Last Friday, HIFS has posted some improved core earnings - lets see how it matches our projection based on our model and what to expect for the First Quarter 2025
you are right historically HIFS was able to achieve 3% + NIM. However I do not believe they can get to 3% in the short term. HIFS since 2018 have cut in the number of branches (which is good in terms of operating expenses) and is really focus on commercial loan multi-family loan (not retail anymore) and does not have a strong deposit franchise anymore in my opinion. Furthermore, they have an unbalanced loan / deposit ratio and they rely too much on more expansive FHLB and wholesale deposit. It was fine in 2016-2021 as rate was ultra low, but not anymore. I should have said expected and not historical. Thanks for the comment
you are right historically HIFS was able to achieve 3% + NIM. However I do not believe they can get to 3% in the short term. HIFS since 2018 have cut in the number of branches (which is good in terms of operating expenses) and is really focus on commercial loan multi-family loan (not retail anymore) and does not have a strong deposit franchise anymore in my opinion. Furthermore, they have an unbalanced loan / deposit ratio and they rely too much on more expansive FHLB and wholesale deposit. It was fine in 2016-2021 as rate was ultra low, but not anymore. I should have said expected and not historical. Thanks for the comment
Also Cassy thanks for pointing this out... are you a shareholder?
Good how do you like the latest results?
Nothing out of expectations. Good to see a banker placed in SF. Big gains in equities this Q. Expect NIM to be 1.50 to 1.75 in 2025.