residential real estate loans.
Outlook
Despite industry headwinds, Alerus Financial Corp (NASDAQ:ALRS) believes it is well-positioned for the future, with a diversified business model, strong capital, reserves and liquidity levels, and a dedicated team focused on adding value to clients.
Explore the complete 8-K earnings release (here) from Alerus Financial Corp for further details.
This article first appeared on GuruFocus.
